678 PANORAMA TELEVISION PRIVATE LIMITED. Panorama Television Private Limited

Transcription

1 678 PANORAMA TELEVISION PRIVATE LIMITED Panorama Television Private Limited

2 PANORAMA TELEVISION PRIVATE LIMITED 679 Balance Sheet as at 31st March, 2015 (Amount in Rupees) Note As at As at March 31, 2015 March 31, 2014 EQUITY AND LIABILITIES Shareholder s funds Share capital 1 249,596, ,596,080 Reserves and surplus 2 1,014,269,396 1,063,970,398 The accompanying Notes 1 to 22 are an integral part of the financial statements. In terms of our Report of even date 1,263,865,476 1,313,566,478 Non-current liabilities Long-term provisions 3 67,413,065 23,482,689 Current liabilities Short-term borrowings 4 250,000,000 - Trade payables 5 453,109, ,705,231 Other current liabilities 6 138,701, ,585,916 Short-term provisions 7 74,082, ,144, ,893, ,435,893 TOTAL 2,247,171,603 2,093,485,061 ASSETS Non-current assets Fixed assets 8 - Tangible assets 410,367, ,074,625 - Intangible assets 23,450,410 38,106,105 - Capital work-in-progress 4,965,155 - Deferred tax assets (net) 9 58,757,253 25,438,309 Long-term loans and advances ,086,650 36,362, ,626, ,981,074 Current assets Inventories 11 4,339,297 4,221,019 Trade receivables ,996, ,262,893 Cash and bank balances ,789, ,826,340 Short-term loans and advances ,025, ,466,645 Other current assets 15 3,394,461 19,727,090 1,594,544,639 1,794,503,987 TOTAL 2,247,171,603 2,093,485,061 For A.K.Sabat & Co. Chartered Accountants (Firm Registration No E) For and on behalf of the Board of Directors D.Vijaya Kumar Ramoji Rao Ch.Kiron Partner Chairman Director Membership No. : Hyderabad, Dated:

3 680 PANORAMA TELEVISION PRIVATE LIMITED Statement of Profit and Loss for the year ended March 31, 2015 (Amount in Rupees ) Note For the year ended For the year ended March 31, 2015 March 31, 2014 Revenue Revenue from operations 16 1,799,853,514 1,419,981,494 Other income 17 74,271,797 47,191,758 TOTAL REVENUE 1,874,125,311 1,467,173,252 Expenses Employee benefits expense ,918, ,914,812 Finance Costs 20 16,995,782 - Depreciation and amortisation expense 8 (2,258,965) 43,041,612 Other expenses 19 1,158,629, ,946,068 TOTAL EXPENSES 1,793,285, ,902,492 Profit before exceptional items and tax 80,840, ,270,760 Exceptional items ,879,580 - Profit/(Loss) before tax (44,039,378) 623,270,760 Tax expense Current tax - 214,889,543 Deferred tax (33,318,944) (80,489) (33,318,944) 214,809,054 Profit/(Loss) for the year (10,720,434) 408,461,705 Earning per equity share (Face value of Rs.10 each) Basic (in Rs.) (0.43) Diluted (in Rs.) (0.43) The accompanying Notes 1 to 22 are an integral part of the financial statements. In terms of our Report of even date For A.K.Sabat & Co. Chartered Accountants (Firm Registration No E) For and on behalf of the Board of Directors D.Vijaya Kumar Ramoji Rao Ch.Kiron Partner Chairman Director Membership No. : Hyderabad, Dated:

4 PANORAMA TELEVISION PRIVATE LIMITED 681 Cashflow Statement for the year ended March 31, 2015 (Amount in Rupees) For the Year ended For the Year ended March 31, 2015 March 31, 2014 A. Cash flow from Operating Activities Profit /(Loss) before tax (44,039,378) 623,270,759 Adjustments for: Loss/ (Profit) on sale/discard of Assets (65,781) (3,425,711) Depreciation and Amortisation expense (2,258,965) 43,041,612 Assets over 5 years fully depreciated 96,179,580 - Provision for Bad and doubtful debts 10,952,868 13,858,180 Loss/ (Profit) on foreign exchange differences (212,977) Interest paid 16,995,782 - Liabilities writtenback (1,955,269) - Interest income (30,168,318) (38,620,154) Operating profit before working capital changes 45,427, ,124,686 Adjustments for: Trade receivables (416,386,128) 50,880,886 Inventories (118,278) (1,281,894) Long-term loans and advances (118,724,615) (24,502,119) Short-term loans and advances (117,559,048) (214,769,755) Other current assets - - Trade payables 388,844,812 25,572,924 (Decrease)/Increase in Deferred Tax assets (33,318,944) (80,488) Decrease/ (Increase) in Long-term provisions 43,930,376 (4,076,242) Short-term provisions 39,062,643 (5,189,481) Other current liabilities (399,884,762) 474,948,550 Cash generated from operations (568,726,403) 939,627,067 Taxes paid (60,053,172) (224,596,458) Cash flow before exceptional items (628,779,575) - Exgratia provision of earlier years reversed back (40,440,238) - Provision for Bad and doubtful debts 28,700,000 - Depreciation effect in expenses 2,258,965 - Net cash (used) in / from Operating Activities (638,260,848) 715,030,609

5 682 PANORAMA TELEVISION PRIVATE LIMITED Cashflow Statement for the year ended March 31, 2015 (Cont.) For the Year ended For the Year ended March 31, 2015 March 31, 2014 B. Cash flows from Investing Activities Purchase of Fixed Assets (308,469,202) (91,071,345) Purchase of intangibles (21,220,447) (3,923,126) Capial work in progress (4,965,158) - Sale of Fixed Assets 85,513 4,119,444 Interest received 46,500,946 21,501,985 Net cash used in Investing Activities (288,068,348) (69,373,042) C. Cash flows from Financing Activities Increase/(Decrease) in short-term borrowings 250,000,000 - Interest paid (1,708,110) - Net cash from Financing Activities 248,291,892 - Net decrease in cash and cash equivalents (A + B + C) (678,037,305) 645,657,567 Cash and cash equivalents at the beginning of the year 853,826, ,168,773 Cash and cash equivalents at the end of the year 175,789, ,826,340 In terms of our Report attached For A.K.Sabat & Co. Chartered Accountants (Firm Registration No E) For and on behalf of the Board of Directors D.Vijaya Kumar Ramoji Rao Ch.Kiron Partner Chairman Director Membership No. : Hyderabad, Dated:

6 PANORAMA TELEVISION PRIVATE LIMITED 683 (Amount in Rupees) As at As at March 31, 2015 March 31, Share capital Authorised : Equity shares 2,50,00,000 (previous year 2,50,00,000), of Rs.10 each 250,000, ,000,000 Issued : Equity shares 2,49,59,608 (previous year 2,49,59,608), of Rs.10 each 249,596, ,596,080 Subscribed and fully paid-up : Equity shares 2,49,59,608 (previous year 2,49,59,608), of Rs.10 each 249,596, ,596,080 A. Reconciliation of number of shares and amount outstanding As at As at At the beginning of the year Nos. 2,49,59,608 2,49,59, ,596, ,596,080 Issue of shares Nos At the end of the year Nos. 2,49,59,608 2,49,59, ,596, ,596,080 B. Rights and restrictions attached to the equity shares The Company has only one class of equity shares having a par value Rs. 10 per share. Each holder of equity shares is entitled to one vote per share held. The dividend in case proposed by the Board of Directors will be subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity share holders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding. C. Equity shares held by the Holding company, Equator Trading Enterprises Private Limited - Nos. 2,49,59,608 (Previous year 2,49,59,608) D Shareholders holding more than 5% of equity shares Nos. % held Nos. % held Equator Trading Enterprises Private Limited (Holding Company) 2,49,59, ,49,59, E Equity shares allotted as fully paid-up shares without payment being received in cash for the period of five years immediately preceding March 31, As at As at March 31, 2015 March 31, 2014 Nos. Nos. Shares issued in the year as part of Scheme of Arrangement of Television division of Ushodaya Enterprises Private Limited (UEPL) with the Company. 12,728 12,728 2 Reserves and surplus Securities premium account * *(Refer Note c) At the beginning and at the end of the year 341,741, ,741,485 Surplus in the Statement of Profit and Loss At the beginning of the year 722,228, ,767,208 Less : Loss for the year (10,720,434) 408,461,705 Less : Carrying amount of assets whose remaining life is nil (38,980,568) - At the end of the year 672,527, ,228,913 TOTAL 1,014,269,396 1,063,970,398

7 684 PANORAMA TELEVISION PRIVATE LIMITED (Amount in Rupees) As at As at March 31, 2015 March 31, Long-term provisions Provision for employee benefits Gratuity (Refer Note 22-3.h) 20,552,323 - Compensated absence 46,860,742 23,482,689 TOTAL 67,413,065 23,482,689 4 Short-term borrowings Unsecured-Loan from related parties (Refer Note 22-3-j) [(Loan carries simple interest at the rate of 12% per annum and is for a period of 12 (Twelve) months and may be repaid prior to the maturity)] 250,000,000-5 Trade Payables 453,109, ,705,231 * Includes amount due to related parties Rs.42,12,10,242 (Previous year Rs.6,61,87,133)(Refer Note 22-3-j) Based on the information available with the Company, the balance due to Micro and Small Enterprises as defined under the Micro, Small and Medium enterprises Development (MSMED) Act, 2006 is Rs. Nil (Previous year Rs. Nil) and no interest during the year has been paid or payable under the terms of the MSMED Act,2006. Dues to Micro and Small Enterprises has been determinded to the extent such parties have been identified on the basis of information collected by the Management. This has been relied upon by the auditors. (Amount in Rupees) As at As at March 31, 2015 March 31, Other current liabilities Interest accrued but not due on borrowings 15,287,672 - Other payables Advance from customers 34,863,404 74,244,020 Capital creditors 23,136,713 21,880,599 Statutory liabilities 45,653,635 16,913,296 Book Overdraft - 420,006,819 Employee Dues 19,759,730 5,541,182 TOTAL 138,701, ,585,916 7 Short-term provisions Provision for tax (net of taxes paid) - 59,900,120 Current portion of employee benefits Gratuity (Refer Note 22-3.h) 17,370, ,472 Compensated Absence 11,717,743 5,908,091 Provision for expenses 44,993,475 - Provision for ex-gratia - 46,481,063 TOTAL 74,082, ,144,746

8 PANORAMA TELEVISION PRIVATE LIMITED Fixed Assets (Amount in Rupees) Particulars GROSS BLOCK DEPRECIATION NET BLOCK As at Additions Deletions/ As at Up to Adjusted Assets Amounting For the Deletions/ Up to As at As at Adjustments in related charged off policy year Adjustments earnings change A. Tangible assets Leasehold improvements 17,536,290 33,365,151-50,901,441 13,676, ,703,954-15,380,499 35,520,942 3,859,744 Plant and Machinery Air conditioners and Refrigeration 11,908,969 13,177,681-25,086,650 6,999, ,364 1,892,976 (480,393) 1,290,761-10,399,215 14,687,435 4,909,461 Electrical installtion and equipment 35,097,601 25,366,054-60,463,655 24,758,620 2,796,422 5,503,353 (2,111,653) ,463,417 28,000,238 10,338,981 Plant and machinery 713,664, ,257,833 15, ,906, ,530,639 32,653,280 53,718,408 (50,295,004) , ,159, ,746, ,133,612 Data processing equipment 78,496,312 20,340,552-98,836,864 63,745, ,909 97,830 (1,502,965) ,441,307 27,395,557 14,751,181 Furniture and Fixtures 18,223,136 8,345,179-26,568,315 14,149, ,010 2,571,795 (2,391,403) 921,705-15,448,191 11,120,124 4,074,052 Motor Vehicles 5,309,011 1,083, ,786 5,652,732 4,917, , ,901 (456,770) 523, ,786 4,569,215 1,083, ,463 Office equipment 10,583,747 7,401,720 20,400 17,965,066 6,967,619 1,481,033 - (351,051) 2,055, ,152,345 7,812,721 3,616,128 Total 890,819, ,337, ,780 1,198,381, ,744,693 38,972,568 63,942,262 (57,589,239) 51,699, , ,013, ,367, ,074,625 Previous Year 806,004,172 91,071,345 6,256, ,819, ,751, ,555,384 5,562, ,744, ,074, ,252,396 B. Intangible assets Computer Softwares 19,910,823 21,220,447-41,131,270 17,008,885 8,000 - (1,531,262) ,680,862 23,450,408 2,901,938 Film telecast rights 120,337, ,337,394 85,133,227-32,237,318-2,966, ,337,394-35,204,167 Total 140,248,217 21,220, ,468, ,142,112 8,000 32,237,318 (1,531,262) 5,162, ,018,256 23,450,408 38,106,105 Previous Year 136,325,092 3,923, ,248,217 88,655, ,486, ,142,112 38,106,105 47,669,208

9 686 PANORAMA TELEVISION PRIVATE LIMITED (Amount in Rupees) As at As at March 31, 2015 March 31, Deferred tax assets (net) a) Deferred tax liability - (4,528,582) - on difference between book balance and tax balances of fixed assets b) Deferred tax assets - Difference between book and tax balances of fixed assets 12,594, Provision for compensated absences and gratuity 29,394,254 9,457,583 - Provision for bad and doubtful debts 16,768,800 20,509,309 Total - (b) 58,757,254 29,966,891 Deferred tax assets (net) (b) - (a) 58,757,254 25,438,310 During the period credited to the Statement of Profit and Loss with deferred tax (net) Rs.3,33,18,944 (Previous year Rs.80,489). 10 Long-term loans and advances (Unsecured, considered good) Capital Advances 100,384,204 8,282,332 Security deposits 54,702,440 28,079,703 TOTAL 155,086,650 36,362, Inventories (At lower of cost or net realisable value) Serials and programmes 646, ,254 Stores and spares 3,693,179 3,245,765 TOTAL 4,339,297 4,221, Trade receivables Outstanding for the year exceeding six months from the date they are due for payment Unsecured, considered good 23,152, ,534,367 Unsecured, considered doubtful 52,492,656 13,858,180 Less : Provision for doubtful debts (52,492,656) (13,858,180) Other Debts (Unsecured, considered good) 793,843, ,728,526 TOTAL 816,996, ,262, Cash and bank balances Balance with banks in current accounts 59,482,153 50,120,887 Cheque on Hand - 249,000,000 Cash on hand 306, ,453 Other Bank balances-deposit accounts- with maturity more than 3 months and upto 12 months 116,000, ,500,000 TOTAL 175,789, ,826,340

10 PANORAMA TELEVISION PRIVATE LIMITED 687 (Amount in Rupees) As at As at 14 Short-term loans and advances (Unsecured, considered good) Income tax (net of provisions) March 31, ,910,752 March 31, Loans and advances to Related Parties (Refer Note 22-3-j) 466,237, ,500,000 Others Advance to vendors 32,824,616 9,555,176 Balances with Government Authorities 26,146,628 16,492,333 Prepaid expenses 9,852,566 11,861,106 Security deposits 1,053,778 2,058,030 TOTAL 594,025, ,466, Other current assets (Unsecured, considered good) Interest accrued on fixed deposits 3,394,461 19,727,090 For the For the year ended year ended March 31, 2015 March 31, Revenue from operations Advertisement revenue 1,613,281,450 1,295,558,798 Subscription revenue 183,822, ,423,853 Other operating revenue 2,750,049 1,998,843 TOTAL 1,799,853,514 1,419,981, Other income Interest on bank deposits 30,168,318 38,620,156 Profit on sale of asset 65,781 3,425,711 Net gain on foreign exchange transactions and fluctuation - 140,509 Exgratia provision reversal 40,440,238 - Liabilities no longer required written back 1,955,269 Miscellaneous receipts 1,642,191 5,005,382 TOTAL 74,271,797 47,191, Employee benefits expense Salaries, bonus and other allowances 545,468, ,950,293 Contribution to Provident Fund and others 39,189,410 22,120,939 Gratuity expense 11,759,243 4,736,507 Staff welfare expenses 23,501,393 12,107,073 TOTAL 619,918, ,914,812

11 688 PANORAMA TELEVISION PRIVATE LIMITED For the For the year ended year ended 19 Other expenses Power and fuel March 31, ,463,565 March 31, ,576,702 Rent 57,795,648 26,836,116 Repairs 20,960,974 14,413,965 Advertisement & publicity expenses 48,709,914 27,700,747 Auditors remuneration 1,700,000 1,270,000 Provision for doubtful debts 10,952,868 13,858,180 Communication costs 33,699,222 21,763,701 Insurance 2,420,095 2,425,736 Legal & Professional charges 6,322,808 38,080,765 Loss on foreign exchange fluctuation (net) 212,977 - Miscellaneous expenses 9,526,836 3,006,140 Commission & Brokerage 22,020, ,014 Office upkeep and maintenance 15,555,892 8,989,895 Printing and stationery 4,264,338 3,276,102 Rates and taxes 11,892,858 15,578,065 Staff recruitment and training expenses 18, ,085 Travelling and conveyance 57,471,063 26,045,215 Vehicle maintenance 31,418,402 15,437,460 Bank charges 243, ,450 Interest on delayed payment of taxes 199,704 6,388,378 Telecast & Uplink Fee 81,522,205 45,845,738 Cable Network Charges 405,250,847 - Content Expenses 12,656,868 8,189,211 Studio & Equipment hire charges 43,435,418 6,977,096 Media Professional fee 90,574,091 51,803,589 Other Expenses News 39,981,310 15,267,093 Software Expenses - Commissioned 34,716,901 35,530,638 Software Expenses - Inhouse 81,642,660 75,007,988 TOTAL 1,158,629, ,946, Finance Cost Interest on Inter-corporate deposit 15,287,672 - Interest on Loan against fixed deposit 1,708,110 - TOTAL 16,995, Exceptional Items Provision for doubtful debts 28,700,000 - Fixed Assets More than 5 years written off 96,179,580 - TOTAL 124,879,580 -

12 PANORAMA TELEVISION PRIVATE LIMITED 689 Note 22: Significant Accounting Policies and Additional for the year ended March 31, Corporate Information: 1.1 Background Panorama Television Private Limited, a Company registered under the Companies Act, 1956, is in the business of program production and broadcast of satellite television channels in Hindi, Urdu and other regional languages predominantly to Indian viewers. ETV-Rajasthan, ETV-Bihar, ETV-MP, ETV-UP, ETV-Urdu, ETV-Bangla, ETV-Kannada, ETV-Haryana/HP and ETV- Gujarathi are the channels owned and broadcast by the Company. ETV-Gujarathi was launched during the year. The channels are distributed through cable operators, direct to home (DTH) and other service providers. 1.2 Scheme of Arrangement a. Under Honourable High Court of Andhra Pradesh approved and regulatory complied Scheme of Arrangement under Section 391 to 394 of the Companies Act, 1956 business undertaking demerged from Ushodaya Enterprises Private Limited, comprising of ETV-Rajasthan, ETV-U.P., ETV-M.P., ETV-Bihar and ETV-Urdu vested with the Company. Accordingly, on February29, 2012 with effect from April 1, 2010 as the appointed date, assets and liabilities of the demerged undertaking have been over at their respective book values on a going concern basis. b. As per the Scheme of Arrangement, with effect from the appointed date and up to and including the Effective date, the Demerged company, among others, shall carry on and be deemed to have carried on the business and activities in relation to the Company and shall hold and stand possessed of the properties, rights, interests and assets relating to the Company, for and on account of and in trust for the Company and shall account for the same to the Company. c. The Scheme of Arrangement has been accounted for under the Purchase method as prescribed under Accounting Standard 14, Notified by Companies (Accounting Standard) Rules, Accordingly, the assets and liabilities of the television division as at April 1, 2010 have been taken over at their respective book values as specified in the Scheme. In compliance of the accounting treatment prescribed in the Scheme of Arrangement, necessary adjustments were made in the accounts. 2. Significant Accounting Policies a. Basis of accounting and preparation of financial statements 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 Section 211(3C) of the Companies Act, 1956 (Accounting Standards) Rules, 2006 (as amended) ( the 1956 Act ) (which continue to be applicable in respect of Section 133 of Companies Act, 2013 ( the 2013 Act ) in terms of General Circular 15/2013 dated 13 September, 2013 of the Ministry of Corporate Affairs ) and the relevant provisions of the 1956 Act/ 2013 Companies Act, as applicable. 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. b. Use of estimates The preparation of financial statements in conformity with Indian GAAP requires judgements, estimates and assumptions to be made that affect the reported amount of assets and liabilities, disclosure of contingent liabilities on the date of financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known/materialise. c. Fixed assets Tangible Assets a. Tangible Assets are stated at cost net of recoverable taxes, trade discounts and rebates and include amounts added on revaluation, less accumulated depreciation and impairment loss, if any. The cost comprises purchase price, borrowing costs and any cost directly attributable to bringing the asset to its working condition for its intended use. b. Subsequent expenditures related to an item of tangible asset are added to its book value only if they increase the future benefits from the existing asset beyond its previously assessed standard of performance. c. Projects under which are assets are not ready for their intended use are shown as Capital work-in-progress. Intangible Assets Intangible Assets are stated at cost of acquisition net of recoverable taxes less accumulated amortization/depletion and impairment loss, if any. The cost comprises purchase price, borrowing costs, and any cost directly attributable to bringing the asset to its working condition for the intended use

13 690 PANORAMA TELEVISION PRIVATE LIMITED d. Depreciation and amortization Tangible assets i. Depreciation is provided considering the useful lives of respective fixed assets as provided and prescribed under Schedule II of the Companies Act, ii. Assets costing Rupees five thousand or less are fully depreciated in the year of purchase. iii. Pursuant to the enactment of the Companies Act, 2013, cost of leasehold improvements are depreciated over the remaining period of lease of the premises. Intangible assets i. Film telecast rights Rights acquired for broadcast of feature films / program are stated at cost and are amortised over the period of agreement or up to ten years, whichever is earlier. Intangibles which were acquired under a purchase agreement are amortised on a Straight Line Basis over a period of ten years from the date of the acquisition. ii. Other intangibles Other Intangibles which were acquired under an agreement are amortised on a straight line basis over a period of five years from the date of the agreement. e. Impairment of assets An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is charged to the Statement of Profit and Loss in the year in which an asset is identified as impaired. The impairment loss recognised in prior accounting period is reversed if there has been a change in the estimate of recoverable amount f. Leases i. Where the Company is the lessee Leases where the lesser effectively retains substantially all the risks and benefits of ownership of the leased item is classified as operating leases. Operating lease payments are recognized as an expense in the Statement of Profit and Loss. ii. Where the Company is the lessor Lease income is recognised in the Statement of Profit and Loss on a straight-line basis over the lease term. Initial direct costs such as legal costs, brokerage costs, etc. are recognised immediately in the Statement of Profit and Loss. g. Inventories Trading materials, stores and spares and consumables Trading materials, stores and spares and consumables are stated at the lower of cost and net realizable value. Cost is determined on first in first out (FIFO) basis. Serial and program costs i. Serials and program purchased or produced in-house which are yet to telecast are carried at cost. Cost includes amount paid to the producers for serials and program purchased. Cost of programs produced in-house includes remuneration to artists, directors and technicians, location expenses and other production costs. Provision for impairment is made for episodes of serials and programs not telecast for more than a year. ii. Serials and programs purchased and the costs of serials and programs produced in- house is expensed off based on number of episodes telecast during the period. Cost of news/current affairs/ one- time events are fully expensed off on first telecast. h. Foreign currency transactions i. Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction or that approximates the actual rate at the date of the transaction. ii. Monetary items denominated in foreign currencies at the year-end are restated at year end rates. In case of items which are covered by forward exchange contracts, the difference between the year-end rate and rate on the date of the contract is recognised as exchange difference and the premium paid on forward contracts is recognised over the life of the contract. iii. Non-monetary foreign currency items are carried at cost.

14 PANORAMA TELEVISION PRIVATE LIMITED 691 iv. Any income or expense on account of exchange difference either on settlement or on translation is Recognised in the Statement of Profit and Loss. i. Revenue recognition Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Specifically, the following basis is adopted: i. Advertising income Advertising income is recognized when the related commercial or program is telecast on the channels. ii. Subscription income Subscription income from pay channels represents subscription fees billed to cable operators and aggregators, direct to home (DTH) service providers towards pay -channels operated by the Company and are recognized in the period during which the service is provided. Subscription fee is determined based on management s best estimates of the number of subscribers to which the service is provided, at contractually agreed rates. Subscription Income from DTH customers is recognized in accordance with terms of agreements entered into with the service providers. iii. Interest income Interest income is recognized on a time proportion basis taking into account the amount outstanding and the interest rate applicable. j. Retirement and other Employee benefits i. Regular monthly contribution to Employees s Provident Fund Scheme which is in the nature of defined contribution plan is charged against revenue when the contributions to the respective funds are due. There are no other obligations other than the contribution payable to the fund. ii. The Company provides for gratuity, a defined benefit retirement plan ( the Gratuity Plan ) covering eligible employees. In accordance with the Payment of Gratuity Act,1972, the Gratuity Plan provides a lump sum payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee s salary and tenure of employment. The Company also makes contributions to funds administered and managed by the insurance companies for the amount notified by the said insurance companies. The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the projected unit credit method, which recognizes each year of services as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation is measured at the present value of the estimated future cash flows. The discount rate used for determining the present value of the obligation is based on the market yield on government securities as at the balance sheet date. Actuarial gains/losses are recognized immediately in the statement of profit and loss. The Liability with respect to the Gratuity Plan is determined based on actuarial valuation done by an independent actuary at the year end and any differential between the fund amount as per the insurer and actuarial valuation is charged to the statement of profit and loss. iii. Earned Leave encashment liability and sick Leave liability which are in the nature of defined benefit obligation are provided for on actuarial basis, based on independent actuarial valuation on Projected Unit Credit Method on the date of the financial statements as per the requirements of Accounting Standard-15 on Employee Benefits. Actuarial gains/losses are recognised immediately in the Statement of Profit and Loss. k. Taxes on income Tax expense comprises current and deferred tax. Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, Deferred income taxes reflects the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. In situations where the company has unabsorbed

15 692 PANORAMA TELEVISION PRIVATE LIMITED depreciation or carry forward tax losses, all deferred tax assets are recognised only if there is virtual certainty supported by convincing evidence that they can be realised against future taxable profits. At each balance sheet date the Company re-assesses the unrecognized deferred tax assets. It recognizes the unrecognized deferred tax assets to the extent that it is reasonably certain that sufficient future taxable income will be available against which such deferred tax assets can be realized. l. Provisions A provision is recognised when the Company has a present obligation as a result of past event, 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 are not discounted to its present value and are determined based on 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. m. Service tax input credit Service tax input credit is accounted for in the books in the period in which the underlying service received is accounted and when there is reasonable certainty in availing / utilising the credits. n. Earnings per share Basic earnings per share is calculated by dividing the net profit or loss for the period attributable to the shareholders by the weighted average number of the equity shares outstanding at the year end. Diluted earnings per share using the weighted average numbers of equity shares and dilutive potential equity shares outstanding at the year end, except when the result would be anti-dilutive. o. 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. p. 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. q. Barter transactions: Barter transactions are recognised at the fair value of consideration receivable or payable. When the fair value of the transactions cannot be measured reliably, the revenue/expense is measured at the fair value of the goods/services provided/ received adjusted by the amount of cash or cash equivalent transferred. 3. ADDITIONAL NOTES TO THE FINANCIAL STATEMENTS a. Accounting policy change: i. Depreciation on Fixed Tangible Assets The Company has changed the method of providing depreciation from Written Down Value method to the Straight Line Method, as a result of which of Rs.5,75,89,239 has been written back to the statement of Profit and Loss and adjusted against the depreciation of the year. Had this change not been made, the loss of the year would have been higher by Rs.10,15,592 on account of current depreciation and the value of net fixed assets would have been lower by Rs.10,15,592. ii. Amortisation on Computer software under Fixed Intangible Assets The Company has changed amortization on Computer software under Fixed intangible assets in accounting amortization from a period of 3 years to a period of 5 years, as a result of which Rs.15,31,262 has been written back to the Statement of Profit and Loss and adjusted against the depreciation of the year. Had this change not been made, the loss of the year would have been higher by Rs.31,95,890 on account of current amortization and the value of the net Fixed Intangible Assets would have been lower by Rs.31,95,890. b. Depreciation: Depreciation for the year is provided as per Schedule II of the Companies Act, 2013 (the Act). Accordingly Rs.3,89,80,568 being the remaining Carrying amount of the assets whose remaining life in NIL are recognized in the opening balance of

16 PANORAMA TELEVISION PRIVATE LIMITED 693 retained earnings and Rs. 5,68,61,538 is charged to revenue as depreciation for the year. Hence, depreciation for the year is not directly comparable with previous year. c. Intangible Assets: Film and programme content purchased by Ushodaya Enterprises Private Limited (UEPL) were transferred to the company as a part of the scheme of arrangement in the year The Company recorded these assets in its books as intangible assets and continued to amortise the same over the period of 10 years on its useful life. During the year under review, considering end of commercial value of these program content, the carrying value of Rs. 29,66,849 has been fully impaired. d. Obligations on long term, non-cancellable operating leases: The Company has taken various residential / commercial premises under cancellable / non-cancellable operating leases. The cancellable lease agreements are normally renewed on expiry. Operating lease charges amounting to Rs. 57,795,648 (Previous year Rs. 26,836,116) has been debited to the Statement of Profit and Loss during the year. The details of future minimum lease payments under non-cancellable leases are as under: Amount in Rs. Particulars As at As at Not later than one year 6,47,96,463 18,26,566 Later than one year but not more than 5 years 1,49,799,305 8,29,54,504 More than 5 years 5,08,76,007 10,89,53,887 e. Capital commitment and contingent liabilities Contingent liabilities (i) Claims against the Company not acknowledged as debts of Rs. 56,77,000 (Previous year Rs.56,77,000). No provision has been made in the accounts for these demands as the Company expects a favorable decision in appeal (ii) Claims against the Company not acknowledged as debts include demands raised by Income Tax authorities aggregating to Rs.6,19,39,810 (Previous year Rs.1,32,39,040). No provision has been made in the accounts for these demands as the Company expects a favorable decision in appeal. (iii) Claims against the Company not acknowledged as debts include demands raised by Service Tax authorities aggregating to Rs. 7,78,68,465 (Previous year Rs.12,49,08,277). No provision has been made in the accounts for these demands as the Company expects a favorable decision in appeal. (iv) Commitments Estimated amount of contracts remaining to be executed on capital accounts and not provided for Rs.16,02,37,089 (previous year Rs.63,54,000). (v) Tax deducted at source not admitted by Income Tax Authorities Rs.1,21,38,927 for the Assessment Year and Rs.71,40,517 for the Assessment Year No provision has been made in the accounts for this demand has the Company has made representation for admission of the same. f. Micro, Small and Medium enterprises The identification of Micro, Small and Medium Enterprises suppliers as defined under the provisions of The Micro, Small and Medium Enterprises Development Act, 2006 is based on Management s knowledge of their status. The Company has not received any memorandum ( as required to be filed by the suppliers with the notified authority under the Micro, Small and Medium Enterprises Development Act, 2006) claiming their status as Micro, Small or Medium Enterprises. Consequently the amount paid / payable to these parties during the year and the previous year is Nil. g. Exceptional Items: During the year, based on review of current and non- current assets, the company has accounted for a) impairment in the value of certain tangible and intangible assets and b) write off / provision of certain non recoverable receivables. The amount has been charged to the Statement of Profit & Loss as detailed under note 21 as Exceptional Item. However, the above adjustments will have no impact on the future operating profits and cash flows of the businesses of the Company.

17 694 PANORAMA TELEVISION PRIVATE LIMITED f. Employee benefits: On 1st April 2014, 346 No. of employees, on 1st December 2014, 188 No. of employees and on January 1, No. of employees were transferred from Prism TV Private Limited ( Related Party) and Prism TV Private Limited also transferred the liabilities amounting to Rs lacs with respect to gratuity, leave encashment and other employees benefits up to December 31, 2014 for such transferred employees on the basis of actuarial valuation. During the year, the company has taken over 544 employees on its rolls who were transferred to it, on continuing employment basis, from Prism TV Private Limited, a related party. Prism TV Private Limited has taken over the gratuity and compensated absence benefits liability of Rs lacs, in respect to these employees accrued up to 31st December 2014, on the basis of actuarial valuation. Defined Contribution plan The Company makes Provident Fund and Employee State Insurance contributions which are defined contribution plans for qualifying employees. The Company has recognised Rs.3,25,25,630 (Previous year Rs.1,72,91,719 for Provident Fund contributions and Rs.66,31,420 (Previous year Rs.48,25,924) for Employee State Insurance in the Statement of Profit and Loss. Defined benefit plan The employees gratuity fund scheme managed by a Trust (PNB Metlife India Insurance Company Limited) is a defined benefit plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for Compensated Absences is recognized in the same manner as gratuity. For funded plan, the Company makes contributions to the trust from time to time which in turn makes contributions to the Employee s Group Gratuity scheme of PNB MetLife India Insurance Company Limited. The following table set out the funded / unfunded status of the retirement benefits plans and the amount recognised in the financial statements: Particulars (Rupees) (Rupees) a. Change in defined benefit obligation 1. Present value of obligation at the beginning of the year 42,765,616 41,530, Current service cost 9,960,211 5,458, Interest expense 3,421,249 3,322, Past service cost Acturial (gain) / loss 28,329,629 (3,784,003) 6. Benefits paid (3,787,881) (3,761,785) 7. Present value of obligation at the end of the year 80,688,824 42,765,616 b. Fair value of plan assets 1. Fair value of plan assets at the beginning of the year 41,910,144 16,911, Expected return on scheme assets 3,352,812 1,352, Employer s contribution 4,021,477 28,500, Benefits paid (3,787,881) (3,761,785) 5. Acturial (gain) / loss (2,725,186) (1,092,227) 6. Fair value of plan assets at the end of the year 42,771,366 41,910,144 c. Return on plan assets 1. Expected return on plan assets 3,352,812 1,352, Acturial (gain) / loss (2,725,186) (1,092,227) 3. Actual return on plan assets 627, ,673

18 PANORAMA TELEVISION PRIVATE LIMITED 695 Particulars d. Amount recognised with Balance Sheet (Rupees) (Rupees) 1. Present value of defined benefit obligations 80,688,824 42,765, Fair value of plan assets 42,771,366 41,910, Net liability/(asset) recognised in the balance sheet (37,917,458) (855,472) Non current liability 20,546,573 Current liability 17,370, ,472 e. Expenses recognised in the Statement of Profit and Loss 1. Current service costs 9,960,211 5,458, Interest expense 3,421,249 3,322, Expected return on investment (3,352,812) (1,352,900) 4. Net actuarial (gain)/loss recognised during the year 31,054,815 (2,691,776) 5. Expenditure recognised in the Statement of Profit and Loss 41,083,463 4,736,507 Particulars Principal Actuarial assumptions for gratuity and compensated absences i. Rate for discounting liabilities 8.00 % p.a % p.a. ii. Expected salary increase rate 8.00 % p.a % p.a. iii. Expected rate of return 8.00 % p.a % p.a. iv. Mortality table used IALM ( ) IALM ( ) v. Retirement age vi. Withdrawal rates - Upto 30 years 20% 20% - Upto 44 years 20% 20% - Above 44 years 20% 20% Notes: 1. The discount rate is based on the prevailing market yield of Indian Government Securities as at the balance sheet date for the estimated term of obligations. 2. The expected return is based on the expectation of the average long term rate of return on investments of the fund during the estimated term of the obligations. 3. The estimates of future salary increases considered takes into account the inflation, seniority, promotion and other relevant factors. 4. The planned assets of the Company are managed by the PNB MetLife India Insurance Company Limited in terms of an insurance policy taken to fund obligations of the Company with respect to its gratuity plan. i. Derivative instruments and unhedged Foreign currency exposure: The Company does not use foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations related to certain firm commitments and forecasted transactions. The Company s foreign currency exposure not hedged by a derivative instrument or otherwise as at the year end is as follows:

19 696 PANORAMA TELEVISION PRIVATE LIMITED Foreign Currency Particulars Currency Value Rupees Trade Payables USD 2,78, ,74,58,579.2 GBP Trade Receivables USD 1,31, ,04, j. Related party Disclosures a. Related parties and their relationships GBP 8, ,40, (36,080) (36,02,549) Sr. No. Name of the entity Relationship 1 Equator Trading Enterprises Pvt. Ltd Enterprises exercising control 2 Independent Media Trust (w.e.f ) Enterprises exercising control 3 Adventure Marketing Private Limited (w.e.f )# Enterprises exercising control 4 Watermark Infratech Private Limited (w.e.f )# Enterprises exercising control 5 Colorful Media Private Limited (w.e.f )# Enterprises exercising control 6 RB Media Holdings Private Limited (w.e.f )# Enterprises exercising control 7 RB Mediasoft Pvt Limited (w.e.f )# Enterprises exercising control 8 RRB Mediasoft Pvt Limited (w.e.f )# Enterprises exercising control 9 Network18 Media & Investments Ltd Enterprises exercising control 10 TV18 Broadcast Limited Enterprises exercising control 11 Reliance Industries Limited (RIL) (w.e.f ) Beneficiary/Protector of Independent Media Trust 12 Reliance Industrial Investments and Holdings Limited Beneficiary/Protector of Independent (w.e.f ) Media Trust 13 Prism TV Private Limited Fellow Subsidiary 14 Television Eighteen Mauritius Limited Fellow Subsidiary 15 Capital18 Fincap Private Limited Fellow Subsidiary 16 Television Eighteen Media and Investments Limited Fellow Subsidiary 17 Network18 Holdings Limited Fellow Subsidiary 18 Digital 18 Media Limited Fellow Subsidiary 19 RRB Investments Private Limited Fellow Subsidiary 20 Setpro18 Distribution Limited Fellow Subsidiary 21 Infomedia Press Limited Fellow Subsidiary 22 NW 18 HSN Holdings Plc ( formerly TV18 HSN Holdings Limited) Cyprus Fellow Subsidiary 23 BK Holdings Limited (Amalgamated with Network18 Holdings Ltd w.e.f ) Fellow Subsidiary 24 Capital18 Limited, Mauritius(Amalgamated with Network18 Holdings Ltd w.e.f ) Fellow Subsidiary 25 RRK Finhold Private Limited Fellow Subsidiary 26 RVT Finhold Private Limited Fellow Subsidiary 27 Greycells 18 Media Limited Fellow Subsidiary 28 Colosceum Media Private Limited Fellow Subsidiary

20 PANORAMA TELEVISION PRIVATE LIMITED 697 j. Related party Disclosures (Contd...) Sr. No. Name of the entity Relationship 29 Stargaze Entertainment Private Limited Fellow Subsidiary 30 Web 18 Holdings Limited, Cyprus Fellow Subsidiary 31 E-18 Limited, Cyprus Fellow Subsidiary 32 Web 18 Software Services Limited Fellow Subsidiary 33 e - Eighteen.com Limited Fellow Subsidiary 34 Moneycontrol Dot Com India Limited Fellow Subsidiary 35 ibn18 (Mauritius) Limited Fellow Subsidiary 36 AETN18 Media Private Limited Fellow Subsidiary 37 RVT Media Private Limited Fellow Subsidiary 38 TV18 Home Shopping Network Limited Fellow Subsidiary 39 Big Tree Entertainment Private Limited Fellow Subsidiary 40 Reed Infomedia India Private Limited Fellow Subsidiary 41 Viacom18 Media Private Limited Joint ventures of enterprise exercising control 42 IBN Lokmat News Private Limited Joint ventures of enterprise exercising control 43 Indiacast UTV Media Distribution Private Limited Joint ventures of enterprise exercising control 44 Indiacast UK Limited Joint ventures of enterprise exercising control 45 Indiacast Media Distribution Pvt. Limited Joint ventures of enterprise exercising control 46 Eenadu Television Private Limited Associates of enterprise exercising control 47 Ramoji Rao Key Management Personnel 48 Ch.Kiron Key Management Personnel 49 Dolphin Hotels Limited Entities under significant influence of 50 Margadarsi Enterprises Entities under significant influence of 51 Margadarsi Computers Entities under significant influence of 52 Mayuri Film Distributors Entities under significant influence of 53 Ushakiron Properties Entities under significant influence of 54 Margadarsi Financiers Entities under significant influence of 55 Ushodaya News Agency Entities under significant influence of 56 Ramoji Universal Travels Entities under significant influence of

21 698 PANORAMA TELEVISION PRIVATE LIMITED j. Related party Disclosures (Contd...) Sr. No. Name of the entity Relationship 57 Ushakiron Enterprises Entities under significant influence of 58 Vasundhara Publications Entities under significant influence of 59 Ushakiron Movies International Entities under significant influence of 60 Ramoji Knowledge Centre Entities under significant influence of 61 Colorama Printers Private Limited Entities under significant influence of 62 Margadarsi Marketing Private Limited Entities under significant influence of 63 Manpower Selection and Management Services Private Limited Entities under significant influence of 64 Usha Kiron Movies Limited Entities under significant influence of 65 Priya Foods Private Limited Entities under significant influence of 66 Margadarsi Investment and Leasing Company Private Limited Entities under significant influence of 67 Ushodaya Shipping Private Limited Entities under significant influence of 68 Suman Advertising Private Limited Entities under significant influence of 69 Images Hoardings Private Limited Entities under significant influence of 70 Margadarsi Financial Services Private Limited Entities under significant influence of 71 Margadarsi Chit Fund Private Limited Entities under significant influence of 72 Margadarsi Housing Private Limited Entities under significant influence of 73 Margadarsi Chits (Karnataka) Private Limited Entities under significant influence of 74 Ushodaya Enterprises Private Limited Entities under significant influence of 75 Reliance Retail Limited Fellow Subsidiary (Subsidiary of Reliance Industries Limited, The Sole beneficiary of Independent Media Trust) Note: Related parties have been identified by the management of the Company.

22 PANORAMA TELEVISION PRIVATE LIMITED 699 THIS PAGE INTENTIONALLY LEFT BLANK

23 700 PANORAMA TELEVISION PRIVATE LIMITED THIS PAGE INTENTIONALLY LEFT BLANK

24 PANORAMA TELEVISION PRIVATE LIMITED 701 THIS PAGE INTENTIONALLY LEFT BLANK

25 702 PANORAMA TELEVISION PRIVATE LIMITED ii) Transaction with Related Parties Transactions Enterprises Associate of Fellow JV of Entity Under excercising enterprise Subsidiary enterprise Significant control exercising exercising Influence control control (i) Transaction during the period ended 31st March, 2015 Revenue from operations TV18 Broadcast Limited 178,917, (1,379,500) IndiaCast Media Distribution Pvt Ltd ,621, (410,871) - IndiaCast UTV Media Distribution Pvt Ltd ,778, (34,526,307) - IndiaCast UK Limited ,352, (3,602,549) - Viacom18 Media Limited ,800 - Prism TV Private Limited , Kalanjali Arts & Crafts (49,133) Other Income Eenadu Television Private Limited - 848, (News Subscription Charges-PTI) Prism TV Private Limited - - (1,149,996) - - Interest Expenses TV18 Broadcast Limited 15,287, Expenditure for Services Received TV18 Broadcast Limited 25,261, (49,786,250) IndiaCast UTV Media Distribution Pvt Ltd ,913,822 - IBN Lokmat News Private Limited ,800 - Eenadu Television Private Limited - (55,334,516) Prism TV Private Limited - - 5,714, Dolphine Hotels Limited ,997, (1,943,071) Margradasi Computers , (820,416) Margradasi Financiers ,732,175 Ushakiron Properties ,136, (9,666,033) Manpower Selection & Management Services , (120,000) Ushakiron Movies Limited ,743, (35,076,575) Reimbursement of Expenses (Paid) TV18 Broadcast Limited 5,303, (1,902,502)