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Auditor Report of Network 18 Media & Investments Ltd.

Mar 31, 2016

Report on the Standalone Financial Statements

1. We have audited the accompanying standalone financial statements of Network18 Media & Investments Limited (the ‘Company''), which comprise the Balance Sheet as at 31 March 2016, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended and a summary of the significant accounting policies and other explanatory information.

Management’s Responsibility for the Standalone Financial Statements

2. The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (the ‘Act'') with respect to the preparation of these standalone financial statements, that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 (as amended). This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act; safeguarding the assets of the Company; 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

3. Our responsibility is to express an opinion on these standalone financial statements based on our audit.

4. 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.

5. We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone financial statements are free from material misstatement.

6. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial controls relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

8. I n our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March 2016, its loss and its cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

9. As required by the Companies (Auditor''s Report) Order, 2016 (the ‘Order'') issued by the Central Government of India in terms of Section 143(11) of the Act, we give in the Annexure I a statement on the matters specified in paragraphs 3 and 4 of the Order.

10. 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. i n 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 standalone financial statements dealt with by this report are in agreement with the books of account;

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

e. on the basis of the written representations received from the directors and taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2016 from being appointed as a director in terms of Section 164(2) of the Act;

f. we have also audited the internal financial controls over financial reporting (IFCoFR) of the Company as of 31 March 2016 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date and our report dated 20 April 2016 as per Annexure II expressed unmodified opinion; and

g. 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. as detailed in Note 34 to the standalone financial statements, the Company has disclosed the impact of pending litigations on its standalone financial position;

ii. t he Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses; and

iii. there has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company. accounts and records have been made and maintained. However, we have not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

(vii) (a) Undisputed statutory dues including provident fund, employees’ state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues, as applicable, have generally been regularly deposited to the appropriate authorities, though there has been a slight delay in a few cases. Further, no undisputed amounts payable in respect thereof were outstanding at the year-end for a period of more than six months from the date they became payable.

(b) There are no dues in respect of income-tax, sales-tax, service tax, duty of customs, duty of excise and value added tax that have not been deposited with the appropriate authorities on account of any dispute.

(viii) The Company has not defaulted in repayment of loans or borrowings to any bank during the year. The Company has no loans or borrowings payable to a financial institution or government and no dues payable to debentures holders during the year.

(ix) The Company did not raise moneys by way of initial public offer or further public offer (including debt instruments). In our opinion, the term loans were applied for the purposes for which the loans were obtained.

(x) No fraud by the Company or on the Company by its officers or employees has been noticed or reported during the period covered by our audit.

(xi) In our opinion, the provisions of section 197 of the Act read with Schedule V to the Act is not applicable to the Company as

Independent Auditor’s report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (the ‘Act’)

1. In conjunction with our audit of the standalone financial statements of Network18 Media & Investments Limited (the ‘Company'') as of and for the year ended 31 March 2016, we have audited the internal financial controls over financial reporting (IFCoFR) of the Company of as of that date. the Company does not pay any remuneration to the directors. Accordingly, the provisions of clause 3(xi) of the Order are not applicable.

(xii) In our opinion, the Company is not a Nidhi Company. Accordingly, clause 3(xii) of the Order is not applicable.

(xiii) In our opinion, all transactions with the related parties are in compliance with sections 177 and 188 of Act, where applicable, and the requisite details have been disclosed in the financial statements etc., as required by the applicable accounting standards.

(xiv) During the year, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures.

(xv) The Company has not entered into any non-cash transactions with directors or persons connected with them.

(xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.

Management’s Responsibility for Internal Financial Controls

2. The Company''s Board of Directors is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the ‘Guidance Note'') issued by the Institute of Chartered Accountants of India (‘ICAI''). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of the Company''s business, including adherence to Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.

Auditors’ Responsibility

3. Our responsibility is to express an opinion on the Company’s IFCoFR based on our audit. We conducted our audit in accordance with the Standards on Auditing (‘standards''), issued by the ICAI and deemed to be prescribed under section 143(10) of the Act, to the extent applicable to an audit of IFCoFR, and the Guidance Note issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate IFCoFR were established and maintained and if such controls operated effectively in all material respects.

4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the IFCoFR and their operating effectiveness. Our audit of IFCoFR included obtaining an understanding of IFCoFR, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. 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.

5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s IFCoFR.

Meaning of Internal Financial Controls over Financial Reporting

6. A Company''s IFCoFR is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A Company''s IFCoFR includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company''s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

7. Because of the inherent limitations of IFCoFR, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the IFCoFR to future periods are subject to the risk that IFCoFR may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

8. In our opinion, the Company has, in all material respects, adequate internal financial controls over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31 March 2016, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note issued by the ICAI.

For Walker Chandiok & Co LLP

(formerly Walker, Chandiok & Co)

Chartered Accountants

Firm''s Registration No.: 001076N/N500013

per B P Singh

Partner

Membership No.: 70116

Place : Noida

Date : 20 April 2016


Mar 31, 2015

1. We have audited the accompanying standalone financial statements of Network 18 Media & Investments Limited (the 'Company'), which comprise the Balance Sheet as at 31 March 2015, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended and a summary of the significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Financial Statements

2. The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (the 'Act') with respect to the preparation of these standalone financial statements, that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 (as amended). 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

3. Our responsibility is to express an opinion on these standalone financial statements based on our audit.

4. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

5. We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone financial statements are free from material misstatement.

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

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

Opinion

8. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March 2015, its loss and its cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

9. As required by the Companies (Auditor's Report) Order, 2015 (the 'Order') issued by the Central Government of India in terms of Section 143(11) of the Act, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order.

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

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

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

c. the standalone financial statements dealt with by this report are in agreement with the books of account;

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

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

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. as detailed in Note 35 to the standalone financial statements, the Company has disclosed the impact of pending litigations on its standalone financial position;

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

iii. there has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

Independent Auditor's Report (Contd.)

Annexure to the Independent Auditor's Report of even date to the members of Network 18 Media & Investments Limited, on the Standalone Financial Statements for the year ended 31 March, 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:

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

(b) The Company has a regular program of physical verification of its fixed assets under which fixed assets are verified in a phased manner over a period of 3 years, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.

(ii) (a) The company's entire inventory is lying with third parties for which written confirmations have been obtained by the management as at the year-end.

(b) The procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory and no material discrepancies between physical inventory and book records were noticed on physical verification.

(iii) The Company has granted unsecured loans to a company covered in the register maintained under Section 189 of the Act; and with respect to the same:

(a) the principal and interest amount is not due for repayment currently

(b) there is no overdue amount in respect of the loan granted to such company.

(iv) 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. During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas.

(v) In our opinion, the Company has complied with the directives issued by the Reserve Bank of India, the provisions of Sections 73to 76 and other relevant provisions of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended) as applicable, with regard to the deposits accepted. According to the information and explanations given to us, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal, in this regard.

(vi) We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under sub-section (1) of Section 148 of the Act in respect of Company's services and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

(vii) (a) Undisputed statutory dues including provident fund, employees' state insurance, income-tax, sales-tax, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues, as applicable, have generally been regularly deposited with the appropriate authorities, though there has been a slight delay in a few cases. Further, no undisputed amounts payable in respect thereof were outstanding at the year-end for a period of more than six months from the date they became payable.

(b) There are no dues in respect of income-tax, sales-tax, wealth tax, service tax, duty of customs, duty of excise, value added tax and cess that have not been deposited with the appropriate authorities on account of any dispute.

(c) The Company has transferred the amount 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 made there under within the specified time.

(viii) In our opinion, the Company's accumulated losses at the end of the financial year are less than fifty percent of its net worth. The Company has incurred cash losses in the current year and immediately preceding financial year.

(ix) The Company has not defaulted in repayment of dues to any bank or financial institution during the year. The Company did not have any outstanding debentures during the year.

(x) In our opinion, the terms and conditions on which the Company has given guarantee for loans taken by others from banks or financial institutions are not, prima facie, prejudicial to the interest of the Company.

(xi) In our opinion, the Company has applied the term loans for the purpose for which these loans were obtained.

(xii) No fraud on or by the Company has been noticed or reported during the period covered by our audit.

For Walker Chandiok & Co LLP

(Formerly Walker, Chandiok & Co)

Chartered Accountants

Firm's Registration No.: 001076N/N500013

per BP Singh

Partner

Membership No.: 70116

Place : Noida

Date : 15 April 2015


Mar 31, 2014

1. We have audited the accompanying financial statements of Network18 Media & Investments Limited, ("the Company"), which comprise the Balance Sheet as at 31 March 2014, and 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

2. Management is responsible for the preparation of these 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 notified under the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013. This responsibility includes the design, implementation and maintenance of internal control 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.

Auditors'' Responsibility

3. Our responsibility is to express an opinion on these financial statements based on our audit. 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.

4. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors'' 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 an opinion on the effectiveness of 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.

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

Opinion

6. In our opinion and to the best of our information and according to the explanations given to us, 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:

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

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

iii) 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

7. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

8. As required by Section 227(3) of the Act, we report that:

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

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 financial statements dealt with by this report are in agreement with the books of account;

d. in our opinion, the financial statements comply with the Accounting Standards notified under the Companies Act, 1956 read with the General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013 ; and

e. on the basis of written representations received from the directors, and taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2014 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Act.

Annexure to the Independent Auditors'' Report of even date to the members of Network18 Media & Investments Limited, on the financial statements for the year ended 31 March 2014

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:

(i) (a) The Company has maintained proper records

showing full particulars, including quantitative details and situation of fixed assets.

(b) The Company has a regular program of physical verification of its fixed assets under which fixed assets are verified in a phased manner over a period of 3 years, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.

(c) During the year, the Company has disposed off a substantial part of the fixed assets, which, however, in our opinion has not affected the going concern status of the Company.

(ii) (a) The management has conducted physical verification of inventory at reasonable intervals during the year.

(b) The procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory and no material discrepancies between physical inventory and book records were noticed on physical verification.

(iii) (a) The Company has granted unsecured loans to three parties covered in the register maintained under Section 301 of the Act. The maximum amount outstanding during the year is Rs 3,414,069,174 and the year-end balance is Rs 229,858,604.

(b) In our opinion, the rate of interest and other terms and conditions of such loans are not, prima facie, prejudicial to the interest of the Company.

(c) In respect of loans granted, receipt of the principal amount and the interest is regular.

(d) There is no overdue amount in respect of loans granted to such companies, firms or other parties.

(e) The Company has not taken any loans, secured or unsecured from companies, firms or other parties covered in the register maintained under Section 301 of the Act. Accordingly, the provisions of clauses 4(iii)(f) and 4(iii)(g) of the Order are not applicable.

(iv) 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. During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas.

(v) (a) In our opinion, the particulars of all contracts or arrangements that need to be entered into the register maintained under Section 301 of the Act have been so entered.

(b) Owing to the unique and specialized nature of the items involved and in the absence of any comparable prices, we are unable to comment as to whether the transactions made in pursuance of such contracts or arrangements have been made at the prevailing market prices at the relevant time.

(vi) In our opinion, the Company has complied with the directives issued by the Reserve Bank of India, the provisions of Sections 58A and 58AA and other relevant provisions of the Act and the Companies (Acceptance of Deposits) Rules, 1975, as applicable, with regard to the deposits accepted from the public. According to the information and explanations given to us, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal, in this regard.

(vii) In our opinion, the Company has an internal audit system commensurate with its size and the nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under clause (d) of sub-section (1) of Section 209 of the Act in respect of Company''s services and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

(ix) (a) Undisputed statutory dues including provident fund, investor education and protection fund, employees'' state insurance, income-tax, sales- tax, wealth tax, service tax, custom duty, excise duty, cess and other material statutory dues, as applicable, have generally been regularly deposited with the appropriate authorities, though there has been a slight delay in a few cases.

Further, no undisputed amounts payable in respect thereof were outstanding at the year-end for a period of more than six months from the date they became payable.

(b) There are no dues in respect of income-tax, sales- tax, wealth tax, service tax, customs duty, excise duty and cess that have not been deposited with the appropriate authorities on account of any dispute.

(x) In our opinion, the Company''s accumulated losses at the end of the financial year are less than fifty percent of its net worth. The Company has incurred cash losses in the current year and immediately preceding financial year.

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

(xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities. Accordingly, the provisions of clause 4(xii) of the Order are not applicable.

(xiii) In our opinion, the Company is not a chit fund or a nidhi/ mutual benefit fund/ society. Accordingly, provisions of clause 4(xiii) of the Order are not applicable.

(xiv) In our opinion, the Company is not dealing or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Order are not applicable.

(xv) In our opinion, the terms and conditions on which the Company has given guarantee for loans taken by others from banks or financial institutions are not, prima facie, prejudicial to the interest of the Company.

(xvi) In our opinion, the Company has applied the term loans for the purpose for which these loans were obtained.

(xvii) In our opinion and based on an overall examination of the balance sheet of the Company, we report that funds amounting to approximately Rs. 3,356,617,048 raised on short- term basis in the form of short term borrowings and excess of current liabilities over current assets have been used for long term investment for funding the operating losses of the Company.

(xviii) During the year, the Company has not made any preferential allotment of shares to companies covered in the register maintained under Section 301 of the Act. Accordingly, the provisions of clause 4(xviii) of the Order are not applicable.

(xix) The Company has created security in respect of debentures issued during the year.

(xx) We have verified the end use of money raised by public issue as disclosed by the management in the other explanatory information to the financial statements.

(xxi) No fraud on or by the Company has been noticed or reported during the period covered by our audit.

For Walker Chandiok & Co LLP (formerly Walker, Chandiok & Co) Chartered Accountants Firm Registration No.: 001076N

per B.P. Singh Partner Membership No.: 70116

Place: Noida Date: May 27, 2014


Mar 31, 2013

Report on the Financial Statements

1. We have audited the accompanying financial statements of Network18 Media & Investments Limited, ("the Company"), which comprise the Balance Sheet as at 31 March 2013, and 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

2. Management is responsible for the preparation of these 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 referred to in sub- section (3C) of Section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control 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.

Auditors'' Responsibility

3. Our responsibility is to express an opinion on these financial statements based on our audit. 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.

4. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors'' 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. 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.

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

Basis for Qualified Opinion

6. The Company has paid Rs. 26,388,400 as managerial remuneration to its managing director upto 31 March 2013 (upto 31 March 2012: Rs. 20,100,400), which is in excess of the limits prescribed under the Act. Had the Company accounted for the remuneration in accordance with the Act, the net loss after tax for the year ended 31 March 2013 would have been lower by Rs. 26,388,400 (for the year ended 31 March 2012: Rs. 20,100,400) and Short- term loans and advances would have been higher by Rs. 26,388,400 (as at 31 March 2012: Rs. 20,100,400). Our report on the financial statements for the year ended 31 March 2012 was also qualified in respect of this matter. Qualified Opinion

7. 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:

i) in the case of the Balance Sheet, of the state of affairs of the Company as at 31 March 2013;

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

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

Emphasis of Matter

8. We draw attention to Note 4 to the financial statements in connection with the scheme of arrangement between the Company and Infomedia Press Limited (''Infomedia''), a subsidiary company, approved by the Hon''ble High Court of Delhi, made effective on 1 June 2012 with an appointed date of 1 April 2010. Pursuant to the terms of the said Scheme, the Company has adjusted the diminution, other than temporary, in the carrying value of its Non-current investments through Securities Premium Account, which otherwise would have been debited to the Statement of Profit and Loss in accordance with accounting standards, as notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and other recognised accounting practices and policies. Our opinion is not qualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

9. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

10. As required by Section 227(3) of the Act, we report that:

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

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 financial statements dealt with by this report are in agreement with the books of account;

d. Except for the effect of the matter described in the Basis of Qualified Opinion paragraph,in our opinion, the financial statements comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Act; and

e. on the basis of written representations received from the directors, as on 31 March 2013 and taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2013 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Act.

Annexure to the Independent Auditors'' Report of even date to the members of Network18 Media & Investments Limited, on the financial statements for the year ended 31 March 2013

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:

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

(b) The Company has a regular program of physical verification of its fixed assets under which fixed assets are verified in a phased manner over a period of 3 years, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.

(c) In our opinion, a substantial part of fixed assets has not been disposed off during the year.

(ii) (a) The management has conducted physical verification of inventory at reasonable intervals during the year.

(b) The procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory and no material discrepancies between physical inventory and book records were noticed on physical verification.

(iii) (a) The Company has granted unsecured loans to two parties covered in the register maintained under Section 301 of the Act. The maximum amount outstanding during the year is Rs. 1,544,854,134 and the year-end balance is Rs. 1,544,854,134.

(b) In our opinion, the rate of interest and other terms and conditions of such loans are not, prima facie, prejudicial to the interest of the Company.

(c) In respect of loans granted, the principal and interest amount is not due for repayment currently.

(d) There is no overdue amount in respect of loans granted to such companies, firms or other parties.

(e) The Company has taken secured loans from six parties covered in the register maintained under Section 301 of the Act. The maximum amount outstanding during the year is Rs 3,452,676,048 and the year-end balance is nil.

(f) In our opinion, the rate of interest and other terms and conditions of loans taken by the Company are not, prima facie, prejudicial to the interest of the Company

(g) In respect of loans taken, repayment of the principal amount and the interest is regular.

(iv) Owing to the nature of its business, the Company does not sell any goods. Accordingly, clause 4(iv) of the Order with respect to sale of goods is not applicable. 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 inventories and fixed assets and for the sale of services. During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas

(v) (a) In our opinion,the particulars of all contracts or arrangements that need to be entered into the register maintained underSection 301 of the Act have been so entered.

(b) In our opinion, the transactions made inpursuance of such contracts or arrangements and exceeding the value of Rs five lakhs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) In our opinion, the Company has complied with the directives issued by the Reserve Bank of India, the provisions of Sections 58A and 58AA and other relevant provisions of the Act and the Companies (Acceptance of Deposits) Rules, 1975, as applicable, with regard to the deposits accepted from the public. According to the information and explanations given to us, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal, in this regard.

(vii) In our opinion, the Company has an internal audit system commensurate with its size and the nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under clause (d) of sub-section (1) of Section 209 of the Act in respect of Company''s services and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

(ix) (a) Undisputed statutory dues including provident fund, investor education and protection fund, employees'' state insurance, income-tax, sales- tax, wealth tax, service tax, custom duty, excise duty, cess have not generally been regularly deposited with the appropriate authorities though the delays in deposit have not been significant. Further, no undisputed amounts payable in respect thereof were outstanding at the year-end for a period of more than six months from the date they become payable.

(b) There are no dues in respect of income-tax, sales-tax, wealth tax, service tax, customs duty,excise duty and cess that have not been deposited with the appropriate authorities on account of any dispute.

(x) In our opinion, the Company''s accumulated losses at the end of the financial year are less than fifty per cent of its net worth. The Company has incurred cash losses in the current and the immediately preceding financial year.

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

(xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities. Accordingly, the provisions of clause 4(xii) of the Order are not applicable.

(xiii) In our opinion, the Company is not a chit fund or a nidhi/mutual benefit fund/society. Accordingly, provisions of clause 4(xiii) of the Orderare not applicable.

(xiv) In our opinion, the Company is not dealing or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Order are not applicable.

(xv) In our opinion, the terms and conditions on which the Company has given guarantee for loans taken by others from banks or financial institutions are not, prima facie, prejudicial to the interest of the Company.

(xvi) In our opinion, the Company has applied the term loans for the purpose for which these loans were obtained.

(xvii) In our opinion, no funds raised on short-term basis have been used for long-term investment by the Company.

(xviii) During the year, the Company has not made any preferential allotment of shares to companies covered in the register maintained under Section 301 of the Act. Accordingly, the provisions of clause 4(xviii) of the Order are not applicable.

(xix) The Company has created security in respect of debentures outstanding during the year.

(xx) We have verified the end use of money raised by public issue as disclosed by the management in the other explanatory informationto the financial statements.

(xxi) No fraud on or by the Company has been noticed or reported during the period covered by our audit.

For Walker, Chandiok & Co

Chartered Accountants

Firm Registration No.: 001076N

per B.P. Singh

Partner

Membership No.: 70116

Place : Noida

Date : May 13, 2013


Mar 31, 2012

1. We have audited the attached Balance Sheet of Network 18 Media & Investments Limited (the Company), as at 31 March 2012, and also the Statement of Profit and Loss and the Cash Flow Statement for the year ended on that date annexed thereto (collectively referred as the financial statements). 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 the 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 a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 (the Order) (as amended) issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956 (the Act) , we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

4. Without qualifying our opinion in respect of the ensuing matter, we draw attention to Note 4 to the financial statements. In accordance with the scheme of arrangement between the Company and some of its subsidiary companies approved by the Honble High Court of Delhi made effective on 10 June 2011 with an appointed date of 1 April 2010, the Company has adjusted the book values of certain assets and liabilities to reflect their fair values and has recorded the resulting adjustment to the Securities Premium Account.

5. We report that, the Company has paid Rs. 20,100,400 as managerial remuneration to its managing director upto 31 March 2012 (upto 31 March 2011 Rs. 15,204,400, the opinion of the predecessor auditor was qualified in this respect) which is in excess of the limits prescribed under the Act. Had the Company accounted for the remuneration in accordance with the Act, the Loss for the year would have been lower by Rs. 20,100,400 (for the year ended 31 March 2011 Rs. 15,204,400) and Short- term loans and advances would have been higher by Rs. 20,100,400 (as at 31 March 2011 Rs.15,204,400).

6. Further to our comments in the Annexure referred to above, we report 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 appears from our examination of those books;

(c) The financial statements dealt with by this report are in agreement with the books of account;

(d) On the basis of written representations received from the directors, as on 31 March 2012 and taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2012 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Act;

(e) In our opinion and to the best of our information and according to the explanations given to us, subject to the effect on the financial statements of the matter referred to in paragraph 5 above, the financial statements dealt with by this report comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Act and 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, in the case of:

(i) the Balance Sheet, of the state of affairs of the Company as at 31 March 2012;

(ii) the Statement of Profit and Loss, of the loss for the year ended on that date; and

(iii) the Cash Flow Statement, of the cash flows for the year ended on that date.

Annexure to the Auditors Report of even date, to the members of Network 18 Media & Investments Limited on the financial statements for the year ended 31 March 2012

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:

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

(b) The fixed assets have been physically verified by the management during the year and no material discrepancies were noticed on such verification. In our opinion, the frequency of verification of the fixed assets is reasonable having regard to the size of the Company and the nature of its assets.

(c) In our opinion, a substantial part of fixed assets has not been disposed off during the year.

(ii) (a) The management has conducted physical verification of inventory at reasonable intervals during the year.

(b) The procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification.

(iii) (a) The Company has granted unsecured loans to one party covered in the register maintained under Section 301 of the Act. The maximum amount outstanding during the year is Rs. 544,804,21 1 and the year-end balance is Rs.544,804,211.

(b) In our opinion, the rate of interest and other terms and conditions of such loans are not, prima facie, prejudicial to the interest of the Company.

(c) In respect of loans granted, receipt of the principal amount and interest is regular.

(d) There is no overdue amount in respect of loans granted to such companies, firms or other parties.

(e) The Company has taken secured loans from five parties covered in the register maintained under Section 301 of the Act. The maximum amount outstanding during the year is Rs. 3,135,369,220 and the year-end balance is Rs. 3,135,369,220 .

(f) In our opinion, the rate of interest and other terms and conditions of loans taken by the Company are not, prima facie, prejudicial to the interest of the Company.

(g) In respect of loans taken, payment of the principal amount and interest is regular.

(iv) Owing to the nature of its business, the Company does not sell any goods. Accordingly, clause 4(iv) of the Order with respect to sale of goods is not applicable. 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 services. During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas.

(v) (a) In our opinion, the particulars of all contracts or arrangements that need to be entered into the register maintained under Section 301 of the Act have been so entered.

(b) In our opinion, the transactions made in pursuance of such contracts or arrangements and exceeding the value of rupees five lakhs in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

(vi) In our opinion, the Company has complied with the directives issued by the Reserve Bank of India, the provisions of Sections 58A and 58AA and other relevant provisions of the Act and the Companies (Acceptance of Deposits) Rules, 1975 as applicable with regard to the deposits accepted from the public. According to the information and explanations given to us, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal, in this regard.

(vii) In our opinion, the Company has an internal audit system commensurate with its size and the nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under clause (d) of sub- section (1) of Section 209 of the Act in respect of Companys services and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

(ix) (a) Undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income-tax, sales- tax, wealth-tax, service-tax, custom duty, excise duty, cess and other material statutory dues, as applicable, have generally been regularly deposited with the appropriate authorities, though there has been a slight delay in a few cases. No undisputed amounts payable in respect thereof were outstanding at the year- end for a period of more than six months from the date they became payable.

(b) There are no dues in respect of income tax, sales tax, wealth tax, service tax, customs duty, excise duty and cess that have not been deposited with the appropriate authorities on account of any dispute.

(x) In our opinion, the Companys accumulated losses at the end of the financial year are less than fifty per cent of its net worth. The Company has incurred cash losses in the current and the preceding financial year.

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

(xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities. Accordingly, the provisions of clause 4(xii) of the Order are not applicable.

(xiii) In our opinion, the Company is not a chit fund or a nidhi/ mutual benefit fund/ society. Accordingly, the provisions of clause 4(xiii) of the Order are not applicable.

(xiv) In our opinion, proper records have been maintained for the transactions and contracts in respect of dealing and/ or trading in shares, securities, debentures and other investments and timely entries have been made therein. These shares, securities, debentures and other securities have been held by the Company in its own name except to the extent of exemption granted under Section 49 of the Act.

(xv) In our opinion, the terms and conditions on which the Company has given guarantee for loans taken by others from banks or financial institutions are not, prima facie, prejudicial to the interest of the Company.

(xvi) In our opinion, the Company has applied the term loans for the purpose for which these loans were obtained.

(xvii)In our opinion, no funds raised on short-term basis have been used for long-term investment.

(xviii) During the year, the Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under Section 301 of the Act. Accordingly, the provisions of clause 4(xviii) of the Order are not applicable.

(xix) The Company has created security in respect of debentures issued during the year.

(xx) The Company has not raised any money by public issues during the year. Accordingly, the provisions of clause 4(xx) of the Order are not applicable.

(xxi) No fraud on or by the Company has been noticed or reported during the period covered by our audit.

for Walker, Chandiok & Co

Chartered Accountants

Firm Registration No.: 001076N



per B.P. Singh

Partner

Membership No.: 70116

Place: New Delhi

Date: 4 August 2012


Mar 31, 2011

1. We have audited the attached Balance Sheet of Network18 Media & Investments Limited ('the Company') as at March 31,2011 and the Profit & Loss Account for the year ended on that date and the Cash Flow Statement for the year ended on that date both annexed hereto . 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 a test check 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 the 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,issued by the Company Law Board in terms of Section 227(4A) of the Companies Act,1956, we annex hereto a statement on the matters specified in paragraph 4 of the said Order, to the extent applicable to the company.

4. Attention is drawn to:

(i) Note 13(a) of Schedule 15 to the financial statements regarding payment of remuneration to the Managing Director in excess of the limits prescribed under Schedule XIII of the Companies Act,1956 . The Central Government has partially approved the Company's application for payment of the remuneration and the Company has filed an application for reconsideration of the matter.

(ii) Notes 7(e) ,7(f) and 8 of Schedule 15 to the financial statements regarding the non provision for other than temporary impairment in the value of Investments of Rs. 2,612.36 millions and non recoverability of advances of Rs 1276 million. We are unable to comment on the adjustments and impact, if any, on the financial statements in respect of the above matters .

5. Without qualifying our opinion attention is drawn to,

a) Note 1(f ) of Schedule 15 to the financial statements wherein it is stated that no effect has been given in these financial statements of the Scheme of restructuring referred to in that note.

b) Note 1(e) of Schedule 15 to the financial

statements referring to operational losses incurred by the company and the company's plans in that regard.

6. Further to our comments in the annexure referred to in Paragraph 4 above, we report that

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

b. in our opinion, proper books of account have been kept as required by law , so far as appears from our examination of the books.

c. the Balance Sheet ,Profit and 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 & Loss Account and Cash Flow Statement dealt with by this report are in compliance with the Accounting Standards referred to in sub section 3(c) of Section 211 of the Companies Act,1956.

e. In our opinion and to the best of our information and according to the explanations given to us , the said accounts read together with Para 5 above and the significant accounting policies and notes thereon and subject to our comments in Para 4 above ,give the information as required by The Companies Act,1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

ii) in the case of the Profit and Loss account,of the loss 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

7. 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 Directors is disqualified as on that date from being appointed as a Director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act,1956.

Annexure

Annexure referred to in Para 3 of our Report of even date, to the members of Network18 Media & Investments Limited

As required by the Companies (Auditor's Report) Order, 2003 on the basis of such checks as we considered appropriate, and, according to the information and explanations given to us, we report that :- 1. The company has maintained proper records

showing full particulars including quantitative details

and situation of fixed assets.

2. The fixed assets have been physically verified by the management during the period and no material discrepancies were noticed.

3. A substantial part of fixed assets have not been disposed off during the year.

4. All inventories have been physically verified by the management at reasonable intervals.

5. The procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the company and its business.

6. The company has maintained proper records of inventory and no material discrepancies were noticed on physical verification.

7. The company had granted an unsecured loan of Rs 552.50 millions to an entity covered in the Register maintained under Section 301 of the Act at a rate of interest lower than market. The said loan has been repaid as on March 31, 2011.

8. The company has not taken any loans, from a company listed in the Register maintained under Section 301 of the Act.

9. There is an internal control procedure commensurate with the size of the company and the nature of its business for the purchase of Fixed Assets and inventory and for the sale of services. During the course of our audit, we have not observed any continuing failure to correct weaknesses in the internal control system.

10. The particulars of all contract or arrangements referred to in Section 301 of the Act, have been entered in the Register required to be maintained under that section . Transactions made in pursuance of such arrangements have been made at prices which are, prima facie, reasonable having regard to the prevailing market prices at the relevant time.

11. In respect of deposits accepted during the year from the public, the directives issued by the Reserve Bank of India and the provisions of Section 58A and 58AA, other relevant provisions of the Companies Act,1956 and the rules framed thereunder, where applicable, have been complied with. According to the information and explanations given to us, no order has been passed by the Company Law Board, or the National Company Law Tribunal or the Reserve Bank of India or any other tribunal,

12. The company has an internal audit system commensurate with its size and the nature of its business.

13. Maintenance of cost records has not been prescribed by the Central Government under Section 209(1) (d)

of the Companies Act,1956, for any of the products of the Company.

14. The company has been generally been regular in depositing undisputed statutory dues on account of Income tax, Provident Fund, Service Tax and Employees State Insurance dues. The company's current operations do not require it to deposit any amounts towards Investor Education and Protection Fund, Sales Taxes, Customs Duty, Excise and such cess(s).There are no undisputed sums payable towards Income tax, Wealth tax, Provident Fund, Service Tax and Employees State Insurance dues, which were outstanding at the year end for a period of more than six months from the date they became payable.

15. The company's losses as at March 31,2011 do not exceed 50% of its Net Worth. The company has incurred cash losses in the year under review and in the immediately preceding financial year.

16. The company has not defaulted in repayment of dues to a financial institution or bank or debenture holders.

17. No loans / advances have been granted on the basis of security of pledge of shares, debentures and other securities.

18. The company's activities do not require compliance with any special statute applicable to chit fund companies.

19. In respect of dealings or trading in shares and securities the company has maintained proper records of the transactions and contracts and timely entries have been made . All shares / securities have been held by the company in its own name.

20. The company has given guarantees for loans taken

by others from Financial Institutions / Banks, the terms of which are prima facie, not prejudicial to the company's interest.

21. Term Loans were applied for the purpose they were

obtained.

22. Short term loans have not been used for or Long term investments.

23. The company has made a preferential allotment Equity

Shares to a party listed in the Register maintained u/s 301 of the Companies Act and the terms of the same are not prejudicial to the interests of the company.

24. The company has not issued any debentures and therefore no security was required to be created.

25. The management has disclosed the end use of money raised through rights issue and the same has been verified.

26. No fraud on or by the company has been noticed or reported during the year.

For G S Ahuja & Associates Chartered Accountants Firm registration no. N 8999

G S Ahuja Proprietor Membership No. 87732 Noida, May 30, 2011


Mar 31, 2010

1. We have audited the attached Balance Sheet of Network18 Media & Investments Limited (the company) as at March 31,2010 and the profit & Loss Account for the year ended on that date and the Cash Flow Statement for the year ended on that date both annexed hereto. 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 a test check, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and signifcant estimates made by the 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 (Auditors Report) Order, 2003,issued by the Company Law Board in terms of Section 227(4A) of the Companies Act,1956 ,we annex hereto a statement on the matters specifed in paragraph 4 of the said Order, to the extent applicable to the company.

4. The company has paid a remuneration of Rs. 10,944,000/- to its Managing Director which is in excess of that allowed under Schedule XIII to the Companies Act, 1956. The companys application for approval of the remuneration paid in the year ended March 31,2010 and the previous year is pending before the Central Government . We are unable to comment on the adjustments and impact, if any, on the financial statements in respect of the above non compliance.

5. Further to our comments in the annexure referred to in Paragraph 4 above, we report that

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

b. in our opinion, proper books of account have been kept as required by law, so far as appears from our examination of the books.

c. the Balance Sheet, profit and 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 & Loss Account and Cash Flow Statement dealt with by this report are in compliance with the Accounting Standards referred to in sub section 3(c) of Section 211 of the Companies Act,1956.

e. In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the signifcant accounting policies and notes thereon, subject to our comments in Para 4 above, give the information as required by The Companies Act,1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

i) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2010, and ii) in the case of the profit and Loss account, of the loss for the year ended on that date, and

iii) in the case of the Cash Flow statement, of the cash fows of the Company for the year ended on that date.

6. 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 Directors is disqualifed as on that date from being appointed as a Director in terms of clause (g) of sub-section (1)

ANNEXURE

Annexure referred to in Para 3 of our Report of even date, to the members of Network18 Media & Investments Limited

As required by the Companies (Auditors Report) Order, 2003 on the basis of such checks as we considered appropriate, and, according to the information and explanations given to us, we report that :- 1. The company has maintained proper records showing full particulars including quantitative details and situation of fxed assets.

2. The fxed assets have been physically verifed by the management during the period and no material discrepancies were noticed .

3. A substantial part of fxed assets have not been disposed off during the year.

4. All inventories have been physically verifed by the management at reasonable intervals .

5. The procedures of physical verifcation of inventory followed by the management are reasonable and adequate in relation to the size of the company and its business.

6. The company has maintained proper records of inventory and no material discrepancies were noticed on physical verifcation.

7. The company has granted an unsecured loan of Rs. 1450 million to a company covered in the Register maintained under Section 301 of the Act. The rate of interest and other terms and conditions are prima facie not prejudicial to the interest of the company. The loan repayment and interest thereon are repaid as per mutual agreement.

8. The company has not taken any loans, from a company listed in the Register maintained under Section 301 of the Act .

9 There is an internal control procedure commensurate with the size of the company and the nature of its business for the purchase of Fixed Assets and inventory and for the sale of services. During the course of our audit, we have not observed any continuing failure to correct weaknesses in the internal control system.

10. The particulars of all contract or arrangements referred to in Section 301 of the Act , have been entered in the Register required to be maintained under that section . Transactions made in pursuance of such arrangements have been made at prices which are, prima facie, reasonable having regard to the prevailing market prices at the relevant time.

11. In respect of deposits accepted during the year from the public, the directives issued by the Reserve Bank of India and the provisions of Section 58A and 58AA , other relevant provisions of the Companies Act,1956 and the rules framed thereunder, where applicable , have been complied with. According to the information and explanations given to us, no order has been passed by the Company Law Board, or the National Company Law Tribunal or the Reserve Bank of India or any other tribunal.

12. The company has an internal audit system commensurate with its size and the nature of its business.

13. Maintenance of cost records has not been prescribed by the Central Government under Section 209(1) (d) of the Companies Act,1956, for any of the products of the Company.

14. The company has been generally been regular in depositing undisputed statutory dues on account of Income tax, Provident Fund, Service Tax and Employees State Insurance dues.The companys current operations do not require it to deposit any amounts towards Investor Education and Protection Fund, Sales Taxes, Customs Duty, Excise and such cess(s).There are no undisputed sums payable towards Income tax, Wealth tax, Provident Fund, Service Tax and Employees State Insurance dues, which were outstanding at the year end for a period of more than six months from the date they became payable.

15. The companys losses as at March 31,2010 do not exceed 50% of its Net Worth. The company has incurred cash losses in the year under review and in the immediately preceding financial year.

16. The company has not defaulted in repayment of dues to a financial institution or bank or debenture holders.

17. No loans/ advances have been granted on the basis of security of pledge of shares, debentures and other securities .

18. The companys activities do not require compliance with any special statute applicable to chit fund companies.

19. In respect of dealings or trading in shares and securities the company has maintained proper records of the transactions and contracts and timely entries have been made . All shares / securities have been held by the company in its own name .

20. The company has given guarantees for loans taken by others from Financial Institutions / Banks , the terms of which are prima facie, not prejudicial to the companys interest.

21. Term Loans were applied for the purpose they were obtained .

22. Short term loans have not been used for or Long term investments.

23. The company has made a preferential allotment Equity Shares to a party listed in the Register maintained u/s 301 of the Companies Act, 1956 and the terms of the same are not prejudicial to the interests of the company .

24. The company has not created security in respect of debentures issued.

25. The management has disclosed the end use of money raised through rights issue and the same has been verifed.

26. No fraud on or by the company has been noticed or reported during the year .

For G S Ahuja & Associates

Chartered Accountants

Firm Registration no. N 8999

G S Ahuja

oida Proprietor

May 28,2010 Membership No. 87732

 
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