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Auditor Report of G V Films Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of GV FILMS LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 2015, the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation and presentation of financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing opinion on the effectiveness of the company's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter described in the Basis for Qualified Opinion paragraph, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2015;

b) in the case of the Statement of Profit and Loss, of the Loss for the year ended on that date; and

c) In the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2015 ("the Order") issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Act, we give in the Annexure a statement on the matters specified in the paragraph 3 and 4 of the Order, to the extent applicable.

2. As required by Section 143 (3) of the Act, we report that:

a. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

b. In our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

c. The Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account;

d. In our opinion, the aforesaid financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;

e. On the basis of written representations received from the directors as on March 31, 2015 and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2015, from being appointed as a director in terms of 164 (2) of the Act of the Companies Act, 2013.

f. With respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i The Company does not have any pending litigations which would impact its financial position

ii The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses

iii The Company is not required to transfer any amount to the Investor Education and Protection Fund.

ANNEXURE TO THE INDEPENDENT AUDITORS' REPORT OF EVEN DATE TO THE MEMBERS OF GV FILMS LIMITED, ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2015

Based on the audit procedures performed for the purpose of reporting a true and fair view on the financial statements of the Company and taking into consideration the information and explanations given to us and the books of account and other records examined by us in the normal course of audit, we report that:

1. Fixed Assets

- The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

- According to the information and explanations given to us, the fixed assets were physically verified by the management in accordance with the programme of verification, which in our opinion is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancy was noticed on such verification. The Company has not undertaken impairment study of the fixed assets.

2. Inventories in the books represent picture rights and Internet film rights. The management has undertaken periodical physical verification of the inventory.

3. In our opinion, 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 and fixed assets and for the sale of goods and services.

4. The Company has not accepted any deposits from the public within the meaning of the directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules framed there under. Accordingly, the provisions of clause 4(v) of the Order are not applicable.

5. To the best of our knowledge and belief, the Central Government has not prescribed maintenance of cost records under sub-section (1) of Section 148.

6.

- Undisputed statutory dues towards income-tax, sales-tax, service-tax, custom duty, excise duty, cess and other material statutory dues have been regularly deposited with the appropriate authorities and there have-not been delays in any cases mentioned above except below

Name of the Statute Nature of dues Amount (Rs,)

Income Tax TDS 7,64,914

Municipal Corporation Professional Tax 20,125

- According to the information and explanations given to us the company is not required to transfer any amounts which were required to be transferred to the investor education and protection fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules there under.

7. In our opinion, the Company's has incurred a cash loss during the financial year and the cash losses as at the end of the financial year is less than 50% of the networth.

8. In our opinion, the Company has not defaulted in repayment of dues to a financial institution, bank or to debenture holders during the year.

9. According to the information and explanations given to us, the company has not given any guarantee against loans taken by others from banks or financial institutions. Terms and conditions thereof are prejudicial to the interest of the company.

10. In our opinion, the term loans were applied for the purpose for which they were obtained. No new loans were obtained during the current year.

11. According to the information and explanations given to us, no material fraud on or by the Company has been noticed or reported during the course of our audit.

For R. Ravindran & Associates

Chartered Accountants

Firm Registration No. 003222S

R. Ravindran

Proprietor

M No 023829

Chennai, 29th May, 2015


Mar 31, 2014

1. We have audited the attached Balance Sheet of M/s. GV FILMS LIMITED as at 31st March 2014 and also the Profit and Loss Account 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 an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on 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 overall 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 (CARO 2003) issued by the Company Law Board in terms of Section 227(4A) of the Companies Act, 1956, we enclose in the annexure a statement on the matters specified in paragraphs 4 and 5 of the said order to the extent applicable.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we state that:

a. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit.

b. In our opinion proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

c. The Balance Sheet and Profit & Loss Account and cash flow statement dealt with by this report are in agreement with the books of account.

d. In our opinion, the balance sheet, profit and loss account and the cash flow statement comply with the Accounting Standards referred to in Subsection (3C) of section 211 of the Companies Act, 1956

e. We report that Shri Jain Kumar Vijay is disqualified from being appointed as a director under clause (g) of sub-Section (1) of Section 274 of the Companies Act, 1956.

f. And In our opinion and according to the best of our information, the said accounts 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 principle generally accepted in India ;

i. in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2014

ii. in the case of the Profit and Loss Account of the Loss of the Company for the year ended on that date and

iii. in the case of the Cash Flow Statement, of the Cash Flows of the Company for the year ended on that date.

ANNEXURE REFERRED TO IN PARAGRAPH I OF THE REPORT OF EVEN DATE OF THE AUDITORS TO THE MEMBERS OF GV FILMS LIMITED ON THE ACCOUNTS FOR THE YEAR ENDED 31ST MARCH 2013.

1) Fixed Assets:

* The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

* According to the information and explanations given to us, the fixed assets were physically verified by the management in accordance with the programme of verification, which in our opinion is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancy was noticed on such verification. The Company has not undertaken impairment study of the fixed assets.

2) Inventory:

Inventories in the books represent picture rights and Internet film rights. The management has undertaken periodical physical verification of the inventory.

3) Loan to/from directors and interested parties

* In our opinion and according to the information and explanations given to us, the Company has granted loans to the extent of Rs. 6,46,36,033/- during the year to Companies listed in the Register maintained under Section 301 of the Companies Act, 1956.

* The company has taken loans, secured or unsecured, to the extent of Rs. 7,36,06,837/- from companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956.

4) Internal Control

In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regard to purchase of fixed assets and purchase and sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls.

5) Transaction covered by section 301

* In our opinion and according to the information and explanations given to us, the transactions that need to be entered into register maintained under section 301 of the Companies Act, 1956 have been entered.

* In our opinion and according to the information and explanations given to us, Transactions 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.

6) Deposit from Public

The Company has not accepted any deposit from the public and the provisions of 58A and 58AA of the Companies Act, 1956 are not applicable.

7) Internal Audit

In our opinion and according to the information and explanations given to us, the Company does not have an internal audit system commensurate with the size and nature of its business.

8) Cost Accounting Records

The Provision of section 209(1) (d) of the Companies Act, 1956 regarding maintenance of cost records is not applicable to the company.

9) Statutory Dues

According to the information and explanations given to me, the company has no undisputed statutory dues pending for more than 6 months.

10) Cash Loss

As per Clause (x) of Paragraph 4 of CARO 2003, the Company has incurred a cash loss during the financial year and the cash losses as at the end of the financial year is less than Fifty per cent of the Net worth.

11) Repayment of dues

As at the year end, the company has interest overdue of Rs. 1,95,65,919/- to FCCB holders and is subject to dispute.

12) Defaults to financial Institutions

As per information and records produced there are no loans from financial institutions as on 31st March 2014.

13) Loans and Advances on the basis of securities

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, debentures and other securities.

14) Applicability of provisions to Chit fund, Nidhi/mutual benefit fund/societies

The company is not a chit fund or a nidhi / mutual benefit fund/society hence the clause (xiii) of the Companies (Auditor''s Report) Order 2003 is not applicable to the company.

15) Trading in shares, securities debentures and other investments

In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments. Therefore, the provisions of clause 4 (xiv) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

16) Guarantee given for others

In our opinion and according to the information and explanations given to us, the Company has not given any guarantees for loans taken by others from bank or financial institutions, the terms and conditions whereof are prejudicial to the interest of the company.

17) End use of term loans

During the year the company has not taken any new term loans.

18) Short term Funds

In our opinion and according to the information and explanations given to us, and on an overall examination of the balance sheet of the company, we report that funds raised on short term basis were not used for long term investment. Accordingly clause (xvii) of the CARO 2003 is not applicable.

19) Preferential allotment of shares

According to the information and explanations given to us, during the period covered by our audit report, the Company has not made any preferential allotment of equity shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

20) Debentures

The company has not issued any debenture during the period covered by our audit. Accordingly clause 4(xix) of the order is not applicable.

21) End use of public issue proceeds

During the year covered by our audit report, the Company has not raised any money by way of public issue.

22) Reporting of Frauds

To the best of our knowledge and belief and according to the information and explanations given to us, no material fraud on or by the Company has been noticed or reported during the course of our audit.

For R. Ravindran & Associates Chartered Accountants FRN:003222S

R. Ravindran Proprietor Mumbai, 30th May, 2014 M.No:023829


Mar 31, 2012

1. We have audited the attached Balance Sheet of M/s. GV FILMS LIMITED as at 31st March 2012 and also the Profit and Loss Account 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 an opinion on these financial statements based on ouraudit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on 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 overall financial statement presentation. We believe that ouraudit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor''s Report) Order, 2003 (CARO 2003) issued by the Company Law Board in terms of Section 227(4A) of the Companies Act, 1956, we enclose in the annexure a statement on the matters specified in paragraphs 4 and 5 of the said order to the extent applicable.

4. Furtherto ourcomments in the Annexure referred to in paragraph 3 above, we state that: Subject to non recognition of impairment in advances for capex of Rs 27,22,70,344/- and intangible asset under development Rs.143,24,79,586/-

a. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of ouraudit.

b. Inouropinion proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

c. The Balance Sheet and Profit & Loss Account and cash flow statement dealt with by this report are in agreement with the books of account.

d. In our opinion, the balance sheet, profit and loss account and the cash flow statement comply with the Accounting Standards referred to in Subsection (3C) of section 211 of the Companies Act, 1956

e. On the basis of written representations received from the Directors, as on March 31,2012 and taken on record by the Board of Directors, we report that none of the director of the company is disqualified from being appointed as a director under clause (g) of sub-Section (1) of Section 274 of the Companies Act, 1956.

f. And In our opinion and according to the best of our information, the said accounts 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 principle generally accepted in India;

i. in the case of the Balance Sheet, of the state of affairs of the Company as at 31 st March, 2012

ii. in the case of the Profit and Loss Account of the Loss of the Company for the year ended on that date and

iii. in the case of the Cash Flow Statement, of the Cash Flows of the Company for the year ended on that date.

ANNEXURE REFERRED TO IN PARAGRAPH I OF THE REPORT OF EVEN DATE OF THE AUDITORS TO THE MEMBERS OF GV FILMS LIMITED ON THE ACCOUNTS FOR THE YEAR ENDED 31st MARCH 2012.

1) Fixed Assets:

The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

According to the information and explanations given to us, the fixed assets were physically verified by the management in accordance with the programme of verification, which in our opinion is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancy was noticed on such verification. The Company has not undertaken impairment study of the fixed assets.

2) Inventory:

Inventories in the books represent picture rights and Internet film rights. The management has undertaken periodical physical verification of the inventory.

3) Loan to/from directors and interested parties

In our opinion and according to the information and explanations given to us, the Company has granted loans to the extent of Rs.63,630/- during the year to Companies listed in the Register maintained under Section 301 of the Companies Act, 1956.

The company has taken loans, secured or unsecured, to the extent of Rs. 22,52,02,123 from companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956.

4) Internal Control

In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regard to purchase of fixed assets and purchase and sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls.

5) Transaction covered by section 301

In our opinion and according to the information and explanations given to us, the transactions that need to be entered into register maintained under section 301 of the Companies Act, 1956 have been entered.

In our opinion and according to the information and explanations given to us, Transactions 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.

6) Depositfrom Public

The Company has not accepted any deposit from the public and the provisions of 58Aand 58AAof the Companies Act, 1956 are not applicable.

7) Internal Audit

In our opinion and according to the information and explanations given to us, the Company does not have an internal audit system commensurate with the size and nature of its business.

8) Cost Accounting Records

The Provision of section 209(1) (d) of the Companies Act, 1956 regarding maintenance of cost records is not applicable to the company.

9) Statutory Dues

According to the information and explanations given to me, the company has undisputed statutory dues amounting to Rs 9,89,433.

10) Cash Loss

As per Clause (x) of Paragraph 4 of CARO 2003, the Company has incurred a cash loss during the financial year and the cash losses as at the end of the financial year is less than Fifty per cent of the Net worth.

11) Repayment of dues

As at the year end, the company has interest overdue of Rs 101,35,256/- to FCCB holders and is subject to dispute.

12) Defaults to financial Institutions

As per information and records produced there are no loans from financial institutions as on 31st March 2012.

13) Loans and Advances on the basis of securities

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, debentures and other securities.

14) Applicability of provisions to Chitfund, Nidhi/mutual benefit fund/societies

The company is not a chit fund or a nidhi / mutual benefit fund/society hence the clause (xiii) of the Companies (Auditor''s Report) Order 2003 is not applicable to the company.

15) Trading in shares, securities debentures and other investments

In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments. Therefore, the provisions of clause 4 (xiv) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

16) Guarantee given for others

In our opinion and according to the information and explanations given to us, the Company has not given any guarantees for loans taken by others from bank or financial institutions, the terms and conditions whereof are prejudicial to the interest of the company.

17) End use of term loans

During the year the company has taken a has not taken any new term loans.

18) Shortterm Funds

In our opinion and according to the information and explanations given to us, and on an overall examination of the balance sheet of the company, we report that funds raised on short term basis were not used for long term investment. Accordingly clause (xvii) of the CARO 2003 is not applicable.

19) Preferential allotment of shares

According to the information and explanations given to us, during the period covered by our audit report, the Company has not made any preferential allotment of equity shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

20) Debentures

The company has not issued any debenture during the period covered by our audit. Accordingly clause 4(xix) of the order is not applicable.

21) End use of public issue proceeds

During the year covered by our audit report, the Company has not raised any money by way of public issue.

22) Reporting of Frauds

To the best of our knowledge and belief and according to the information and explanations given to us, no material fraud on or by the Company has been noticed or reported during the course of our audit.

For R. Ravindran & Associates

Chartered Accountants

Firm Registration No. 003222S

(Sd/-)

R. Ravindran

Proprietor

Chennai, 14th August, 2012 M. No. 023829


Mar 31, 2011

1. We have audited the attached Balance Sheet of M/s. GV FILMS LIMITED as at 31 st March 2011 and also the Profit and Loss Account 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 an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on 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 overall 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 (CARO 2003) issued by the Company Law Board in terms of Section 227(4A) of the Companies Act, 1956, we enclose in the annexure a statement on the matters specified in paragraphs 4 and 5 of the said orderto the extent applicable.

4. Furtherto ourcomments in the Annexure referred to in paragraph 3 above, we state that:

Subject to non recognition of impairment in Capital work in Progress of Rs 27,22,70,344 and intangible asset under development Rs.143,24,79,586/-

a. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit.

b. In our opinion proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

c. The Balance Sheet and Profit & Loss Account and cash flow statement dealt with by this report are in agreement with the books of account.

d. In our opinion, the balance sheet, profit and loss account and the cash flow statement comply with the Accounting Standards referred to in Subsection (3C) of section 211 of the Companies Act, 1956

e. On the basis of written representations received from the Directors, as on March 31,2011 and taken on record by the Board of Directors, we report that none of the director of the company is disqualified from being appointed as a director under clause (g) of sub-Sec. (1) of Sec. 274 of the Companies Act, 1956.

f. In our opinion and according to the best of our information, the said accounts 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 principle generally accepted in India;

i. in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2011

ii. in the case of the Profit and Loss Account of the Loss of the Company for the year ended on that date and

iii. in the case of the Cash Flow Statement, of the Cash Flows of the Company for the year ended on that date.

ANNEXURE REFERRED TO IN PARAGRAPH I OF THE REPORT OF EVEN DATE OF THE AUDITORS TO THE MEMBERS OF GV FILMS LIMITED ON THE ACCOUNTS FORTHE YEAR ENDED 31st MARCH 2011.

1) Fixed Assets:

The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

According to the information and explanations given to us, the fixed assets were physically verified by the management in accordance with the programme of verification, which in our opinion is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancy was noticed on such verification. The Company has not undertaken impairment study of the fixed assets. During the year the Company transferred one Theatre at Thanjavur and such transfer has not affected the Company as a going concern.

2) Inventory:

Inventories in the books represent picture rights and Internet film rights. The management has undertaken periodical physical verification of the inventory.

3) Loan to/from directors and interested parties

In our opinion and according to the information and explanations given to us, the Company has granted loans during the year to Companies listed in the Register maintained under Section 301 of the Companies Act, 1956.

In our opinion and according to the information and explanations given to us, the Company has taken interest free unsecured loan from a director and/or firms in which he was associated as a proprietor or partner, to the extent of Rs. 1,26,85,000/-. Apart from this loan, the company has not taken any loans, secured or unsecured, from companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956.

4) Internal Control

In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regard to purchase of fixed assets and purchase and sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls.

5) Transaction covered bv section 301

In our opinion and according to the information and explanations given to us, the transactions that need to be entered into register maintained under section 301 of the Companies Act, 1956 have been entered..

In our opinion and according to the information and explanations given to us, Transactions 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.

6) Deposit from Public

The Company has not accepted any deposit from the public and the provisions of 58A and 58AA of the Companies Act, 1956 are not applicable.

7) InternalAudit

In ouropinion and according to the information and explanations given to us, the Company does not have an internal audit system commensurate with the size and nature of its business.

8) Cost Accounting Records

The Provision of section 209(1) (d) of the Companies Act, 1956 regarding maintenance of cost records is not applicable to the company.

9) Statutory Dues

According to the information and explanations given to me, the company has undisputed statutory dues amounting to Rs 2,03,115 towards income tax, Rs 7,86,318 towards fringe benefit tax and Rs 2,26,326 towards Tax deducted at source.

10) Cash Loss

As per Clause (x) of Paragraph 4 of CARO 2003, the Company has incurred a cash loss during the financial year and the cash losses as at the end of the financial year is less than Fifty per cent of the Net worth.

11) Repayment of dues

The company has overdue interest to the extent of Rs. 94,68,549/- as at the year end to FCCB holders and is subject to dispute.

12) Defaults to financial Institutions

The company has defaulted in paying the Interest of Rs 25,17,912/- as on 31st March, 2011 to State bank of India. The loan was settled afterthe Balance Sheet date.

13) Loans and Advances on the basis of securities

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, debentures and other securities.

14) Applicability of provisions to Chit fund. Nidhi/mutual benefit fund/societies

The company is not a chit fund ora nidhi/mutual benefit fund/society hence the clause (xiii) of the Companies (Auditor''s Report) Order 2003 is not applicable to the company.

15) Trading in shares, securities debentures and other investments

In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments. Therefore, the provisions of clause 4 (xiv) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

16) Guarantee given for others

In our opinion and according to the information and explanations given to us, the Company has not given any guarantees for loans taken by others from bank or financial institutions, the terms and conditions whereof are prejudicial to the interest of the company.

17) End use of term loans

During the year the company has not taken any new term loans.

18) Shortterm Funds

In our opinion and according to the information and explanations given to us, and on an overall examination of the balance sheet of the company, we report that funds raised on short term basis were not used for long term investment. Accordingly clause (xvii) of the CARO 2003 is not applicable.

19) Preferential allotment of shares

According to the information and explanations given to us, during the period covered by our audit report, the Company has not made any preferential allotment of equity shares to parties and companies covered in the register maintained under Section 301 ofthe Companies Act, 1956.

20) Debentures

The company has not issued any debenture during the period covered by our audit. Accordingly clause 4(xix) ofthe order is not applicable.

21) End use of public issue proceeds

During the year covered by our audit report, the Company has not raised any money by way of public issue.

22) Reporting of Frauds

To the best of our knowledge and belief and according to the information and explanations given to us, no material fraud on or by the Company has been noticed or reported during the course of our audit.

For R. Ravindran & Associates

Chartered Accountants

Firm Registration No. 003222S

Sd/-

R. Ravindran

Proprietor

M. No. 023829

Chennai, 30th May, 2011


Mar 31, 2010

1. We have audited the attached Balance Sheet of M/s. GV FILMS LIMITED as at 31st March 2010 and also the Profit and Loss Account for the year ended on that date annexed thereto. These financial statements are the responsibility of the companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on test basis evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting p inciples used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis forouropinion.

3. As required by the Companies (Auditors Report) Order, 2003 (CARO 2003) issued by the Company Law Board in terms of Section 227(4A) of the Companies Act, 1956, we enclose in the annexure a statement on the matters specified in paragraphs 4 and 5 of the said order to the extent applicable.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we state that:

a. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit.

b. In our opinion proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

c. The Balance Sheet and Profit & Loss Account and cash flow statement dealt with by this report are in agreement with the books of account.

d. In our opinion, the balance sheet, profit and loss account and the cash flow statement comply with the Accounting Standards referred to in Subsection (3C) of section 211 of the Companies Act, 1956

e. On the basis of written representations received from the Directors, as on March 31, 2010 and taken on record by the Board of Directors, we report that none of the director of the company is disqualified from being appointed as a director under clause (g) of sub-Section (1) of Section 274 of the Companies Act,1956.

f. In our opinion and according to the best of our information, the said accounts 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 principle generally accepted in India;

1. In the case of the Balance Sheet, of the state of affairs of the Company as at 31 st March, 2010

2. In the case of the Profit and Loss Account of the Loss of the Company for the year ended on that date and

3. In the case of the Cash Flow Statement, of the Cash Flows of the Company for the year ended on that date.

ANNEXURE REFERRED TO IN PARAGRAPH I OF THE REPORT OF EVEN DATE OF THE AUDITORS TO THE MEMBERS OF GV FILMS LIMITED ON THE ACCOUNTS FOR THE YEAR ENDED 31ST MARCH 2010.

1) Fixed Assets:

a. The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

b. According to the information and explanations given to us, the fixed assets were physically verified by the management in accordance with the programme of verificat on, which in our opinion is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancy was noticed on such verification.

c. No impairment loss has arisen on fixed assets.

d. The company did not dispose-off any fixed asset during the year.

2) Inventory:

The Company is principally engaged in the production, distribution and exhibition of motion pictures. As such, tlr^ Company does not carry any stock of finished goods, raw materials, and spare parts and hence the question of physical verification of the same does not arise. Inventories in the books represent picture rights and Intei net film rights.

3) Loan to/from directors and interested parties

a. In our opinion and according to the information and explanations given to us, the Company has not granted any secured or unsecured loans during the year to Companies listed in the Register maintained under Section 301 of the Companies Act, 1956.

b. In our opinion and according to the information and explanations given to us, the Company has taken interest free unsecured loan from a director of the company to the extent of Rs. 3,65,25,395/-. Apart from this loan, the company has not taken any loans, secured or unsecured, from companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956.

4) Internal Control

In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regard to purchase of fixed assets and purchase and sale of goods. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls.

5) Transaction covered by section 301

a. In our opinion and according to the information and explanations given to us the transactions that need to be entered into register maintained under section 301 of the Companies Act, 1956 have been so entered.

b. In our opinion and according to the information and explanations given to us, Transactions 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.

6) Deposit from Public

The Company has not accepted any deposit from the public and the provisions of 58A and 58AA of the Companies Act, 1956 are not applicable.

7) Internal Audit

In our opinion and according to the information and explanations given to us, the Company has an internal audit system commensurate with the size and nature of its business.

8) CostAccounting Records

The Provision of section 209( 1) (d) of the Companies Act, 1956 regarding maintenance of cost records is not applicable to the company.

9) Statutory Dues

According to the information and explanations given to me, there is no undisputed amounts payable in respect of sales tax or income-tax nor they were in arrears ac at 31st March, 2010 for a period of more than six months from the date they became payable.

The Company has been regular in depositing with the appropriate authorities dues on account of Provident Fund and Employees State Insurance Corporation.

10) Cash Loss

As per Clause (x) of Paragraph 4 of CARO 2003, the Company has incurred a cash loss during the financial year and the cash losses as at the end of the financial year is less than Fifty per cent of the Net worth.

11) Repayment of dues

The company has a dspute with its FCCB holders and the same is pending before Courts. Under these circumstances, the Company has not paid interest to the extent of Rs. 18,55,126/- which is overdue as at the yearend.

12) Loans and Advances on the basis of securities

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, debentures and other securities.

13) Applicability of provisions to Chit fund, Nidhi/mutual benefit fund/societies

The company is not a chit fund or a nidhi/mutual benefit fund/society hence the clause (xiii) of the Companies (Auditors Report) Order 2003 is not applicable to the company.

14) Trading in shares, securities debentures and other investments

In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments. Therefore, the provisions of clause 4 (xiv) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

15) Guarantee given for others

In our opinion and according to the information and explanations given to us, the Company has not given any guarantees for loans taken by others from bank or financial institutions, the terms and conditions whereof are prejudicial to the interest of the company.

16) End use of term loans

During the year the company has taken a new term loan. In our opinion and according to the information and explanations given to us, the term loan was used for the purpose for which it was raised.

17) Short term Funds

In our opinion and according to the information and explanations given to us, and on an overall examination of the balance sheet of the company, we report that funds raised on short term basis were not used for long term investment. Accordingly clause (xvii) of the CARO 2003 is not applicable.

18) Preferential allotment of shares

According to the information and explanations given to us, during the period covered by our audit report, the Company has not made any preferential allotment of equity shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

19) Debentures

The company has not issued any debenture during the period covered by our audit. Accordingly clause 4(xix) of the order is not applicable.

20) End use of public issue proceeds

During the year covered by our audit report, the Company has not raised any money by way of public issue.

21) Reporting of Frauds

To the best of our knowledge and belief and according to the information and explanations given to us, no material fraud on or by the Company has been noticed or reported during the course of our audit.

For R. Ravindran & Associates Chartered Accountants Firm Registration No. 003222S

sd/- R. Ravindran Proprietor M. No.023829

Chennai

13th August 2010







 
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