Silly Monks Entertainment Limited

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2 COMPANY INFORMATION BOARD OF DIRECTORS Shri. Tekulapalli Sanjay Reddy Shri. Anil Kumar Pallala Mrs. Swathi Reddy Shri. Sreenivasa Reddy Musani Shri. Katragadda Rajesh Shri. Prasada Rao Kalluri Chairman & Managing Director Whole Time Director Non- Executive Non - Independent Director Non- Executive Non - Independent Director Independent Director Independent Director COMPANY SECRETARY & COMPLIANCE OFFICER Ms. Sushma Barla CHIEF FINANCIAL OFFICER Shri. B. Narsing Rao Registered Office: Statutory Auditors: 301, Ektha Pearl, , B P Raju Marg, Kothaguda, M/s. Ramasamy Koteswara & Co. Kondapur, Hyderabad , Telangana, India Chartered Accountants Tele-Fax No. : Firm Regn No S BOARD COMMITTEES Audit Committee: Shri. Rajesh Katragadda Shri. Prasada Rao Kalluri Shri. Tekulapalli Sanjay Reddy Chairman Member Member Nomination and Remuneration Committee: Shri. Rajesh Katragadda Shri. Prasada Rao Kalluri Shri. Sreenivasa Reddy Musani Chairman Member Member Stakeholders Relationship Committee: Shri. Rajesh Katragadda Shri. Prasada Rao Kalluri Shri. Tekulapalli Sanjay Reddy Chairman Member Member 1

3 Contents Page No. NOTICE...3 ANNEXURE TO THE NOTICE...5 DIRECTORS REPORT...6 ANNEXURES TO DIRECTORS REPORT AUDITORS REPORT ON FINANCIAL STATEMENTS BALANCE SHEET STATEMENT OF PROFIT & LOSS ACCOUNT CASH FLOW STATEMENT NOTES FORMING PART OF FINANCIAL STATEMENTS AUDITOR S REPORT ON CONSOLIDATED FINANCIAL STATEMENTS CONSOLIDATED BALANCE SHEET CONSOLIDATED STATEMENT OF PROFIT & LOSS ACCOUNT CONSOLIDATED CASH FLOW STATEMENT ATTENDENDENCE SLIP PROXY FORM

4 NOTICE Notice is hereby given that the 04 th Annual General Meeting of the Members of Silly Monks Entertainment Limited will be held on Tuesday, the 26 th September, 2017 at A.M. at the registered office of the Company situated at 301, Ektha Pearl, , B P Raju Marg, Kothaguda, Kondapur, Hyderabad , Telangana, India to transact the following business: ORDINARY BUSINESS: 1. To consider and adopt the Audited Financial Statements of the Company for the year together with the Report of the Board of Directors and Auditors thereon; and the audited Consolidated Financial Statements of the Company for the year To appoint a director in place of Mrs. Swathi Reddy, as She retires by rotation and being eligible offers herself for re - appointment. 3. To ratify the appointment of Statutory Auditors of the Company and to fix their remuneration and in this regard, to consider and if thought fit, to pass with or without modification(s), the following resolution as an Ordinary Resolution: RESOLVED THAT pursuant to the provisions of Sections 139, 141, 142 and other applicable provisions of the Companies Act, 2013, read with the Companies (Audit and Auditors) Rules, 2014, and the resolution passed by the members in their AGM held on , the appointment of M/s. Ramasamy koteswara & Co., Chartered Accountants, (Registration No S), Hyderabad who were appointed as the Statutory Auditors of the Company to hold the office as such till the conclusion of 6 th Annual General Meeting, be and is hereby ratified and the Board of Directors of the Company be and are hereby authorised to fix the remuneration payable to the Statutory Auditors for the audit of the accounts for the financial year ending March 31, By order of the Board of Directors For Silly Monks Entertainment Limited Place: Hyderabad Date: 04 th September, 2017 SD/- Sushma Barla Company Secretary & Compliance Officer 3

5 NOTES FOR MEMBERS: 1. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND AND ON A POLL TO VOTE INSTEAD OF HIMSELF/HERSELF. SUCH A PROXY NEED NOT BE A MEMBER OF THE COMPANY. A person can act as proxy on behalf of members not exceeding fifty (50) and holding in the aggregate not more than ten percent of the total share capital of the Company. The instrument of Proxy in order to be effective, should be deposited at the Registered Office of the Company, duly completed and signed, not less than 48 hours before the commencement of the meeting. A Proxy form is sent herewith. Proxies submitted on behalf of the companies, societies etc., must be supported by an appropriate resolution/authority, as applicable. 2. The register of members and share transfer books of the company will remain closed from Friday the 22 nd day of September 2017 to Monday the 25 th day of September 2017 (both days inclusive). 3. M/s. Bigshare Services Pvt. Ltd, E-2/3 Ansa Industrial Estate, Saki Vihar Road, Sakinaka, Andheri (East), Mumbai , the Registrar and Transfer Agent (RTA) of the Company. All communications in respect of share transfers and change in the address of the members may be communicated to them. 4. All the documents referred to in the Notice will be available to the members for inspection at the Registered Office of the company between A.M to P.M on all working days from the date hereof up to the date of the Meeting. 5. Members/Proxies are requested to bring the attendance slip filled in for attending the Meeting. By order of the Board of Directors For Silly Monks Entertainment Limited Place: Hyderabad Date: 04 th September, 2017 SD/- Sushma Barla Company Secretary & Compliance Officer 4

6 ANNEXURE TO THE NOTICE INFORMATION IN RESPECT OF DIRECTORS SEEKING APPOINTMENT/ RE-APPOINTMENT AS REQUIRED UNDER THE SECRETARIAL STANDARDS ON GENERAL MEETINGS ISSUED BY ICSI Name of the Director Swathi Reddy Date of first appointment on the Board 20 th day of September, 2013 Date of Birth (46 Years) She has more than two decades of work experience Expertise in Specific Functional areas in the marketing sector. She holds a degree in Bachelor of Commerce and Educational Qualification Master of Business Administration (MBA) from the Osmania University of Hyderabad. Directorships in other Companies Membership / Chairmanships of committees of Other Boards (other than the Company) Details of Remuneration sought to be paid and the remuneration last drawn by such person Shareholding in the Company as on Relation between Directors inter-se Number of meetings attended during the year Dream Boat Entertainment Private Limited. Foreign Companies: Dream Boat Entertainment Pte Limited Nil Nil She holds 11,000 Equity Shares of Rs.10/- each She is the wife of Mr. Tekulapalli Sanjay Reddy, Chairman & Managing Director. Attended 13 out of 13 Board Meetings held during the year 5

7 DIRECTORS REPORT Silly Monks Entertainment Limited To The Members, M/s. Silly Monks Entertainment Limited. Your directors have pleasure in presenting their Fourth Annual Report on the business and operations of the company together with the audited financial statements along with the report of the Auditors for the financial year ended 31 March FINANCIAL RESULTS: The performance for the current year in comparison to the previous year are as under: (Amount in Rs.) Particulars Financial Year Financial Year Revenue from Operations 2,99,93,287 2,01,74,196 Other Income 2,30,172 13,980 Total Revenue 3,02,23,459 2,01,88,176 Total Expenses 2,64,92,233 1,92,16,218 Net Profit / Loss Before Tax (PBT) 37,31,226 9,71,958 Current Tax 7,10,985 2,00,740 Deferred Tax 4,22,317 1,06,045 MAT Credit Entitlement (17,423) - Net Profit (PAT) 26,15,348 6,65,173 EPS COMPANY PERFORMANCE Your Company posted good financial results with a net profit of Rs Lakhs during the year under review. Due to continuous efforts of the management the revenues of the company increased by 49.71% to that of the previous year. The Company is looking forward to increase its profits in the coming financial years with the support of all the stakeholders of the Company. 3. TRANSFER TO RESERVES The Company did not transfer any amount to the General Reserve for the Financial Year ended March 31 st,

8 4. DIVIDEND: Silly Monks Entertainment Limited No Dividend was declared for the financial year ended 31 st March, 2017 due to conservation of Profits for the future expansion of business of the Company. 5. SUBSIDIARIES: Dream Boat Entertainment Pte Limited (Hong Kong) Dream Boat Entertainment Limited is a wholly Owned Subsidiary of the Company incorporated in Hong Kong, involved in the business similar to that of the Company. Pursuant to the provisions of Section 129(3) of the Companies Act, 2013, a statement containing the salient features of the financial statements of Subsidiaries/Associates in the prescribed format i.e. Form AOC-1 is provided as Annexure - I to this Report. The statement also provides the details of performance, financial position of each of the subsidiaries/associates. 6. STATUTORY AUDITORS: The Shareholders of the Company At their Annual General Meeting (AGM) held on 18 th December, 2014, have appointed M/s. Ramasamy koteswara & Co., Chartered Accountants, (Registration No S), Hyderabad, as Statutory Auditors of the Company to hold office from the conclusion of that AGM till the conclusion of the 06 th AGM (subject to ratification of the appointment by the members at every AGM held after that AGM) at such remuneration as may be decided by the Board of Directors. The Board recommends their appointment for ratification at the ensuring Annual General Meeting. 7. DIRECTORS & KEY MANAGERIAL PERSONAL: 7.1 Director Retiring by Rotation Mrs. Swathi Reddy retires by rotation at the forthcoming Annual General Meeting, and being eligible, offers herself for re-appointment at the said Meeting of the Company. 7.2 Changes in the Board and Key Managerial Personnel Board Mr. Tekulapalli Sanjay Reddy, was appointed as the Chairman & Managing Director of the Company for a period of 3 years with effect from and whose appointment was approved by the members of the Company at the Extraordinary General Meeting held on 15 th day of May, Mr. Anil Kumar Pallala was appointed as the Whole Time Director of the Company for a period of 3 years with effect from and whose appointment was approved by the members of the Company at the Extraordinary Meeting held on 15 th day of May,

9 Mrs. Swathi Reddy, Executive Director of the Company, was redesignated as Non-Executive Director with effect from 31 st day of March, 2017, by the board of directors of the Company at their meeting held on 31 st day of March, The Board of Directors of the Company appointed Mr. Rajesh Katragadda and Mr. Prasada Rao Kalluri as an additional directors in the capacity of Non Executive Independent Directors of the Company at their board meeting held on 31 st day of March, 2017 and their appointment s had approved by the members of the Company at the Extraordinary General Meeting held on 15 th day of May, The Board of Directors of the Company appointed Mr. Sreenivasa Reddy Musani as an additional director of the Company at their board meeting held on 31 st day of March, 2017 and whose appointment was approved by the members of the Company at the Extraordinary General Meeting held on 15 th day of May, As on the date of this report, the following are the Board of Directors of the Company: SL. NO. NAME OF THE Director DESIGNATION 1. Tekulapalli Sanjay Reddy Chairman & Managing Director 2. Anil Kumar Pallala Whole Time Director 3. Swathi Reddy Non Executive Directors 4. Sreenivasa Reddy Musani Non Executive Directors 5. Rajesh Katragadda Non Executive Independent Directors 6. Prasada Rao Kalluri Non Executive Independent Directors Key Managerial Personnel The Board of Directors of the Company at their meeting held on 31 st March, 2017, appointed Mr. Boda Narsing Rao as Chief Financial Officer of the Company, with effect from 01 st April, Ms. Sushma Barla was appointed as a Company Secretary and Compliance Officer of the Company with effect from 24 th day of May, As on the date of this report, the following are the Key Managerial Personnel of the Company: SL. NO. NAME OF THE KMP DESIGNATION 1. Tekulapalli Sanjay Reddy Chairman & Managing Director 2. Anil Kumar Pallala Whole Time Director 3. Boda Narsing Rao Chief Financial Officer 4. Sushma Barla Company Secretary & Compliance Officer Independent Directors The Company has received necessary declaration from each Independent Director of the Company, that they meet the criteria of independence prescribed under section 149(6) of the Companies Act, 2013 (the Act). 8

10 8. BOARD MEETINGS The Board met Thirteen (13) times during the financial year The following are the details of the Board Meetings: Sl. No. 9. COMMITTEES a) AUDIT COMMITTEE: Date of Board Meeting The Audit Committee of the Company was constituted pursuant to the Board Meeting held on 12 th day of June, 2017, comprises the following Members: Shri. Rajesh Katragadda - Chairman Shri. Prasada Rao Kalluri - Member Shri. Tekulapalli Sanjay Reddy - Member None of the recommendations made by the Audit Committee were rejected by the board. During the year under review the Audit Committee met on b) NOMINATION AND REMUNERATION COMMITTEE The Nomination and Remuneration Committee of the Company was constituted pursuant to the Board Meeting held on 12 th day of June, 2017, comprises the following Members: Shri. Rajesh Katragadda - Chairman Shri. Prasada Rao Kalluri - Member Shri. Sreenivasa Reddy Musani - Member During the year under review, the Stakeholder s Relationship Committee was not met. 9

11 c) STAKEHOLDER S RELATIONSHIP COMMITTEE The Stakeholder s Relation Ship Committee of the Company was constituted pursuant to the Board Meeting held on 12 th day of June, 2017, comprises the following Members: Shri. Rajesh Katragadda - Chairman Shri. Prasada Rao Kalluri - Member Shri. Tekulapalli Sanjay Reddy - Member 10. POLICY ON DIRECTOR S AND KEY MANAGERIAL PERSONNEL APPOINTMENT AND REMUNERATION During the year, your Company has adopted the policy on Director s Appointment and Remuneration. The objective of the policy is to ensure the executive directors and other employees are sufficiently compensated for their performance. The policy seeks to provide criteria for determining qualifications and positive attributes and independence of a director and also recommend a policy relating to the remuneration for the directors and key managerial personnel. 11. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS MADE BY THE COMPANY UNDER THE PROVISIONS OF SECTION 186 OF THE COMPANIES ACT, 2013 Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements. 12. FIXED DEPOSITS: Your Company has not accepted any fixed deposits and as such no principal or interest was outstanding as on the date of the Balance sheet. 13. DIRECTORS RESPONSIBILITY STATEMENT Pursuant to Section 134 (5) of the Companies Act, 2013 Your Directors confirm that: i) In preparation of annual accounts for the financial year ended 31st March, 2017, the applicable Accounting Standards have been followed along with proper explanation relating to material departures; ii) The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give true and fair view of the state of affairs of the Company at the end of the financial year ended 31st March, 2017 and of the profit and loss of the Company for the year iii) The Directors have taken proper and sufficient care for their maintenance of adequate accounting records in accordance with the provisions of the Companies Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities. iv) The Directors had prepared the annual accounts on a going concern basis; and 10

12 v) The directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. 14. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES During the FY under review, transactions were conducted by the Company pursuant to the Agreements entered into with its Related Parties during previous years; the same were on an arm s length basis and in the ordinary course of business. There are no materially significant related party transactions made by the Company with the Promoters, Directors, Key Managerial Personnel or any related party which may have a potential conflict with the interest of the Company at large. The details of related party transactions which were entered into during the previous year / current year are provided in Financial Statements, under the head measurement and disclosures as per the Accounting Standards. The particulars of contracts or arrangements with related parties referred to in sub-section (1) of Section 188 of the Companies Act, 2013 in Form AOC-2 is herewith annexed as Annexure II to this report. 15. SHARE CAPITAL The Authorised Share Capital of the Company as on date of Balance Sheet is Rs. 55,00,000/- divided into 5,50,000 equity shares of Rs.10/- each. The paid up share capital of the company as on date of balance sheet is Rs. 52,45,000/- divided into 5,24,500 equity shares of Rs. 10/- each. During the year under review, the company has increased the Authorized Share Capital of the company, from Rs. 55,00,000/- to Rs. 5,00,00,000/- at the Extraordinary General Meeting held on Your Company has issued 31,47,000 Bonus Shares in the ratio of 6:1 i.e. 6 equity shares for every 1 equity share held to the shareholders by way of capitalization of Securities Premium Account. The paid-up Share Capital of the Company as on Date is Rs. 3,67,15,000/- divided into 36,71,500 equity shares of Rs. 10/- each. During the year under review, the Company has not issued shares with differential voting rights, sweat equity shares or Employee Stock Options. 16. EXTRACT OF ANNUAL RETURN: An Extract of Annual return prepared in accordance with the provisions of the section 92 (3) of the Companies Act, 2013 in the form MGT-9 is Annexed as Annexure III to this report. 11

13 17. AUDITORS REPORT There are no qualifications, reservations or adverse remarks made by M/s. Ramasamy koteswara & Co., Chartered Accountants, Statutory Auditors in their report for the Financial Year ended 31 st March, CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO: a) Conservation of Energy, Technology Absorption: The particulars prescribed by section 134(3)(m) the Companies Act, 2013, pertaining to disclosure measures taken in relation to conservation of energy and technology absorption are not applicable. b) Foreign Exchange earnings and Outgo: Foreign Exchange Earnings: Rs. 2,42,05,282/- Foreign Exchange Outgoings: MATERIAL CHANGES AFTER THE CLOSURE OF THE FINANCIAL YEAR: During the year, the Company has converted from Private Limited Company to Public limited Company by passing a Special Resolution at the Extraordinary General meeting of the members of the Company held on 15 th day of May, 2017, and the Company has obtained fresh Certificate of Incorporation dated, 24 th day of May, 2017 from the Registrar of Companies, for the state of Telangana and Andhra Pradesh. Pursuant to the approval of the members of the Company at the Extraordinary general meeting of the members of the Company held on 08 th day of June, 2017, your Company has filled Draft prospectus with the National Stock Exchange of India Limited on 24 th day of August, 2017 for the purpose of Initial Public offer comprising a fresh issue of 9,70,000 equity Shares and Offer for sale (OFS) of 2,90,000 equity Shares. The Company has obtained in-principle approval from the NSE dated 14 th September, 2017 as the Company proposes to list its shares in SME platform of NSE (Emerge). 20. CHANGE IN THE NATURE OF BUSINESS: There was no change in the nature of business of your Company during the financial year ended 31 st March, SIGNIFICANT OR MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS There are no orders passed by the Regulators / Courts which would impact the going concern status of your Company and its future operations. Further, we confirm that there were no instances of fraud to be reported by the Auditors vide their Report for the FY INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY: Your Company has an adequate system of internal financial controls with reference to financial statements, including but not limited to safeguard and protection of assets from loss, their unauthorized 12

14 use or disposition. All the transactions were properly authorized, recorded and reported to the Management. The Company is following all the applicable Accounting Standards for properly maintaining the books of accounts and reporting in the financial statements. Your Company continues to ensure proper and adequate systems and procedures commensurate with its size and nature of its business. 23. RISK MANAGEMENT POLICY: The Company is in the Process of adopting a policy on risk management. Your Company believes that managing the risk helps in maximizing the returns. The Company s approach to addressing business risk is comprehensive and includes periodic review of such risks and frameworks for the mitigating the risks and reporting mechanism of such risks. The risk management framework is reviewed periodically by the board. 24. PARTICLARS OF EMPLOYEES There are no employees who are covered under the provisions of Section 197(12) of the Companies Act, 2013 read with the Rule 5 Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and hence the statement in this respect has not been given. 25. ACKNOWLEDGMENT AND APPRECIATION: Your Directors take this opportunity to thank the Clients, shareholders, bankers, business associates for their consistent support and continued encouragement to the Company. Further your Directors convey their appreciation for the whole hearted and committed efforts by all its employees. BY ORDER OF THE BOARD OF DIRECTORS FOR SILLY MONKS ENTERTAINMENT LIMITED SD/- SD/- TEKULAPALLI SANJAY REDDY ANIL KUMAR PALLALA PLACE: HYDERABAD CHAIRMAN & MANAGING DIRECTOR WHOLE TIME DIRECTOR DATE: 04 TH SEPTEMBER, 2017 DIN: DIN:

15 Annexures to Directors Report Silly Monks Entertainment Limited ANNEXURE - I Form AOC-1 (Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 of Companies (Accounts) Rules, 2014) Statement containing salient features of the financial statement of subsidiaries/associate companies /joint ventures Part "A": Subsidiaries Information in respect of each subsidiary to be presented with (Amount In Rs.) Sl. No. Particulars Details 1. Name of the Subsidiary Dream Boat Entertainment Pte. Limited 2. Reporting period for the subsidiary concerned, if different from the holding company's reporting period 3. Reporting currency and Exchange rate as on the last date of the relevant Financial year in the case of foreign subsidiaries Event Monks Entertainment LLP Monkstar Music LLP Not Applicable Not Applicable Not Applicable 1 USD = Not Applicable Not Applicable 4. Share capital 80,000 1,00,000 5,00, Reserves & surplus 1,43,29,056 8,31,812 5,18, Total assets 3,07,58,966 9,91,111 11,10, Total Liabilities 3,07,58,966 9,91,111 11,10, Investments Nil Nil Nil 9. Turnover 10,76,18,245 9,51,200 8,11, Profit before taxation 1,16,84,371 1,30,604 2,51, Provision for taxation (Includes DTL/DTA) - 39,299 77, Profit after taxation 1,16,84,371 91,305 1,74, Proposed Dividend % of shareholding 100% 64% 67% None of the above subsidiaries have been liquidated or sold during the year. Part B : Associates and Joint Ventures NIL The Company does not have any Associate Company / Joint Ventures. As per my report of even date. For Ramasamy Koteswara Rao & Co., Chartered Accountants Firm Regn No S For and on behalf of the Board of Directors Silly Monks Entertainment Limited SD/- SD/- SD/- (CV Koteswara Rao) Tekulapalli Sanjay Reddy Anil Kumar Pallala Partner Chairman & Managing Director Whole Time Director Membership No DIN: DIN: Place: Hyderabad Date:

16 ANNEXURE - II Form No. AOC-2 DETAILS OF RELATED PARTY TRANSACTIONS (Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014) Form for disclosure of particulars of contracts/arrangements entered into by the company with related parties referred to in subsection (1) of section 188 of the Companies Act, 2013 including certain arms length transactions under third proviso thereto 1. Details of contracts or arrangements or transactions not at arm s length basis: NIL The company has not entered into any contract or arrangement or transaction which is not at arm s length basis during the year under review. 2. Details of material contracts or arrangement or transactions at arm s length basis: The Company has entered into a Lease agreement dated 04 th day of December, 2013 with Mr. T. Sanjay Reddy & Mrs. Swathi Reddy directors of the Company for the premises of the previous registered office of the Company situated at G2, Namitha Nest, 1 st Floor,1-89/A/16, Durgam Cherurvu Road, kavuri Hills, Madhapur, Hyderabad for the period of 3 years starting from 16 th day of December, 2013 to 15 th day of December, The lease period is completed with financial year The following are the details of the transaction. Name(s) of the related party and nature of relationship Mr. Tekulapalli Sanjay Reddy - Chairman & Managing Director Swathi Reddy - Non - Executive Director Nature of contracts/ arrangements/ transactions Rent paid (Expenses) Rent paid (Expenses) Duration of the contracts / arrangement / transactions 3 years Concluded during the F.Y years Concluded during the F.Y Salient terms of the contracts or arrangements or transactions including the value, if any Lease of premises for a period of 3 years at a monthly rent of Rs.55,000/- Lease of premises for a period of 3 years at a monthly rent of Rs.55,000/- Date(s) of approval by the Board, if any Existing Agreement - Not Applicable Existing Agreement - Not Applicable Amount paid as advances, if any Rs.2,50,000/- as Security Deposit Rs.2,50,000/- as Security Deposit BY ORDER OF THE BOARD OF DIRECTORS FOR SILLY MONKS ENTERTAINMENT LIMITED SD/- SD/- TEKULAPALLI SANJAY REDDY ANIL KUMAR PALLALA PLACE: HYDERABAD CHAIRMAN & MANAGING DIRECTOR WHOLE TIME DIRECTOR DATE: 04 TH SEPTEMBER, 2017 DIN: DIN:

17 ANNEXURE III FORM NO. MGT 9 EXTRACT OF ANNUAL RETURN As on financial year ended on Pursuant to Section 92 (3) of the Companies Act, 2013 and rule 12(1) of the Company (Management & Administration) Rules, I. REGISTRATION &OTHER DETAILS: 1. CIN U92120TG2013PLC Registration Date 20/09/ Name of the Company Silly Monks Entertainment Private Limited 4. Category/Sub-category of the Company Non-Government Company/ Private Company Limited by Shares 5. Address of the Registered office & contact details 6. Whether listed company No 7. Name, Address & contact details of the Not Applicable Registrar & Transfer Agent, if any. 301, Ektha Pearl, , B P Raju Marg, Kothaguda, Kondapur Hyderabad - Telangana , India. info@sillymonks.com II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY (All the business activities contributing 10 % or more of the total turnover of the company shall be stated): S. No. Name and Description of main products / services NIC Code of the Product/service 1. Motion picture, video and television programme production, sound recording and music publishing activities (Publishing, Digital & Social Media) % to total turnover of the % III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES: Sl. No. Name and Address of the Company 1. Dream Boat Entertainment Pte Ltd. CIN/GLN Holding/ Subsidiary / Associate % of shares held Applicable Section NA Subsidiary 100% 2(87) 2. Monkstar Music LLP AAD-8082 Subsidiary 67% 2(87) 3. Event Monks Entertainment LLP AAD-2703 Subsidiary 64% 2(87) 16

18 IV. Silly Monks Entertainment Limited SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity) a) Category-wise Share Holding: Category of Shareholders A. Promoters (1) Indian No. of Shares held at the beginning of the year [As on 31-March-2016] Demat Physical Total % of Total Shares No. of Shares held at the end of the year[as on 31-March-2017] Demat Physical Total % of Total Shares % Change during the year a) Individual/ HUF - 318, , , , (15.45) b) Central Govt c) State Govt.(s) d) Bodies Corp e) Banks / FI f) Any other Sub-total (A)(1) - 318, , , , (15.45) (2) Foreign a)nri Individuals b) Other Individuals c) Bodies Corp d) Banks / FI e) Any other Sub-total (A)(2) Total Shareholding of Promoter (A)= (A)(1)+(A)(2) B. Public Shareholding 1. Institutions - 318, , , , (15.45) a) Mutual Funds b) Banks / FI c) Central Govt d) State Govt(s) e) Venture Capital Funds f) Insurance Companies g) FIIs h) Foreign Venture Capital Funds i) Others (specify) Sub-total (B)(1):

19 2. Non-Institutions a) Bodies Corp. i) Indian , , ii) Overseas b) Individuals i) Individual shareholders holding nominal share capital up to Rs. 1 lakh ii) Individual shareholders holding nominal share capital in excess of Rs 1 lakh c) Others (specify) , , , , (4.85) Clearing Member Trust Non Resident Individuals Foreign Portfolio Investors Corporate (FPI) Sub-total (B)(2): , , , , Total Public Shareholding (B)=(B)(1)+ (B)(2) C. Shares held by Custodian for GDRs & ADRs - 100, , , , Grand Total (A+B+C) - 418, , , , S. No. b) Shareholding of Promoters/ Promoters Group:- Shareholder s Name Shareholding at the beginning of the year No. of Shares % of total Shares of the company %of Shares Pledged / encumbere d to total shares Promoters Shareholding at the end of the year No. of Shares % of total Shares of the company %of Shares Pledged / encumbere d to total shares % change in shareholdi ng during the year 1 Tekulapalli % % 0 (14.77%) Sanjay Reddy 2 Anil Kumar % % 0 (3.39%) Pallala Total % % 0 (18.16%) 18

20 Promoter s Group 3 Swathi Reddy % % 0 (0.53%) 4 Gaurika Reddy % % 5 Karyampudi Koti Sridevi 6 Tekulapalli Mahikaansh Reddy % % % % Total % % % c) Change in Promoters Shareholding (please specify, if there is no change):- Particulars Date Reason Shareholding at the beginning of the year 1. Tekulapalli Sanjay Reddy Promoters No. of shares % of total shares of the company Cumulative shareholding during the year No. of shares % of total shares of the company At the beginning of the year % - - Changes during the year Transfer (13000) (2.48%) % At the end of the year % 2. Anil Kumar Pallala At the beginning of the year % - - Changes during the year Transfer (4000) (0.76%) % At the end of the year % 3. Swathi Reddy Promoter s Group At the beginning of the year % - - Changes during the year % At the end of the year % 4. Gaurika Reddy At the beginning of the year Changes during the year Transfer % At the end of the year % 5. Karyampudi Koti Sridevi At the beginning of the year

21 Changes during the year Transfer (0.76%) At the end of the year (0.76%) 6. Tekulapalli Mahikaansh Reddy At the beginning of the year Changes during the year Transfer % At the end of the year % d) Shareholding Pattern of top ten Shareholders (Other than Directors, Promoters and Holders of GDRs and ADRs): Particulars Date Reason Shareholding at the beginning of the year 1. Ektha.Com Private Limited No. of shares % of total shares of the company Cumulative shareholding during the year No. of shares % of total shares of the company At the beginning of the year Changes during the year Allotment Allotment Allotment Allotment Allotment Allotment % Allotment Allotment Allotment Allotment Allotment % At the end of the year % 2. Korrapati Ranganathasai At the beginning of the year % - - Changes during the year NA NA NA NA % At the end of the year % 20

22 e) Shareholding of Directors and Key Managerial Personnel: Particulars Date Reason Shareholding at the beginning of the year 1. Tekulapalli Sanjay Reddy No. of shares % of total shares of the company Cumulative shareholding during the year No. of shares % of total shares of the company At the beginning of the year % - - Changes during the year Transfer (13000) (2.48%) % At the end of the year % 2. Anil Kumar Pallala At the beginning of the year % - - Changes during the year Transfer (4000) (0.76%) % At the end of the year % 3. Swathi Reddy At the beginning of the year % - - Changes during the year % At the end of the year % 4. Sreenivasa Reddy Musani At the beginning of the year NIL NIL NIL NIL Changes during the year - - NIL NIL NIL NIL At the end of the year NIL NIL NIL NIL 5. Katragadda Rajesh At the beginning of the year NIL NIL NIL NIL Changes during the year - - NIL NIL NIL NIL At the end of the year NIL NIL NIL NIL 6. Prasada Rao Kalluri At the beginning of the year NIL NIL NIL NIL Changes during the year - - NIL NIL NIL NIL At the end of the year NIL NIL NIL NIL 7. Boda Narsing Rao At the beginning of the year NIL NIL NIL NIL Changes during the year - - NIL NIL NIL NIL At the end of the year NIL NIL NIL NIL 8. Sushma Barla At the beginning of the year NIL NIL NIL NIL Changes during the year - - NIL NIL NIL NIL At the end of the year NIL NIL NIL NIL 21

23 V. INDEBTEDNESS - Indebtedness of the Company including interest outstanding/accrued but not due for payment. (Amount in Rs.) Indebtedness at the beginning of the financial year Secured Loans Excluding Deposits Unsecured Loans Deposits Total Indebtedness i) Principal Amount 24,70, ,70,000 ii) Interest due but not paid iii)interest accrued but not due Total (i+ii+iii) 24,70, ,70,000 Change in Indebtedness during the financial year * Addition 76,43, ,43,000 * Reduction 13,16, ,16,098 Net Change 63,26, ,26,902 Indebtedness at the end of the financial year i) Principal Amount 87,96, ,96,902 ii) Interest due but not paid iii)interest accrued but not due Total (i+ii+iii) 87,96, ,96,902 VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL A. Remuneration to Managing Director, Whole-time Directors and/or Manager: Sl. No. Particulars of Remuneration Name of MD/WTD/ Manager (Amount in Rs.) Designation CMD WTD Total Amount 1. Gross salary Tekulapalli Sanjay Reddy* Anil Kumar Pallala** (a) Salary as per provisions contained in section 17(1) of the Income-tax Act, ,00,000 21,00,000 57,00,000 (b) Value of perquisites u/s 17(2) Income-tax Act, 1961 (c) Profits in lieu of salary under section 17(3) Income- tax Act, Stock Option Sweat Equity Commission - as % of profit - others, specify

24 5. Others, please specify Total (A) 36,00,000 21,00,000 57,00,000 Ceiling as per the Act The provisions of Section 197 does not applicable during the Financial Year *As on 31 st March, 2017, Mr. Tekulapalli Sanjay Reddy was appointed as the Chairman & Managing Director, for the F.Y he has received the remuneration for the position of the Director not as a KMP ** As on 31 st March, 2017, Mr. Anil kumar Pallala was appointed as the Whole Time Director, for the F.Y he has received the remuneration for the position of the Director not as a KMP. B. Remuneration to other Directors: Sl. No. Particulars of Remuneration Name of Directors 1. Independent Directors Katragadda Rajesh Prasada Rao Kalluri (Amount in Rs.) Total Amount Fee for attending board committee meetings Nil Nil Nil Commission Nil Nil Nil Others, please specify Nil Nil Nil Total (1) Nil Nil Nil 2. Other Non-Executive Directors Swathi Reddy Sreenivasa Reddy Musani Fee for attending board committee meetings Nil Nil Nil Commissionv Nil Nil Nil Others, please specify Nil Nil Nil Total (2) Nil Nil Nil Total (B)=(1+2) Nil Nil Nil Total Managerial Remuneration Nil Nil Nil Overall Ceiling as per the Act C. Remuneration to Key Managerial Personnel other than MD/Manager/WTD Not Applicable (Amount in Rs.) Sl. No. Particulars of Remuneration Name of Key Managerial Personnel Total Amount 1. Designation Gross salary (a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961 (b) Value of perquisites u/s 17(2) Incometax Act, 1961 (c) Profits in lieu of salary under section 17(3) Income- tax Act, Stock Option 3. Sweat Equity - 23

25 4. Commission - as % of profit - others, specify 5. Others, please specify Total (A) VII. PENALTIES / PUNISHMENT/ COMPOUNDING OF OFFENCES Type A. COMPANY Penalty Punishment Compounding B. DIRECTORS Section of the Companies Act Brief Description Details of Penalty / Punishment/ Compounding fees imposed Authority [RD / NCLT/ COURT] Appeal made, if any (give Details) Penalty Punishment Compounding C. OTHER OFFICERS IN DEFAULT Penalty Punishment Compounding BY ORDER OF THE BOARD OF DIRECTORS FOR SILLY MONKS ENTERTAINMENT LIMITED SD/- SD/- TEKULAPALLI SANJAY REDDY ANIL KUMAR PALLALA PLACE: HYDERABAD CHAIRMAN & MANAGING DIRECTOR WHOLE TIME DIRECTOR DATE: 04 TH SEPTEMBER, 2017 DIN: DIN:

26 AUDITORS REPORT To the Members of SILLY MONKS ENTERTAINMENT LIMITED (Formerly Known as SILLY MONKS ENTERTAINMENT PRIVATE LIMITED) Report on the Standalone Financial Statements We have audited the accompanying standalone financial statements of SILLY MONKS ENTERTAINMENT LIMITED (Formerly Known as SILLY MONKS ENTERTAINMENT PRIVATE LIMITED) (the Company ), which comprise the Balance Sheet as at March 31, 2017, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information (together hereinafter referred to as standalone financial statements ). Management s Responsibility for the Financial Statements The Company s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ( the Act ) with respect to the preparation of these Standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. Auditor s Responsibility Our responsibility is to express an opinion on these Standalone financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder. We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company s preparation of the financial statements that give a true and fair view in order to design audit procedures that 25

27 are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company s Directors, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Standalone financial statements Opinion In our opinion and to the best of our information and according to the explanations given to us, the standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2017, its Profit and its cash flows for the year ended on that date. Report on Other Legal and Regulatory Requirements 1. As required by the Companies (Auditor s report) Order, 2016 ( the Order ) issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure A a statement on the matters specified in paragraphs 3 and 4 of the Order. 2. As required by section 143 (3) of the Act, we report that: (a) We have sought and obtained all the information and explanations which to the best of our Knowledge and belief were necessary for the purpose of our audit; (b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books; (c) The Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this Report are in agreement with the books of account; (d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts)Rules, 2014 and the Companies (Indian Accounting Standards) Rules, 2015, as amended; (e) On the basis of written representations received from the directors as on March 31, 2017, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2017, from being appointed as a director in terms of section 164 (2) of the Act; (f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in Annexure B to this report; 26

28 (g) With respect to the other matters to be included in the Auditor s Report in accordance with Rule 11of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us: i. The Company does not have any pending litigations which would impact its financial position. ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses. iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company. iv. The Company has provided requisite disclosures in its financial statement as to holdings as well as dealing in Specified Bank Notes during the period 8 November 2016 to 30 December Based on the audit procedures and relying on the management representation we report that the disclosures are in accordance with books of account maintained by the Company and as produced to us by the Management. For Ramasamy Koteswara Rao & Co, Chartered Accountants Firm Registration Number: S Place: Hyderabad Date: SD/- (C V Koteswara Rao) Partner Membership No

29 Annexure A to the Auditors Report (referred to in paragraph 1 of our Report of even date to the Members of SILLY MONKS ENTERTAINMENT LIMITED (Formerly Known as SILLY MONKS ENTERTAINMENT PRIVATE LIMITED) for the year ended March 31, 2017) On the basis of such checks as we considered appropriate and according to the information and explanation given to us during the course of our audit, we report that; i. (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets. (b) All fixed assets have been physically verified by the management during the year in accordance with a phased program of verification which, in our opinion is reasonable having regard to the size of the company and the nature of its assets. According to the information furnished to us, no material discrepancies have been noticed on such verification. (c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the company does not have any immovable properties so reporting under this clause is not applicable to the Company. ii. iii. The Company is a service company, primarily rendering digital marketing services. Accordingly, it does not hold any physical inventories. Thus, paragraph 3(ii) of the Order is not applicable to the Company. The Company has granted loans to parties covered in the register maintained under section 189 of the Companies Act, 2013 ( the Act ). (a) In our opinion, the rate of interest and other terms and conditions on which the loans had been granted to the parties listed in the register maintained under Section 189 of the Act were not, prima facie, prejudicial to the interest of the Company. (b) In the case of the loans granted to the parties listed in the register maintained under section 189 of the Act, the borrowers have been regular in the payment of the principal and interest as stipulated. (c) There are no overdue amounts in respect of the loan granted to parties listed in the register maintained under section 189 of the Act. iv. In our opinion and according to the information and explanations given to us, the company has complied with the provisions of section 185 and 186 of the Companies Act, 2013 In respect of loans, investments, guarantees, and security. v. The Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, the provisions of clause 3(v) of the Order are not applicable. vi. vii. The Central Government has not prescribed the maintenance of cost records under section 148(1) of the Act, for any of the services rendered by the Company. (a) According to information and explanations given to us and on the basis of our examination of the books of account, and records, the Company has been generally regular in depositing undisputed 28

30 statutory dues including Provident Fund, Employees State Insurance, Income-Tax, Sales tax, Service Tax, Value added Tax, Cess and any other statutory dues with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable in respect of the above were in arrears as at March 31, 2017 for a period of more than six months from the date on when they become payable. (b) According to the information and explanation given to us, there are no dues of income tax, sales tax, service tax, and value added tax outstanding on account of any dispute. viii. ix. The Company has not defaulted in any repayment of loans or borrowings from any financial institution, banks, government or debenture holders during the year. Accordingly, paragraph 3(viii) of the Order is not applicable Based upon the audit procedures performed and the information and explanations given by the management, the company has not raised moneys by way of initial public offer or further public offer including debt instruments and term Loans. Accordingly, the provisions of clause 3 (ix) of the Order are not applicable to the Company and hence not commented upon. x. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, we report that no fraud by the company or on the company by the officers and employees of the Company has been noticed or reported during the year. xi. xii. xiii. xiv. xv. xvi. According to the information and explanations given by the management, the managerial remuneration has been paid / provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act, In our opinion, the Company is not a Nidhi company. Therefore, the provisions of clause 3(xii) of the order are not applicable to the Company and hence not commented upon. According to the information and explanations given by the management, transactions with the related parties are in compliance with section 177 and 188 of Companies Act, 2013 where applicable and the details have been disclosed in the notes to the financial statements, as required by the applicable accounting standards. According to the information and explanations given to us and on an overall examination of the balance sheet, the Company has made the preferential allotment and private placement of shares during the year under review and complied with applicable provisions of the companies Act, According to the information and explanations given by the management, the Company has not entered into any non-cash transactions with directors or persons connected with him as referred to in section 192 of Companies Act, According to the information and explanations given to us, the provisions of section 45-IA of the Reserve Bank of India Act, 1934 are not applicable to the Company and hence not commented upon. 29