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Accounting Policies of Zee Entertainment Enterprises Ltd. Company

Mar 31, 2016

1 CORPORATE INFORMATION

Zee Entertainment Enterprises Limited ("ZEEL" or "the Company") is incorporated in the State of Maharashtra, India and is listed on Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) in India. The Company is mainly in the following businesses:

(a) Broadcasting of Satellite Television Channels

(b) Space Selling agent for other satellite television channels

(c) Sale of Media Content i.e. programs/film rights/feeds/music rights

A BASIS OF PREPARATION

The financial statements are prepared on going concern basis in accordance with Generally Accepted Accounting Principles in India (Indian GAAP) and comply in all material aspects with its accounting standards specified under Section 133 of the Companies Act, 2013 (Act) read with Rule 7 of the Companies (Accounts) Rules 2014, the provisions of the Act (to the extent notified) and guidelines issued by the Securities and Exchange Board of India (SEBI). The financial statements have been prepared on accrual basis and under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those of previous year

B USE OF ESTIMATES

The preparation of financial statements requires the management to make estimates and assumptions that affect the reported amount of assets and liabilities, disclosure of contingent liabilities as at the date of financial statements and the reported amount of revenue and expenses for the year. Actual results could differ from these estimates. Any revision to such accounting estimate is recognised prospectively in current and future periods

C TANGIBLE FIXED ASSETS

(i) Tangible fixed assets are stated at cost, less accumulated depreciation and impairment loss, if any. The cost comprises purchase price, borrowing costs if capitalisation criteria are met and directly attributable cost of bringing the asset to its working condition for the intended use. Integrated Receiver Decoders (IRD) boxes are capitalised, when available for deployment,

(ii) Capital work-in-progress comprises cost of tangible fixed assets and related expenses that are not yet ready for their intended use at the reporting date

D INTANGIBLE ASSETS

Intangible assets acquired or developed are measured on initial recognition at cost and stated at cost less accumulated amortisation and impairment loss, if any. Intangible Asset - channels include expenses incurred on development of new television channels till the time, it is ready for commercial launch

E BORROWING COSTS

Borrowing costs attributable to the acquisition or construction of qualifying assets till the time such assets are ready for intended use are capitalised as part of cost of the assets. All other borrowing costs are expensed in the period they occur.

F IMPAIRMENT OF TANGIBLE AND INTANGIBLE ASSETS

At each Balance Sheet date, the Company reviews the carrying amount of assets to determine whether there is an indication that those assets have suffered impairment loss. If any such indication exists, the recoverable amount of assets is estimated in order to determine the extent of impairment loss. The recoverable amount is higher of the net selling price and value in use, determined by discounting the estimated future cash flows expected from the continuing use of the asset to their present value

G DEPRECIATION /AMORTISATION ON TANGIBLE/ INTANGIBLE ASSETS

Depreciable amount for tangible / intangible fixed assets is the cost of an asset, or other amount substituted for cost, less its estimated residual value (i) Depreciation on tangible fixed assets is provided on straight-line method as per the useful life prescribed in Schedule II to the Companies Act, 2013 except in respect of the following categories of assets, where the life of the assets has been assessed based on technical advice, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement etc.

Aircraft-15 years

Furniture and Fixtures - 5 years

Gas Plant - 20 years

Mobile Phones - 3 years

Plant and Machinery - 5-10 years

Vehicles - 5 years

(ii) Premium on Leasehold Land and Leasehold Improvements are amortised over the period of Lease

(iii) Intangible assets are amortised over their respective individual useful lives estimated by management,

H INVESTMENTS

(i) Investments, which are readily realisable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments including investment property are classified as long-term investments

(ii) Current investments are stated at lower of cost and fair market value determined on an individual investment basis. Long-term investments are stated at cost less provision for diminution other than temporary in the value of such investments,

(iii) Investment property

Investment in land which is not intended to be occupied substantially for use by or in the operations of the Company is classified as Investment property and stated at cost. The cost comprises purchase price, borrowing costs, if capitalisation criteria are met and directly attributable cost of bringing the investment property to its working condition for intended use

I TRANSACTIONS IN FOREIGN CURRENCIES

(i) Foreign currency transactions are accounted at the exchange rate prevailing on the date of such transaction

(ii) Foreign currency monetary items are translated using the exchange rate prevailing at the reporting date. Exchange differences arising on settlement of monetary items or on reporting such monetary items at rates different from those at which they were initially recorded during the period, or reported in previous financial statements are recognised as income or as expenses in the period in which they arise

iii) Non-monetary foreign currency items are carried at cost,

REVENUE RECOGNITION

Revenue is recognised to the extent it is probable that economic benefits will flow to the Company and the revenue can be reliably measured,

(i) Broadcasting revenue - Advertisement revenue (net of discount and volume rebates) is recognised when the related advertisement or commercial appears before the public i.e. on telecast. Subscription revenue is recognised on time basis on the provision of television broadcasting service to subscribers

(ii) Sales - Media content is recognised, when the significant risks and rewards have been transferred to the customers in accordance with the agreed terms

(iii) Services

Commission-Space selling is recognised when the related advertisement or commercial appears before the public i.e. on telecast,

(iv) Revenue from other services is recognised as and when such services are completed/performed,

(v) Interest income is recognised on a time proportion basis taking into account amount outstanding and the applicable interest rate

(vi) Dividend income is recognised when the Company''s right to receive dividend is established,

(vii) Rent income is recognised on accrued basis as per the agreed terms

K INVENTORIES

(i) Media Content:

Media content i.e. Programs, Film rights, Music rights ((completed (commissioned / acquired) and under production)) are stated at lower of cost / unamortised cost or realisable value. Cost comprises acquisition / direct production cost. Where the realisable value on the basis of its estimated useful economic life is less than its carrying amount, the difference is expensed as impairment. Programs, film rights, music rights are expensed / amortised as under

1 Programs - reality shows, chat shows, events, current affairs, game shows and sports rights etc. are fully expensed on telecast,

2 Programs (other than (1) above) are amortised over three financial years starting from the year of first telecast, as per management estimate of future revenue potential

3 Film rights are amortised on a straight-line basis over the licensed period or sixty months from the commencement of rights, whichever is shorter,

4 Music rights are amortised over three financial years starting from the year of commencement of rights, as per management estimate of future revenue potential

(ii) Raw Stock: Tapes are valued at lower of cost or estimated net realisable value. Cost is taken on weighted average basis,

L RETIREMENT AND OTHER EMPLOYEE BENEFITS

(i) Short-term employee benefits are expensed at the undiscounted amount in the Statement of Profit and Loss in the year the employee renders the service,

(ii) Post employment and other long-term employee benefits are recognised as an expense in the Statement of Profit and Loss at the present value of the amount payable determined using actuarial valuation techniques in the year the employee renders the service. Actuarial gains and losses are charged to the Statement of Profit and Loss

(iii) Payment to defined contribution retirement benefit schemes are recognised as an expense in the Statement of Profit and Loss, when due

M ACCOUNTING FOR TAXES ON INCOME

(i) Current Tax is determined as the amount of tax payable in respect of taxable income as per the provisions of the Income Tax Act, 1961

(ii) Deferred tax is recognised, subject to consideration of prudence in respect of deferred tax asset, on timing difference, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods and measured using relevant enacted tax rates and laws

(iii) Minimum Alternate Tax (MAT) paid in accordance with tax laws, which give rise to future economic benefits in the form of adjustment of future tax liability, is recognised as an asset only when, based on convincing evidence it is probable that the future economic benefits associated with it will flow to the Company and the assets can be measured reliably.

N LEASES

(i) Finance lease

Assets acquired on long-term leases, which in economic terms constitute investments financed on long-term basis i.e. Finance Lease are capitalised and the corresponding lease liability is recorded at an amount equal to the fair value of the leased asset at the inception of the lease. Initial costs directly attributable to lease are recognised with the asset under lease

(ii) Operating lease

Lease of assets under which all the risks and rewards of ownership are effectively retained by the lessor are classified as operating leases Lease payments / revenue under operating leases are recognised as expense / income on accrual basis in accordance with the respective lease agreements

0 EARNINGS PER SHARE

Basic earnings per share is computed and disclosed using the weighted average number of equity shares outstanding during the period. Dilutive earnings per share is computed and disclosed using the weighted average number of equity and dilutive equity equivalent shares outstanding during the period, except when the results would be anti-dilutive

P PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurement are recognised when there is present obligation as a result of past events and it is probable that there will be an outflow of resources. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates. Contingent liabilities are not recognised but are disclosed in the financial statements. Contingent assets are neither recognised nor disclosed in the financial statements


Mar 31, 2015

The financial statements are prepared on going concern basis in accordance with Generally Accepted Accounting Principles in India (Indian GAAP). GAAP comprises mandatory accounting standards as prescribed under Section 133 of the Companies Act, 2013 (Act) read with Rule 7 of the Companies (Accounts) Rules, 2014, the provisions of the Act (to the extent notifed) and guidelines issued by the Securities and Exchange Board of India (SEBI). The financial statements have been prepared on accrual basis and under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those of previous year.

b Use of estimates

The preparation of financial statements requires the management to make estimates and assumptions that affect the reported amount of assets and liabilities, on the date of the financial statements and the reported amount of revenue and expenses for the period. Difference between the actual results and estimates are recognised in the period in which the results are known / materialised.

c Tangible fxed assets (i) Tangible fxed assets are stated at cost, less accumulated depreciation and impairment loss, if any. The cost comprises purchase price, borrowing costs if capitalisation criteria are met and directly attributable cost of bringing the asset to its working condition for the intended use. Integrated Receiver Decoders (IRD) boxes are capitalised, when available for deployment.

(ii) Capital work-in-progress comprises cost of tangible fxed assets and related expenses that are not yet ready for their intended use at the reporting date.

d Intangible assets

Intangible assets acquired are measured on initial recognition at cost and stated at cost less accumulated amortisation and impairment loss, if any.

e Borrowing costs

Borrowing costs attributable to the acquisition or construction of qualifying assets till the time such assets are ready for intended use are capitalised as part of cost of the assets. All other borrowing costs are expensed in the period they occur.

f Impairment of tangible and intangible assets At each Balance Sheet date, the Company reviews the carrying amount of assets to determine whether there is an indication that those assets have suffered impairment loss. If any such indication exists, the recoverable amount of assets is estimated in order to determine the extent of impairment loss. The recoverable amount is higher of the net selling price and value in use, determined by discounting the estimated future cash flows expected from the continuing use of the asset to their present value.

g Depreciation / Amortisation on tangible / intangible assets (i) Depreciable amount for tangible fxed assets is the cost of an asset, or other amount substituted for cost, less its estimated residual value.

Depreciation on tangible fxed assets is provided on straight- line method as per the useful life prescribed in Schedule II to the Companies Act, 2013 except in respect of the following categories of assets, where the life of the assets has been assessed based on technical advice, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement etc. Aircraft - 15 years Furniture and Fixtures - 5 years Gas Plant - 20 years Mobile Phones - 3 years Plant and Machinery - 5-10 years Vehicles - 5 years.

(ii) Premium on Leasehold Land and Leasehold Improvements are amortised over the period of Lease.

(iii) Intangible assets are amortised over their respective individual estimated useful lives on a straight line basis.

h Investments

(i) Investments, which are readily realisable and intended to be held for not more than one year from the date on which such investments are made, are classifed as current investments. All other investments including investment property are classifed as long-term investments.

(ii) Current investments are

stated at lower of cost and fair market value determined on an individual investment basis. Long-term investments are stated at cost less provision for diminution other than temporary in the value of such investments.

(iii) Investment property

Investment in land which is not intended to be occupied substantially for use by or in the operations of the Company is classifed as Investment property and stated at cost. The cost comprises purchase price, borrowing costs, if capitalisation criteria are met and directly attributable cost of bringing the investment property to its working condition for intended use.

i Transactions in foreign currencies

(i) Foreign currency transactions are accounted at the exchange rate prevailing on the date of such transaction.

(ii) Foreign currency monetary items are translated using the exchange rate prevailing at the reporting date. Exchange differences arising on settlement of monetary items or on reporting such monetary items at rates different from those at which they were initially recorded during the period, or reported in previous financial statements are recognised as income or as expenses in the period in which they arise.

(iii) Non-monetary foreign Currency items are carried at cost.

j Revenue recognition

Revenue is recognised to the extent it is probable that economic benefits will flow to the Company and the revenue can be reliably measured.

(i) Broadcasting revenue -

Advertisement revenue (net of discount and volume rebates) is recognised when the related advertisement or commercial appears before the public i.e. on telecast. Subscription revenue is recognised on time basis on the provision of television broadcasting service to subscribers.

(ii) Sales - Media content is recognised, when the significant risks and rewards have been transferred to the customers in accordance with the agreed terms.

(iii) Services

Commission-Space selling is recognised when the related advertisement or commercial appears before the public i.e. on telecast.

(iv) Revenue from other services is recognised as and when such services are completed / performed.

(v) Interest income is recognised on a time proportion basis taking into account amount outstanding and the applicable interest rate.

(vi) Dividend income is recognised when the Company''s right to receive dividend is established.

k Inventories

(i) Media Content :

Media content i.e. Programs, Film rights, Music rights (completed (commissioned / acquired) and under production) are stated at lower of cost / unamortised cost or realisable value. Cost comprises acquisition / direct production cost. Where the realisable value on the basis of its estimated useful economic life is less than its carrying amount, the difference is expensed as impairment. Programs, flm rights, music rights are expensed / amortised as under :

1 Programs - reality shows, chat shows, events, current affairs, game shows and sports rights etc. are fully expensed on telecast.

2 Programs (other than (1) above) are amortised over three financial years starting from the year of frst telecast, as per management estimate of future revenue potential.

3 Film rights are amortised on a straight-line basis over the licensed period or 60 months from the commencement of rights, whichever is shorter.

4 Music rights are amortised over three financial years starting from the year of commencement of rights, as per management estimate of future revenue potential.

(ii) Raw Stock : Tapes are valued at lower of cost or estimated net realisable value. Cost is taken on weighted average basis.

Retirement and other employee benefits

(i) Short-term employee

benefits are expensed at the undiscounted amount in the Statement of Profit and Loss in the year the employee renders the service.

(ii) Post employment and other long-term employee benefits are recognised as an expense in the Statement of Profit and Loss at the present value of the amount payable determined using actuarial valuation techniques in the year the employee renders the service. Actuarial gains and losses are charged to the Statement of Profit and Loss.

(iii) Payment to defned contribution retirement Benefit schemes are recognised as an expense in the Statement of Profit and Loss, when due.

Accounting for taxes on income (i) Current Tax is determined as the amount of tax payable in respect of taxable income as per the provisions of the Income Tax Act, 1961.

(ii) Deferred tax is recognised, subject to consideration of prudence in respect of deferred tax asset, on timing difference, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods and measured using relevant enacted tax rates and laws.

(iii) Minimum Alternate Tax (MAT) paid in accordance with tax laws, which give rise to future economic benefits in the form of adjustment of future tax liability, is recognised as an asset only when, based on convincing evidence, it is probable that the future economic benefits associated with it will flow to the Company and the assets can be measured reliably.

n Leases

(i) Finance lease

Assets acquired under Finance Lease are capitalised and the corresponding lease liability is recorded at an amount equal to the fair value of the leased asset at the inception of the lease. Initial costs directly attributable to lease are recognised with the asset under lease.

(ii) Operating lease

Lease of assets under which all the risks and rewards of ownership are effectively retained by the lessor are classifed as operating leases. Lease payments / revenue under operating leases are recognised as expense / income on accrual basis in accordance with the respective lease agreements.

o Earnings per share

Basic earnings per share is computed and disclosed using the weighted average number of equity shares outstanding during the period. Dilutive earnings per share is computed and disclosed using the weighted average number of equity and dilutive equity equivalent shares outstanding during the period, except when the results would be anti-dilutive.

p Provisions, contingent liabilities and contingent assets Provisions involving substantial degree of estimation in measurement are recognised when there is present obligation as a result of past events and it is probable that there will be an outflow of resources. These estimates are reviewed at each reporting date and adjusted to refect the current best estimates. Contingent liabilities are not recognised but are disclosed in the financial statements. Contingent assets are neither recognised nor disclosed in the financial statements.

c) Terms / rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 1 each. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian Rupees. The fnal dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

d) Terms / rights attached to Preference Shares

(i) 6% Cumulative Redeemable Non-Convertible Preference Shares - Listed

During the year ended 31 March 2014, the Company has issued 20,169,423,120 6% Cumulative Redeemable Non-Convertible Preference Shares of Rs. 1 each by way of bonus in the ratio of 21 Bonus Preference Shares of Rs. 1 each fully paid up for every one Equity share of Rs. 1 each fully paid up and are listed on Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) in India.

The Company will redeem at par value, 20% of the total Bonus Preference Shares allotted, every year from the fourth anniversary of the date of allotment. The Company shall have an option to buy back the Bonus Preference Shares fully or in parts at an earlier date(s) as may be decided by the Board. Further, if on any anniversary of the date of allotment beginning from the fourth anniversary, the total number of Bonus Preference Shares bought back and redeemed cumulatively is in excess of the cumulative Bonus Preference Shares required to be redeemed till the said anniversary, then there will be no redemption on that anniversary. At the 8th anniversary of the date of allotment, all the remaining and outstanding Bonus Preference Shares shall be redeemed by the Company.

The holders of Bonus Preference Shares shall have a right to vote only on resolutions which directly affect their rights. The holders of Bonus Preference Shares shall also have a right to vote on every resolution placed before the Company at any meeting of the equity shareholders if dividend or any part of the dividend has remained unpaid on the said Bonus Preference Shares for an aggregate period of atleast two years preceding the date of the meeting.

(ii) 6% Non-Cumulative Redeemable Non-Convertible Preference Shares - Unlisted

The Company has issued and alloted 22,273,886 6% Non-Cumulative Redeemable Non-Convertible Preference shares of Rs. 1 each fully paid up, to the shareholders of Diligent Media Corporation Limited, pursuant to the Scheme of Arrangement as referred in Note 43. These Preference shares are redeemable at par at any time within three years from the date of allotment. The preference shareholders shall be entitled to vote only on resolutions which directly affect their rights.

b) Investments made

There are no investments by the Company other than those stated under Note 9 and Note 12 in the Financial Statements.

d) Securities given

There are no securities given during the year.

25 Leases

A. Operating Leases:

(a) The Company has taken office, residential premises and plant and machinery (including equipments) etc. under cancellable / non-cancellable lease agreements that are renewable on a periodic basis at the option of both the Lessor and the Lessee. The initial tenure of the lease is generally from 11 months to 108 months.

(b) In respect of assets given under operating lease :

(i) The Company has given part of its buildings under cancellable operating lease agreement. The initial term of the lease is for 11 to 36 months. (ii) The rental revenue for the year is Rs./Millions 108 (85).


Mar 31, 2014

1. CORPORATE INFORMATION

Zee Entertainment Enterprises Limited ("ZEEL" or "the Company") is incorporated in the State of Maharashtra, India and is listed on Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) in India. The Company is mainly in the following businesses:

a) Broadcasting of Satellite Television Channels;

b) Space Selling agent for other satellite television channels;

c) Sale of Television Content i .e. programs / film rights / feeds;

d) Production and distribution of films.

2. SIGNIFICANT ACCOUNTING POLICIES

a) Basis of preparation

The financial statements are prepared on going concern basis in accordance with Generally Accepted Accounting Principles in India (Indian GAAP) and comply in all material respect with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provision of the Companies Act, 1956 read with general circular 8/2014 dated 4 April, 2014, issued by the Ministry of Corporate Affairs. The financial statements have been prepared on accrual basis and under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those of previous year.

b) Use of estimates

The preparation of financial statements requires the management to make estimates and assumptions that affect the reported amount of assets and liabilities, on the date of the financial statements and the reported amount of revenue and expenses for the period. Difference between the actual results and estimates are recognised in the period in which the results are known / materialised.

c) Tangible fixed assets

(i) Tangible fixed assets are stated at cost, less accumulated depreciation and impairment loss, if any. The cost comprises purchase price, borrowing cost if capitalisation criteria are met and directly attributable cost of bringing the asset to its working condition for the intended use. Integrated Receiver Decoders (IRD) boxes are capitalised, when available for deployment.

(ii) Capital work in progress comprises cost of fixed assets and related expenses that are not yet ready for their intended use at the reporting date.

d) Intangible assets

Intangible assets acquired are measured on initial recognition at cost and stated at cost less accumulated amortisation and impairment loss, if any.

e) Borrowing costs

Borrowing costs attributable to the acquisition or construction of qualifying assets till the time such assets are ready for intended use are capitalised as part of cost of the asset. All other borrowing costs are expensed in the period they occur.

f) Impairment of tangible and intangible assets

At each Balance Sheet date, the Company reviews the carrying amount of assets to determine whether there is an indication that those assets have suffered impairment loss. If any such indication exists, the recoverable amount of assets is estimated in order to determine the extent of impairment loss. The recoverable amount is higher of the net selling price and value in use, determined by discounting the estimated future cash flows expected from the continuing use of the asset to their present value.

g) Depreciation / Amortisation on tangible / intangible assets

(i) Depreciation on tangible fixed assets is provided on straight line method at the rates specified in Schedule XIV to the Companies Act, 1956 except Aircraft on which depreciation is provided based on estimated useful life of 15 years.

The rate of depreciation so derived is more than the rate prescribed under Schedule XIV.

(ii) Premium on Leasehold Land and Leasehold Improvements are amortised over the period of Lease.

(iii) Intangible assets are amortised on a straight line basis over the economic useful life estimated by the management.

h) Investments

(i) Investments, which are readily realisable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments including investment property are classified as long-term investments.

(ii) Current investments are stated at lower of cost and fair market value determined on an individual investment basis. Long-term investments are stated at cost less provision for diminution other than temporary in the value of such investments.

(iii) Investment property

Investment in land which is not intended to be occupied substantially for use by or in the operations of the Company is classified as Investment property. Investment properties are stated at cost. The cost comprises purchase price, borrowing costs, if capitalisation criteria are met and directly attributable cost of bringing the investment property to its working condition for intended use.

i) Transactions in foreign currencies

(i) Foreign currency transactions are accounted at the exchange rate prevailing on the date of such transactions.

(ii) Foreign currency monetary items are translated using the exchange rate prevailing at the reporting date. Exchange differences arising on settlement of monetary items or on reporting such monetary items at rates different from those at which they were initially recorded during the period, or reported in previous financial statements are recognised as income or as expenses in the period in which they arise.

(iii) Non-monetary foreign currency items are carried at cost.

j) Revenue recognition

Revenue is recognised to the extent it is probable that economic benefits will flow to the company and the revenue can be reliably measured.

(i) Broadcasting revenue - Advertisement revenue (net of discount and volume rebates) is recognised when the related advertisement or commercial appears before the public i.e. on telecast. Subscription revenue is recognised on time basis on the provision of television broadcasting service to subscribers.

(ii) Sales - Television content (including Programs, Film Rights) is recognised, when the significant risks and rewards have been transferred to the customers in accordance with the agreed terms.

(iii) Services

1. Commission-Space selling is recognised when the related advertisement or commercial appears before the public i.e. on telecast.

2. Theatrical revenue from films is recognised on receipt of related sale reports.

(iv) Revenue from other services is recognised as and when such services are completed / performed.

(v) Interest income is recognised on a time proportion basis taking into account amount outstanding and the applicable interest rate.

(vi) Dividend income is recognised when the Company''s right to receive dividend is established.

k) Inventories

(i) Television Content for Broadcasting :

Television content i.e. Programs, Film rights (completed (commissioned / acquired) and under production) are stated at lower of cost / unamortised cost or realisable value. Cost comprises acquisition /direct production cost. Where the realisable value on the basis of its estimated useful economic life is less than its carrying amount, the difference is expensed as impairment. Programs, film rights are expensed / amortised as under:

1. Programs - reality shows, chat shows, events, current affairs, game shows and sports rights etc. are fully expensed on telecast.

2. Programs (other than (1) above) are amortised over three financial years starting from the year of first telecast, as per management estimate of future revenue potential.

3. Film rights are amortised on a straight-line basis over the licensed period or 60 months from the commencement of rights, whichever is shorter.

(ii) Films produced and / or acquired for distribution:

Cost is allocated to each right based on management estimate of revenue. Costs of theatrical rights, satellite rights, music rights, home video rights etc are amortised when sold / exploited and residual rights are carried at lower of unamortised cost or net realisable value.

1. Theatrical rights: 70% of allocated cost is amortised over three months of theatrical release of films and balance 30% in subsequent three quarters.

2. Satellite rights, music rights, home video rights etc: Allocated cost of each right is expensed on sale and amortised on exploitation as per (i) (3) above.

3. Negative rights : 90% of the cost is allocated and amortised as per (1) and (2) above and 10% of the cost is allocated to Intellectual Property Rights (IPR) and amortised over subsequent five years.

(iii) Raw Stock : Tapes are valued at lower of cost or estimated net realisable value. Cost is taken on weighted average basis.

I) Retirement and other employee benefits

(i) Short-term employee benefits are expensed at the undiscounted amount in the Statement of Profit and Loss in the year the employee renders the service.

(ii) Post employment and other long term employee benefits are recognised as an expense in the Statement of Profit and Loss at the present value of the amount payable determined using actuarial valuation techniques in the year the employee renders the service. Actuarial gains and losses are charged to the Statement of Profit and Loss.

m) Accounting for taxes on income

(i) Current Tax is determined as the amount of tax payable in respect of taxable income as per the provisions of the Income Tax Act, 1961.

(ii) Deferred tax is recognised, subject to consideration of prudence in respect of deferred tax asset, on timing difference, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods and measured using relevant enacted tax rates and laws.

n) Leases

(i) Finance Lease

Assets acquired under Finance Lease are capitalised and the corresponding lease liability is recorded at an amount equal to the fair value of the leased asset at the inception of the lease. Initial costs directly attributable to lease are recognised with the asset under lease.

(ii) Operating Lease

Lease of assets under which all the risk and rewards of ownership are effectively retained by the lesser are classified as operating leases. Lease payments / revenue under operating leases are recognised as expense / income on accrual basis in accordance with the respective lease agreements.

o) Earnings per Share

Basic earnings per share is computed and disclosed using the weighted average number of equity shares outstanding during the period. Dilutive earnings per share is computed and disclosed using the weighted average number of equity and dilutive equity equivalent shares outstanding during the period, except when the results would be anti-dilutive.

p) Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognised when there is present obligation as a result of past events and it is probable that there will be an outflow of resources. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates. Contingent Liabilities are not recognised but are disclosed in the financial statements. Contingent Assets are neither recognised nor disclosed in the financial statements.

c) Terms / rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 1 each. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian Rupees. The final dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company after distribution of preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

d) Terms / rights attached to Redeemable Preference Shares

During the year, the Company has issued 20,169,423,120 6% Cumulative Redeemable Non- Convertible Preference Shares of Rs. 1/- each by way of bonus in the ratio of 21 Bonus Preference Shares of Rs. 1/- each fully paid up for every one Equity share of Rs. 1/- each fully paid up and listed on Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) in India.

The Company will redeem at par value, 20% of the total Bonus Preference Shares allotted, every year from the fourth anniversary of the date of allotment. The Company shall have an option to buy back the Bonus Preference Shares fully or in parts at an earlier date(s) as may be decided by the Board. Further, if on any anniversary of the date of allotment beginning from the fourth anniversary, the total number of Bonus Preference Shares bought back and redeemed cumulatively is in excess of the cumulative Bonus Preference Shares required to be redeemed till the said anniversary then there will be no redemption on that anniversary. At the 8th anniversary of the date of allotment, all the remaining and outstanding Bonus Preference Shares shall be redeemed by the Company.

The holders of Bonus Preference Shares shall have a right to vote only on resolutions which directly affect their rights. The holders of Bonus Preference Shares shall also have a right to vote on every resolution placed before the Company at any meeting of the equity shareholders if dividend or any part of the dividend has remained unpaid on the said Bonus Preference Shares for an aggregate period of at least two years preceding the date of the meeting.

h) Employees Stock Option Scheme (ESOP)

The Company has instituted an Employee Stock Option Plan (ESOP 2009) as approved by the Board of Directors and Shareholders of the Company in 2009 for issuance of stock options convertible into equity shares not exceeding in the aggregate 5% of the issued and paid up capital of the Company as at 31 March, 2009 i.e. up to 21,700,355 equity shares of Rs. 1 each, to the employees of the Company as well as that of its subsidiaries and also to Non-executive Directors including Independent Directors of the Company at the market price determined as per the Securities and Exchange Board of India (Employee Stock Options Scheme) Guidelines, 1999 (SEBI (ESOS) Guidelines). The said scheme is administered by the Remuneration Committee of the Board.

During the year ended 31 March, 2014, the Company did not grant any stock options. The options earlier granted under the Scheme vested during the year and these would be exercisable at any time within a period of four years from each vesting and the equity shares arising on exercise of options shall not be subject to any lock in.

The options were granted to the employees / directors at an exercise price, being the latest market price as per the SEBI (ESOS) Guidelines. In view of, there being no intrinsic value on the date of the grant (being the excess of market price of share under the Scheme over the exercise price of the option), the Company is not required to account for the value of options as per the SEBI guidelines.

(b) In respect of assets given under operating lease :

(i) The Company has given part of its buildings under cancellable operating lease agreement. The initial term of the lease is for 36 months.

(ii) The rental revenue for the year is Rs./millions 85 (77).


Mar 31, 2013

1 Basis of preparation

The financial statements are prepared under the historical cost convention on going concern basis in accordance with Indian Generally Accepted Accounting Principles (GAAP) and comply in all material aspects with the Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006, the provisions of the Companies Act, 1956 and guidelines issued by the Securities and Exchange Board of India (SEBI). The Company follows the mercantile system of accounting and recognises income and expenditure on accrual.

2 Use of estimates

The preparation of financial statements requires the management to make estimates and assumptions that affect the reported amount of assets and liabilities, on the date of the financial statements and the reported amount of revenue and expenses for the year. Difference between the actual results and estimates are recognised in the period in which the results are known / materialised.

3 Tangible fixed assets

(a) Tangible fixed assets are stated at cost, less accumulated depreciation and impairment loss, if any. The cost comprises purchase price, borrowing cost if capitalisation criteria are met and directly attributable cost of bringing the asset to its working condition for the intended use. Integrated Receiver Decoders (IRD) boxes are capitalised, when available for deployment.

(b) Capital work in progress comprises cost of fixed assets and related expenses that are not yet ready for their intended use at the reporting date.

4 Intangible assets

I ntangible assets acquired are measured on initial recognition at cost and stated at cost less accumulated amortisation and impairment loss, if any.

5 Borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of respective asset. All other borrowing costs are expensed in the year they occur.

6 Impairment of tangible and intangible assets

At each Balance Sheet date, the Company reviews the carrying amount of assets to determine whether there is an indication that those assets have suffered impairment loss. If any such indication exists, the recoverable amount of assets is estimated in order to determine the extent of impairment loss. The recoverable amount is higher of the net selling price and value in use, determined by discounting the estimated future cash flows expected from the continuing use of the asset to their present value.

7 Depreciation / Amortisation on tangible / intangible assets

(a) Depreciation on tangible fixed assets is provided on straight line method at the rates specified in Schedule XIV to the Companies Act, 1956 except Aircraft on which depreciation is provided based on estimated useful life of 15 years. The rate of depreciation so derived is more than the rate prescribed under Schedule XIV

(b) Premium on Leasehold Land and Leasehold Improvements are amortised over the period of Lease.

(c) Intangible assets are amortised on a straight line basis over the economic useful life estimated by the management.

8 Investments

(a) Investments, which are readily realisable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments including investment property are classified as long-term investments.

(b) Current investments are stated at lower of cost and market value determined on an individual investment basis. Long-term investments are stated at cost less provision for diminution other than temporary in the value of such investments.

(c) Investment property

I nvestment in land which is not intended to be occupied substantially for use by or in the operations of the Company is classified as Investment property. Investment properties are stated at cost. The cost comprises purchase price, borrowing costs, if capitalisation criteria are met and directly attributable cost of bringing the investment property to its working condition for the intended use.

9 Transactions in foreign currencies

(a) Foreign currency transactions are accounted at the exchange rate prevailing on the date of such transactions.

(b) Foreign currency monetary items are translated using the exchange rate prevailing at the reporting date. Exchange differences arising on settlement of monetary items or on reporting such monetary items at rates different from those at which they were initially recorded during the year, or reported in previous financial statements are recognised as income or as expenses in the year in which they arise.

(c) Non-monetary foreign currency items are carried at cost.

10 Revenue recognition

(a) Broadcasting revenue - Advertisement revenue (net of discount and volume rebates) is recognised when the related advertisement or commercial appears before the public i.e. on telecast. Subscription revenue is recognised on time basis on the provision of television broadcasting service to subscribers.

(b) Sales (including Programs, Film Rights) is recognised, when the significant risks and rewards have been transferred to the customers.

(c) Services

i Commission-Space selling is recognised when the related advertisement or commercial appears before the public i.e. on telecast.

ii Theatrical revenue from films is recognised on receipt of related sale reports.

(d) Revenue from other services is recognised as and when such services are completed / performed.

(e) Interest income is recognised on a time proportion basis taking into account principal outstanding and the applicable interest rate.

(f) Dividend income is recognised when the Company''s right to receive dividend is established.

11 Inventories

(a) Television Content for Broadcasting :

Inventories includes Programs, Film rights (completed (commissioned / acquired) and under production) are stated at lower of cost / unamortised cost or realisable value. Cost comprises acquisition / direct production cost. Where the realisable value on the basis of its estimated useful economic life is less than its carrying amount, the difference is expensed as impairment. Programs, film rights are expensed / amortised as under:

i Programs - reality shows, chat shows, events, current affairs, game shows and sports rights etc. are fully expensed on telecast.

ii Programs (other than (i) above) are amortised over three financial years starting from the year of first telecast, as per management estimate of future revenue potential.

iii Film rights are amortised on a straight-line basis over the licensed period or 60 months from the commencement of rights, whichever is shorter.

(b) Films produced and / or acquired for distribution:

Cost is allocated to each right based on management estimate of revenue. Costs of theatrical rights, satellite rights, music rights, home video rights etc are amortised when sold / exploited and residual rights are carried at lower of unamortised cost or net realisable value.

i Theatrical rights: 70% of allocated cost is amortised over three months of theatrical release of films and balance 30% in subsequent three quarters.

ii Satellite rights, music rights, home video rights etc: Allocated cost of each right is expensed on sale and amortised on exploitation as per (a) (iii) above.

iii Negative rights : 90% of the cost is allocated and amortised as per (i) and (ii) above and 10% of the cost is allocated to Intellectual Property Rights (IPR) and amortised over subsequent five years.

(c) Raw Stock : Tapes are valued at lower of cost or estimated net realisable value. Cost is taken on weighted average basis.

12 Retirement and other employee benefits

(a) Short-term employee benefits are expensed at the undiscounted amount in the Statement of Profit and Loss in the year the employee renders the service.

(b) Post employment and other long term employee benefits are recognised as an expense in the Statement of Profit and Loss at the present value of the amount payable determined using actuarial valuation techniques in the year the employee renders the service. Actuarial gains and losses are charged to the Statement of Profit and Loss.

13 Accounting for taxes on income

(a) Current Tax is determined as the amount of tax payable in respect of taxable income as per the provisions of the Income Tax Act, 1961.

(b) Deferred tax is recognised, subject to consideration of prudence in respect of deferred tax asset, on timing difference, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods and measured using relevant enacted tax rates and laws.

14 Leases

(a) Finance Lease

Assets acquired under Finance Lease are capitalised and the corresponding lease liability is recorded at an amount equal to the fair value of the leased asset at the inception of the lease. Initial costs directly attributable to lease are recognised with the asset under lease.

(b) Operating Lease

Lease of assets under which all the risk and rewards of ownership are effectively retained by the lessor are classified as operating leases. Lease payments / revenue under operating leases are recognised as expense / income on accrual basis in accordance with the respective lease agreements.

15 Earnings Per Share

Basic earnings per share is computed and disclosed using the weighted average number of equity shares outstanding during the year. Dilutive earnings per share is computed and disclosed using the weighted average number of equity and dilutive equity equivalent shares outstanding during the year, except when the results would be anti-dilutive.

16 Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognised when there is present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognised but are disclosed in the notes. Contingent Assets are neither recognised nor disclosed in the financial statements.


Mar 31, 2012

1 Basis of Preparation

these financial statements are prepared in accordance with indian Generally Accepted Accounting principles (GAAp) under the historical cost convention on accrual basis and comply in all material aspects with the accounting standards notified under section 211 (3c), companies(Accounting standards) rules, 2006, the provisions of the companies Act, 1956 and guidelines issued by the securities and exchange Board of india (sEBI).

2 Use of estimates

the preparation of financial statements requires the management to make estimates and assumptions that affect the reported amounts of assets and liabilities, as of the date of the financial statements and the reported amount of revenue and expenses of the year. Actual results could differ from these estimates. Any revision to estimates is recognised prospectively in current and future periods.

3 Tangible fixed assets

(a) tangible fixed assets are stated at cost, net of accumulated depreciation and impairment losses, if any. cost include all expenses incurred to bring the assets to its present location and condition.

(b) capital work in progress comprises cost of fixed assets and related expenses that are not yet ready for their intended use at the reporting date.

4 Intangible assets

intangible assets acquired are measured on initial recognition at cost. intangible assets are carried at cost less accumulated amortisation and impairment loss, if any.

5 Borrowing Costs

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of respective asset. All other borrowing costs are expensed in the period they occur.

6 Impairment of tangible and intangible assets

At each Balance sheet date, the company reviews the carrying amount of assets to determine whether there is an indication that those assets have suffered impairment loss. if any such indication exists, the recoverable amount of assets is estimated in order to determine the extent of impairment loss. the recoverable amount is higher of the net selling price and value in use, determined by discounting the estimated future cash flows expected from the continuing use of the asset to their present value.

7 Depreciation / Amortisation on tangible and intangible assets

(a) Depreciation on tangible fixed assets is provided on straight Line method at the rates specified in schedule XiV to the companies Act, 1956.

(b) premium on leasehold land and leasehold improvements are amortized over the period of lease.

(c) intangible assets are amortised on a straight line basis over the economic useful life estimated by the management.

8 Investments

(a) investments, which are readily realisable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments including investment property are classified as long-term investments.

(b) current investments are stated at lower of cost and fair value determined on an individual investment basis. long-term investments are stated at cost less provision for diminution other than temporary in the value of such investments.

(c) investment property

investment in land which is not intended to be occupied substantially for use by or in the operations of the company is classified as investment property, investment properties are stated at cost. the cost comprises purchase price, borrowing costs, if capitalisation criteria are met and directly attributable cost of bringing the investment property to its working condition for the intended use.

9 Transactions in foreign currencies

(a) Foreign currency transactions are accounted at the exchange rates prevailing on the date of such transactions.

(b) Foreign currency monetary items are translated using the exchange rates prevailing at the reporting date. Exchange difference are recognised as income or expense in the period in which they arise.

(c) Non-monetary items denominated in foreign currency are carried at cost.

10 Revenue recognition

(a) Broadcasting revenue - Advertisement revenue (net of agency commission) is recognized when the related advertisement or commercial appears before the public i.e. on telecast. subscription revenue is recognized on completion of service.

(b) sales (includes licensing of Programs, Films / Movie Rights) are recognized, when the delivery is completed.

(c) services

i commission-space selling is recognized when the related advertisement or commercial appears before the public i.e. on telecast.

ii theatrical revenue from movies is recognized on receipt of related sale reports.

(d) Dividend income is recognized when the company's right to receive dividend is established.

(e) interest income is recognized on a time proportion basis taking into account outstanding and the applicable interest rate.

(f) Revenue from other services are recognised as and when such services are completed / performed.

11 Inventories

(a) programs, films / movie rights for Broadcasting :

programs, films / movie rights are carried at lower of unamortized cost or realizable value. Where the realizable value on the basis of its estimated useful economic life is less than its carrying amount, the difference is expensed as impairment.

i cost of reality shows / chat shows / events/ game shows and sports rights etc. are fully expensed on telecast.

ii cost of programs (other than (i) above) are amortized over three financial years from the year of telecast as per management estimates of future revenue potential.

iii cost of films/movie rights are charged on a straight-line basis over the license period or 60 months from the date of acquisition, whichever is shorter.

(b) films / movie produced and/or acquired for distribution:

cost is allocated to each rights based on management estimates of revenues and amortization of costs of theatrical rights, satellite rights, music rights, video rights and others are made when sold/exploited and films/movie rights carried at lower of unamortized cost or net realizable value.

i theatrical rights: 70% of allocated cost is amortized over three months of theatrical release of movie and balance 30% in subsequent three quarters.

ii satellite rights, music rights, Home Video rights etc: Allocated cost of each right is expensed on sale.

iii Negative rights : 90% of the cost is allocated and amortized as per b(i) and b(ii) above and 10% of the cost is allocated to intellectual property rights (IpR) and amortized over subsequent five years.

(c) Work- in - progress: programs and films / movies under production are stated at cost. cost comprises of raw stock, cost of services and other expenses incurred upto the date of balance sheet.

(d) raw stock: tapes are valued at lower of cost or estimated net realizable value. cost is taken on Weighted Average basis.

12 Retirement and other employee benefits

(a) short-term employee benefits are expensed at the undiscounted amount in the statement of profit and Loss in the year employee renders the service.

(b) post employment and other long term employee benefits are recognized as an expense in the statement of profit and Loss at the present value of the amount payable determined using actuarial valuation techniques in the year the employee renders the service. Actuarial gains and losses are charged to the statement of profit and Loss.

13 Accounting for taxes on income

(a) current tax is determined as the amount of tax payable in respect of taxable income as per the provisions of the income tax Act, 1961.

(b) Deferred tax is recognized, subject to consideration of prudence in respect of deferred tax asset, on timing difference, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods and measured using relevant enacted tax rates and laws.

14 Leases

(a) finance Lease

Assets acquired under finance Lease are capitalized and the corresponding lease liability is recorded at an amount equal to the fair value of the leased asset at the inception of the lease. initial costs directly attributable to lease are recognized with the asset under lease.

(b) Operating Lease

Lease of assets under which all the risk and rewards of ownership are effectively retained by the lessor are classified as operating leases. Lease payments/revenue under operating leases are recognized as expense/income on accrual basis in accordance with the respective lease agreements.

15 Earnings Per Share

Basic earnings per share is computed and disclosed using the weighted average number of equity shares outstanding during the year. Dilutive earnings per share is computed and disclosed using the weighted average number of equity and dilutive equity equivalent shares outstanding during the year, except when the results would be anti-dilutive.

16 Provisions, Contingent Liabilities and Contingent Assets

provisions involving substantial degree of estimation in measurement are recognized when there is present obligation as a result of past events and it is probable that there will be an outflow of resources. contingent Liabilities are not recognized but are disclosed in the notes. contingent Assets are neither recognized nor disclosed in the financial statements.


Mar 31, 2010

1. Basis of Accounting

The Financial Statements have been prepared under the Historical Cost Convention and on accrual basis in accordance with the accounting standards referred to in Section 211 (3C) of the Companies Act, 1956.

2. Use of Estimates

The preparation of financial statements requires the management to make estimates and assumptions that affect the reported amounts of assets and liabilities, as of the date of the financial statements and the reported amount of revenue and expenses of the year. Actual results could differ from these estimates. Any revision to estimates is recognized prospectively in current and future periods.

3. Fixed Assets

a) Fixed assets are stated at original cost of acquisition/ installation net of accumulated depreciation, amortization and impairment losses. The cost of fixed assets includes taxes, duties, freight and other incidental expenses related to the acquisition and installation of the respective assets.

b) Capital Work in progress is stated at the amount expended upto the date of Balance sheet including advances for capital expenditure.

c) Computer software including implementation expenses (intangible asset) is capitalized as an intangible asset in the year in which related software is implemented.

4. Borrowing Costs

Borrowing Costs attributable to the acquisition or construction of qualifying assets are capitalized as a part of the cost of such assets. All other borrowing costs are charged to revenue.

5. Impairment of Assets

At each Balance Sheet date, the Company reviews the carrying amount of fixed assets to determine whether there is an indication that those assets have suffered impairment loss. If any such indication exists, the recoverable amount of assets is estimated in order to determine the extent of impairment loss. The recoverable amount is higher of the net selling price and value in use, determined by discounting the estimated future cash flows expected from the continuing use of the asset to their present value.

6. Depreciation/Amortization

a) Depreciation on fixed assets is provided on Straight Line Method at the rate specified in Schedule XIV to the Companies Act, 1956.

b) Premium on Leasehold Land and Leasehold Improvements are amortized over the period of Lease.

c) Computer Software (intangible assets) is amortized on straight line basis over a period of 36 months from the date of its implementation based on the management estimate of useful life.

7. Investments

a) Long Term Investments are carried at cost. Provision for diminution in value of these investments other than temporary is made , wherever required.

b) Current Investments are carried at cost or fair value whichever is lower.

8. Transaction in Foreign Currencies

a) Foreign currency transactions are accounted at the exchange rates prevailing on the date of such transactions.

b) Foreign currency monetary assets and liabilities at the Balance Sheet date are translated at the closing rate. Gain and losses resulting on settlement/translation of monetary assets and liabilities are recognized in the Profit and Loss Account.

c) Non-monetary items denominated in foreign currency are carried at cost.

d) In respect of forward exchange contracts assigned to the foreign currency assets/ liabilities, the difference due to change in exchange rate between the inception of forward contract and date of the Balance Sheet is recognized in the Profit and Loss Account. Any profit or loss resulting on settlement/ cancellation of forward contract is recognized as income or as expense in the year it arises.

9. Revenue Recognition

a) Broadcasting revenue - Advertisement revenue (net of agency commission) is recognized when the related advertisement or commercial appears before the public i.e. on telecast. Subscription revenue is recognized on completion of service.

b) Sales (includes licensing of TV Programs and movies ) are recognized when the delivery is completed.

c) Services

i. Commission-Space selling is recognized when the related advertisement or commercial appears before the public i.e. on telecast.

ii. Theatrical revenue from movies is recognized on receipt of reports

d) Dividend is recognized when the right to receive the dividend is unconditional.

10. Inventories

a) TV Programs and Movie rights (Produced and acquired):

TV Programs and movie rights are carried at lower of unamortized cost or realizable value. Where the realizable value on the basis of its useful economic life is less than its carrying amount, the difference is expensed as impairment.

i. Cost of reality shows / chat shows / events/ game shows etc. are fully expensed on telecast.

ii. TV Programs (other than (i) above) are amortized over three financial years from the year of telecast as per management estimates of future revenue potential.

iii. Movie rights are amortized on a straight-line basis over the license period or 60 months from the date of purchase whichever is shorter.

b) Movie produced and acquired for distribution:

The amortization pertaining to domestic theatrical, International theatrical rights, television rights, music rights, video rights and others are made, based on management estimates of revenues from each of these rights

i. Theatrical rights: - 70% cost is amortized over three months of theatrical release of movie and balance 30% in subsequent three quarters.

ii. Satellite rights, Music rights, Home Video rights etc are expensed on sale.

iii. In case of Negative rights of movies 90% of cost is amortized as per b(i) above and 10% allocated to IPR is amortized over subsequent nine years.

c) TV programs and movies under production are stated at cost. Cost comprises of material cost, cost of services and other expenses incurred upto the date of balance sheet.

d) Raw Stock - Tapes are valued at lower of cost or estimated net realizable value. Cost is taken on First in First out (FIFO) basis.

e) Educational Materials/ Equipments are valued at lower of cost or estimated net realizable value. Cost means average cost.

11. Retirement Benefits

a) Short-term employee benefits are expensed at the undiscounted amount in the profit and loss account in the year employee renders the service.

b) Post employment and other long term employee benefits are expensed in the profit and loss account in the year the employee render the service. The expense is recognized at the present value of the amount payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to the profit and loss account.

12. Accounting for Taxes on Income

a) Current Tax is determined as the amount of tax payable in respect of taxable income for the year as per the provisions of the Income Tax Act, 1961.

b) Deferred tax is recognized, subject to consideration of prudence in respect of deferred tax asset, on timing difference, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods and measured using tax rates and laws enacted.

13. Leases

a) Finance Lease

Assets acquired under Finance Lease are capitalized and the corresponding lease liability is recorded at an amount equal to the fair value of the leased asset at the inception of the lease. Initial costs directly attributable to lease are recognized with asset under lease.

b) Operating Lease

Lease of assets under which all the risk and rewards of ownership are effectively retained by the lessor are classified as operating leases. Lease payments/revenue under operating leases are recognized as expense/income on accrual basis in accordance with the respective lease agreements.

14. Miscellaneous Expenditure

Share Issue and Preliminary expenses are amortized over a period of ten years.

15. Earnings Per Share

Basic earnings per share is computed and disclosed using the weighted average number of common shares outstanding during the year. Dilutive earnings per share is computed and disclosed using the weighted average number of common and dilutive common equivalent shares outstanding during the year, except when the results would be anti-dilutive.

16. Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes to accounts. Contingent Assets are neither recognized nor disclosed in the fnancial statements.

 
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