Home  »  Company  »  Kohinoor Broadcastin  »  Quotes  »  Accounting Policy
Enter the first few characters of Company and click 'Go'

Accounting Policies of Kohinoor Broadcasting Corporation Ltd. Company

Mar 31, 2014

1.1. Basis of Preparation and Presentation

The financial statements are prepared in accordance with Indian Generally Accepted Accounting Principles (GAAP) under the historical cost convention on the accrual basis. The Financial Statements comply in all material aspects with all the applicable accounting standards notified u/s 211 3(c) of the Companies Act 1956 and the relevant provisions of the Companies Act 1956.

All significant accounting policies adopted in the Preparation and Presentation of financial statements has been disclosed. The fundamental accounting assumptions, viz. Going Concern, Consistency and Accrual are being followed in financial statements. There is no change in policies being followed by the Company.

2.2. Use of Estimates

The preparation of Financial Statements in conformity with Generally Accepted Accounting Principles requires the management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period end. Although these estimates are based upon managements'' best knowledge of current events and actions, actual results could differ from these estimates.

2.3 Deferred revenue expenditure on account of fee for increase in the Authorized capital and the GDR issue expenses is amortized over a period of 5 years.

2.4 Preliminary expenditure is amortized over a period of five years in equal instalments.

2.5 Accounting policies not specifically referred to herein above is in consistent with generally accepted accounting practices.

2.6 Inventories (AS 2)

Inventories of Raw Materials, Work-in-Progress and Finished Goods are valued at lower of cost or estimated net realizable value. Cost is taken on FIFO or specific identification basis. Net realizable value of Raw Materials, Work-in-Progress and Finished Goods is taken as estimated by the management.

2.7 Cash Flow Statement (AS 3)

Cash Flow Statement is prepared under "indirect method". Cash and Cash Equivalents are defined as cash in hand, demand deposits and short term, highly liquid investments readily convertible to known amounts of cash and subject to insignificant risk of change in value. For the purpose of Cash Flow Statement, cash and cash equivalents include bank overdraft.

2.8 Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies (AS 4)

All items of income and expense, recognised in a period are included in the determination of net profit or loss for the period. This includes profit or loss from ordinary activities, extraordinary items and the effects of changes in accounting estimates/ policies. The nature and amount of prior period items are separately disclosed in the statement of profit and loss in a manner that their impact on the current profit or loss can be perceived.

2.9 Contingencies and Events Occurring after the Balance Sheet Date (AS 5)

As per AS 4, assets and liabilities are adjusted for events occurring after the balance sheet that provide additional evidence to assist the estimation of amounts relating to conditions existing at the balance sheet date or those indicating the fundamental accounting assumption of going concern is not appropriate.

Those events occurring after the balance sheet date that represent material changes and commitments affecting the financial position of the enterprise are disclosed in the Director''s Report.

2.10 Depreciation (AS 6)

Depreciation for all assets is provided on Written Down Value Method in the manner laid down in Schedule XIV to the Companies Act, 1956. The depreciation has been calculated on a pro-rata basis from the date on which the asset is purchased or put to use whichever is later.

2.11 Construction Contracts (AS 7)

Since the company is not into the business of construction, the policy related to the same has not been formulated.

2.12 Revenue Recognition (AS 9)

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue will be relatively measured.

For advertisements, the commission is recognized when the related advertisement or commercial appears before the public i.e. on telecast. Programmes/Modules production and acquisition costs are net of recoveries. Sale is recognized when risk and reward of ownership is passed on to the customers. For services revenue is recognized when the service is completed.

2.13 Fixed Assets (AS 10)

Fixed assets are stated at cost less depreciation. Cost comprises of capital costs and incidental expenses attributable to bringing the assets to working condition for its intended use. All capital costs and incidental expenditure relating to pre operational period are shown as capital work in progress. Where an indication of impairment exists, the carrying amount of the asset is assessed and written down immediately to its recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with carrying amount and are included in profit/ (loss). On disposal of revalued assets, amounts in revaluations reserve relating to those assets are transferred to accumulated profits.

2.14 Accounting For Effects of Changes in Foreign Exchange Rate (AS 11)

Transactions in foreign currencies are recognized at rate of overseas currency ruling on the date of transaction. Gain/Loss arising on account of rise or fall in overseas currencies vis-a-vis reporting currency between the date of transaction and that of payment is charged to Profit and Loss Account.

Receivables/payables {Excluding for fixed assets} in foreign currencies are translated at the exchange rate ruling at the year ended date and resultant gain or loss is accounted for in the Profit and Loss Account. Increase/decrease in foreign currency loan on account of exchange fluctuation is debited or credited to the Profit and Loss Account. Impact of Exchange fluctuation is separately disclosed in notes to accounts.

Gain / Loss on translation of financial statements of non-integral foreign operations as on Balance Sheet date is recognized in Foreign Currency Translation Reserve {FCTR} Account, included in Reserves and Surplus, till the disposal of foreign operations.

2.15 Government Grants (AS 12)

Grants from government are recognised where there is reasonable assurance that the company will comply with the conditions attached and that the ultimate collection will be made.

2.16 Accounting for Investments (AS 13)

Current Investments are held at lower of cost and NAV/market value.

Long term investments are held at cost less diminution, if any, in the carrying cost of investment other than temporary in nature. Loss, if any, sustained by any subsidiary is not recognized unless it is permanent in nature.

2.17 Accounting for Amalgamations (AS 14)

The company has no plans for undergoing any amalgamation or de-merger and hence, no policy has been formulated for the same.

2.18 Accounting for Employees Benefits (AS-15)

Liabilities in respect of retirement benefits to employees are provided for as follows:-

-Contribution to Provident Fund and other recognized Funds are charged to Profit & Loss Account.

-The Gratuity liability is paid by the Company out of own funds. The Provision for the gratuity is made on the basis of Actuarial Valuation. The provision for gratuity is recomputed at the end of each financial year.

2.19 Borrowing Costs (AS 16)

Borrowing costs are interest and other costs that an entity incurs in connection with the borrowing of funds. A qualifying asset is an asset that necessarily takes a substantial period of time to get ready for its intended use or sale. Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset form part of the cost of that asset. Other borrowing costs are recognised as an expense.

2.20 Segment Reporting (AS 17)

The company discloses information if any to enable users of its financial statements to evaluate the nature and financial effects of the business activities in which it engages and the economic environments in which it operates.

2.21 Related Party Disclosure (AS 18)

For the purpose of the financial statements, parties are considered to be related to the Company if the Company has the ability, directly or indirectly, to control the party or exercise significant influence over the party in making financial and operating, decisions, or vice versa, or where the Company and the party are subject to common control or common significant influence. Related parties may be individuals or other entities, corporations and associates of common significant influence.

2.22 Accounting for Leases (AS 19)

For lease agreements where all the risks and rewards incident to ownership of an asset are substantially transferred to the lessee (Finance Lease), they are recognised as liability since the inception of agreement. For others, (Operating Lease), the lease payments are recognised as expense in the Profit & Loss Statement on a straight line basis over the term of agreement.

2.23 Earnings Per Share (AS 20)

For the purpose of calculation of EPS (Basic and Diluted) the net profit attributable to Equity Shareholders as per Profit and Loss Account is taken. The weighted number of shares is considered for the purpose of calculation of Basic and Diluted EPS.

2.24 Consolidated Financial Statements (AS 21)

The company prepares and publish consolidated financial statements in respect of the group as per AS-21.

2.25 Accounting for Taxes on Income (AS 22)

Income tax expense is determined on the taxable profits under Income Tax Act after setting off of unabsorbed losses and unabsorbed depreciation. Provision for MAT is made if current tax on taxable profits is less than the MAT applicable. Deferred tax assets and liabilities are measured using the tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled based on tax rates enacted or substantively enacted at the Balance Sheet date. Deferred tax liabilities are recognized for all taxable temporary differences. Deferred tax assets are recognized for all deductible temporary differences, carry forward of unused tax assets and unused tax losses, to the extent that it is probable that taxable profit will be available which the deductible temporary differences, carry forward of unused tax assets and unused tax losses can be. The carrying amount of deferred tax assets is reviewed at each Balance Sheet date. DTA is reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax assets to be utilized.

2.26 Accounting for investment in associates in Consolidated Financial Statements (AS 23)

An associate is an enterprise in which the investor has significant influence and which is neither a subsidiary nor a joint venture of the investor. The company has no associate concern.

2.27 Discontinuing Operations (AS 24)

During the year the Company has not discontinued any of its operations nor has planned any discontinuation.

2.28 Interim Financial Reporting (AS-25)

The Company is publishing un-audited quarterly financial results as per clause 41 of the Listing Agreement with BSE and the same have been duly limited reviewed by the statutory auditors.

2.29 Accounting for Intangible Assets (AS 26)

Film and Program and Broadcasting Rights ("Satellite Rights")

Acquired Satellite Rights for the broadcasting of feature films and other purchasing such as multi-episode television serials are stated at cost. All expenditure on Satellite Rights is recognized as intangible assets, till they become available for telecast on television. Satellite Rights disclosed under intangible assets represent rights, which are available for use as at the date of Balance Sheet. Expected benefits from use or sale of satellite rights are estimated by the management. These are amortized over pattern of economic benefits as per best estimates by the management. While estimating economic benefits management consider variety of factors such as the level of market acceptance of television products, programming viewership, advertisement rates etc.

Film Production costs, distribution and related rights

Upon the theatrical release of a content, the cost of production/acquisition of all the rights related to each such content is amortized in the ratio that current period revenue for the content bears to the management''s estimate of the remaining unrecognized revenue for all the rights arising from the content, as per the individual-film-forecast method. The estimates for remaining unrecognized revenue for each of the content is reviewed periodically and revised if necessary. Expenditure incurred towards production of content not complete as at the date of Balance Sheet and amounts paid under contractual terms for acquiring distribution rights and related rights of content not released in theatres as the date of Balance Sheet are classified as intangible assets under development.

2.30 Financial reporting of interest in Joint Ventures (AS 27)

The Company has no Joint Venture.

2.31 Impairment of Assets (AS 28)

The carrying amounts of the Company''s assets are reviewed at each Balance Sheet date to determine whether there is any indication of impairment. If any such indication exists, the asset''s recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. Impairment loss is charged to the Profit and Loss Account unless it reverses a previous revaluation, credited to reserves, in which case it is charged to reserves.

2.32 Provisions and Contingent Liabilities (AS 29)

(a) Provisions: A provision is recognized when an enterprise 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. These are reviewed at each Balance Date and adjusted to reflect the management''s current estimates.

(b) Contingent Liabilities: A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources.

2.33 Trade Receivables and Payables

Trade and other receivables are stated at their original invoice amount less allowance for doubtful debts based on a review of all outstanding amounts at year end. An allowance for doubtful debts is made when there is objective evidence that the Company will not be able to collect all amounts due according to original terms of receivables. Bad debts are written off when identified. Trade and other payables are stated at cost.

Right, Preferences and Restriction attached to shares Equity shares The company has only one class of Equity having a par value Rs. 10.00 per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the board of directors is subject to the approval of the shareholders in ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the Equity shareholders are eligible to receive the remaining assets of the company after distribution of all preferential amounts, in proportion to their shareholding.

Provision for Gratuity has been calculated as per AS 15 (Accounting for Employee Benefits) and includes Gratuity Liability, which is paid by the Company out of own funds. The Provision for the gratuity is made on the basis of Actuarial Valuation and recomputed at the end of each financial year. The Actuarial Valuation has been carried out on the following assumptions: Salary Escalation Rate 5%, Average age 41 years. The estimates of future salary increases, considered in Actuarial Valuation, takes account of inflation, seniority, promotion and other relevant factors.


Mar 31, 2013

1.1. Basis of Preparation and Presentation

The financial statements are prepared in accordance with Indian Generally Accepted Accounting Principles (GAAP) under the historical cost convention on the accrual basis. The Financial Statements comply in all material aspects with all the applicable accounting standards notified u/s 211 3(c) of the Companies Act 1956 and the relevant provisions of the Companies Act 1956.

All significant accounting policies adopted in the Preparation and Presentation of financial statements has been disclosed. The fundamental accounting assumptions, viz. Going Concern, Consistency and Accrual are being followed in financial statements. There is no change in policies being followed by the Company.

1.2. Use of Estimates

The preparation of Financial Statements in conformity with Generally Accepted Accounting Principles requires the management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period end. Although these estimates are based upon managements'' best knowledge of current events and actions, actual results could differ from these estimates.

1.3 Deferred revenue expenditure on account of fee for increase in the Authorized capital and the GDR issue expenses is amortized over a period of 5 years.

1.4 Preliminary expenditure is amortized over a period of five years in equal installments.

1.5 Accounting policies not specifically referred to herein above is in consistent with generally accepted accounting practices.

1.6 Inventories (AS 2)

Inventories of Raw Materials, Work-in-Progress and Finished Goods are valued at lower of cost or estimated net realizable value. Cost is taken on FIFO or specific identification basis. Net realizable value of Raw Materials, Work-in-Progress and Finished Goods is taken as estimated by the management.

1.7 Cash Flow Statement (AS 3)

Cash Flow Statement is prepared under "indirect method". Cash and Cash Equivalents are defined as cash in hand, demand deposits and short term, highly liquid investments readily convertible to known amounts of cash and subject to insignificant risk of change in value. For the purpose of Cash Flow Statement, cash and cash equivalents include bank overdraft.

1.8 Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies (AS 4)

All items of income and expense, recognized in a period are included in the determination of net profit or loss for the period. This includes profit or loss from ordinary activities, extraordinary items and the effects of changes in accounting estimates/ policies. The nature and amount of prior period items are separately disclosed in the statement of profit and loss in a manner that their impact on the current profit or loss can be perceived.

1.9 Contingencies and Events Occurring after the Balance Sheet Date (AS 5)

As per AS 4, assets and liabilities are adjusted for events occurring after the balance sheet that provide additional evidence to assist the estimation of amounts relating to conditions existing at the balance sheet date or those indicating the fundamental accounting assumption of going concern is not appropriate.

Those events occurring after the balance sheet date that represent material changes and commitments affecting the financial position of the enterprise are disclosed in the Director''s Report.

1.10 Depreciation (AS 6)

Depreciation for all assets is provided on Written Down Value Method in the manner laid down in Schedule XIV to the Companies Act, 1956. The depreciation has been calculated on a pro-rata basis from the date on which the asset is purchased or put to use whichever is later.

1.11 Construction Contracts (AS 7

Since the company is not into the business of construction, the policy related to the same has not been formulated.

1.12 Revenue Recognition (AS 9)

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue will be relatively measured.

For advertisements, the commission is recognized when the related advertisement or commercial appears before the public i.e. on telecast. Programmers/Modules production and acquisition costs are net of recoveries. Sale is recognized when risk and reward of ownership is passed on to the customers. For services revenue is recognized when the service is completed.

1.13 Fixed Assets (AS 10)

Fixed assets are stated at cost less depreciation. Cost comprises of capital costs and incidental expenses attributable to bringing the assets to working condition for its intended use. All capital costs and incidental expenditure relating to pre operational period are shown as capital work in progress. Where an indication of impairment exists, the carrying amount of the asset is assessed and written down immediately to its recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with carrying amount and are included in profit/ (loss). On disposal of revalued assets, amounts in revaluations reserve relating to those assets are transferred to accumulated profits.

1.14 Accounting For Effects of Changes in Foreign Exchange Rate (AS 11)

Transactions in foreign currencies are recognized at rate of overseas currency ruling on the date of transaction. Gain/Loss arising on account of rise or fall in overseas currencies vis-a-vis reporting currency between the date of transaction and that of payment is charged to Profit and Loss Account.

Receivables/payables {Excluding for fixed assets} in foreign currencies are translated at the exchange rate ruling at the year ended date and resultant gain or loss is accounted for in the Profit and Loss Account. Increase/decrease in foreign currency loan on account of exchange fluctuation is debited or credited to the Profit and Loss Account. Impact of Exchange fluctuation is separately disclosed in notes to accounts.

Gain / Loss on translation of financial statements of non-integral foreign operations as on Balance Sheet date is recognized in Foreign Currency Translation Reserve {FCTR} Account, included in Reserves and Surplus, till the disposal of foreign operations.

1.15 Government Grants (AS 12)

Grants from government are recognized where there is reasonable assurance that the company will comply with the conditions attached and that the ultimate collection will be made.

1.16 Accounting for Investments (AS 13)

Current Investments are held at lower of cost and NAV/market value.

Long term investments are held at cost less diminution, if any, in the carrying cost of investment other than temporary in nature. Loss, if any, sustained by any subsidiary is not recognized unless it is permanent in nature.

1.17 Accounting for Amalgamations (AS 14)

The company has no plans for undergoing any amalgamation or de-merger and hence, no policy has been formulated for the same.

1.18 Accounting for Employees Benefits (AS-15)

Liabilities in respect of retirement benefits to employees are provided for as follows:- -Contribution to Provident Fund and other recognized Funds are charged to Profit & Loss Account.

-The Gratuity liability is paid by the Company out of own funds. The Provision for the gratuity is made on the basis of Actuarial Valuation. The provision for gratuity is recomputed at the end of each financial year.

1.19 Borrowing Costs (AS 16)

Borrowing costs are interest and other costs that an entity incurs in connection with the borrowing of funds. A qualifying asset is an asset that necessarily takes a substantial period of time to get ready for its intended use or sale. Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset form part of the cost of that asset. Other borrowing costs are recognized as an expense.

1.20 Segment Reporting (AS 17

The company discloses information if any to enable users of its financial statements to evaluate the nature and financial effects of the business activities in which it engages and the economic environments in which it operates.

1.21 Related Party Disclosure (AS 18)

For the purpose of the financial statements, parties are considered to be related to the Company if the Company has the ability, directly or indirectly, to control the party or exercise significant influence over the party in making financial and operating, decisions, or vice versa, or where the Company and the party are subject to common control or common significant influence. Related parties may be individuals or other entities, corporations and associates of common significant influence.

1.22 Accounting for Leases (AS 19)

For lease agreements where all the risks and rewards incident to ownership of an asset are substantially transferred to the lessee (Finance Lease), they are recognized as liability since the inception of agreement. For others, (Operating Lease), the lease payments are recognized as expense in the Profit & Loss Statement on a straight line basis over the term of agreement.

1.23 Earnings Per Share (AS 20)

For the purpose of calculation of EPS (Basic and Diluted) the net profit attributable to Equity Shareholders as per Profit and Loss Account is taken. The weighted number of shares is considered for the purpose of calculation of Basic and Diluted EP

1.25 Accounting for Taxes on Income (AS 22)

Income tax expense is determined on the taxable profits under Income Tax Act after setting off of unabsorbed losses and unabsorbed depreciation. Provision for MAT is made if current tax on taxable profits is less than the MAT applicable. Deferred tax assets and liabilities are measured using the tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled based on tax rates enacted or substantively enacted at the Balance Sheet date. Deferred tax liabilities are recognized for all taxable temporary differences. Deferred tax assets are recognized for all deductible temporary differences, carry forward of unused tax assets and unused tax losses, to the extent that it is probable that taxable profit will be available which the deductible temporary differences, carry forward of unused tax assets and unused tax losses can be. The carrying amount of deferred tax assets is reviewed at each Balance Sheet date. DTA is reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax assets to be utilized.

1.26 Accounting for investment in associates in Consolidated Financial Statements (AS 23)

An associate is an enterprise in which the investor has significant influence and which is neither a subsidiary nor a joint venture of the investor. The company has no associate concern.

1.27 Discontinuing Operations (AS 24)

During the year the Company has not discontinued any of its operations nor has planned any discontinuation.

1.28 Interim Financial Reporting (AS-25)

The Company is publishing un-audited quarterly financial results as per clause 41 of the Listing Agreement with BSE and the same have been duly limited reviewed by the statutory auditors.

1.29 Accounting for Intangible Assets (AS 26)

Film and Program and Broadcasting Rights ("Satellite Rights")

Acquired Satellite Rights for the broadcasting of feature films and other purchasing such as multi-episode television serials are stated at cost. All expenditure on Satellite Rights is recognized as intangible assets, till they become available for telecast on television. Satellite Rights disclosed under intangible assets represent rights, which are available for use as at the date of Balance Sheet. Expected benefits from use or sale of satellite rights are estimated by the management. These are amortized over pattern of economic benefits as per best estimates by the management. While estimating economic benefits management consider variety of factors such as the level of market acceptance of television products, programming viewership, advertisement rates etc.

Film Production costs, distribution and related rights

Upon the theatrical release of a content, the cost of production/acquisition of all the rights related to each such content is amortized in the ratio that current period revenue for the content bears to the management''s estimate of the remaining unrecognized revenue for all the rights arising from the content, as per the individual-film-forecast method. The estimates for remaining unrecognized revenue for each of the content is reviewed periodically and revised if necessary.

Expenditure incurred towards production of content not complete as at the date of Balance Sheet and amounts paid under contractual terms for acquiring distribution rights and related rights of content not released in theatres as the date of Balance Sheet are classified as intangible assets under development.

1.30 Financial reporting of interest in Joint Ventures (AS 27)

The Company has no Joint Venture.

1.31 Impairment of Assets (AS 28)

The carrying amounts of the Company''s assets, are reviewed at each Balance Sheet date to determine whether there is any indication of impairment. If any such indication exists, the asset''s recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. Impairment loss is charged to the Profit and Loss Account unless it reverses a previous revaluation, credited to reserves, in which case it is charged to reserves.

1.32 Provisions and Contingent Liabilities (AS 29)

(a) Provisions: A provision is recognized when an enterprise 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. These are reviewed at each Balance Date and adjusted to reflect the management''s current estimates.

(b) Contingent Liabilities: A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources.

1.33 Trade Receivables and Payables

Trade and other receivables are stated at their original invoice amount less allowance for doubtful debts based on a review of all outstanding amounts at year end. An allowance for doubtful debts is made when there is objective evidence that the Company will not be able to collect all amounts due according to original terms of receivables. Bad debts are written off when identified.

Trade and other payables are stated at cost.

The company has only one class of equity shares having a par value of Rs. 10 per share. Each shareholder is eligible for one vote per share. However, 2456510 underlying equity shares held by the Deuetsche Bank Trust Company Americas, representing 2456510 GDRs do not hold any voting rights. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the company, after distribution of all preferential amounts, in proportion of their shareholding.


Mar 31, 2012

1.1. Basis of Preparation and Presentation

The financial statements are prepared in accordance with Indian Generally Accepted Accounting Principles (GAAP) under the historical cost convention on the accrual basis. The Financial Statements comply in all material aspects with all the applicable accounting standards notified u/s 211 3(c) of the Companies Act 1956 and the relevant provisions of the Companies Act 1956.

All significant accounting policies adopted in the Preparation and Presentation of financial statements has been disclosed. The fundamental accounting assumptions, viz. Going Concern, Consistency and Accrual are being followed in financial statements. There is no change in policies being followed by the Company.

1.2. Use of Estimates

The preparation of Financial Statements in conformity with Generally Accepted Accounting Principles requires the management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period end. Although these estimates are based upon managements' best knowledge of current events and actions, actual results could differ from these estimates.

1.3 Deferred revenue expenditure on account of fee for increase in the Authorized capital and the GDR issue expenses is amortized over a period of 5 years.

1.4 Preliminary expenditure is amortized over a period of five years in equal instalments.

1.5 Accounting policies not specifically referred to herein above is in consistent with generally accepted accounting practices.

1.6 Inventories (AS 2)

Inventories of Raw Materials, Work-in-Progress and Finished Goods are valued at lower of cost or estimated net realizable value. Cost is taken on FIFO or specific identification basis. Net realizable value of Raw Materials, Work-in-Progress and Finished Goods is taken as estimated by the management.

1.7 Cash Flow Statement (AS 3)

Cash Flow Statement is prepared under "indirect method". Cash and Cash Equivalents are defined as cash in hand, demand deposits and short term, highly liquid investments readily convertible to known amounts of cash and subject to insignificant risk of change in value. For the purpose of Cash Flow Statement, cash and cash equivalents include bank overdraft.

1.8 Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies (AS 4)

All items of income and expense, recognised in a period are included in the determination of net profit or loss for the period. This includes profit or loss from ordinary activities, extraordinary items and the effects of changes in accounting estimates/policies. The nature and amount of prior period items are separately disclosed in the statement of profit and loss in a manner that their impact on the current profit or loss can be perceived.

1.9 Contingencies and Events Occurring after the Balance Sheet Date (AS 5)

As per AS 4, assets and liabilities are adjusted for events occurring after the balance sheet that provide additional evidence to assist the estimation of amounts relating to conditions existing at the balance sheet date or those indicating the fundamental accounting assumption of going concern is not appropriate.

Those events occurring after the balance sheet date that represent material changes and commitments affecting the financial position of the enterprise are disclosed in the Director's Report.

1.10 Depreciation (AS 6)

Depreciation for all assets is provided on Written Down Value Method in the manner laid down in Schedule XIV to the Companies Act, 1956. The depreciation has been calculated on a pro-rata basis from the date on which the asset is purchased or put to use whichever is later.

1.11 Construction Contracts (AS 7)

Since the company is not into the business of construction, the policy related to the same has not been formulated.

1.12 Revenue Recognition (AS 9)

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue will be relatively measured.

For advertisements, the commission is recognized when the related advertisement or commercial appears before the public i.e. on telecast. Programmes/Modules production and acquisition costs are net of recoveries. Sale is recognized when risk and reward of ownership is passed on to the customers. For services revenue is recognized when the service is completed.

1.13 Fixed Assets (AS 10)

Fixed assets are stated at cost less depreciation. Cost comprises of capital costs and incidental expenses attributable to bringing the assets to working condition for its intended use. All capital costs and incidental expenditure relating to pre operational period are shown as capital work in progress. Where an indication of impairment exists, the carrying amount of the asset is assessed and written down immediately to its recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with carrying amount and are included in profit/ (loss). On disposal of revalued assets, amounts in revaluations reserve relating to those assets are transferred to accumulated profits.

1.14 Accounting For Effects of Changes in Foreign Exchange Rate (AS 11)

Transactions in foreign currencies are recognized at rate of overseas currency ruling on the date of transaction. Gain/Loss arising on account of rise or fall in overseas currencies vis-a-vis reporting currency between the date of transaction and that of payment is charged to Profit and Loss Account.

Receivables/payables {Excluding for fixed assets} in foreign currencies are translated at the exchange rate ruling at the year ended date and resultant gain or loss is accounted for in the Profit and Loss Account. Increase/decrease in foreign currency loan on account of exchange fluctuation is debited or credited to the Profit and Loss Account. Impact of Exchange fluctuation is separately disclosed in notes to accounts.

Gain/Loss on translation of financial statements of non-integral foreign operations as on Balance Sheet date is recognized in Foreign Currency Translation Reserve (FCTR) Account, included in Reserves and Surplus, till the disposal of foreign operations.

1.15 Government Grants (AS 12)

Grants from government are recognised where there is reasonable assurance that the company will comply with the conditions attached and that the ultimate collection will be made.

1.16 Accounting for Investments (AS 13)

Current Investments are held at lower of cost and NAV/market value.

Long term investments are held at cost less diminution, if any, in the carrying cost of investment other than temporary in nature. Loss, if any, sustained by any subsidiary is not recognized unless it is permanent in nature.

1.17 Accounting for Amalgamations (AS 14)

The company has no plans for undergoing any amalgamation or de-merger and hence, no policy has been formulated for the same.

1.18 Accounting for Employees Benefits (AS-15)

Liabilities in respect of retirement benefits to employees are provided for as follows:- -Contribution to Provident Fund and other recognized Funds are charged to Profit & Loss Account. -The Gratuity liability is paid by the Company out of own funds. The Provision for the gratuity is made on the basis of Actuarial Valuation. The provision for gratuity is recomputed at the end of each financial year.

1.19 Borrowing Costs (AS 16)

Borrowing costs are interest and other costs that an entity incurs in connection with the borrowing of funds. A qualifying asset is an asset that necessarily takes a substantial period of time to get ready for its intended use or sale. Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset form part of the cost of that asset. Other borrowing costs are recognised as an expense.

1.20 Segment Reporting (AS 17)

The company discloses information if any to enable users of its financial statements to evaluate the nature and financial effects of the business activities in which it engages and the economic environments in which it operates.

1.21 Related Party Disclosure (AS 18)

For the purpose of the financial statements, parties are considered to be related to the Company if the Company has the ability, directly or indirectly, to control the party or exercise significant influence over the party in making financial and operating, decisions, or vice versa, or where the Company and the party are subject to common control or common significant influence. Related parties may be individuals or other entities, corporations and associates of common significant influence.

1.22 Accounting for Leases (AS 19)

For lease agreements where all the risks and rewards incident to ownership of an asset are substantially transferred to the lessee (Finance Lease), they are recognised as liability since the inception of agreement. For others, (Operating Lease), the lease payments are recognised as expense in the Profit & Loss Statement on a straight line basis over the term of agreement.

1.23 Earnings Per Share (AS 20)

For the purpose of calculation of EPS (Basic and Diluted) the net profit attributable to Equity Shareholders as per Profit and Loss Account is taken. The weighted number of shares is considered for the purpose of calculation of Basic and Diluted EPS.

1.24 Consolidated Financial Statements (AS 21)

The company prepares and publish consolidated financial statements in respect of the group as per AS-21.

1.25 Accounting for Taxes on Income (AS 22)

Income tax expense is determined on the taxable profits under Income Tax Act after setting off of unabsorbed losses and unabsorbed depreciation. Provision for MAT is made if current tax on taxable profits is less than the MAT applicable. Deferred tax assets and liabilities are measured using the tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled based on tax rates enacted or substantively enacted at the Balance Sheet date. Deferred tax liabilities are recognized for all taxable temporary differences. Deferred tax assets are recognized for all deductible temporary differences, carry forward of unused tax assets and unused tax losses, to the extent that it is probable that taxable profit will be available which the deductible temporary differences, carry forward of unused tax assets and unused tax losses can be. The carrying amount of deferred tax assets is reviewed at each Balance Sheet date. DTA is reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax assets to be utilized.

1.26 Accounting for investment in associates in Consolidated Financial Statements (AS 23)

An associate is an enterprise in which the investor has significant influence and which is neither a subsidiary nor a joint venture of the investor. The company has no associate concern.

1.27 Discontinuing Operations (AS 24)

During the year the Company has not discontinued any of its operations nor has planned any discontinuation.

1.28 Interim Financial Reporting (AS-25)

The Company is publishing un-audited quarterly financial results as per clause 41 of the Listing Agreement with BSE and the same have been duly limited reviewed by the statutory auditors.

1.29 Accounting for Intangible Assets (AS 26)

Film and Program and Broadcasting Rights ("Satellite Rights")

Acquired Satellite Rights for the broadcasting of feature films and other purchasing such as multi-episode television serials are stated at cost. All expenditure on Satellite Rights is recognized as intangible assets, till they become available for telecast on television. Satellite Rights disclosed under intangible assets represent rights, which are available for use as at the date of Balance Sheet. Expected benefits from use or sale of satellite rights are estimated by the management. These are amortized over pattern of economic benefits as per best estimates by the management. While estimating economic benefits management consider variety of factors such as the level of market acceptance of television products, programming viewership, advertisement rates etc.

Film Production costs, distribution and related rights

Upon the theatrical release of a content, the cost of production/acquisition of all the rights related to each such content is amortized in the ratio that current period revenue for the content bears to the management's estimate of the remaining unrecognized revenue for all the rights arising from the content, as per the individual-film-forecast method. The estimates for remaining unrecognized revenue for each of the content is reviewed periodically and revised if necessary. Expenditure incurred towards production of content not complete as at the date of Balance Sheet and amounts paid under contractual terms for acquiring distribution rights and related rights of content not released in theatres as the date of Balance Sheet are classified as intangible assets under development.

1.30 Financial reporting of interest in Joint Ventures (AS 27)

The Company has no Joint Venture.

1.31 Impairment of Assets (AS 28)

The carrying amounts of the Company's assets, are reviewed at each Balance Sheet date to determine whether there is any indication of impairment. If any such indication exists, the asset's recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. Impairment loss is charged to the Profit and Loss Account unless it reverses a previous revaluation, credited to reserves, in which case it is charged to reserves.

1.32 Provisions and Contingent Liabilities (AS 29)

(a) Provisions: A provision is recognized when an enterprise 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. These are reviewed at each Balance Date and adjusted to reflect the management's current estimates.

(b) Contingent Liabilities: A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources.

1.33 Trade Receivables and Payables

Trade and other receivables are stated at their original invoice amount less allowance for doubtful debts based on a review of all outstanding amounts at year end. An allowance for doubtful debts is made when there is objective evidence that the Company will not be able to collect all amounts due according to original terms of receivables. Bad debts are written off when identified. Trade and other payables are stated at cost.


Mar 31, 2010

(a) Use of Estimates

The preparation of Financial Statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period end. Although these estimates are based upon managements best knowledge of current events and actions, actual results could differ from these estimates.

(b) Basis of Preparation

The financial statements are prepared to comply in all material aspects with all the applicable accounting principles in India, the applicable accounting standards notified U/s 211 3(C) of the Companies Act 1956 and the relevant provisions of the Companies Act 1956.

The Company follows mercantile system of accounting and recognizes income and expenditure on accrual basis and prepares its accounts on a going concern basis.

(c) Deferred revenue expenditure on account of fee for increase in the Authorized capital and the GDR issue expenses are amortized over a period of 5 years.

(d) Pre-operative expenditure is amortized over a period of five years in equal installments.

(e) Accounting policies not specifically referred to herein above is in consistent with generally accepted accounting practices.

B. STATEMENT OF SIGNIFICANT ACCOUNTING STANDARDS: -

(i) Accounting Convention (AS-1): -

(a) The financial statements have been prepared under Historical Cost Convention on going Concern basis.

(b) The Company generally follows mercantile system of accounting and recognizes income and expenditure on accrual basis except those with significant uncertainties.

(ii) Inventories (AS-2): -

(a) Inventories of Raw Materials, Work in Progress and Finished Goods are valued at lower of cost or estimated net realizable value.

(b) Cost is taken on FIFO or specific identification basis.

(c) Net realizable value of Raw Materials, Work in Progress and Finished Goods is taken as estimated by the management.

(d) Any other item is valued strictly as per AS-2

(iii) Cash Flow Statement (AS-3): -

Cash flow statement is prepared under "indirect method" and the same is annexed. Cash and cash equivalents are defined as cash in hand, demand deposits and short-term, highly liquid investments readily convertible to known amounts of cash and subject to insignificant risk of changes in value. For the purpose of Cash Flow Statement, cash and cash equivalents includes bank overdrafts.

(iv) Events occurring after the Balance Sheet date (AS-4): -

There were no significant events occurred after the Balance Sheet date, which require adjustment in the figures as on the Balance Sheet date.

(v) Net profit or loss for the period, prior period items and changes in accounting policies (AS-5): -

There was no Item relating to prior period which has been debits to Profit and loss Account. Further there is no change in accounting policies during the year.

(vi) Depreciation (AS-6): -

Depreciation is provided on written Down Value Method in the manner laid down in Schedule XIV to the Companies Act, 1956. The depreciation has been calculated on a pro-rata basis from the date on which the asset is purchased or put to use whichever is later.

(vii) Construction contracts (AS-7): -

This Accounting Standard is not applicable.

(viii) Research & Development (AS-8): -

This Accounting Standard is withdrawn.

(ix) Revenue Recognition (AS-9): -

(a) Sale is recognized on dispatch of goods to customers.

(b) For services revenue is recognized when the service is completed.

(c) For advertisements, the commission is recognized when the related advertisement or commercial appears before the public i.e. on telecast.

(d) Programmes/Modules production and acquisition costs are net of recoveries.

(e) Revenue and Expenditure are accounted on a going concern basis.

(x) Fixed Assets (AS-10): -

(a) Fixed assets are stated at cost less depreciation. Cost comprises of capital costs and incidental expenses attributable to bringing the assets to working condition for its intended use.

(b) All capital costs and incidental expenditure relating to pre operational period are shown as capital work in progress.

(c) Where an indication of impairment exists, the carrying amount of the asset is assessed and written down immediately to its recoverable amount.

(d) Gains and losses on disposals are determined by comparing proceeds with carrying amount and are included in profit/(loss) from operations. On disposal of revalued assets, amounts in revaluations reserve relating to those assets are transferred to accumulated profits.

(xi) Accounting for effects of changes in foreign exchange rates (AS-11):-

Transactions in foreign currencies are recognized at rate of overseas currency ruling on the date of transaction. Gain/Loss arising on account of rise or fall in overseas currencies vis a vis reporting currency between the date of transaction and that of payment is charged to profit and loss account.

Receivables/payables (Excluding for fixed assets! in foreign currencies are translated at the exchange rate ruling at the year end date and resultant gain or loss is accounted for in the profit and loss account.

Increase/decrease in foreign currency loan on account of exchange fluctuation are debited/credited to the profit and loss account.

Impact of Exchange fluctuation is separately disclosed in notes to accounts.

Gain or Loss on translation of financial statements of non integral foreign operations as on Balance Sheet date is recognized in "Foreign Currency Translation Reserve (FCTR) account", till the disposal of foreign operations.

(xii) Accounting for Government Grants (AS-12): - The Company has never received any grants.

(xiii) Accounting for Investments (AS-13): -

Current Investments are held at lower of cost and NAV/market value. Long term investments are held at cost less diminution, if any, in the carrying cost of investment other than temporary in nature. Loss, if any, sustained by any subsidiary is not recognized.

(xiv) Accounting for amalgamations(AS-14): -

During the year there was no amalgamation.

(xv) Accounting for Employees Benefits (AS-15): -

Liabilities in respect of retirement benefits to employees are provided for as follows:- -Contribution to Provident Fund and other recognized Funds are charged to Profit & Loss Account. -The Gratuity liability is paid by the Company out of own funds. The Provision for the gratuity is made on the basis of actuarial valuation. The provision for gratuity is recomputed at the end of each financial year.

(xvi) Borrowing cost (AS-16): -

The Company does not hold any borrowed funds.

(xvii) Segment Reporting (AS-17): -

The Company operates in only one segment viz., Media & entertainment. Further the Company is operating from only from a single geographical location. As such, there is no reportable Segment.

(xviii) Related party disclosure (AS-18): -

For the purpose of the financial statements, parties are considered to be related to the Company if the Company has the ability, directly or indirectly, to control the party or exercise significant influence over the party in making financial and operating, decisions, or vice versa, or where the Company and the party are subject to common control or common significant influence. Related parties include related corporations and associates. Related parties may be individuals or other entities. The Disclosure has been made as per the requirement of the standard by way of notes:

(xix) Accounting for Leases (AS-19): -

The Company does not hold any Lease Rights.

(xx) Earnings per share (AS-20): -

Disclosure is made in the Profit & Loss Account as per the requirements of the standard. For the purpose of calculation of EPS (Basic and Diluted) the net profit as per profit and loss account is taken. The weighted number of shares are considered for the purposed of calculation of basic and diluted EPS. The details have been given by way of Notes.

(xxi) Consolidated financial statements (AS-21): -

Consolidated financial statement of the Company and its subsidiary drawn as per Accounting Standard (AS-21) are enclosed.

(xxii) Accounting for Taxes on Income (AS-22): -

Income tax expense is determined on the taxable profits under Income Tax Act after setting off of unabsorbed losses and unabsorbed depreciation. Provision for MAT is made if current tax on taxable profits is less than the MAT applicable.

Deferred tax assets and liabilities are measured using the tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled based on tax rates enacted or substantively enacted at the balance sheet date.

Deferred tax liabilities are recognized for all taxable temporary differences. Deferred tax assets are recognized for all deductible temporary differences, carry forward of unused tax assets and unused tax losses, to the extent that it is probable that taxable profit will be available which the deductible temporary differences, carry forward of unused tax assets and unused tax losses can be utilized.

The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax assets to be utilized.

(xxiii) Accounting for investment in associates in consolidated financial statements (AS-23): - The Company does not have any Associate concern.

(xxiv) Discontinuing operations (AS-24): -

During the year the Company has not discontinued any of its operations nor has planned any discontinuation.

(xxv) Interim financial reporting (AS-25): -

The Company is publishing the quarterly financial results as per clause 41 of the Listing Agreement with BSE and the same are subject to limited review by the statutory auditors.

(xxvi) Accounting for intangible assets (AS-26): -

Film and Program and Broadcasting Rights ("Satellite Rights")

Acquired Satellite Rights for the broadcasting of feature films and other purchasing such as multi-episode television serials are stated at cost.

All expenditure on Satellite Rights is recognized as intangible assets, till they become available for telecast on television. Satellite Rights disclosed under intangible assets represent rights, which are available for use as at the date of balance sheet.

Expected benefits from use or sale of satellite rights are estimated by the management. These are amortized over pattern of economic benefits as per best estimates by the management. While estimating economic benefits management consider variety of factors such as the level of market acceptance of television products, programming viewership, advertisement rates etc.

Film Production costs, distribution and related rights

Upon the theatrical release of a content, the cost of production/acquisition of all the rights related to each such content is amortized in the ratio that current period revenue for the content bears to the managements estimate of the remaining unrecognized revenue for all the rights arising from the content, as per the individual-film-forecast method. The estimates for remaining unrecognized revenue for each content is reviewed periodically and revised if necessary.

Expenditure incurred towards production of content not complete as at the date of Balance Sheet and amounts paid under contractual terms for acquiring distribution rights and related rights of content not released in theatres as the date of balance sheet are classified as intangible assets under development.

(xxvii) Financial reporting of interest in joint venture (AS-27): - The Company does not have any Joint Venture.

(xxviii) Impairment of assets (AS-28): -

The carrying amounts of the Companys assets, other than inventories, are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the assets recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset exceeds it recoverable amount. Impairment loss is charged to the profit and loss account unless it reverses a previous revaluation, credited to reserves, in which case it is charged to reserves.

(xxix) Provisions, contingent liabilities and contingent assets (AS-29): -

(a) Provisions

A provision is recognized when an enterprise 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. These are reviewed at each balance Date and adjusted to reflect the managements current estimates.

(b) Contingent Liabilities

The amount for which the Company is contingently liable is disclosed by way of Notes.

(c) The Company does not have any contested Liability.

 
Subscribe now to get personal finance updates in your inbox!