Koffee Break. 21st Annual Report Twenty First Annual Report. pictures. PDF processed with CutePDF evaluation edition

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1 Koffee Break pictures 21st Annual Report Twenty First Annual Report PDF processed with CutePDF evaluation edition

2 KOFFEE BREAK PICTURES LIMITED BOARD OF DIRECTORS Mr. Apurva Shah : CHAIRMAN AND MANAGING DIRECTOR Mr. Vinodkumar Jain : INDEPENDENT AND NON EXECUTIVE DIRECTOR Mr. Pikesh Sharma : EXECUTIVE DIRECTOR Mr. Vijay Bhiva Pashte : INDEPENDENT AND NON EXECUTIVE DIRECTOR REGISTERED OFFICE: 374, 3 rd Floor, Powai Plaza, Hiranandani Garden, Powai Mumbai AUDITORS: M/s Agarwal Desai & Shah, Chartered Accountants, Mumbai REGISTRARS & SHARE TRANSFER AGENTS: System Support Services, 209, Shiva IndlEst 89, Nr. Copper Chimney Hotel, Sakinaka, Andheri Kurla Road, Andheri (E), Mumbai 72. Phone No SHARES LISTED AT: The Stock Exchange BSE Limited, Ahmedabad 2013 Annual Report 1

3 CONTENTS PAGE NO NOTICE 3 DIRECTORS REPORT 5 REPORT ON CORPORATE GOVERNANCE 7 MANAGEMENT DISCUSSION AND ANALYSIS REPORT 13 AUDITORS REPORT 16 ATTENDANCE SLIP 35 PROXY FORM st ANNUAL GENERAL MEETING Date: September 30, 2013 Day: Monday Time: 11.a.m. Place: 374, 3rd Floor, Powai Plaza, Hiranandani Garden, Powai Mumbai Annual Report 2

4 NOTICE Notice is hereby given that the Twenty First Annual General Meeting of the Members of KOFFEE BREAK PICTURES LIMITED will be held on Monday September 30, 2013 at a.m. at registered office of the company at 374, 3 rd Floor, Powai Plaza, Hiranandani Garden, Powai, Mumbai to transact the following business: ORDINARY BUSINESS 1. To receive, consider and adopt the Audited Balance Sheet as at 31 st March, 2013 & Profit and Loss Account for the year ended on that date, together with reports of the Board of Directors and the Auditors thereon. 2. To appoint a Director in place of Mr.Vinodkumar Jain, who retires by rotation & being eligible, offers him for re-appointment. 3. To consider and, if thought fit, to pass, with or without modifications, the following resolution, as an Ordinary Resolution: RESOLVED THAT subject to the provisions of section 224, 225 and other applicable provisions, if any of the Companies Act, 1956, M/s. Agarwal Desai & Shah, Chartered Accountants, be and are hereby re-appointed as Statutory Auditors of the Company to hold office from the conclusion of this meeting, until the conclusion of the next Annual General Meeting of the Company on such remuneration as may be mutually agreed upon with them and the Company. SPECIAL BUSINESS 4. To consider and, if thought fit, to pass with or without modification(s), the following resolution as an Ordinary Resolution: RESOLVED THAT Mr. Vijay Bhiva Pashte who was appointed as an Additional Director of the Company with effect from May 30, 2013 at the meeting of the Board of Directors of the Company and who holds office till the date of this Annual General Meeting in terms of Section 260 of the Companies Act, 1956, be and is hereby appointed as Director liable to retire by rotation. BY ORDER OF THE BOARD OF DIRECTORS KOFFEE BREAK PICTURES LIMITED Sd/- Place: Mumbai Date: 14 Th August, 2013 APURVA SHAH (MANAGING DIRECTOR) NOTES: 1. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE INSTEAD OF HIMSELF / HERSELF ON POLL ONLY AND SUCH PROXY NEED NOT BE A MEMBER OF THE COMPANY. 2. THE PROXIES IN ORDER TO BE EFFECTIVE, THE PROXY FORM MUST BE RECEIVED AT THE REGISTERED OFFICE OF THE COMPANY AT 374, 3 RD FLOOR, POWAI PLAZA, HIRANANDANI GARDEN, POWAI, MUMBAI NOT LESS THAN 48 HOURS BEFORE THE TIME FOR HOLDING OF THE MEETING. 3. Members/Proxies are requested to bring their admission slips duly filled and signed along with the copies of the Annual Report for attending the Meeting. 4. Corporate Members are requested to send a duly certified copy of the Board resolution pursuant to Section 187 of the Companies Act, 1956 authorizing their representative to attend and vote at the Annual General Meeting. 5. The Explanatory Statement pursuant to section 173(2) of the Companies Act, 1956 in respect of special business under Item No. 4, is annexed hereto and form part of this notice 6. The Register of Members and Share Transfer Books of the Company will remain closed from Thursday, 26th September, 2013 to Monday, 30 th September 2013(both days inclusive). 7. Members holding shares in physical form are requested to notify immediately any change in their address to the Company quoting their folio number. Members holding shares in electronic form may update such details with their respective Depository Participants. 8. Members desirous of getting any information/clarification on the Accounts and operations of the Company or intending to raise any query, are requested to forward the same at least 10 days in advance of the meeting to the Compliance Officer so that, the same may be attended appropriately Annual Report 3

5 9. Details of director seeking appointment/ re-appointment at the ensuing Annual General Meeting to be held on Monday, 30 th day of September, 2013 (in pursuance of Clause 49 of the Listing Agreement): Name of Director Mr. Vinodkumar Jain Date of Birth 08/08/1963 Nationality Indian Date of appointment as director 14/03/2011 Designation Non Executive Independent Director Qualification Matriculate Experience/ Expertise Having an experience of more than 10 years in Capital Market. Shareholding in the Company (Equity Shares of Re.1/- each) NIL List of directorships held in other Companies Tarun Sales Agency Private Limited Relationship with other Directors of the Company Not related Name of Director Mr. Vijay Bhiva Pashte Date of Birth 01/05/1982 Nationality Indian Date of appointment as director 30/05/2013 Designation Additional Director- Non Executive Independent Director Qualification HSC Passed Experience/ Expertise Having an experience of 8 years in Securities Market Shareholding in the Company (Equity Shares of Re.1/- each) NIL List of directorships held in other Companies NIL Relationship with other Directors of the Company Not related Item No. 4: Ordinary Resolution Explanatory Statement (Pursuant to Section 173 (2) of the Companies Act, 1956) Mr. Vijay Bhiva Pashte was appointed as an Additional Director- Non Executive Independent Director of the Company on May 30, 2013 at the meeting of the Board of Directors of the Company. As per the provisions of Section 260 of the Companies Act, 1956, Mr. Pashte holds office upto the date of forthcoming Annual General Meeting. The Company has received a notice in writing under Section 257 of the Companies Act, 1956, along with a requisite deposit, proposing his candidature for the office of Director liable to retire by rotation. Mr. Pashte is having an experience of 8 years in Securities Market. Mr. Pashte is not holding directorship in any other Company. Mr. Vijay Bhiva Pashte does not hold any shares in the Company. None of the Directors of the Company except Mr. Pashte is in any way concerned or interested in this Resolution. The Board of Directors of your Company is of the opinion that her appointment would be beneficial to the Company and hence recommend the Resolution at item no. 4 for your approval. BY ORDER OF THE BOARD OF DIRECTORS KOFFEE BREAK PICTURES LIMITED Sd/- Place: Mumbai Date: 14 Th August, 2013 APURVA SHAH (MANAGING DIRECTOR) 2013 Annual Report 4

6 DIRECTORS REPORT Dear Members, Your Directors have pleasure in presenting the 21 st Annual Report of the Company together with the Audited Statements of the Accounts for the financial year ended 31 st March, FINANCIAL HIGHLIGHTS: Particulars Year ended Total Income 5,20,000 1,16,39,832 Total Expenditure 1,78,13,579 3,69,45,043 Profit/(Loss) before Taxes (1,72,93,579) (2,53,05,210) Less: Provision for Income (29,04,278) (12,60,803) Profit /(Loss) After Taxes (1,43,89,301) (2,40,44,407) Previous Year Balance Brought Forward (2,40,44,407) 53,09,700 Total Available for Appropriation (3,84,33,708) (1,87,34,707) Proposed Dividend NIL NIL Tax on Proposed Dividend NIL NIL Surplus/(Deficit) carried to Balance Sheet (3,84,33,708) (1,87,34,707) 2. OPERATIONS: The total income has decreased by 95%. The total expenditure has decreased by 51.78% to Rs. 1,78,13, DIVIDEND: To conserve the resources of the company, your directors do not recommend any dividend during the year under review. 4. DIRECTORS: In accordance with the provisions of the Articles of Association of the Company, Mr. Vinodkumar Jain, Director of the Company retires by rotation at the ensuing Annual General Meeting of the Company and being eligible has offered himself for re-appointment and your Board recommends for his re-appointment. Mr. Vijay B. Singh has resigned from the post of Directorship w.e.f. May 30, Mr. Vijay Bhiva Pashte was appointed as an Additional Director- Non Executive Independent Director with effect from 30 th May, He holds office up to the date of the ensuing Annual General Meeting. Notices have been received from some members, proposing his appointment as a Director. A brief resume of each of this director furnished in the Annexure to the Notice convening the ensuing Annual General Meeting. 5. DIRECTORS RESPONSIBILITY STATEMENT: Pursuant to provisions contained in Section 217 (2AA) of the Companies Act, 1956, the Directors of your Company confirm: i. That in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures. ii. That they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as at 31st March, 2013 and of the Profit or Loss of the Company for that period. iii. That they have taken proper and sufficient care for the maintenances of adequate accounting records in accordance with the provision of this Act for safeguarding the assets of the Company for preventing and detecting fraud and other irregularities. iv. That they have prepared the Annual accounts on a going concern basis. 6. SUBSIDIARIES: Since the Company has no subsidiaries as on 31 st March, 2013, provision of section 212 of the Companies Act, 1956 is not applicable.. 7. PUBLIC DEPOSITS: The company has not accepted any fixed deposits from the public during the year under review pursuant to the provisions of section 58A of the Companies Act, SHARE CAPITAL: During the period under review there has not been any change in the capital structure of the company. 9. LISTING: The Company is listed at the BSE Limited and Ahmadabad Stock Exchange Limited Annual Report 5

7 10. AUDITORS: M/s Agarwal Desai & Shah, Chartered Accountants, Mumbai, the Statutory Auditors of the Company hold office up to the conclusion of the ensuing Annual General Meeting of the Company. The Company has received a letter from them to the effect that their re-appointment, if made, would be in conformity with the limits prescribed under Section 224 (1B) of the Companies Act, The Board recommends reappointment of M/s Agarwal Desai & Shah, Chartered Accountants, as the Statutory Auditors of the Company to hold office from the conclusion of this Annual General Meeting up to the conclusion of the next Annual General Meeting of the Company. The company has received the letter from auditor to the effect that their appointment would be within the limits prescribed under section 224 (1B) of the Companies act, The Auditors have confirmed that they have subjected themselves to the peer review process of the institute of Chartered Accountants of India (ICAI) and hold a valid certificate issued by the Peer Review Board of the ICAI. 11. CORPORATE GOVERNANCE: Pursuant to Clause 49 of the Listing Agreement with the Stock Exchange, the following have been made a part of the annual report and are attached to this report: Management Discussion and Analysis Corporate Governance Report Statutory Auditors Certificate regarding compliance of conditions of Corporate Governance. Declaration on Compliance with Code of Conduct 12. PARTICULARS OF EMPLOYEES: As per the provisions of Section 217 (2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975, as amended, no employees were in receipt of remuneration exceeding the limits as prescribed under that section and hence your director have nothing to report in this regard. 13. PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTIONAND FOREIGN EXCHANGE EARNINGS AND OUTGO: Information in terms of requirements of clause (e) of sub-section (1) of Section 217 of the Companies Act, 1956 regarding Conservation of Energy, Technology Absorption and Foreign Exchange earnings and outgo, read along with the Companies (Disclosure of particulars in the report of Board of Directors) Rules, 1988 is as follows: (A) Conservation of Energy: The Company continues to implement prudent practices for saving electricity and other energy resources in day-to-day activities. However, considering the nature of business activities carried out by the Company, your director has nothing to report with respect to conservation of energy. (B) Research and Development: The Company has not carried out any specific research activity and so no benefit has been derived from it. (C) Technology absorption, adaption and innovation: The Company continues to take prudential measures in respect of technology absorption, adaptation and take innovative steps to use the scarce resources effectively. (D) Foreign Exchange Earnings and Outgo: There was no inflow and outflow of foreign exchange during the year under review. 14. APPRECIATION: Your Directors acknowledge with gratitude and wishes to place on record, their deep appreciation for the continued support and cooperation received by the Company from shareholders, bankers, Government authorities business associates customers and financial institutions during the year. Your Directors place on record their deep appreciation for the dedication and commitment of your Company s employees at all levels and look forward to their continued support in the future as well. For & On behalf of the Board of Directors Place: Mumbai Date: 14 h August, 2013 Sd/- APURVA SHAH (MANAGING DIRECTOR) 2013 Annual Report 6

8 REPORT ON CORPORATE GOVERNANCE 1. COMPANY S PHILOSOPHY ON CODE OF GOVERNANCE The Company s philosophy of corporate governance stems out from its belief that timely disclosures, transparent accounting policies, and a strong and independent Board go a long way in preserving shareholders trust while maximizing long term corporate values. Keeping in view the Company s size and complexity in operations, the company s corporate governance framework is based on the following main principles: a. Appropriate composition and size of the Board, with each Director bringing in key expertise in different areas. b. Timely and accurate disclosure of all material operational and financial information to the stakeholders. The Securities and Exchange Board of India (SEBI) through clause 49 of the listing agreement with the stock exchanges regulates corporate governance for listed companies. 2. BOARD OF DIRECTORS: a) The composition of the Board of Directors: The Board composition is in conformity with the provisions of the Companies Act, 1956 and with clause 49 of the listing agreement. The strength of the Board as on 14 th August, 2013 is 4 Directors comprising of 2 Executive Directors and 2 Non-Executive Directors. Mr. Apurva Shah Mr. Pikesh Sharma Name of Directors Category of Directorship No. of other Directorships held in other Indian Public Companies Mr. Vijay Bhiva Pashte* Mr. Vinodkumar Jain Chairman & Managing Director Executive Director - Non Executive Independent Director Non Executive Independent Director No. of Committee positions held in other Indian Public Companies Chairman Member *Mr. Vijay Bhiva Pashte has been appointed as an Additional Director- Non Executive Independent Director w.e.f. May 30, Mr. Vijay B. Singh has resigned from the post of Directorship w.e.f. May 30, In accordance with Clause 49 of the Listing Agreement with the Stock Exchanges, membership/chairmanship of only the Audit Committee, Shareholders /Investors Grievance Committee and the Remuneration Committee of the Public Limited Companies has been considered. There are no nominees or Institutional Directors in the Company. None of Directors have pecuniary or Business relationship with the Company other than as mentioned in the elsewhere in the Annual Report. No Director of the Company is either member in more than ten committees and/or Chairman of more than five committees across all Companies in which he is Director. During the year there were in total 4 (Four) Board Meetings which were held on 14/05/12, 14/08/12, 12/11/12 and 15/02/13; the time gap between the two meetings was not more than 4 months. All the information required to be furnished to the Board were made available to them along with detailed Agenda notes. Sr. No. of Board meetings Attendance at the Name of Director No Held Attended last AGM 1. Mr. Apurva Shah 4 4 Yes 2. Mr. Vijay B. Singh* 4 4 Yes 3. Mr. Vinodkumar Jain 4 4 Yes 4. Mr. Pikesh Sharma 4 4 Yes * Mr. Vijay B. Singh has resigned from the post of Directorship w.e.f. May 30, Mr. Vijay Bhiva Pashte has been appointed as an Additional Director w.e.f. May 30, BOARD COMMITTEES: The Board has constituted Committees of Directors to monitor the activities and to deal with matters within the terms of reference of the respective Committees Annual Report 7

9 Audit Committee: The Company has an Audit Committee at the Board level with powers and role that are in accordance with clause 49 of the listing agreement. The Committee acts as a link between the management, the Statutory Auditor and the Board of Directors and oversees the financial reporting process. The Audit Committee comprises of two Independent Directors: Mr. Vinodkumar Jain Chairman* Mr. Vijay Bhiva Pashte Member* Mr. Apurva Shah - Member *Due to resignation of Mr. Vijay B. Singh from the post of Directorship w.e.f. May 30, 2013, the audit committee has been reconstituted on May 30, The functions of the Audit Committee are as per Company Law and Listing Agreement with the Stock Exchanges. These include the Review of accounting and financial policies and procedures, Review of financial reporting system, Internal control system and Procedures and ensuring compliance of statutory requirements. The Audit Committee reviews the financial statements with the Statutory Auditors and the Management with reference to the accounting policies and practices before commending the same to the Board for its approval. The Committee met 4 times during the year under report on 14/05/12, 14/08/12, 12/11/12 and 15/02/13. The time gap between the two meetings was not more than 4 months. Details of the meeting attended: Name of the Directors No. of Committee Meeting Held Attended Mr. Vinodkumar Jain* 4 4 Mr. Vijay Bhiva Pashte* 4 Not Applicable Mr. Apurva Shah 4 4 Mr. Vijay B. Singh* 4 4 *Due to resignation of Mr. Vijay B. Singh from the post of Directorship w.e.f. May 30, 2013, the audit committee has been reconstituted on May 30, Broad terms of reference of the Audit Committee are as per following: Approving and implementing the Audit procedures and techniques. Reviewing audit reports of statutory auditors with management and Statutory Auditors. Reviewing financial reporting systems, internal control systems and control procedures. Ensuring compliance with regulatory guidelines. Oversight of the Company s financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible. Approval of payment to statutory auditors for any other services rendered by the statutory auditors. Reviewing, with the management, the quarterly financial statements before submission to the board for approval. Reviewing, with management, performance of statutory auditors, adequacy of the internal control systems. Reviewing the finding of any internal investigations where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the Board. Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well as post-audit discussion to ascertain any area of concern. Review of Related party Transactions: Reviewing accounting treatment and confirmation of the fact that financial statement are giving true and fair view as per Company Law and Listing Agreement with the Stock Exchanges. Reviewing with the management, the statement of uses / application of funds raised through an issue (public issue, right issue, preferential issue, etc.) the statement of funds utilized for purposes other than those stated in the offer document / prospectus / notice and report submitted by the monitoring agency, monitoring the utilization of proceeds of a public or right issue, and making appropriate recommendations to the Board to take up steps in this matter. Remuneration Committee The Remuneration Committee comprises of two Non-Executive Directors: Mr. Vinodkumar Jain* Chairman Mr. Pikesh Sharma - Member Mr. Vijay Bhiva Pashte* Member *Due to resignation of Mr.Vijay B. Singh from the post of Directorship w.e.f. May 30, 2013, the remuneration committee has been reconstituted on May 30, Annual Report 8

10 The remuneration committee meets annually and this year they met on May 30, All the members of the committee were present Details of the meeting attended: Name of the Directors No. of Committee Meeting Held Attended Mr. Pikesh Sharma 1 1 Mr. Vinod Kumar Jain* 1 1 Mr. Vijay Bhiva Pashte* 1 Not Applicable Mr. Vijay B. Singh* 1 1 *Due to resignation of Mr.Vijay B. Singh from the post of Directorship w.e.f. May 30, 2013, the remuneration committee has been reconstituted on May 30, Shareholders/Investors Grievance Committee: The Committee met on 14/05/12, 14/08/12, 12/11/12 and 15/02/13. The Shareholder s/investment committee presently comprises of two Non Executive Directors and one executive director: Mr. Vijay Bhiva Pashte* Chairman Mr. Vinodkumar Jain Member Mr. Pikesh Sharma - Member *Due to resignation of Mr. Vijay B. Singh from the post of Directorship w.e.f. May 30, 2013, the Shareholders/Investors Grievance committee has been reconstituted on May 30, 2013 The Shareholder s Committee is empowered to perform all the functions of the Board in relation to handling of Shareholder s grievances. It primarily focuses on: Review of investor complaints and their redressal. Review of the queries received from the investors. Review of the work done by Share Transfer Agent. Review of corporate actions related work. The Committee met Four times during the year. Details of the meeting attended The Composition and attendance at the Shareholders/Investors Grievance Committee Meeting was as follows: Name No. of Committee Meetings Held Attended Mr. Vijay Bhiva Pashte* 4 Not Applicable Mr. Vinod Kumar Jain 4 4 Mr. Pikesh Sharma 4 4 Mr. Vijay B. Singh* 4 4 *Due to resignation of Mr. Vijay B. Singh from the post of Directorship w.e.f. May 30, 2013, the Shareholders/Investors Grievance committee has been reconstituted on May 30, 2013 The name and Address of the Compliance Officer is as follows: Mr. Apurva Shah 374, 3 rd Floor, Powai Plaza, Hiranandani Garden, Powai Mumbai koffeebpl@yahoo.com General Body Meetings: Details of last three year s General Meetings are given below: Financial Year Date / Type Time Venue Special Resolution(s) Cultural Centre Hall, BCA Charitable Trust, 30/09/ p.m. Nr. Chandra Nagar Bus Stand, Narayan AGM Nagar Road, Paldi, Ahmedabad Nil /09/2011 AGM 29/9/2012 AGM 4.00 p.m a.m. 328, Adhyaru Industrial Estate,Sun Mill Compound, Lower Parel (West),Mumbai , 3 rd Floor, Powai Plaza, Hiranandani Garden, Powai,Mumbai Nil Nil 2013 Annual Report 9

11 Postal Ballot: No resolution was passed through postal ballot pursuant to section 192A of the Companies Act, 1956 read with Companies (Passing of the Resolution by Postal Ballot) Rules 2011 for obtaining the consent of the shareholders of the Company during the year Disclosures: a) Related Party Transaction: During the year under review, there were no other related party transactions with the promoters, Directors, the management or their relatives during the year with potential conflict of interest with the Company at large except details of which are presented in Note 4 in Other Notes of Accompanying notes to the financial statements as at March 31, 2013 b) Disclosure of accounting treatment: In the preparation of the financial statements, the Company has followed the accounting standards issued by the Institute of Chartered Accountants of India to the extent applicable. c) Disclosure of Risk Management: The Company has adequate risk assessment and minimization procedure. Whistle Blower Policy: Though there is no formal Whistle-blower policy, the Company takes cognizance of complaints made and suggestions given by the employees. Even anonymous complaints are looked into and whenever necessary, suitable corrective steps are taken. The Board hereby affirms that no personnel have been denied access to the audit committee. Statutory Compliance The Company has complied with mandatory provisions of Corporate Governance and is in the process of adopting the non-mandatory provisions of Corporate Governance. Means of Communication: The Quarterly/Yearly results were sent to the concerned Stock Exchanges after approval by the Board. The Company is in the process of updating its website. All quarterly results as well as any official news release will be displayed thereon. Management discussion & Analysis Report is attached herewith forming part of the Annual Report. General Shareholders Information: The 21 st Annual General Meetings is scheduled to be held on Monday,30 th September, 2013 at a.m. at 374, 3 rd Floor, Powai Plaza, Hiranandani Garden, Powai, Mumbai The Financial year of the company is from April to March. The financial Calendar (tentative) is as per following. First quarter results (30 th June) 2 nd week of August, 2013 Second quarter results (30 th September) 2 nd week of November, 2013 Third quarter results (31 st December) 2 nd week of February, 2014 Fourth quarter / Annual Results 2 nd week of May, 2014 Book Closure dates are from Thursday, 26 th September 2013 to Monday, 30 th September 2013 (both days inclusive). The Board of Directors has not proposed any dividend for the current financial year. The company s shares are listed at Mumbai and Ahmedabad Stock Exchange The Company is listed with BSE Limited and Ahmedabad Stock Exchange Limited Scrip Code: ISIN: INE208D Annual Report 10

12 i. Market price data (BSE): (All figures in Indian Rupees) Month High Price Low Price No. of Shares Traded April ,36,841 May ,54,406 June ,08,875 July ,69,10,719 August ,94,875 September ,81,484 October ,29,052 November ,32,800 December ,88,571 January ,60,131 February ,48,727 March ,77,408 ii. Distribution of shareholding as on 31st March, 2013 Distribution of Shares (Slab-Wise) No. of Shareholders Percentage to total No. of shareholders No. of Shares held Percentage to total share Capital Up to ,77, ,98, ,24,13, Above ,52,21, Total ,30,01,11, iii. Shareholding Pattern as on 31 st March 2013 Category No. of Shares % of Shares Indian Promoters and Promoter Group 18, Foreign Promoters Nil Nil Institutional Investors Nil Nil Private Corporate Bodies 5,04,36, Indian Public 7,80,74, NRIs/OBC 14,80, Others (Clearing Members) Nil Nil TOTAL 13,00,11, iv. Register and Transfer System. System Support Services, 209, Shivai Indultrial Estate, Nr. Park Davis, 89, Sakinaka, AndheriKurla Road, Andheri (E), Mumbai 72. Tel No v. Share Transfer System All communications with regard to transfer, transmission, dematerialisation, etc. should be addressed to the RTA.The share transfer activities under physical mode are carried out by the RTA. Shares in physical mode which are lodged for transfer are processed and returned within 15 days from the date of lodgement as per SEBI amendment vide circular no. CIR/MIRSD/8/2012 dated July 05, A summary of transfer/transmission of securities of the Company so approved by the Managing Director is placed at every Board meeting/shareholders /Investors Grievance Committee. The Company obtains from a Company Secretary in Practice half-yearly certificate of compliance with the share transfer formalities as required under Clause 47 (c) of the Listing Agreement and files a copy of the said certificate with the Stock Exchanges. xi. Dematerialization of securities As on 31st March, 2013, 96.67% of your Company s Equity Shares representing 12, 56, 75,400 Equity shares are held on dematerialized mode and the balance were in paper form Annual Report 11

13 Address for correspondence: Shareholders of the company can send correspondence at company s share & Transfer Agent s Office or at the Registered Office of the company situated at following address: REGISTERED OFFICE ADDRESS: Compliance Officer Apurva Shah 374, 3 rd Floor, Powai Plaza, Hiranandani Garden, Powai Mumbai koffeebpl@yahoo.com For & On behalf of the Board of Directors Place: Mumbai Date: 14 h August, 2013 Sd/- APURVA SHAH (MANAGING DIRECTOR) Certificate on Compliance with Clause 49 of the Listing Agreement: As required under clause 49 of the Listing Agreement, M/s. Agarwal Desai & Shah, Chartered Accountants, have verified the compliance of the corporate governance norms by the Company. Their report is annexed hereto. To, The Members of KOFFEE BREAK PICTURES LIMITED AUDITORS CERTIFICATE ON CORPORATE GOVERNANCE We have reviewed the implementation of Corporate Governance procedure by the company during the year ended March 31, 2013, with the relevant records and documents maintained by the Company, furnished to us for our review and the report on Corporate Governance as approved by the Board of Directors. In my opinion and to the best of my information and according to the explanations given to me, I certify that the Company has complied with the conditions of Corporate Governance as stipulated in Clause 49 of the Listing Agreement. The compliance of conditions of Corporate Governance is the responsibility of the management; our examination is neither an audit nor an expression of opinion on the financial statements of the Company. We further state that our examination of such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company. For AGARWAL DESAI & SHAH Chartered Accountants Firm Reg. No W Sd/- Rishi Shekhri Partner Membership No Place: Mumbai Date: 14 th August, Annual Report 12

14 A) INDUSTRY STRUCTURE AND DEVELOPMENT: MANAGEMENT DISCUSSION AND ANALYSIS REPORT The size of the Indian media and entertainment industry will touch Rs.91,700 crore in 2013 with an estimated growth of 11.8 per cent and is projected to grow at a healthy compounded annual growth rate (CAGR) of 15.2 per cent to reach Rs.1.66 lakh crore by 2017, says the FICCI- KPMG Media and Entertainment 2013 report. Besides adaptation to high-end digital technology, the entertainment industry is also witnessing rapid development of state-of-the-art studios and post production facilities. The impetus introduced by digitisation, the continued growth of regional media, the upcoming elections, the strength in the film sector and the fast-increasing new media businesses offered a positive growth chart for the industry. B) SEGMENTWISE PERFORMANCE: We are dealing more on the animation front than the regular entertainment companies as we foresee further growth in this segment since Kids are always accompanied by their parents and the repeat value for the same is comparatively much higher. C) OPPORTUNITIES/OUTLOOK: Apart from making animation films we are targeting products at the children segment. This age-group is easier to please as they do not have any pre-notions about the products they view. Hence they form an excellent audience. Also all products aimed at this segment have a higher repeat value ensuring better sales in fields of home video and merchandise. If kids like one thing, they would repeatedly want to do the same thing time and over again. We are using the best of hardware and software apart from specialized man-power. We aim at delivering traditional 2D animation 90 minute films in a span of 9 to 12 months which usually take months. After the setup of our own animation studio which is one of the best in country in terms of human resources, hardware & software we can now undertake projects for other firms & individuals. The Company is also in talks with various other media companies to foray more and increase its base into the television industry. With the launch of more television channels, there is an acute shortage of material to telecast increasing our opportunities to exploit better prices for our content. D) THREATS: Increased Payouts: With a view to produce differentiated content, the production cost has increased. Consistency: Consistency of picture quality is essential to maintain targeted revenue. E) DISCUSSION ON FINANCIAL PERFORMANCE: The financials of the Company has prepared by ensuring the objectivity, credibility, and correctness through proper financial reporting and disclosure processes, internal control, risk management policies and processes, tax policies, compliance and legal requirements and associated matters. F) RISKS AND CONCERNS: Change in Consumer Preference Risk: The content developed by the Company need not appeal the target audience always as the target audience preferences are bound to change. The level of creativity required for the audience targeted varies with the available options to the consumers. Artist Attrition Risk: The reason for which the Company s content is preferred by the audience includes artist attrition also. These artists are an important part for the content produced by the Company. Technological Risk: Advancement of technology for creation of the picture is necessary with the new technologies being adopted by the competitors. Regulatory Risk: The business may have a positive or a negative impact on the revenues in future due to changes in the regulatory framework and the tax laws as compared to the current scenario. Management continuously monitors and makes efforts to arrest decline and adverse output on any of these factors Annual Report 13

15 G) INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY: The Company has customized accounting packages, which has built in security, which prohibits deletions and overwriting once accounting entry is passed. The Company has introduced checks at various levels to monitor the expenses. H) HUMAN RESOURCES POLICIES: Human capital is a very important asset in a media company. Over the years, the Company has built up a human resource structure, which has enabled the Company to grow and take up challenges. The Company has a qualified team of professionals. I) CAUTIONARY STATEMENT: Statements in the Management Discussion and Analysis describing the Company s objectives, projections, estimates, expectations maybe forward looking statement within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Company s operations include economic conditions affecting demand / supply and price conditions in the domestic and overseas market in which the Company operates, changes in the Government regulations, tax laws and other statutes and other incidental factors. For & On behalf of the Board of Directors Place: Mumbai Date: 14 th August, 2013 Sd/- APURVA SHAH (MANAGING DIRECTOR) 2013 Annual Report 14

16 To, The Members of KOFFEE BREAK PICTURES LIMITED CERTIFICATE ON COMPLIANCE WITH CODE OF CONDUCT DECLARATION To the best of my knowledge and belief, I hereby confirm that all the Board members and the Senior Management Personnel of the company have complied with the provisions of code of conduct as laid down by the Company during the financial year ended on 31st March, For & On behalf of the Board of Directors Sd/- Place: Mumbai Date: 14 th August, 2013 APURVA SHAH (MANAGING DIRECTOR) CERTIFICATION BY CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER To, The Members of KOFFEE BREAK PICTURES LIMITED We hereby certify that for the financial year, ending 31st March, 2013 on the basis of the review of the financial statements and the cash flow statement and to the best of our knowledge and belief that:- 1. These statements do not contain any materially untrue statement or omit any material fact or contain statement that might be misleading; 2. These statements together present a true and fair view of the company s affairs and are in compliance with existing accounting standards, applicable laws and regulations. 3. There are, to the best of our knowledge and belief, no transactions entered into by the company during the year which are fraudulent, illegal or violative of the Company s code of conduct. 4. We accept responsibility for establishing and maintaining internal controls and that we have evaluated the effectiveness of the internal control systems of the Company and we have disclosed to the auditors and the Audit Committee, deficiencies in the design or operation of internal controls, if any of which we are aware and the steps we have taken or propose to take to rectify these deficiencies. 5. We further certify that: a. There have been no significant changes in internal control during the year; b. There have been no significant changes in accounting policies during the year. c. There have been no instances of significant fraud of which we are become aware and the involvement therein, if any, of the management or an employee having a significant role in the Company s internal control system. For and on Behalf of the Board of Directors Sd/- - Place: Mumbai Date: 14 th August, 2013 APURVA SHAH (MANAGING DIRECTOR) 2013 Annual Report 15

17 AUDITORS REPORT To, The Members of, Koffee Break Pictures Limited, 1. We have audited the attached Balance Sheet of KOFFEE BREAK PICTURES LIMITED as at 31st March, 2013, the profit and loss account and the cash flow statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the company s management. Our responsibility is to express the opinion on these financial statements based on audit. 2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those standards require that we plan and perform the audit to perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. 3. As required by the Companies (Auditor s Report) Order, 2003, (as amended) (hereinafter referred to as the order ) issued by the Central Government of India in terms of section 227(4A) of the Companies Act, 1956, (herein after refer to as the act ) we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order. 4. Further to our comments in the Annexure referred to above, We report that: i. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose of our audit; ii. iii. iv. In our opinion proper books of accounts are required by law have been kept by the Company so far as appears from the examination of those books; The balance sheet, profit and loss account and cash flow statement dealt with this report are in agreement with the books of accounts; In our opinion the balance sheet, profit and loss account and cash flow statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956; v. On the basis of written representations received from the directors as on 31st March, 2013 and taken on record by the Board, we report that none of the directors is disqualified as on 31st March, 2013 from being appointed as a director in terms of clause (g) of subsection (1) of section 274 of the Companies Act, 1956; vi. In our opinion and to the best of our information and according to the explanations given to us the said accounts, read together with notes appearing thereon, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India: i) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2013, ii) In the case of the Profit and Loss Account, of the Loss Company for the year ended on that date. iii) In the case of Cash Flow Statement, of the Cash Flows of the company for the year ended on that date. For AGARWAL DESAI & SHAH Chartered Accountants Firm Reg. No W Rishi Shekhri Partner Membership No Mumbai, May 30, Annual Report 16

18 Annexure referred to the Auditors Report (Referred to in paragraph 3 of our report of even date) i. a) The company has maintained records to showing full particulars, including quantitative details and situation of Fixed Assets. b) The company has a program for phased physical verification of all its fixed assets which in our opinion, is reasonable having regard to size of company and nature of its assets. As informed, no material discrepancies have been noticed on such verification. c) The company has disposed off a substantial part of its fixed assets during the year however; the going concern assumptions remain unaffected. ii. a) The management has conducted physical verification of fixed assets at reasonable intervals during the year. b) The procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business. c) The company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification. iii. a) The company has not given any unsecured interest free loan during previous years to parties mentioned in the register maintained u/s 301 of the Act. b to d) Since the company has not given any unsecured loans to the parties covered in the register maintained u/s 301 of the Act, hence paragraph (iii) (b) (c) and (d) of the order, are not applicable e) The company has not taken any new unsecured interest free loans from parties covered in the register maintained u/s 301 of the Act under review f to g) Since the company has not taken any loans from the parties covered in the register maintained u/s 301 of the Act, hence paragraph (iii) (f) and (g) of the order, are not applicable. iv. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory, fixed assets and sale of its products and services. During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas. v. a) To the best of our knowledge and belief and according to the according to the information s and explanations give to us, we are of the opinion that the particulars of contracts or arrangements referred to in section 301 of the act have been entered in the register required to be maintained under that section; and b) Transaction made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time. vi. vii. viii. ix. The company has not accepted any deposit from public. Therefore, the provision of clause 4 (vi) of the Order are not applicable to the Company. The company does not have formal internal audit system but its financial and internal checks ensures proper recording of financial transactions. The maintenance of cost records has not been prescribed by the Central Government u/s (d) of sub-section (1) of section 209 of the Companies Act, According to the information and explanations given to us and record of the company examined by us, there are no disputed dues of any statute liabilities. As per our information, no disputed case is pending. x. According to the information and explanations given to us, the company has accumulated losses of Rs.3,31,24,008 at the end of the financial year and it has not incurred cash losses during the current year but had incurred cash loss of Rs.14, 06, 396 in the immediately preceding financial year. xi. xii. xiii. In our opinion and according to the information and explanations given to us, the company has not made any delay in repayment of dues to a financial institution or bank. In our opinion and according to the information and explanations given to us, the company has not granted loans and advances on the basis of security by way of pledge of shares, debenture and other securities. In our opinion, the company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, the provision of clause 4 (xiii) of the order, are not applicable to the Company Annual Report 17

19 xiv. xv. xvi. xvii. xviii. xix. xx. xxi. In our opinion, the company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly the provision of clause 4 (xiv) of the Order, are not applicable to the company. In our opinion and according to the information and explanations given to us, the Company has not given guarantee for loan taken by others from banks or financial institution. The Company has not raised term loans during the year. The term loans outstanding at the beginning of the year have been applied for the purposes for which they were raised. According to the information and explanation given to us and on an overall examination of the balance sheet of the company, we report that no funds raised on short term basis have been used for long-term investment by the company. According to information and explanation provided to us and on the basis of records examined by us, the company has not made preferential allotment of equity shares to companies/persons covered in the registered maintained u/s 301 of the Companies Act, The Company has not issued debentures during the year under review and therefore the provision of clause 4(xix) of the Order, are not applicable to the company. During the year covered by our audit report, the Company has not raised any money by way of public issue. According to the information and explanation given to us, no fraud on or by the company has been noticed or reported during the course of our audit. For AGARWAL DESAI & SHAH Chartered Accountants Firm Reg. No W Rishi Shekhri Partner Membership No Mumbai, May 30, Annual Report 18

20 KOFFEE BREAK PICTURES LIMITED Balance Sheet as at March 31, 2013 Particulars Note No. March 31, 2013 March 31, 2012 I Equity & Liabilities 1. Shareholders' funds (a) Share Capital 2(1) 13,00,11,000 13,00,11,000 (b) Reserves and Surplus 2(2) 6,34,55,992 7,78,45,293 19,34,66,992 20,78,56, Non - Current Liabilities (a) Long -Term Borrowings 2(3) - 34,14,478 (b) Deferred Tax Liabilities (Net) 2(4) 2,41,437 31,45,715 2,41,437 65,60, Current Liabilities (a) Short - Term Borrowings 2(5) 84,82,865 3,84,98,323 (b) Other Current Liabilities 2(6) 36,72,424 43,63,860 1,21,55,289 4,28,62,183 TOTAL 20,58,63,718 25,72,78,669 II Assets 1. Non - Current Assets (a) Fixed Assets 2(7) Tangible Assets 89,62,706 2,65,28,546 (b) Non - Current Investments 2(8) 19,300 19,300 (c) Long - Term Loans and Advances 2(9) 10,79,98,636 10,88,80,252 11,69,80,642 13,54,28, Current Assets (a) Inventories 2(10) 8,41,40,732 8,41,40,732 (b) Trade Receivables 2(11) 14,33,617 3,44,19,320 (c) Cash and Bank Balances 2(12) 6,47,617 6,01,846 (d) Short - Term Loans and Advances 2(13) 26,61,110 26,88,673 8,88,83,076 12,18,50,571 TOTAL 20,58,63,718 25,72,78,669 See accompanying notes to the finanical statements, as under Significant Accounting Policies 1 Notes to the Balance Sheet 2 Other Notes 4 In terms of our report of even date For Agarwal Desai & Shah Chartered Accountants For and on behalf of Board of Directors Koffee Break Pictures Ltd Sd/- sd/- sd/- Rishi Sekhri Apurva M. Shah Pikesh Sharma Partner Managing Director Director Membership No: Firm Reg. No W Date: May 30, 2013 Place : Mumbai 2013 Annual Report 19

21 Particulars KOFFEE BREAK PICTURES LIMITED KOFFEE BREAK PICTURES LIMITED Statement of Profit and Loss for the year ended March 31, 2013 Note No. March 31, 2013 March 31, 2012 I Revenue from Operations 3(1) 5,20,000 1,14,23,404 II Other Income 3(2) - 2,16,428 III Total Revenue (I + II) 5,20,000 1,16,39,832 IV V VI Expenses Operating Expenses 3(3) - 1,22,77,925 Changes in Inventories 3(4) - (12,13,730) Employee Benefits Expense 3(5) - - Finance Costs 3(6) - 6,85,089 Depreciation and Amortization Expense 2(8) 1,75,65,840 2,38,98,814 Other Expense 3(7) 2,47,739 12,96,944 Total Expense 1,78,13,579 3,69,45,042 Profit before Exceptional and Extraordinary Items and Tax (III-IV) (1,72,93,579) (2,53,05,210) Exceptional Items VII. Profit before Extraordinary Items and Tax (V- VI) (1,72,93,579) (2,53,05,210) VIII Extraordinary Items IX Profit Before Tax (VII-VIII) (1,72,93,579) (2,53,05,210) X XI Tax Expense: (a) Current Tax expense for Current Year - - (b) Excess provision for tax written off - - Net Current Tax expense - - (c) Deferred Tax 2(4) (29,04,278) (12,60,803) (29,04,278) (12,60,803) Profit/(Loss) for the Period from Continuing Operations (IX - X) (1,43,89,301) (2,40,44,407) XII Profit/(Loss) for the Period from Discontinuing Operations XIII Tax Expense of Discontinuing Operations XIV Profit/(Loss) from Discontinuing Operations (After Tax) (XII-XIII) - - XV Profit/(Loss) for the Period (XI + XIV) (1,43,89,301) (2,40,44,407) XVI Earnings Per Equity Share (Face Value ` 10 Per Share): 3(8) (1) Basic (`) (0.11) (0.18) (2) Diluted (`) (0.11) (0.18) See accompanying notes to the finanical statements, as under Significant Accounting Policies 1 Notes to Statement of Profit and Loss 3 Other Notes 4 In terms of our report of even date For Agarwal Desai & Shah Chartered Accountants For and on behalf of Board of Directors Koffee Break Pictures Ltd sd/- sd/- sd/- Rishi Sekhri Apurva M. Shah Pikesh Sharma Partner Managing Director Director Membership No: Firm Reg. No Date: May 30, 2013 Place : Mumbai 2013 Annual Report 20

22 Cash flow statement for the year ended 31 March 2013 Particulars March 31, 2013 March 31, 2012 Cash flow from operating activities Profit before tax from continuing operations (1,72,93,579) (2,53,05,210) Profit before tax from discontinuing operations Profit before tax (1,72,93,579) (2,53,05,210) Non-cash adjustment to reconcile profit before tax to net cash flows Depreciation/amortization on continuing operation 1,75,65,840 2,38,98,814 Foreign Exchange Loss - - Preliminary expenses written off - - Interest expense - - Interest income - - Dividend income - - Operating profit before working capital changes 2,72,261 (14,06,396) Movements in working capital : Increase / (decrease) in trade payables - - Increase / (decrease) in other current liabilities (6,91,436) (4,449) Decrease / (increase) in trade receivables 3,29,85,703 97,70,790 Decrease / (increase) in inventories - (12,13,731) Decrease / (increase) in long-term loans and advances 8,81,616 27,00,000 Decrease / (increase) in short-term loans and advances 27,563 (11,26,774) Cash generated from /(used in) operations 3,34,75,707 87,19,440 Direct taxes paid (net of refunds) - - Net cash flow from / used in operating activities (A) 3,34,75,707 87,19,440 Cash flows from investing activities Interest received - - Net cash flow from/(used in) investing activities (B) - - Cash flows from financing activities Proceeds from long-term borrowings (34,14,478) (1,00,000) Proceeds from short-term borrowings (3,00,15,458) (81,39,490) Interest paid - Net cash flow from/(used in) in financing activities (C) (3,34,29,936) (82,39,490) Net increase / (decrease) in cash and cash equivalents (A + B + C) 45,771 4,79,950 Cash and cash equivalents at the beginning of the year 6,01,846 1,21,896 Cash and cash equivalents at the end of the year 6,47,617 6,01,846 Components of cash and cash equivalents Cash on hand 3,38,765 5,31,174 With banks - on current account 2,99,739 61,559 unpaid dividend accounts* 9,113 9,113 Total cash and cash equivalents (Note 19) 6,47,617 6,01,846 In terms of our report of even date For Agarwal Desai & Shah Chartered Accountants For and on behalf of Board of Directors sd/- Koffee Break Pictures Ltd Rishi Sekhri Partner sd/- sd/- Membership No: Apurva M. Shah Pikesh Sharma Firm Reg. No W Managing Director Director Date: May 30, 2013 Place : Mumbai 2013 Annual Report 21

23 Accompanying notes to the financial statements as at March 31, 2013 NOTE 1: Significant Accounting Policies 1. Basis of accounting and preparation of financial statements KOFFEE BREAK PICTURES LIMITED The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year. The Revised Schedule VI has become effective from 1 April, 2011 for the preparation of financial statements. This has significantly impacted the disclosure and presentation made in the financial statements. Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure. 2. Use of estimates The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognised in the periods in which the results are known / materialise. 3. Inventories (i) (ii) Inventories of under production films/animations and other contents are valued at actual amount spent which includes amount paid, bills settled and advance paid for which bills are awaited. The residual values of all the films are valued at NIL as total cost of production is charged to revenue at the time of first release of such films. Other inventories are stated at cost. Acquired rights pertaining to movies, animations and other contents are amortized on the exploitation of such rights based on the management estimates of revenue potential. 4. Cash and cash equivalents (for purposes of Cash Flow Statement) Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short-term balances (with an original maturity of three months or less from the date of acquisition), highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value. 5. Cash flow statement Cash flows are reported using the indirect method, whereby profit / (loss) before extraordinary items and tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the Company are segregated based on the available information. 6. Depreciation and amortisation Depreciation has been provided on the straight-line method as per the rates prescribed in Schedule XIV to the Companies Act, 1956 except in respect of the following categories of assets, in whose case higher rates of depreciation has been applied Name of Fixed Assets Computers Higher Rate 40% 7. Revenue recognition i) Revenues from Licensing / public sale of movies are recognized in accordance with the licensing agreement or on physical delivery of the movies, whichever is later. (ii) Recoveries of old films are recognized as and when royalties earned. (iii) In respect of services, the company accounts for the revenue are on the basis of completed contract method. (iv) Interest income is accounted on accrual basis. (v) Dividend is recognized when the right to receive the dividend is unconditionally established at the balance sheet date. 8. Other income Interest income is accounted on accrual basis. Dividend income is accounted for when the right to receive it is established Annual Report 22

24 9. Tangible fixed assets Fixed assets, are carried at cost less accumulated depreciation, Service Tax/VAT Credit availed and impairment losses, if any. The cost of fixed assets includes interest on borrowings attributable to acquisition of qualifying fixed assets up to the date the asset is ready for its intended use and other incidental expenses incurred up to that date. Exchange differences arising on restatement / settlement of long-term foreign currency borrowings relating to acquisition of depreciable fixed assets are adjusted to the cost of the respective assets and depreciated over the remaining useful life of such assets. Machinery spares which can be used only in connection with an item of fixed asset and whose use is expected to be irregular are capitalised and depreciated over the useful life of the principal item of the relevant assets. Subsequent expenditure relating to fixed assets is capitalised only if such expenditure results in an increase in the future benefits from such asset beyond its previously assessed standard of performance. Fixed assets acquired and put to use for project purpose are capitalised and depreciation thereon is included in the project cost till commissioning of the project. Fixed assets acquired in full or part exchange for another asset are recorded at the fair market value or the net book value of the asset given up, adjusted for any balancing cash consideration. Fair market value is determined either for the assets acquired or asset given up, whichever is more clearly evident. Fixed assets acquired in exchange for securities of the Company are recorded at the fair market value of the assets or the fair market value of the securities issued, whichever is more clearly evident. 10. Intangible Assets Intangible Assets are recorded at cost of acquisition 11. Investments (i) Long term: Long term investments shown in the balance sheet are valued at cost unless there is a permanent diminution in the value, in such case are valued at the diminished value and the difference is charged to profit and loss account. (ii) Disposal of Investments: On disposal of an investment, the difference between the carrying amount and net disposal proceed is being charged to profit and loss account determined on the basis of First in First out (FIFO) Method. 12. Leave Encashment Leave Encashment expenses are being accounted for as and when the employee encash. 13. Borrowing costs Borrowing costs include interest, amortisation of ancillary costs incurred and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost. Costs in connection with the borrowing of funds to the extent not directly related to the acquisition of qualifying assets are charged to the Statement of Profit and Loss over the tenure of the loan. Borrowing costs, allocated to and utilised for qualifying assets, pertaining to the period from commencement of activities relating to construction / development of the qualifying asset upto the date of capitalisation of such asset is added to the cost of the assets. Capitalisation of borrowing costs is suspended and charged to the Statement of Profit and Loss during extended periods when active development activity on the qualifying assets is interrupted. 14. Segment reporting The entire operation of the Company relates to only one segment viz. Software and Entertainment. As such, there is no separate reportable segment under Accounting Standards- AS 17 on Segment Reporting. 15. Earnings per share Basic earnings per share is computed by dividing the profit / (loss) after tax (including the post tax effect of extraordinary items, if any) by the weighted average number of equity shares outstanding during the year. Diluted earnings per share is computed by dividing the profit / (loss) after tax (including the post tax effect of extraordinary items, if any) as adjusted for dividend, interest and other charges to expense or income relating to the dilutive potential equity shares, by the weighted average number of equity shares considered for deriving basic earnings per share and the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares. Potential equity shares are deemed to be dilutive only if their conversion to equity shares would decrease the net profit per share from continuing ordinary operations. Potential dilutive equity shares are deemed to be converted as at the beginning of the period, unless they have been issued at a later date. The dilutive potential equity shares are adjusted for the proceeds receivable had the shares been actually issued at fair value (i.e. average market value of the outstanding shares). Dilutive potential equity shares are determined independently for each period presented. The number of equity shares and potentially dilutive equity shares are adjusted for share splits / reverse share splits and bonus shares, as appropriate. 16. Taxes on income Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the Income Tax Act, Minimum Alternate Tax (MAT) paid in accordance with the tax laws, which gives future economic benefits in the form of adjustment to future income tax liability, is considered as an asset if there is convincing evidence that the Company will pay normal income tax. Accordingly, MAT is recognised as an asset in the Balance Sheet when it is probable that future economic benefit associated with it will flow to the Company. Deferred tax is recognised on timing differences, being the differences between the taxable income and the accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax is measured using the tax rates and the tax laws 2013 Annual Report 23

25 enacted or substantially enacted as at the reporting date. Deferred tax liabilities are recognised for all timing differences. Deferred tax assets in respect of unabsorbed depreciation and carry forward of losses are recognised only if there is virtual certainty that there will be sufficient future taxable income available to realise such assets. Deferred tax assets are recognised for timing differences of other items only to the extent that reasonable certainty exists that sufficient future taxable income will be available against which these can be realised. Deferred tax assets and liabilities are offset if such items relate to taxes on income levied by the same governing tax laws and the Company has a legally enforceable right for such set off. Deferred tax assets are reviewed at each Balance Sheet date for their realisability. Current and deferred tax relating to items directly recognised in equity are recognised in equity and not in the Statement of Profit and Loss. 17. Provision and Contingencies A provision is recognised when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation in respect of which a reliable estimate can be made. Provisions (excluding retirement benefits) are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. Contingent liabilities are disclosed in the Notes Annual Report 24

26 Accompanying notes to the financial statements as at March 31, 2013 NOTE 2: Notes to the Balance Sheet 1. SHARE CAPITAL (a) Details of authorised, issued and subscribed share capital Particulars March 31, 2013 March 31, 2012 Authorised Capital 16,00,00,000 (PY 16,00,00,000) Equity Shares of 1/- each 16,00,00,000 16,00,00,000 Issued Capital 13,00,11,000 (PY 13,00,11,000) Equity Shares of 1/- each fully paid up 13,00,11,000 13,00,11,000 Subscribed and Paid up 13,00,11,000 (PY 13,00,11,000) Equity Shares of ` 1/- each fully paid up 13,00,11,000 13,00,11,000 Total 13,00,11,000 13,00,11,000 (b) The Share Capital of the Company is divided into 13, 00, 11,000 Equity shares of 1/- each with an Authorised Share Capital of 16, 00, 00,000 Equity shares of 1/- each. There has been no change in the capital structure of the Company during the period under review. (c ) Reconciliation of number of shares outstanding at the beginning and at the end of the reporting period Particulars March 31, 2013 March 31, 2012 No. of shares at the beginning of the year 13,00,11,000 13,00,11,000 Fresh Issue - - No. of shares at the end of the year 13,00,11,000 13,00,11, RESERVES AND SURPLUS Particulars March 31, 2013 March 31, 2012 (a) Capital Reserve Opening Balance 52,95,000 52,95,000 Add/(Less): Transfers - - Closing Balance 52,95,000 52,95,000 (b) Securities Premium Reserve Opening Balance 9,12,85,000 9,12,85,000 Add/(Less): Transfers - - Closing Balance 9,12,85,000 9,12,85,000 (c) Surplus / (Deficit) in Statement of Profit and Loss Opening Balance (1,87,34,707) 53,09,700 Add/(Less): profit/(loss) for the period (1,43,89,301) (2,40,44,407) Add/(Less): Transfers - - Closing Balance (3,31,24,008) (1,87,34,707) Grand Total 6,34,55,992 7,78,45, Annual Report 25

27 3. LONG-TERM BORROWINGS (a) Particulars March 31, 2013 March 31, 2012 (A) Secured Loans Term Loans -Vehicle Loans - 6,36,397-6,36,397 (B) Unsecured Loans (a) Loans & Advances From Related Parties - 7,68,081 (b) Loans from Others - 20,10,000-27,78,081 The Vehicle Loan is secured against the specified asset. Grand Total - 34,14, DEFERRED TAX LIABILITIES (NET) The major components of deferred tax liabilities/assets as recognized in the financial statements is as follows: Particulars March 31, 2013 March 31, 2012 Deferred Tax Liabilities Opening Balance 2,41,437 31,45,715 On difference between book balance and tax balance of fixed assets - Closing Balance 2,41,437 31,45,715 Net 2,41,437 31,45, SHORT-TERM BORROWINGS (a) Particulars March 31, 2013 March 31, 2012 (A) Secured Loans - From Banks 3,54,784 3,84,98,323 81,28,081 Grand Total 84,82,865 3,84,98, OTHER CURRENT LIABILITIES Particulars March 31, 2013 March 31, 2012 TDS: On Salaries - - Others - - Mvat Payable 47,877 1,47,877 Service Tax Payable 13,00,258 13,00,258 Others liabilities : Creditors for expenses 6,85,675 12,77,112 Unpaid Dividend and tax thereon 16,38,614 16,38,613 Total 36,72,424 43,63, NON-CURRENT INVESTMENTS Particulars March 31, 2013 March 31, 2012 Other than Trade Investments Unquoted Investments Equity Shares of Cosmos Bank 19,300 19,300 Grand Total 19,300 19, Annual Report 26

28 9. LONG-TERM LOANS AND ADVANCES (a) Particulars March 31, 2013 March 31, 2012 (a) Capital advances (i) Advance paid for Pictures 1,77,45,386 1,80,26,999 (ii) Advance paid for Assets 8,02,19,300 8,02,19,300 (b) Prepaid expenses - Unsecured, considered good 14,80,000 14,80,000 (c) Others Security Deposits 20,000 20,000 Advances to others 85,33,950 91,33,953 10,79,98,636 10,88,80,252 The Company had given advances to the parties for various business activities which are not completed till date. Hence, no interest is charged on such advances given. 10. INVENTORIES Work-in-progress Particulars March 31, 2013 March 31, 2012 (i) Picture-in-process 8,41,40, ,41,40, Total 8,41,40, ,41,40, TRADE RECEIVABLES 2013 Annual Report 27 Particulars March 31, 2013 March 31, 2012 Trade receivables outstanding for a period exceeding six months Unsecured, considered good 14,33,617 3,40,74,595 Doubtful ,33,617 3,40,74,595 Less: Provision for doubtful debts ,33,617 3,40,74,595 Others Unsecured, considered good - 3,44,725 Doubtful ,44,725 Less: Provision for doubtful debts ,44,725 TOTAL 14,33,617 3,44,19, CASH AND BANK BALANCES Particulars March 31, 2013 March 31, 2012 (a) Cash & Cash Equivalents Cash on Hand 3,38,765 5,31,174 Cheque, Drafts On Hand - - Bank Balances in: In current accounts 2,99,739 61,559 6,38,504 5,92,733 (b) Other Bank Balances Earmarked balances: Unpaid dividend accounts 9,113 9,113 Grand Total 6,47,617 6,01, SHORT-TERM LOANS AND ADVANCES Particulars March 31, 2013 March 31, 2012 (a) Advance income tax - Unsecured, considered good - - TDS 19,65,251 19,65,251 (b) Balances with government authorities VAT credit receivable 6,95,859 7,23,422 Grand Total 26,61,110 26,88,673

29 Accompanying notes to the financial statements as at March 31, 2013 NOTE 2: Notes to the Balance Sheet 7. FIXED ASSETS Gross Block Depreciation Block Net Block Description April 1, 2012 Additions Deductions/ Adjustment March 31, 2013 April 1, 2012 Charged For the year Deductions/A djustments March 31, 2013 March 31, 2013 March 31, 2012 Tangible Assets: Office Equipments 9,45, ,45,732 2,24,154 44,922-2,69,076 6,76,656 7,21,578 Vehicles 21,57, ,57,343 10,46,007 2,04,948-12,50,955 9,06,388 11,11,336 Studio Equipments 8,02, ,02, Computers 2,76,67, ,76,67,436 2,38,40,021 38,27,415-2,76,67,436-38,27,415 Furniture and Fixtures 24,37, ,37,388 6,42,769 1,54,287-7,97,056 16,40,332 17,94,619 Softwares 3,95,99, ,95,99,561 2,05,25,963 1,33,34,268-3,38,60,231 57,39,330 1,90,73,598 TOTAL 7,36,09, ,36,09,893 4,62,78,914 1,75,65,840-6,38,44,754 89,62,706 2,65,28,546 Previous Year 7,83,78,368 3,12,66,500 3,60,34,975 7,36,09,893 2,31,82,533 2,38,98,814 3,60,34,975 4,70,81,347 2,65,28,546 5,04,27, Annual Report 28

30 KOFFEE BREAK PICTURES LIMITED Accompanying notes to the financial statements as at March 31, 2013 NOTE 3: Notes to Statement of Profit and Loss 1. REVENUE FROM OPERATIONS Particulars March 31, 2013 March 31, 2012 (a) Sale of Products 5,20,000 1,14,23,404 Total 5,20,000 1,14,23, OTHER INCOME Particulars March 31, 2013 March 31, 2012 (a) Interest Income - 2,16,428 (b) Balances written off - - Total - 2,16, OPERATING EXPENSES Particulars March 31, 2013 March 31, 2012 (a) Purchases - 1,22,65,516 (b) Processing cost - 12,409 Total - 1,22,77, CHANGES IN INVENTORIES Particulars March 31, 2013 March 31, 2012 (A) At the end of the period (i) Work-in-Progress 8,41,40,732 8,41,40,732 (B) At the beginning of the period (i) Work-in-Progress 8,41,40,732 8,29,27,002 Net - (12,13,730) 5. EMPLOYEE BENEFIT EXPENSES Particulars March 31, 2013 March 31, 2012 Salaries, Incentives and Wages - - Total Annual Report 29

31 6. FINANCE COST Particulars March 31, 2013 March 31, 2012 (a) Interest Expenses: (i) Bank Old Interest (ii) Others - Interest on TDS - 6,72, (b) Other Borrowing cost 12,108 Total - 6,85, OTHER EXPENSES Particulars March 31, 2013 March 31, 2012 Accounting charges Repairs and maintenance- Vehicle - 21,855 Repairs and maintenance- Motor Car - 8,396 Repairs and maintenance- Others - 14,900 Insurance - - Communication 6,772 19,896 Travelling and conveyance 1,182 15,119 Printing and stationery - 2,500 Sales promotion and advertisement expenses 20,994 6,33,542 Postage & Courier Charges - 1,035 Legal and professional 1,82,316 2,33,894 Annual Custodian fees - 63,612 Bank Charges Computer expenses - - Payment to Auditors Audit fees - 28,090 Tax Audit fees - 16,854 Miscelliones expenses 36,363 2,17,251 Foreign Exchange Loss (Net) - - Preliminary expenses written off - - Total 2,47,739 12,96, EARNING PER EQUITY SHARE Particulars March 31, 2013 March 31, 2012 Profit/(Loss) attributable to Equity shareholders (1,43,89,301) (2,40,44,407) Weighted average number of equity shares 13,00,11,000 13,00,11,000 Basic Earnings Per Share (0.11) (0.18) Face value per Share Profit after adjusting interest on potential equity shares (1,43,89,301) (2,40,44,407) Weighted average number of equity share after considering potential 13,00,11,000 13,00,11,000 equity shares Dilutive Earnings per Share (0.11) (0.18) 2013 Annual Report 30

32 KOFFEE BREAK PICTURES LIMITED Accompanying notes to the financial statements as at March 31, 2013 NOTE 4: Other Notes 1. Background of the Company Additional Information required to be given pursuant to Part II of Schedule VI to the Companies Act, 1956 is as follows: The Company is in business of production, distribution, selling and exhibition of movies/animation/entertainment/software etc. Which are not subject to any license and as such information regarding consumption of raw materials, production and sales is not applicable. Further the nature of business of the Company is such that the installed capacity is not quantifiable. 2. Previous Year's Figures The Revised Schedule VI has become effective from 1 April, 2011 for the preparation of financial statements. This has significantly impacted the disclosure and presentation made in the financial statements. Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure. 3. Related Party Disclosure A) Details of Related Parties Description of Relationship Key Management Personnel Relative of Key Management Personnel Relative of Key Management Personnel Relative of Key Management Personnel Relative of Key Management Personnel Relative of Key Management Personnel Relative of Key Management Personnel Name of Related Parties Apurva M. Shah Ashni Shah Bhavna M. Shah Manish L Shah Manish L Shah HUF Lalitchandra Shah Sumitra L. Shah Note: Related parties have been identified by the management B) Details of Related Party transactions during the year ended March 31, 2012 Particulars Managerial Remuneration - - Capital Transactions of Director Loan Taken from director Loan Given to director - - Outstanding Loan at the end of year 12,88,081 7,68,081 Maximum outstanding loan amount 12,88,081 8,68,081 In terms of our report of even date For Agarwal Desai & Shah Chartered Accountants For and on behalf of Board of Directors Koffee Break Pictures Ltd sd/- sd/- sd/- Rishi Sekhri Apurva M. Shah Pikesh Sharma Partner Managing Director Director Membership No: Firm Reg. No W Date: May 30, 2013 Place: Mumbai 2013 Annual Report 31

33 NOTES 2013 Annual Report 32

34 NOTES 2013 Annual Report 33

35 2013 Annual Report 34

36 KOFFEE BREAK PICTURES LIMITED Regd Office: 374, 3 rd Floor, Powai Plaza, Hiranandani Garden, Powai, Mumbai ATTENDANCE SLIP Shareholders attending the meeting in person or by proxy are requested to complete the attendance slip and hand it over at the entrance of the meeting hall. I hereby record my presence at the 21 ST Annual General Meeting of the Company at 374, 3 rd Floor, Powai Plaza, Hiranandani Garden, Powai, Mumbai on Monday September 30, 2013 at a.m. Name of the Shareholder (1 st Name) (Joint Holder) Folio No. DP ID No. Client ID No. Signature of Shareholder(s)/Proxy : Note: No Duplicate Attendance Slip will be issued at the meeting hall. You are requested to bring your copy of Annual Report to the Meeting KOFFEE BREAK PICTURES LIMITED Regd Office: 374, 3 rd Floor, Powai Plaza, Hiranandani Garden, Powai, Mumbai PROXY FORM I/We...of... in the district of being a member/members of the above named Company hereby appoint of. in the district of.. or failing him... of..in the district of as my / our proxy to vote for me/us on my our behalf at the 21 st ANNUAL GENERAL MEETING of the Company to be held at 374, 3 rd Floor, Powai Plaza, Hiranandani Garden, Powai, Mumbai , on Monday September 30, 2013 at a.m., and at any adjournment thereof. Signed this day of., Reg. Folio No. DP ID No.. Client ID No. No. of Shares held Affix 15p. Revenue Stamp Signature of Shareholder Note: 1. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE INSTEAD OF HIMSELF AND A PROXY NEED NOT BE A MEMBER OF THE COMPANY. 2. This form in order to be effective should be duly stamped, completed and signed and must be deposited at the Registered Office of the Company, not less than 48 hours before the meeting Annual Report 35

37 Koffee Break Pictures Limited 374, 3 rd Floor, Powai Plaza, Hiranandani Garden, Powai Mumbai koffeebpl@yahoo.com

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