Mar 31, 2018
This note provides a list of the significant accounting policies adopted in the preparation of these financial statements. These policies have been consistently applied to all the years presented, unless otherwise stated.
a) Basis of preparation
(i) Compliance with Ind AS
The financial statements comply in all material aspects with Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Companies Act, 2013 (the Act) read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, and other accounting principles generally accepted in India.
Effective April 1, 2016, the Company has adopted all the Ind AS standards and the adoption was carried out in accordance with Ind AS 101 First time adoption of Indian Accounting Standards, with April 1, 2015 as the transition date. The transition was carried out from Indian Accounting Principles generally accepted in India as prescribed under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 (IGAAP), which was the previous GAAP.
Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use.
Amounts for the year ended and as at March 31, 2017 were audited by previous auditors-Price Waterhouse Chartered Accountants LLP.
(ii) Historical cost convention
The financial statements have been prepared on a historical cost basis, except for the following:
certain financial assets and liabilities which have been measured at fair value;
assets held for sale - measured at fair value less cost to sell; and
defined benefit plans â plan assets measured at fair value
Historical cost is generally based on the fair value of the consideration given in exchange for goods and services.
(iii) Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the Company takes into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the measurement date. Fair value for measurement and/or disclosure purposes in these financial statements is determined on such a basis, except for share-based payment transactions that are within the scope of Ind AS 102, leasing transactions that are within the scope of Ind AS 17, and measurements that have some similarities to fair value but are not fair value, such as net realisable value in Ind AS 2 or value in use in Ind AS 36.
In addition, for financial reporting purposes, fair value measurements are categorised into Level 1, 2, or 3 based on the degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which are described as follows:
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date;
Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the asset or liability, either directly or indirectly; and
Level 3 inputs are unobservable inputs for the assets or liability.
b) Use of estimates
The preparation of the financial statements in conformity with Ind AS requires the management to make estimates, judgments and assumptions. These estimates, judgments and assumptions affect the application of accounting policies and the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the period. The application of accounting policies that require critical accounting estimates involving complex and subjective judgments and the use of assumptions in these financial statements have been disclosed in Note 2. Accounting estimates could change from period to period. Actual results could differ from those estimates. Appropriate changes in estimates are made as management becomes aware of changes in circumstances surrounding the estimates. Changes in estimates are reflected in the financial statements in the period in which changes are made and, if material, their effects are disclosed in the notes to the financial statements.
c) Business Combinations
i) The acquisition method of accounting is used to account for all business combinations, except common control transactions, regardless of whether equity instruments or other assets are acquired. The consideration transferred for the acquisition of the transferor companies comprises the fair values of the assets transferred;
iabilities incurred to the former owners of the acquired business;
equity interests issued by the Company; and
fair value of any asset or liability resulting from a contingent consideration arrangement.
Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are, with limited exceptions, measured initially at their fair values at the acquisition date. Acquisition-related costs are expensed as incurred.
The excess of the consideration transferred and acquisition-date fair value of any previous equity interest in the acquired entity over the fair value of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the fair value of the net identifiable assets of the business acquired, the difference is recognised in other comprehensive income and accumulated in equity as capital reserve provided there is clear evidence of the underlying reasons for classifying the business combination as a bargain purchase. In other cases, the bargain purchase gain is recognised directly in equity as capital reserve.
Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted to their present value as at the date of exchange. The discount rate used is the entityâs incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an independent financier under comparable terms and conditions.
Contingent consideration is classified either as equity or a financial liability. Amounts classified as a financial liability are subsequently remeasured to fair value with changes in fair value recognised in profit or loss. There is no contingent consideration in respect of all the years presented.
ii) Business combinations involving entities that are controlled by the Company are accounted for using the pooling of interests method as follows:
The assets and liabilities of the combining entities are reflected at their carrying amounts.
No adjustments are made to reflect fair values, or recognise any new assets or liabilities. Adjustments are only made to harmonise accounting policies.
The financial information in the financial statements in respect of prior periods is restated as if the business combination had occurred from the beginning of the preceding period in the financial statements, irrespective of the actual date of the combination. In case of Court approved Scheme the business combination is recognised from the appointed date following the accounting treatment approved by the Court.
The balance of the retained earnings appearing in the financial statements of the transferor is aggregated with the corresponding balance appearing in the financial statements of the transferee.
The identity of the reserves is preserved and the reserves of the transferor become the reserves of the transferee.
The difference, if any, between the amounts recorded as share capital issued plus any additional consideration in the form of cash or other assets and the amount of share capital of the transferor is transferred to capital reserve and is presented separately from other capital reserves.
d) Foreign currency translation
i) Functional and presentation currency
I tems included in the financial statements of the Company are measured using the currency of the primary economic environment in which the entity operates (âthe functional currencyâ). The financial statements are presented in Indian rupee (INR), which is Companyâs functional and presentation currency.
ii) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year-end exchange rates are generally recognised in profit or loss.
Foreign exchange differences regarded as an adjustment to borrowing costs are presented in the statement of profit and loss, within finance costs. All other foreign exchange gains and losses are presented in the statement of profit and loss on a net basis within other gains/(losses).
Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined. Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss. For example, translation differences on nonmonetary assets and liabilities such as equity instruments held at fair value through profit or loss are recognised in profit or loss as part of the fair value gain or loss and translation differences on non-monetary assets such as equity investments classified as FVTOCI are recognised in other comprehensive income.
e) Property, plant and equipment
Freehold land is carried at historical cost. All other items of property, plant and equipment are stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items.
Subsequent costs are included in the assetâs carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to profit or loss during the reporting period in which they are incurred.
Advances paid towards the acquisition of property, plant and equipment outstanding at each Balance Sheet date are classified as capital advances under other non-current assets and the cost of assets not put to use before such date are disclosed under âCapital work-in-progressâ.
Depreciation methods, estimated useful lives and residual value
The useful lives of property, plant and equipment are depreciated on pro-rata basis on the Written-Down Value method over the estimated useful lives of the assets prescribed in Schedule II to the Companies Act, 2013, which are as follows:
The same represents the consumption patterns and/or useful lives of the assets or its components. The residual values are not more than 5% of the original cost of the asset. The assetsâ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.
Leasehold improvements are depreciated over the useful life or over the shorter of the assetâs useful life and the lease term if there is no reasonable certainty that the Company will obtain ownership at the end of the lease term. Leasehold land is depreciated over the lease term.
An assetâs carrying amount is written down immediately to its recoverable amount if the assetâs carrying amount is greater than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised within âOther gains/(losses) -netâ in the Statement of Profit and Loss.
f) Intangible Assets
i) Goodwill
Goodwill on acquisition of subsidiaries is included in intangible assets. Goodwill is not amortised but it is tested for impairment annually, or more frequently if events or changes in circumstances indicate that it might be impaired, and is carried at cost less accumulated impairment losses. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.
Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to those cash-generating units or groups of cash-generating units that are expected to benefit from the business combination in which the goodwill arose. The units or groups of units are identified at the lowest level at which goodwill is monitored for internal management purposes.
ii) Title
Title âDainik Jagranâ is carried at historical cost net of accumulated amortisation and impairment losses. The Company amortises the title on a straight line basis over its estimated useful life of 27 years.
iii) Computer Software
Computer software are stated at their cost of acquisition net of accumulated amortisation. Amortisation of computer software is carried out on a systematic basis over the useful life and accordingly, these are amortised on straight line basis over their estimated useful life of three to five years.
g) Investment property
Investment properties are properties held to earn rentals and/or for capital appreciation (including property under construction for such purposes). Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment properties are measured in accordance with Ind AS 16âs requirements for cost model.
An investment property is derecognised upon disposal or when the investment property is permanently withdrawn from use and no future economic benefits are expected from the disposal. Any gain or loss arising on derecognition of the property (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the profit or loss in the period in which the property is derecognised.
Depreciation methods, useful lives and residual values are in accordance with the policy of property, plant and equipment.
h) Impairment of assets
Assets other than Goodwill are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the assetâs carrying amount exceeds its recoverable amount.
The recoverable amount is the higher of an assetâs fair value less costs of disposal and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash-generating units). Non-financial assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at the end of each reporting period.
i) Cash and cash equivalents
For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes cash on hand, deposits held at call with banks, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities in the balance sheet.
j) Cash flow statement
Cash flows are reported using indirect method, whereby Profit/(loss) before tax reported under Statement of Profit and loss is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the Company are segregated based on available information.
k) Investments and other financial assets i. Classification
The Company classifies its financial assets in the following measurement categories:
those to be measured subsequently at fair value (either through other comprehensive income, or through profit or loss), and
those measured at amortised cost.
For assets measured at fair value, gains and losses will either be recorded in profit or loss or other comprehensive income. For investments in equity or debt instruments, this will depend on whether the Company has made an irrevocable election at the time of initial recognition to account for the equity or debt investment at fair value through other comprehensive income.
The classification depends on the contractual terms of cash flows and how the entity manages the financial assets.
ii. Measurement
At initial recognition, the Company measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or loss are expensed in profit or loss.
For debt instruments, subsequent measurement depends on how the Company manages the asset and the cash flow characteristics of the asset. There are three measurement categories into which the Company classifies its debt instruments:
Amortised cost: Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortised cost. A gain or loss on a debt investment that is subsequently measured at amortised cost and is not part of a hedging relationship is recognised in profit or loss when the asset is derecognised or impaired. Interest income from these financial assets is included in finance income using the effective interest rate method.
Fair value through other comprehensive income (FVTOCI): Assets that are held for collection of contractual cash flows and for selling the financial assets, where those cash flows represent solely payments of principal and interest, are measured at fair value through other comprehensive income (FVTOCI). Movements in the carrying amount are taken through OCI, except for the recognition of impairment gains or losses, interest revenue and foreign exchange gains and losses which are recognised in profit and loss. When the financial asset is derecognised, the cumulative gain or loss previously recognised in OCI is reclassified from equity to profit or loss and recognised in other gains/(losses). Interest income from these financial assets is included in other income using the effective interest rate method.
Fair value through profit or loss: Assets that do not meet the criteria for amortised cost or FVTOCI are measured at fair value through profit or loss. A gain or loss on a debt investment that is subsequently measured at fair value through profit or loss and is not part of a hedging relationship is recognised in profit or loss and presented net in the Statement of Profit and Loss within other gains/ (losses) in the period in which it arises. Interest income from these financial assets is included in other income.
For equity instruments, the Company measures all equity investments at fair value. Where the Companyâs management has elected to present fair value gains and losses on equity investments in other comprehensive income, there is no subsequent reclassification of fair value gains and losses to profit or loss. Dividends from such investments are recognised in profit or loss as other income when the Companyâs right to receive payments is established.
Changes in the fair value of financial assets at fair value through profit or loss are recognised in other gain/(losses) in the Statement of Profit and Loss. Impairment losses (and reversal of impairment losses) on equity investments measured at FVTOCI are not reported separately from other changes in fair value.
The Company has elected to measure its investment in subsidiaries and associates at the previous GAAP carrying amount as it is deemed cost on the date of transition. Subsequently, the same have been carried at cost in accordance with Ind AS 27, âSeparate financial statementsâ.
iii. Impairment of financial assets
The Company assesses on a forward looking basis the expected credit losses associated with its assets carried at amortised cost and FVTOCI debt instruments. The impairment methodology applied depends on whether there has been a significant increase in credit risk.
iv. Income recognition
Interest income: Interest income from debt instruments is recognised using the effective interest rate method. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the gross carrying amount of a financial asset. When calculating the effective interest rate, the Company estimates the expected cash flows by considering all the contractual terms of the financial instrument (for example, prepayment and extension) but does not consider the expected credit losses.
Dividends: Dividends are recognised in profit or loss only when the right to receive payment is established, it is probable that the economic benefits associated with the dividend will flow to the Company, and the amount of the dividend can be measured reliably.
l) Financial liabilities and equity instruments Classification as debt or equity
Debt and equity instruments issued by the Company are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.
Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by the Company are recognised at the proceeds received, net of direct issue costs.
Repurchase of the Companyâs own equity instruments is recognised and deducted directly in equity. No gain or losses recognised in profit or loss on the purchase, sale, issue or cancellation of the Companyâs own equity instruments.
Financial liabilities
All financial liabilities are subsequently measured at amortised cost using the effective interest method or at fair value through profit or loss (FVTPL).
However, financial liabilities that arise when a transfer of a financial asset does not qualify for derecognition or when the continuing involvement approach applies, financial guarantee contracts issued by the Company, and commitments issued by the Company to provide a loan at below-market interest rate are measured in accordance with the specific accounting policies set out below.
a) Financial liabilities at FVTPL
Financial liabilities are classified as at FVTPL when the financial liability is either contingent consideration recognised by the Company as an acquirer in a business combination to which Ind AS 103 applies or is held for trading or it is designated as at FVTPL.
A financial liability is classified as held for trading if:
it has been incurred principally for the purpose of repurchasing it in the near term; or
on initial recognition it is part of a portfolio of identified financial instruments that the Company manages together and has a recent actual pattern of short-term profit-taking; or
I t is a derivative that is not designated and effective as a hedging instrument.
A financial liability other than a financial liability held for trading or contingent consideration recognised by the Company as an acquirer in a business combination to which Ind AS 103 applies, may be designated as at FVTPL upon initial recognition if:
such designation eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise;
the financial liability forms part of a group of financial assets or financial liabilities or both, which is managed and its performance is evaluated on a fair value basis, in accordance with the Companyâs risk management or investment strategy, and information about the grouping is provided internally on that basis; or
it forms part of a contract containing one or more embedded derivatives, and
Ind AS 109 permits the entire combined contract to be designated as at FVTPL.
Financial liabilities at FVTPL are stated at fair value, with any gains or losses arising on remeasurement recognised in profit or loss. The net gain or loss recognised in profit or loss incorporates any interest paid on the financial liability and is included in the âOther incomeâ line item.
However, for not-held-for-trading financial liabilities that are designated as at FVTPL, the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of that liability is recognised in other comprehensive income, unless the recognition of the effects of changes in the liabilityâs credit risk in other comprehensive income would create or enlarge an accounting mismatch in profit or loss, in which case these effects of changes in credit risk are recognised in profit or loss. The remaining amount of change in the fair value of liability is always recognised in profit or loss. Changes in fair value attributable to a financial liabilityâs credit risk that are recognised in other comprehensive income are reflected immediately in retained earnings and are not subsequently reclassified to profit or loss.
b) Financial liabilities subsequently measured at amortised cost
Financial liabilities that are not held-for-trading and are not designated as at FVTPL are measured at amortised cost at the end of subsequent accounting periods. The carrying amounts of financial liabilities that are subsequently measured at amortised cost are determined based on the effective interest method. Interest expense that is not capitalised as part of costs of an asset is included in the âFinance costsâ line item.
The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the financial liability, or (where appropriate) a shorter period, to the net carrying amount on initial recognition.
c) Foreign exchange gains and losses
For financial liabilities that are denominated in a foreign currency and are measured at amortised cost at the end of each reporting period, the foreign exchange gains and losses are determined based on the amortised cost of the instruments and are recognised in âOther incomeâ.
The fair value of financial liabilities denominated in a foreign currency is determined in that foreign currency and translated at the spot rate at the end of the reporting period. For financial liabilities that are measured as at FVTPL, the foreign exchange component forms part of the fair value gains or losses and is recognised in profit or loss.
d) Derecognition of financial liabilities
The Company derecognises financial liabilities when, and only when, the Companyâs obligations are discharged, cancelled or have expired. An exchange of debt instruments with substantially different terms is accounted for as an extinguishment of the original financial liability and the recognition of a new financial liability. Similarly, a substantial modification of the terms of an existing financial liability (whether or not attributable to the financial difficulty of the debtor) is accounted for as an extinguishment of the original financial liability and the recognition of a new financial liability. The difference between the carrying amount of the financial liability derecognised and the consideration paid and payable is recognised in profit or loss.
m) Borrowings
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in profit or loss over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalised as a prepayment for liquidity services and amortised over the period of the facility to which it relates.
The fair value of the liability portion of redeemable non-convertible debentures is determined using a market interest rate for an equivalent nonconvertible bonds. This amount is recorded as a liability on an amortised cost basis until redemption of the debentures. The remainder of the proceeds is attributable to the equity portion of the compound instrument. This is recognised and included in shareholdersâ equity, net of income tax effects, and not subsequently re-measured.
Borrowings are removed from the balance sheet when the obligation specified in the contract is discharged, cancelled or expired. The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in profit or loss as other gains/(losses).
n) Borrowing costs
General and specific borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalised during the period of time that is required to complete and prepare the asset for its intended use or sale.
Qualifying assets are assets that necessarily take a substantial period of time to get ready for their intended use or sale. Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.
Other borrowing costs are expensed in the period in which they are incurred.
o) Inventories
Inventories, comprising raw materials, finished goods and stores and spares, are stated at the lower of cost and net realisable value. Cost of raw materials comprises cost of purchases. Cost of inventories also includes all other costs incurred in bringing the inventories to their present location and condition. Costs of raw materials and stores and spares are assigned to individual items of inventory on the basis of first-in first-out basis and cost of finished goods is determined on direct cost basis. Costs of purchased inventory are determined after deducting rebates and discounts. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.
p) Income tax
The income tax expense or credit for the period is the tax payable on the current periodâs taxable income based on the applicable income tax rate adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.
Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred income tax is also not accounted for if it arises from initial recognition of an asset or liability in a transaction, other than a business combination, that at the time of the transaction affects neither accounting profit nor taxable profit (tax loss). Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.
Deferred tax assets are recognised for all deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.
q) Employee benefits
(i) Short-term obligations
Liabilities for wages and salaries, including non-monetary benefits that are expected to be settled wholly within 12 months after the end of the period in which the employees render the related service are recognised in respect of employeesâ services up to the end of the reporting period and are measured at the amounts expected to be paid when the liabilities are settled. The liabilities are presented as current employee benefit obligations in the balance sheet.
(ii) Other long-term employee benefit obligations
The liabilities for earned leave are not expected to be settled wholly within 12 months after the end of the period in which the employees render the related service and they are calculated annually by actuaries. They are therefore measured as the present value of expected future payments to be made in respect of services provided by employees up to the end of the reporting period using the projected unit credit method. The benefits are discounted using the market yields at the end of the reporting period that have terms approximating to the terms of the related obligation. Re-measurement as a result of experience adjustments and changes in actuarial assumptions are recognised in profit or loss.
The obligations are presented as current liabilities in the balance sheet if the entity does not have an unconditional right to defer settlement for at least twelve months after the reporting period, regardless of when the actual settlement is expected to occur.
(iii) Post-employment obligations
The Company operates the following postemployment schemes:
(a) Defined benefit plan of gratuity where gratuity fund is recognised by the income tax authorities and is administered and managed by the Life Insurance Corporation of India (âLICâ); and
(b) Defined contribution plans such as provident fund.
(iv) Gratuity obligations
The liability or asset recognised in the balance sheet in respect of defined benefit gratuity plans is the present value of the defined benefit obligation at the end of the reporting period less the fair value of plan assets. The defined benefit obligation is calculated annually by actuaries using the projected unit credit method.
The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows by reference to market yields at the end of the reporting period on government bonds that have terms approximating to the terms of the related obligation.
The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the fair value of plan assets. This cost is included in employee benefit expense in the Statement of Profit and Loss.
Re-measurements, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability and the return on plan assets (excluding amounts included in net interest on the net defined benefit liability), are recognised immediately in the balance sheet with a corresponding debit or credit to retained earnings through other comprehensive income in the period in which they occur. They are included in retained earnings in the statement of changes in equity and in the balance sheet.
Changes in the present value of the defined benefit obligation resulting from plan amendments or curtailments are recognised immediately in profit or loss as past service cost.
(v) Defined contribution plans
The Companyâs contribution to Employee Provident fund, Employee State Insurance Fund and Employeeâs Pension Scheme 1995 are accounted for as defined contribution plans and the contributions are recognised as employee benefit expense when they are due. The Company deposits these amounts with the fund administered and managed by the provident fund/ Employees State Insurance authorities. The Company does not carry any further obligations, apart from the contributions made on monthly basis.
(vi) Termination benefits
Termination benefits are payable when employment is terminated by the Company before the normal retirement date, or when an employee accepts voluntary redundancy in exchange for these benefits. The Company recognises termination benefits as an expense immediately.
r) Provisions
Provisions for legal claims, volume discounts and returns are recognised when the Company has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation and the amount can be reliably estimated. Provisions are not recognised for future operating losses.
Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small.
Provisions are measured at the present value of managementâs best estimate of the expenditure required to settle the present obligation at the end of the reporting period. The discount rate used to determine the present value is a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The increase in the provision due to the passage of time is recognised as interest expense.
s) Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are net of returns, trade allowances, rebates, value added taxes and amounts collected on behalf of third parties.
The Company recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and specific criteria has been met for each of the Companyâs activities, as described below. The Company bases its estimate of return on historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement.
Recognising revenue from major business activities
i. Advertisement
Revenue from sale of advertisement space is recognised (net of estimated volume discounts), as and when the relevant advertisement is published. Revenue against all barter-transactions is recognised at the time of actual performance of the contract to the extent of performance completed by either party against its part of contract and is measured at fair value in reference to nonbarter transactions.
ii. Sale of publications
Revenue from sale is recognised on dispatch, net of credits for unsold copies, which coincides with transfer of significant risks and rewards.
iii. Others
Revenue from outdoor activities is recognised as and when the relevant advertisement is displayed.
Revenue from event management and activation services is recognised when the event is completed.
Revenue from other operating activities is recognised on delivery of goods after completion as set out in the relevant contracts.
t) Leases
Assets acquired under finance leases are recognised as property, plant and equipment. Liability is recognised at the lower of the fair value of the leased assets at inception of the lease and the present value of the minimum lease payments. Lease payments are apportioned between the finance charge and the reduction of the outstanding liability.
The finance charge is allocated over the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability and charge to the Statement of Profit and Loss.
Leases in which a significant portion of the risks and rewards of ownership are not transferred to the Company as lessee are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to profit or loss on a straight-line basis over the period of the lease unless the payments are structured to increase in line with expected general inflation to compensate for the lessorâs expected inflationary cost increases.
u) Earnings per share
(i) Basic Earnings per share
Basic earnings per share is calculated by dividing the profit attributable to owners of the Company by the weighted average number of equity shares outstanding, excluding treasury shares, during the year.
(ii) Diluted Earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after income tax effect of interest and other financing costs associated with dilutive potential equity shares and the weighted average number of additional equity shares that would have been outstanding assuming the conversion of all dilutive potential equity shares.
v) Insurance claims
Insurance claims are accounted for on the basis of claims admitted/expected to be admitted and to the extent that the amount recoverable can be measured reliably and it is reasonable to expect ultimate collection.
w) Operating cycle
Based on the nature of activities of the Company and the normal time between acquisition of assets and their realisation in cash or cash equivalents, the Company has determined its operating cycle as 12 months for the purpose of classification of its assets and liabilities as current and non-current.
x) Rounding of amounts
All amounts disclosed in the financial statements and notes have been rounded off to the nearest Rupees Lakhs and two decimals thereof as per the requirement of Schedule III, unless otherwise stated.
Mar 31, 2017
This note provides a list of the significant accounting policies adopted in the preparation of these financial statements. These policies have been consistently applied to all the years presented, unless otherwise stated.
a) Basis of preparation
(i) Compliance with Ind AS
The financial statements comply in all material aspects with Indian Accounting Standards (Ind AS) notified under Section 133 of the Companies Act, 2013 (the Act) [Companies (Indian Accounting Standards) Rules, 2015] and other relevant provisions of the Act.
The financial statements up to year ended March 31, 2016 were prepared in accordance with the accounting standards notified under Companies (Accounting Standards) Rules, 2006 (as amended) and other relevant provisions of the Act.
These financial statements are the first financial statements of the Company under Ind AS. Refer note 36 for an explanation of how the transition from Indian GAAP to Ind AS has affected the Companyâs financial position, financial performance and cash flows.
(ii) Historical cost convention
The financial statements have been prepared on a historical cost basis, except for the following:
- certain financial assets and liabilities which have been measured at fair value;
- assets held for sale - measured at fair value less cost to sell; and
- defined benefit plans - plan assets measured at fair value.
b) Business Combinations
i) The acquisition method of accounting is used to account for all business combinations, except common control transactions, regardless of whether equity instruments or other assets are acquired. The consideration transferred for the acquisition of the transferor companies comprises the â
- fair values of the assets transferred;
- Iiabilities incurred to the former owners of the acquired business;
- equity interests issued by the Company; and
- fair value of any asset or liability resulting from a contingent consideration arrangement.
Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are with limited exceptions, measured initially at their fair values at the acquisition date. Acquisition-related costs are expensed as incurred.
The excess of the consideration transferred and acquisition-date fair value of any previous equity interest in the acquired entity over the fair value of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the fair value of the net identifiable assets of the business acquired, the difference is recognised in other comprehensive income and accumulated in equity as capital reserve provided there is clear evidence of the underlying reasons for classifying the business combination as a bargain purchase. In other cases, the bargain purchase gain is recognised directly in equity as capital reserve.
Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted to their present value as at the date of exchange. The discount rate used is the entityâs incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an independent financier under comparable terms and conditions.
Contingent consideration is classified either as equity or a financial liability. Amounts classified as a financial liability are subsequently re-measured to fair value with changes in fair value recognised in profit or loss. There is no contingent consideration in respect of all the years presented.
(ii) Business combinations involving entities that are controlled by the Company are accounted for using the pooling of interests method as follows:
- The assets and liabilities of the combining entities are reflected at their carrying amounts.
- No adjustments are made to reflect fair values, or recognise any new assets or liabilities. Adjustments are only made to harmonise accounting policies.
- The financial information in the financial statements in respect of prior periods is restated as if the business combination had occurred from the beginning of the preceding period in the financial statements, irrespective of the actual date of the combination. In case of Court approved Scheme the business combination is recognised from the appointed date following the accounting treatment approved by the Court.
- The balance of the retained earnings appearing in the financial statements of the transferor is aggregated with the corresponding balance appearing in the financial statements of the transferee.
- The identity of the reserves are preserved and the reserves of the transferor become the reserves of the transferee.
- The difference, if any, between the amounts recorded as share capital issued plus any additional consideration in the form of cash or other assets and the amount of share capital of the transferor is transferred to capital reserve and is presented separately from other capital reserves.
c) Foreign currency translation
i) Functional and presentation currency
Items included in the financial statements of the Company are measured using the currency of the primary economic environment in which the entity operates (âthe functional currencyâ). The financial statements are presented in Indian rupee (INR), which is Companyâs functional and presentation currency.
ii) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates are generally recognised in profit or loss.
Foreign exchange differences regarded as an adjustment to borrowing costs are presented in the statement of profit and loss, within finance costs. All other foreign exchange gains and losses are presented in the statement of profit and loss on a net basis within other gains/ (losses).
Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined. Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss. For example, translation differences on nonmonetary assets and liabilities such as equity instruments held at fair value through profit or loss are recognised in profit or loss as part of the fair value gain or loss and translation differences on non-monetary assets such as equity investments classified as FVOCI are recognised in other comprehensive income.
d) Property, plant and equipment
Freehold land is carried at historical cost. All other items of property, plant and equipment are stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items.
Subsequent costs are included in the assetâs carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to profit or loss during the reporting period in which they are incurred.
TRANSITION TO IND AS
On transition to Ind AS, the Company has elected to continue with the carrying value of all of its property, plant and equipment recognised as at April 1, 2015 measured as per the previous GAAP and use that carrying value as the deemed cost of the property, plant and equipment.
Depreciation methods, estimated useful lives and residual value
The useful lives of property, plant and equipment are depreciated on pro-rata basis on the Written-Down Value method over the estimated useful lives of the assets prescribed in Schedule II to the Companies Act, 2013, which are as follows:
Buildings 30 years
Buildings constructed on leasehold land 30 years
Plant and Machinery 15 years
Office equipment 5 years
Computers 3 years
Furniture and Fixtures 10 years
Vehicles 8 years
The same represents the consumption patterns and/or useful lives of the assets or its components. The residual values are not more than 5% of the original cost of the asset. The assetsâ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.
Leasehold improvements are depreciated over the useful life or over the shorter of the assetâs useful life and the lease term if there is no reasonable certainty that the Company will obtain ownership at the end of the lease term. Leasehold land are depreciated over the lease term.
An assetâs carrying amount is written down immediately to its recoverable amount if the assetâs carrying amount is greater than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised within âOther (losses)/gains - netâ in the statement of profit or loss.
e) Intangible Assets
i) Goodwill
Goodwill on acquisitions of subsidiaries is included in intangible assets. Goodwill is not amortised but it is tested for impairment annually, or more frequently if events or changes in circumstances indicate that it might be impaired, and is carried at cost less accumulated impairment losses. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.
Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to those cash-generating units or groups of cash-generating units that are expected to benefit from the business combination in which the goodwill arose. The units or groups of units are identified at the lowest level at which goodwill is monitored for internal management purposes.
ii) Title
Title âDainik Jagranâ is carried at historical cost net of accumulated amortisation and impairment losses. The Company amortises the title on a straight line basis over its estimated useful life of 27 years.
iii) Computer Software
Computer software are stated at their cost of acquisition net of accumulated amortisation. Amortisation of computer software is carried out on a systematic basis over the useful life and accordingly, these are amortised on straight line basis over their estimated useful life of three years.
TRANSITION TO IND AS
On transition to Ind AS, the Company has elected to continue with the carrying value of all of its intangible assets recognised as at April 1, 2015 measured as per the previous GAAP and use that carrying value as the deemed cost of the intangible assets.
f) Impairment of assets
Assets other than Goodwill are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the assetâs carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an assetâs fair value less costs of disposal and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash-generating units). Non-financial assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at the end of each reporting period.
g) Cash and cash equivalents
For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes cash on hand, deposits held at call with banks, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities in the balance sheet.
h) Investments and other financial assets
i. Classification
The Company classifies its financial assets in the following measurement categories:
- those to be measured subsequently at fair value (either through other comprehensive income, or through profit or loss), and
- those measured at amortised cost.
For assets measured at fair value, gains and losses will either be recorded in profit or loss or other comprehensive income. For investments in equity or debt instruments, this will depend on whether the Company has made an irrevocable election at the time of initial recognition to account for the equity or debt investment at fair value through other comprehensive income.
The classification depends on the contractual terms of cash flows and how the entity manages the financial assets.
ii. Measurement
At initial recognition, the Company measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or loss are expensed in profit or loss.
For debt instruments, subsequent measurement depends on how the Companyâs manages the asset and the cash flow characteristics of the asset. There are three measurement categories into which the Company classifies its debt instruments:
- Amortised cost: Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortised cost. A gain or loss on a debt investment that is subsequently measured at amortised cost and is not part of a hedging relationship is recognised in profit or loss when the asset is derecognised or impaired. Interest income from these financial assets is included in finance income using the effective interest rate method.
- Fair value through other comprehensive income (FVOCI): Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assetsâ cash flows represent solely payments of principal and interest, are measured at fair value through other comprehensive income (FVOCI). Movements in the carrying amount are taken through OCI, except for the recognition of impairment gains or losses, interest revenue and foreign exchange gains and losses which are recognised in profit and loss. When the financial asset is derecognised, the cumulative gain or loss previously recognised in OCI is reclassified from equity to profit or loss and recognised in other gains/ (losses). Interest income from these financial assets is included in other income using the effective interest rate method.
- Fair value through profit or loss: Assets that do not meet the criteria for amortised cost or FVOCI are measured at fair value through profit or loss. A gain or loss on a debt investment that is subsequently measured at fair value through profit or loss and is not part of a hedging relationship is recognised in profit or loss and presented net in the statement of profit and loss within other gains/(losses) in the period in which it arises. Interest income from these financial assets is included in other income.
For equity instruments, the Company measures all equity investments at fair value. Where the Companyâs management has elected to present fair value gains and losses on equity investments in other comprehensive income, there is no subsequent reclassification of fair value gains and losses to profit or loss. Dividends from such investments are recognised in profit or loss as other income when the Companyâs right to receive payments is established.
Changes in the fair value of financial assets at fair value through profit or loss are recognised in other gain/ (losses) in the statement of profit and loss. Impairment losses (and reversal of impairment losses) on equity investments measured at FVOCI are not reported separately from other changes in fair value.
The Company has elected to measure its investment in subsidiaries and associates at the previous GAAP carrying amount as it is deemed cost on the date of transition. Subsequently, the same have been carried at cost in accordance with Ind AS 27: Separate financial statements.
iii. Impairment of financial assets
The Company assesses on a forward looking basis the expected credit losses associated with its assets carried at amortised cost and FVOCI debt instruments. The impairment methodology applied depends on whether there has been a significant increase in credit risk.
iv. Income recognition
Interest income: Interest income from debt instruments is recognised using the effective interest rate method. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the gross carrying amount of a financial asset. When calculating the effective interest rate, the Company estimates the expected cash flows by considering all the contractual terms of the financial instrument (for example, prepayment and extension) but does not consider the expected credit losses.
Dividends: Dividends are recognised in profit or loss only when the right to receive payment is established, it is probable that the economic benefits associated with the dividend will flow to the Company, and the amount of the dividend can be measured reliably.
i) Borrowings
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in profit or loss over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalised as a prepayment for liquidity services and amortised over the period of the facility to which it relates.
The fair value of the liability portion of redeemable non-convertible debentures is determined using a market interest rate for an equivalent nonconvertible bonds. This amount is recorded as a liability on an amortised cost basis until redemption of the debentures. The remainder of the proceeds is attributable to the equity portion of the compound instrument. This is recognised and included in shareholdersâ equity, net of income tax effects, and not subsequently re-measured.
Borrowings are removed from the balance sheet when the obligation specified in the contract is discharged, cancelled or expired. The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in profit or loss as other gains/(losses).
j) Borrowing costs
General and specific borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalised during the period of time that is required to complete and prepare the asset for its intended use or sale.
Qualifying assets are assets that necessarily take a substantial period of time to get ready for their intended use or sale. Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.
Other borrowing costs are expensed in the period in which they are incurred.
k) Inventories
Inventories, comprising raw materials, finished goods and stores and spares, are stated at the lower of cost and net realisable value. Cost of raw materials comprises cost of purchases. Cost of inventories also includes all other costs incurred in bringing the inventories to their present location and condition. Costs of raw materials and stores and spares are assigned to individual items of inventory on the basis of first-in first-out basis and cost of finished goods is determined on direct cost basis. Costs of purchased inventory are determined after deducting rebates and discounts. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.
l) Income tax
The income tax expense or credit for the period is the tax payable on the current periodâs taxable income based on the applicable income tax rate adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.
Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred income tax is also not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting profit nor taxable profit (tax loss). Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.
Deferred tax assets are recognised for all deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.
Deferred tax liabilities are not recognised for temporary differences between the carrying amount and tax bases of investments in subsidiaries and associates where the Company is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not reverse in the foreseeable future.
Deferred tax assets are not recognised for temporary differences between the carrying amount and tax bases of investments in subsidiaries and associates where it is not probable that the differences will reverse in foreseeable future and taxable profit will not be available against which the temporary difference can be utilised.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.
m) Employee benefits
(i) Short-term obligations
Liabilities for wages and salaries, including non-monetary benefits that are expected to be settled wholly within 12 months after the end of the period in which the employees render the related service are recognised in respect of employeesâ services up to the end of the reporting period and are measured at the amounts expected to be paid when the liabilities are settled. The liabilities are presented as current employee benefit obligations in the balance sheet.
(ii) Other long-term employee benefit obligations
The liabilities for earned leave are not expected to be settled wholly within 12 months after the end of the period in which the employees render the related service and they are calculated annually by actuaries. They are therefore measured as the present value of expected future payments to be made in respect of services provided by employees up to the end of the reporting period using the projected unit credit method. The benefits are discounted using the market yields at the end of the reporting period that have terms approximating to the terms of the related obligation. Re-measurement as a result of experience adjustments and changes in actuarial assumptions are recognised in profit or loss.
The obligations are presented as current liabilities in the balance sheet if the entity does not have an un-conditional right to defer settlement for at least twelve months after the reporting period, regardless of when the actual settlement is expected to occur.
(iii) Post-employment obligations
The Company operates the following postemployment schemes:
(a) Defined benefit plan of gratuity where gratuity fund is recognised by the income tax authorities and is administered and managed by the Life Insurance Corporation of India (âLICâ); and
(b) Defined contribution plans such as provident fund.
Gratuity obligations
The liability or asset recognised in the balance sheet in respect of defined benefit gratuity plans is the present value of the defined benefit obligation at the end of the reporting period less the fair value of plan assets. The defined benefit obligation is calculated annually by actuaries using the projected unit credit method.
The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows by reference to market yields at the end of the reporting period on government bonds that have terms approximating to the terms of the related obligation.
The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the fair value of plan assets. This cost is included in employee benefit expense in the Statement of profit and loss.
Re-measurements, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability and the return on plan assets (excluding amounts included in net interest on the net defined benefit liability), are recognised immediately in the balance sheet with a corresponding debit or credit to retained earnings through other comprehensive income in the period in which they occur. They are included in retained earnings in the statement of changes in equity and in the balance sheet.
Changes in the present value of the defined benefit obligation resulting from plan amendments or curtailments are recognised immediately in profit or loss as past service cost.
Defined contribution plans
The Companyâs contribution to Employee Provident fund, Employee State Insurance Fund and Employeeâs Pension Scheme 1995 are accounted for as defined contribution plans and the contributions are recognised as employee benefit expense when they are due. The Company deposits these amounts with the fund administered and managed by the provident fund/ Employees State Insurance authorities. The Company has no further payment obligations once the contributions have been paid. The Company does not carry any further obligations, apart from the contributions made on monthly basis.
(iv) Termination benefits
Termination benefits are payable when employment is terminated by the Company before the normal retirement date, or when an employee accepts voluntary redundancy in exchange for these benefits. The Company recognises termination benefits as an expense immediately.
n) Provisions
Provisions for legal claims, volume discounts and returns are recognised when the Company has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation and the amount can be reliably estimated. Provisions are not recognised for future operating losses.
Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small.
Provisions are measured at the present value of managementâs best estimate of the expenditure required to settle the present obligation at the end of the reporting period. The discount rate used to determine the present value is a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability.
The increase in the provision due to the passage of time is recognised as interest expense.
o) Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are net of returns, trade allowances, rebates, value added taxes and amounts collected on behalf of third parties.
The Company recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and specific criteria has been met for each of the Companyâs activities, as described below. The Company bases its estimate of return on historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement.
Recognising revenue from major business activities
i. Advertisement
Revenue from sale of advertisement space is recognised (net of estimated volume discounts), as and when the relevant advertisement is published. Revenue against all barter-transactions is recognised at the time of actual performance of the contract to the extent of performance completed by either party against its part of contract and is measured at fair value in reference to non barter transactions.
ii. Sale of publications
Revenue from sale is recognised on dispatch, net of credits for unsold copies, which coincides with transfer of significant risks and rewards.
iii. Others
Revenue from Outdoor activities is recognised as and when the relevant advertisement is displayed.
Revenue from Event Management services is recognised when the event is completed.
Revenue from other operating activities is recognised on delivery of goods after completion as set out in the relevant contracts.
p) Leases
Assets acquired under finance leases are recognised as fixed assets. Liability is recognised at the lower of the fair value of the leased assets at inception of the lease and the present value of the minimum lease payments. Lease payments are apportioned between the finance charge and the reduction of the outstanding liability. The finance charge is allocated over the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability and charge to the Statement of profit and loss.
Leases in which a significant portion of the risks and rewards of ownership are not transferred to the Company as lessee are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to profit or loss on a straight-line basis over the period of the lease unless the payments are structured to increase in line with expected general inflation to compensate for the lessorâs expected inflationary cost increases.
q) Earnings per share
(i) Basic Earnings per share
Basic earnings per share is calculated by dividing the profit attributable to owners of the Company by the weighted average number of equity shares outstanding during the financial year, if any, issued during the year and excluding treasury shares.
(ii) Diluted Earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after income tax effect of interest and other financing costs associated with dilutive potential equity shares and the weighted average number of additional equity shares that would have been outstanding assuming the conversion of all dilutive potential equity shares.
r) Recent accounting pronouncements Standards issued but not yet effective
In March 2017, the Ministry of Corporate Affairs issued the Companies (Indian Accounting Standards) (Amendments) Rules, 2017, notifying amendments to Ind AS 7, Statement of Cash Flows and Ind AS 102, Share-Based Payment. These amendments are in accordance with the recent amendments made by International Accounting Standards Board (IASB) to IAS 7, Statement of Cash Flows and IFRS 2, Share-Based Payment, respectively. The amendments are applicable to the Company from April 1, 2017.
Amendment to Ind AS 7
The amendment to Ind AS 7 requires the entities to provide disclosures that enable users of financial statements to evaluate changes in liabilities arising from financing activities, including both changes arising from cash flows and non-cash changes, suggesting inclusion of a reconciliation between the opening and closing balances in the Balance Sheet for liabilities arising from financing activities, to meet the disclosure requirement.
This is a new requirement and appropriate disclosures will be made in the financial statements when the amendment becomes effective.
Amendment to Ind AS 102
The amendment to Ind AS 102 provides specific guidance for the measurement of cash-settled awards, modification of cash-settled awards and awards that include a net settlement feature in respect of withholding taxes. Ind AS 102 is not applicable to the Company.
s) Rounding of amounts
All amounts disclosed in the financial statements and notes have been rounded off to the nearest Rupees lakhs and two decimals thereof as per the requirement of Schedule III, unless otherwise stated.
Mar 31, 2016
(i) General Information
Jagran Prakashan Limited ("the Company" or "JPL") is engaged primarily
in printing and publication of Newspaper and Magazines in India. The
other activities of the company comprise outdoor advertising business,
event management services and digital business. The Company is a
public limited company and is listed on Bombay Stock Exchange (BSE) and
National Stock Exchange (NSE).
a) Basis of Preparation
These financial statements have been prepared in accordance with the
generally accepted accounting principles in India under the historical
cost convention on accrual basis. Pursuant to section 133 of the
Companies Act 2013 read with Rule 7 of the Companies (Accounts) Rules
2014, till the Standards of Accounting or any addendum thereto are
prescribed by the Central Government in consultation and recommendation
of the National Finance Reporting Authority, the existing Accounting
Standards notified under Companies Act, 1956 shall continue to apply.
Consequently, these financial statements have been prepared to comply
in all material respects with accounting standards notified under
section 211(3C) of the Companies Act, 1956 [Companies (Accounting
Standards) Rules 2006 as amended] and other relevant provisions of the
Companies Act, 2013.
All assets and liabilities have been classified as current or
non-current as per the Company''s normal operating cycle and other
criteria set out in the Schedule III to the Companies Act, 2013. Based
on the nature of products and the time between the acquisition of
assets for processing and their realisation in cash and cash
equivalents, the Company has considered its operating cycle as 12
months for the purpose of current and non- current of classification of
assets and liabilities.
The Ministry of Corporate Affairs (MCA) has notified the Companies
(Accounting Standards) Amendment Rules, 2016 vide its notification
dated March 30, 2016. The said notification read with Rule 3(2) of the
Companies (Accounting Standards) Rules, 2006 is applicable to
accounting period commencing on or after the date of notification i.e.
April 1, 2016.
b) Tangible and Intangible Assets
i. Tangible assets and Intangible assets are stated at the cost of
acquisition or construction net of accumulated depreciation and
accumulated impairment losses, if any. Tangible assets are depreciated
on pro-rata basis on the Written-Down Value method over the estimated
useful lives of the assets prescribed in Schedule II to the Companies
Act 2013.
ii. Subsequent expenditures related to an item of Fixed Asset are
added to its book value only if they increase the future benefits from
the existing asset beyond its previously assessed standard of
performance.
iii. Assets individually costing less than Rs. 5,000 each are fully
depreciated in the year of acquisition. In respect of assets acquired,
sold or discarded during the year, depreciation is provided on pro-rata
basis for the period during which each asset was in use.
iv. Depreciation is provided on composite cost of Land and Building
wherever cost of Land is not separately available. In these cases, the
said composite cost is capitalised under Building.
v. Leasehold land and Leasehold improvements are amortised on a
straight-line basis over the total period of lease including renewals,
or useful life, whichever is shorter.
vi. Losses arising from the retirement of and gains or losses arising
from disposal of fixed assets which are carried at cost are recognised
in the Statement of Profit and Loss.
vii. Title Dainik Jagran has been amortized on straight line basis over
its estimated useful life.
viii. Computer Software are stated at their cost of acquisition net of
accumulated amortisation. These are amortised on straight line basis
over their estimated useful life of three years.
ix. Items of fixed assets that have been retired from active use and
are held for disposal are stated at lower of their net book value and
net realisable value and are shown separately in the financial
statements. Any expected loss is recognised immediately in the
Statement of profit and loss.
c) Investments
Investments that are readily realisable and are 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 are
classified as long term investments.
Long term investments are stated at cost of acquisition inclusive of
expenditure incidental to acquisition. A provision for diminution is
made to recognise a decline, other than temporary, in the value of long
term investments, such reduction being determined and made for each
investment individually.
Current investments are stated at lower of cost and fair value
determined on an individual basis.
Consideration for barter/exchange transactions is exchanged in
accordance with the terms of the contract to formalise the arrangement.
d) Inventories
Inventories are valued at cost or net realisable value, whichever is
lower. Cost of raw materials and stores is determined on
first-in-first-out basis and cost of finished goods is determined on
direct cost basis. Net realisable value is the estimated selling price
in the ordinary course of business, less the estimated costs of
completion and the estimated costs necessary to make the sale.
e) Foreign Currency Transactions
On initial recognition, all foreign currency transactions are recorded
by applying to the foreign currency amount the exchange rate between
the reporting currency and the foreign currency at the date of the
transaction.
Exchange differences arising on the settlement of monetary items at
rates different from those at which they were initially recorded during
the year, or reported in the previous financial statements, are
recognized as income or as expense in the year in which they arise.
As at the reporting date, non-monetary items which are carried in terms
of historical cost denominated in a foreign currency are reported using
the exchange rate at the date of the transaction. All non-monetary
items which are carried at fair value or other similar valuation
denominated in a foreign currency are reported using exchange rates
that existed when values were determined.
Foreign Currency Monetary Items outstanding as at Balance Sheet date
are valued using the conversion rate prevailing as at Balance Sheet
date and the exchange differences on restatement are recognised as
income or as expense in the Statement of Profit and Loss.
The Company does not have any derivative transactions.
f) Revenue Recognition
Revenues are recognized to the extent that it is probable that economic
benefit will flow to the Company and revenue can be reliably measured.
It is accounted for net of trade discounts.
Specifically the following basis are adopted in respect of various
sources of revenues of the Company:-
i. Advertisement
Revenue from sale of advertisement space is recognized, as and when the
relevant advertisement is published.
Revenue/Expense against all Barter- Contracts is recognised at the time
of actual performance of the contract to the extent of performance
completed by either party against its part of contract.
ii. Sale of Publications
Revenue from sale is recognised on dispatch, net of credits for unsold
copies, which coincides with transfer of significant risks and rewards.
iii. Others
Revenue from Outdoor activities is recognised as and when the relevant
advertisement is displayed.
Revenue from Event Management services is recognised when the event is
completed.
Revenuefrom printing job work is recognised on delivery of goods after
completion as set out in the relevant contracts.
Claims from insurance companies/ Interest on income tax refunds/
Government department are recognised as and when amount receivable can
be reasonably determined.
Interest income is recognised on a time proportion basis taking into
account the amount outstanding and the rate applicable.
Dividend income is recognised if the right to receive payment is
established by the Balance Sheet date.
g) Employee Benefits
Short term employee benefits are recognised in the period during which
the services have been rendered. The Company''s contribution to Employee
Provident Fund, Employee''s State Insurance Fund and Employee''s Pension
Scheme 1995 are charged to revenue. These are defined contribution
plans and the Company deposits these amounts with the fund administered
and managed by the provident fund/ Employees State Insurance
authorities. The Company does not carry any further obligations, apart
from the contributions made on monthly basis.
The Company has Defined Benefit plans namely leave encashment and
gratuity for all employees, the liability for which is determined on
the basis of an actuarial valuation at the end of the year using the
projected unit credit method. Every employee is entitled to benefit
equivalent to fifteen days salary last drawn for each completed year of
service in line with the Payment of Gratuity Act, 1972. The same is
payable at the time of separation from the Company or retirement,
whichever is earlier. The benefits vest after five years of continuous
service. Gratuity Fund is recognised by the income tax authorities and
is administered and managed by the Life Insurance Corporation of India
("LIC").
Termination benefits are recognised as an expense immediately.
Actuarial gains and losses comprise experience adjustments and the
effects of changes in actuarial assumptions are recognised immediately
in the Statement of Profit and Loss as income or expense.
h) Taxation
i. Tax expense comprises current tax and deferred tax.
ii. Current tax comprises Company''s tax liability for the current
financial year as well as additional tax paid/adjusted, if any, during
the year in respect of earlier years on receipt of demand from the
authorities. For computation of taxable income under the Income Tax
Act, 1961, cash basis of accounting has been adopted and consistently
followed by the Company.
iii. Deferred tax assets and liabilities are computed on the timing
differences at the Balance Sheet date using the tax rate and tax laws
that have been enacted or substantively enacted by the Balance sheet
date. Deferred tax assets are recognised subject to consideration of
prudence based on management estimates of reasonable certainty that
sufficient taxable income will be available in the future periods
against which such deferred tax assets can be realised. In situations,
where the Company has unabsorbed depreciation or carry forward losses
under tax laws, all deferred tax assets are recognised only to the
extent that there is virtual certainty supported by convincing evidence
that they can be realised against future taxable profits. Unrecognised
deferred tax assets of earlier years are re-assessed and recognised to
the extent that it has become reasonably certain that future taxable
income will be available against which such deferred tax assets can be
realised.
iv. Current tax assets and current tax liabilities are offset when
there is legally enforceable right to set-off the recognised amounts
and there is an intention to settle the asset and the liability on a
net basis. Deferred tax assets and deferred tax liabilities are offset
when there is a legally enforceable right to set-off assets against
liabilities representing current tax and where the deferred tax assets
and the deferred tax liabilities relate to taxes on income levied by
the same governing taxation laws.
v. Minimum Alternative tax ("MAT") credit is recognised as an asset
only when and to the extent there is convincing evidence that the
Company will pay normal income tax during the specified period. In the
year in which the MAT credit becomes eligible to be recognised as an
asset in accordance with the Guidance Note issued by the Institute of
Chartered Accountants of India, the said asset is created by way of a
credit to the Statement of Profit and Loss and shown as MAT Credit
Entitlement. The Company reviews the same at each balance sheet date
and writes down the carrying amount of MAT Credit Entitlement to the
extent there is no longer convincing evidence to the effect that
Company will pay normal Income Tax during the specified period.
i) Lease
Assets acquired under finance leases are recognised as fixed assets.
Liability is recognised at the lower of the fair value of the leased
assets at inception of the lease and the present value of minimum lease
payments. Lease payments are apportioned between the finance charge and
the reduction of the outstanding liability. The finance charge is
allocated over the lease term so as to produce a constant periodic rate
of interest on the remaining balance of the liability and charge to the
Statement of profit and loss.
Leases in which a significant portion of the risks and rewards of
ownership are retained by the lessor are classified as operating
leases.
Payments made under operating leases are charged to Statement of Profit
and Loss on a straight line basis over the period of the lease.
In case of non-cancellable operating leases, the total rent payable
including future escalations till the expiry of lease is charged
equally to Statement of profit and loss over the period of lease
including renewals.
j) Impairment of Assets
At each balance sheet date, the Company reviews the carrying amounts of
its fixed assets to determine whether there is any indication that
those assets suffered an impairment loss. For the purpose of assessing
impairment, the smallest identifiable group of assets that generates
cash inflows from continuing use that are largely independent of the
cash inflows from other assets or groups of assets, is considered as a
cash generating unit. If any such indication exists, the impairment
loss is recognised for the amount by which the asset''s carrying value
exceeds its recoverable amount. Recoverable amount is the higher of an
asset''s net selling price and value in use. In assessing value in use,
the estimated future cash flows expected from the continuing use of the
asset and from its disposal are discounted to their present value using
a pre-tax discount rate that reflects the current market assessments of
time value of money and the risks specific to the asset. An impairment
loss is reversed to the extent that the asset''s carrying amount does
not exceed the carrying amount that would have been determined if no
impairment loss had previously been recognised.
k) Provisions and Contingent Liability
i. The Company creates a provision when there is a present obligation
arising as a result of past event that probably requires an outflow of
resources and a reliable estimate can be made of the amount of
obligation. Provisions are measured at the best estimate of the
expenditure required to settle the present obligation at the balance
sheet date and are not discounted to its present value.
ii. Contingent liabilities are disclosed when there is possible
obligation arising from past events, the existence of which will be
confirmed only by the occurrence or non- occurrence of one or more
uncertain future events not wholly within the control of the company or
a present obligation that arises from past events where it is either
not probable that an outflow of resources will be required to settle or
a reliable estimate of the amount cannot be made.
l) Earnings Per Share
Earnings per Share ("EPS") are computed on the basis of net profit
after tax for the year. The number of shares used in computing basic
EPS is weighted average number of shares outstanding during the year.
The diluted EPS is calculated on the same basis as basic EPS, since
there are no dilutive equity shares.
m) Segment Information
The Company is engaged primarily in printing and publication of
Newspaper and Magazines in India. The other activities of the company
comprise outdoor advertising business, event management services and
digital business. However these in the context of the Accounting
Standard 17 on Segment Reporting is considered to constitute single
reportable business segment and single geographical segment.
Accordingly, no separate disclosure for primary or secondary segments
is given.
n) Cash Flow Statement
Cash flows are reported using the indirect method, whereby net profit
before tax is adjusted for the effects of transactions of non- cash
nature. The cash flows from operating, investing and financing
activities of the Company are segregated.
o) Borrowing Cost
Borrowing costs include interest, other costs incurred in connection
with borrowing and exchange differences arising from foreign currency
borrowings to the extent that they are regarded as an adjustment to the
interest cost. General and specific borrowing costs directly
attributable to the acquisition, construction or production of
qualifying assets, which are assets that necessarily take a substantial
period of time to get ready for their intended use or sale, are added
to the cost of those assets, until such time as the assets are
substantially ready for their intended use or sale. All other borrowing
costs are recognised in Statement of Profit and Loss in the period in
which they are incurred.
p) Cash and Cash Equivalents
In the cash flow statement, cash and cash equivalents include cash in
hand, demand deposits with banks, other short-term highly liquid
investments with original maturities of three months or less.
Mar 31, 2015
1. (I) GENERAL INFORMATION
Jagran Prakashan Limited ("the Company" or "JPL") is engaged primarily
in printing and publication of Newspaper and Magazines in India. The
other activities of the company comprise outdoor advertising business,
event management services and digital business. The Company is a
public limited company and is listed on Bombay Stock Exchange (BSE) and
National Stock Exchange (NSE)
a) Accounting Convention
These financial statements have been prepared in accordance with the
generally accepted accounting principles in India under the historical
cost convention on accrual basis. Pursuant to section 133 of the
Companies Act 2013 read with Rule 7 of the Companies (Accounts) Rules
2014, till the Standards of Accounting or any addendum thereto are
prescribed by the Central Government in consultation and recommendation
of the National Finance Reporting Authority, the existing Accounting
Standards notified under Companies Act, 1956 shall continue to apply.
Consequently, these financial statements have been prepared to comply in
all material respects with accounting standards notified under section
211(3C) [Companies (Accounting Standards) Rules 2006 as amended] and
other relevant provisions of the Companies Act, 2013.
All assets and liabilities have been classified as current or
non-current as per the Company''s normal operating cycle and other
criteria set out in the Schedule III to the Companies Act, 2013. Based
on the nature of products and the time between the acquisition of
assets for processing and their realisation in cash and cash
equivalents, the Company has considered its operating cycle as 12
months for the purpose of current and non-current of classification of
assets and liabilities between.
b) Tangible and Intangible Assets
i. Tangible assets and Intangible assets are recorded by the Company at
the cost of acquisition or construction. Tangible assets are
depreciated on pro-rata basis on the Written-Down Value method over the
estimated useful lives of the assets prescribed in Schedule II to the
Companies Act 2013.
ii. Assets individually costing less than Rs. 5,000 each are fully
depreciated in the year of acquisition. In respect of assets acquired,
sold or discarded during the year, depreciation is provided on pro-rata
basis for the period during which each asset was in use.
iii. Depreciation is provided on composite cost of Land and Building
wherever cost of Land is not separately available. In these cases, the
said composite cost is capitalised under Building.
iv. Leasehold land and Leasehold improvements are amortised on a
straight- line basis over the total period of lease including renewals.
v. Losses arising from the retirement of and gains or losses arising
from disposal of fixed assets which are carried at cost are recognised
in the Statement of Profit and Loss.
vi. Title Dainik Jagran has been amortized on straight line basis over
its estimated useful life.
vii. Computer Software are stated at their cost of acquisition net of
accumulated amortisation. These are amortised on straight line basis
over their estimated useful life of three years.
viii. Items of fixed assets that have been retired from the active use
and are held for disposal are stated at lower of their net book value
and net realisable value and are shown separately in the financial
statements. Any expected loss is recognised immediately in the
Statement of profit and loss.
c) Investments
Investments that are readily realisable and are 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 are
classified as long term investments.
Long term investments are stated at cost of acquisition inclusive of
expenditure incidental to acquisition. A provision for diminution is
made to recognise a decline, other than temporary in the value of long
term investments, such reduction being determined and made for each
investment individually.
Current investments are stated at lower of cost and fair value
determined on an individual basis.
Consideration for barter/exchange transactions is exchanged in
accordance with the terms of the contract to formalise the arrangement.
d) Inventories
Inventories are valued at cost or net realisable value, whichever is
lower. Cost of raw materials and stores is determined on
first-in-first-out basis and cost of finished goods is determined on
direct cost basis. Net realisable value is the estimated selling price
in the ordinary course of business, less the estimated costs of
completion and the estimated costs necessary to make the sale.
e) Foreign Currency Transactions
On initial recognition, all foreign currency transactions are recorded
by applying to the foreign currency amount the exchange rate between
the reporting currency and the foreign currency at the date of the
transaction.
Exchange differences arising on the settlement of monetary items at
rates different from those at which they were initially recorded during
the year, or reported in the previous financial statements, are
recognized as income or as expense in the year in which they arise.
As at the reporting date, non-monetary items which are carried in terms
of historical cost denominated in a foreign currency are reported using
the exchange rate at the date of the transaction. All non-monetary
items which are carried at fair value or other similar valuation
denominated in a foreign currency are reported using exchange rates
that existed when values were determined.
Foreign Currency Monetary Items outstanding as at Balance Sheet date
are valued using the conversion rate prevailing as at Balance Sheet
date and the exchange differences on restatement are recognised as
income or as expense in the Statement of Profit and Loss.
The Company does not have any derivative transactions.
f) Revenue Recognition
Revenues are recognized to the extent that it is probable that economic
benefit will flow to the Company and revenue can be reliably measured.
It is accounted for net of trade discounts.
Specifically the following basis are adopted in respect of various
sources of revenues of the Company:-
i. Advertisement
Revenue from sale of advertisement space is recognized, as and when the
relevant advertisement is published.
Revenue/Expense against all Barter- Contracts is recognised at the time
of actual performance of the contract to the extent of performance
completed by either party against its part of contract.
ii. Sale of Publications
Revenue from sale is recognised on dispatch, net of credits for unsold
copies, which coincides with transfer of significant risks and rewards.
iii. Others
Revenue from Outdoor activities is recognised as and when the relevant
advertisement is displayed.
Revenue from Event Management services is recognised when the event is
completed.
Revenue from printing job work is recognised on delivery of goods after
completion as set out in the relevant contracts.
-Claims from insurance companies/ Interest on income tax refunds/
Government department are recognised as and when amount receivable can
be reasonably determined.
Interest income is recognised on a time proportion basis taking into
account the amount outstanding and the rate applicable.
Dividend income is recognised if the right to receive payment is
established by the Balance Sheet date.
g) Employee Benefits
Short term employee benefits are recognised in the period during which
the services have been rendered. The Company''s contribution to Employee
Provident Fund, Employee''s State Insurance Fund and Employee''s Pension
Scheme 1995 are charged to revenue. These are defined contribution plans
and the Company deposits these amounts with the fund administered and
managed by the provident fund authorities. The Company does not carry
any further obligations, apart from the contributions made on monthly
basis.
The Company has Defend Benefit plans namely leave encashment and
gratuity for all employees, the liability for which is determined on
the basis of an actuarial valuation at the end of the year using the
projected unit credit method. Every employee is entitled to benefit
equivalent to fifteen days salary last drawn for each completed year of
service in line with the Payment of Gratuity Act, 1972. The same is
payable at the time of separation from the Company or retirement,
whichever is earlier. The benefits vest after five years of continuous
service using the projected unit credit method. Gratuity Fund is
recognised by the income tax authorities and is administered and
managed by the Life Insurance Corporation of India ("LIC").
Termination benefits are recognised as an expense immediately. Actuarial
gains and losses comprise experience adjustments and the effects of
changes in actuarial assumptions are recognised immediately in the
Statement of Profit and Loss as income or expense.
h) Taxation
i. Tax expense comprises current tax and deferred tax.
ii. Current tax comprises Company''s tax liability for the current
financial year as well as additional tax paid/adjusted, if any, during
the year in respect of earlier years on receipt of demand from the
authorities. For computation of taxable income under the Income Tax
Act, 1961, cash basis of accounting has been adopted and consistently
followed by the Company.
iii. Deferred tax assets and liabilities are computed on the timing
differences at the Balance Sheet date using the tax rate and tax laws
that have been enacted or substantively enacted by the Balance sheet
date. Deferred tax assets are recognised subject to consideration of
prudence based on management estimates of reasonable certainty that
sufficient taxable income will be available in the future periods against
which such deferred tax assets can be realised. Unrecognised deferred
tax assets of earlier years are re-assessed and recognised to the
extent that it has become reasonably certain that future taxable income
will be available against which such deferred tax assets can be
realised.
iv. Minimum Alternative tax ("MAT") credit is recognised as an asset
only when and to the extent there is convincing evidence that the
Company will pay normal income tax during the specified period. In the
year in which the MAT credit becomes eligible to be recognised as an
asset in accordance with the Guidance Note issued by the Institute of
Chartered Accountants of India, the said asset is created by way of a
credit to the Statement of Profit and Loss and shown as MAT Credit
Entitlement. The Company reviews the same at each balance sheet date
and writes down the carrying amount of MAT Credit Entitlement to the
extent there is no longer convincing evidence to the effect that Company
will pay normal Income Tax during the specified period.
-i) Lease
Assets acquired under finance leases are recognised as fixed assets.
Liability is recognised at the lower of the fair value of the leased
assets at inception of the lease and the present value of minimum lease
payments. Lease payments are apportioned between the finance charge and
the reduction of the outstanding liability. The finance charge is
allocated over the lease term so as to produce a constant periodic rate
of interest on the remaining balance of the liability and charge to the
Statement of profit and loss.
Leases in which a significant portion of the risks and rewards of
ownership are retained by the lessor are classified as operating leases.
Payments made under operating leases are charged to Statement of Profit
and Loss on a straight line basis over the period of the lease.
In case of non-cancellable operating leases, the total rent payable
including future escalations till the expiry of lease is charged
equally to Statement of profit and loss over the period of lease
including renewals.
j) Impairment of Assets
At each balance sheet date, the Company reviews the carrying amounts of
its fixed assets to determine whether there is any indication that those
assets suffered an impairment loss. For the purpose of assessing
impairment, the smallest identifiable group of assets that generates
cash inflows from continuing use that are largely independent of the
cash inflows from other assets or groups of assets, is considered as a
cash generating unit. If any such indication exists, the impairment
loss is recognised for the amount by which the assets carrying value
exceeds its recoverable amount. Recoverable amount is the higher of an
asset''s net selling price and value in use. In assessing value in use,
the estimated future cash flows expected from the continuing use of the
asset and from its disposal are discounted to their present value using
a pre- tax discount rate that reflects the current market assessments of
time value of money and the risks specific to the asset.
k) Provisions and Contingent Liability
i. The Company creates a provision when there is a present obligation
arising as a result of past event that probably requires an outflow of
resources and a reliable estimate can be made of the amount of
obligation. Provisions are measured at the best estimate of the
expenditure required to settle the present obligation at the balance
sheet date and are not discounted to its present value.
ii. A disclosure for a contingent liability is made when there is a
present obligation or arising as a result of past event that probably
will not require an outflow of resources or where a reliable estimate of
the obligation cannot be made.
l) Earnings Per Share
Earnings Per Share ("EPS") are computed on the basis of net profit after
tax for the year. The number of shares used in computing basic EPS is
weighted average number of shares outstanding during the year.
The diluted EPS is calculated on the same basis as basic EPS, since
there are no dilutive equity shares.
m) Segment Information
The Company is engaged primarily in printing and publication of
Newspaper and Magazines in India. The other activities of the company
comprise outdoor advertising business, event management services and
digital business. However these in the context of the Accounting
Standard 17 on Segment Reporting is considered to constitute single
reportable business segment and single geographical segment.
Accordingly, no separate disclosure for primary or secondary segments
is given.
n) Cash Flow Statement
Cash flows are reported using the indirect method, whereby net profit
before tax is adjusted for the effects of transactions of non-cash
nature. The cash flows from operating, investing and financing activities
of the Company are segregated.
o) Borrowing Cost
Borrowing cost attributable to the acquisition or construction of fixed
asset which take substantial period of time to get ready for its
intended use is capitalised as part of the cost of that asset. Other
borrowing costs are recognized as an expense in the year in which they
are incurred.
p) Cash and Cash Equivalents
In the cash flow statement, cash and cash equivalents include cash in
hand, demand deposits with banks, other short-term highly liquid
investments with original maturities of three months or less.
Mar 31, 2013
A) Accounting Convention
These financial statements have been prepared in accordance with the
generally accepted accounting principles in India under the historical
cost convention on accrual basis. The financial statements have been
prepared to comply in all material respects with accounting standards
notified under section 211 (3C) of the Companies Act 1956 ("the Act")
and the relevant provisions of the Act and guidelines issued by the
Securities and Exchange Board of India (SEBI), to reflect the financial
position and the results of operations of Jagran Prakashan Limited
("the Company"). Accounting policies have been consistently applied,
except where a newly issued accounting standard or a revision to an
existing accounting standard requires a change in the accounting policy
hitherto in use or to the extent disclosed in this note,
All assets and liabilities have been classified as current or
non-current as per the Company''s normal operating cycle and other
criteria set out in the Schedule VI to the Companies Act, 1956. Based
on the nature of products and the time between the acquisition of
assets for processing and their realisation in cash and cash
equivalents, the Company has considered its operating cycle as 12
months for the purpose of classification of assets and liabilities
between current and non-current.
b) Tangible and Intangible Assets
i. Tangible assets and Intangible assets are recorded by the Company
at the cost of acquisition or construction after considering the grants
received and depreciated on Written-Down Value basis, at the rates
prescribed in Schedule-XIV to the Act.
ii. Assets individually costing less than Rs. 5,000 each are fully
depreciated in the year of acquisition. In respect of assets acquired,
sold or discarded during the year, depreciation is provided on pro-rata
basis for the period during which each asset was in use.
iii. Depreciation is provided on composite cost of Land and Building
wherever cost of Land is not separately available. In these cases, the
said composite cost is capitalised under Building.
iv. Leasehold land and Leasehold improvements are amortised on a
straight-line basis over the total period of lease including renewals.
v. Losses arising from the retirement of, and gains or losses arising
from disposal of fixed assets which are carried at cost are recognised
in the Statement of Profit and Loss,
vi. Title Dainik Jagran has an indefinite life and therefore not
amortized. [Also refer Note 13 (a)]
vii. Computer Software are stated at their cost of acquisition net of
accumulated amortisation. These are amortised on straight line basis
over their estimated useful life of three years,
c) Investments
Investments that are readily realisable and are 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 are
classified as long term investments,
Long term investments are stated at cost of acquisition inclusive of
expenditure incidental to acquisition. A provision for diminution is
made to recognise a decline, other than temporary in the value of long
term investments,
Current investments are stated at lower of cost and fair value
determined on an individual basis,
Consideration for barter/exchange transactions is exchanged in
accordance with the terms of the contract to formalise the arrangement,
d) Inventories
Inventories are valued at cost or net realisable value, whichever is
lower. Cost of raw materials and stores is determined on
first-in-first-out basis and cost of finished goods is determined on
direct cost basis. Net realisable value is the estimated selling price
in the ordinary course of business, less the estimated costs of
completion and the estimated costs necessary to make the sale,
e) Foreign Currency Transactions
On initial recognition, all foreign currency transactions are recorded
by applying to the foreign currency amount the exchange rate between
the reporting currency and the foreign currency at the date of the
transaction,
Exchange differences arising on the settlement of monetary items at
rates different from those at which they were initially recorded during
the year, or reported in the previous financial statements, are
recognized as income or as expense in the year in which they arise.
Non-monetary items which are carried at fair value or other similar
valuation denominated in a foreign currency are reported using exchange
rates that existed when values were determined,
Foreign Currency Monetary Items outstanding as at Balance Sheet date
are valued using the conversion rate prevailing as at Balance Sheet
date and the exchange differences on restatement are recognised as
income or as expense in the Statement of Profit and Loss,
The Company does not have any derivative transactions,
f) Revenue Recognition
Revenues are recognized to the extent that it is probable that economic
benefit will flow to the Company and revenue can be reliably measured,
It is accounted for net of trade discounts,
Specifically the following bases are adopted in respect of various
sources of revenues of the Company:-
i. Advertisement
Revenue from sale of advertisement space is recognized, as and when the
relevant advertisement is published,
Revenue/Expense against all Barter-Contracts is recognised at the time
of actual performance of the contract to the extent of performance
completed by either party against its part of contract.
ii. Sale of Publications
Revenue from sale is recognised on dispatch, net of credits for unsold
copies,
iii. Others
Revenue from Outdoor activities is recognised as and when the relevant
advertisement is displayed,
Revenue from Event Management services is recognised when the event is
completed, Revenue from printing job work is recognised on delivery of
goods after completion as set out in the relevant contracts.
Claims from insurance companies/ Interest on income tax refunds/
Government department are recognised as and when amount receivable can
be reasonably determined.
Interest income is recognised on a time proportion basis taking into
account the amount outstanding and the rate applicable.
Dividend income is recognised if the right to receive payment is
established by the Balance Sheet date.
g) Employee Benefits
Short term employee benefits are recognised in the period during which
the services have been rendered. The Company''s contribution to Employee
Provident Fund, Employee''s State Insurance Fund and Employee''s Pension
Scheme 1995 is charged to revenue. These are defined contribution plans
and the Company deposits these amounts with the fund administered and
managed by the provident fund authorities.
The Company has Defined Benefit plans namely leave encashment and
gratuity for all employees, the liability for which is determined on
the basis of an actuarial valuation at the end of the year using the
projected unit credit method. Every employee is entitled to benefit
equivalent to fifteen days salary last drawn for each completed year of
service in line with the Payment of Gratuity Act, 1972. The same is
payable at the time of separation from the Company or retirement,
whichever is earlier. The benefits vest after five years of continuous
service using the projected unit credit method. Gratuity Fund is
recognised by the income tax authorities and is administered and
managed by the Life Insurance Corporation of India ("LIC").
Termination benefits are recognised as an expense immediately.
Actuarial gains and losses comprise experience adjustments and the
effects of changes in actuarial assumptions and are recognised
immediately in the Statement of Profit and Loss as income or expense.
h) Taxation
i. Tax expense comprises current tax and deferred tax.
ii. Current tax comprises Company''s tax liability for the current
financial year as well as additional tax paid/adjusted, if any, during
the year in respect of earlier years on receipt of demand from the
authorities. For computation of taxable income under the Income Tax
Act, 1961, cash basis of accounting has been adopted and consistently
followed by the Company,
iii. Deferred tax assets and liabilities are computed on the timing
differences at the Balance Sheet date using the tax rate and tax laws
that have been enacted or substantively enacted by the Balance sheet
date. Deferred tax assets are recognised based on management estimates
of reasonable certainty that sufficient taxable income will be
available in the future periods against which such deferred tax assets
can be realised. Unrecognised deferred tax assets of earlier years are
re-assessed and recognised to the extent that it has become reasonably
certain that future taxable income will be available against which such
deferred tax assets can be realised.
iv. Minimum Alternative tax ("MAT") credit is recognised as an asset
only when and to the extent there is convincing evidence that the
Company will pay normal income tax during the specified period. In the
year in which the MAT credit becomes eligible to be recognised as an
asset in accordance with the recommendations contained in Guidance Note
issued by the Institute of Chartered Accountants of India, the said
asset is created by way of a credit to the Statement of Profit and Loss
and shown as MAT Credit Entitlement. The Company reviews the same at
each balance sheet date and writes down the carrying amount of MAT
Credit Entitlement to the extent there is no longer convincing evidence
to the effect that Company will pay normal Income Tax during the
specified period.
i) Lease
Assets acquired under finance leases are recognised as fixed assets.
Liability is recognised at the lower of the fair value of the leased
assets at inception of the lease and the present value of minimum lease
payments. Lease payments are apportioned between the finance charge and
the reduction of the outstanding liability. The finance charge is
allocated over the lease term so as to produce a constant periodic rate
of interest on the remaining balance of the liability and charge to the
Statement of profit and loss.
Payments made under operating leases are charged to Statement of Profit
and Loss on a straight line basis over the period of the lease.
In case of non-cancellable operating leases, the total rent payable
including future escalations till the expiry of lease is charged
equally to Statement of profit and loss over the period of lease
including renewals.
j) Impairment of Assets
At each balance sheet date, the Company reviews the carrying amounts of
its fixed assets to determine whether there is any indication that
those assets suffered an impairment loss. For the purpose of assessing
impairment, the smallest identifiable group of assets that generates
cash inflows from continuing use that are largely independent of the
cash inflows from other assets or groups of assets, is considered as a
cash generating unit. If any such indication exists, the impairment
loss is recognised for the amount by which the assets carrying value
exceeds its recoverable amount. Recoverable amount is the higher of an
asset''s net selling price and value in use. In assessing value in use,
the estimated future cash flows expected from the continuing use of the
asset and from its disposal are discounted to their present value using
a pre-tax discount rate that reflects the current market assessments of
time value of money and the risks specific to the asset.
k) Provisions and Contingent Liability
i. The Company creates a provision when there is a present obligation
arising as a result of past event that probably requires an outflow of
resources and a reliable estimate can be made of the amount of
obligation.
ii. A disclosure for a contingent liability is made when there is a
possible obligation or a present obligation that probably will not
require an outflow of resources or where a reliable estimate of the
obligation can not be made.
l) Earnings Per Share
Earnings Per Share ("EPS") are computed on the basis of net profit
after tax for the year. The number of shares used in computing basic
EPS is weighted average number of shares outstanding during the year.
The diluted EPS is calculated on the same basis as basic EPS, since
there are no dilutive equity shares.
m) Segment Information
The Company is engaged primarily in printing and publication of
Newspaper and Magazines in India. The other activities of the company
comprise outdoor advertising business, event management services and
digital business. However, these in the context of the Accounting
Standard 17 on Segment Reporting considered to constitute single
reportable business segment and single geographic segment. Accordingly,
no separate disclosure for primary or secondary segments is given.
n) Cash Flow Statement
Cash flows are reported using the indirect method, whereby net profit
before tax is adjusted for the effects of transactions of non-cash
nature. The cash flows from operating, investing and financing
activities of the Company are segregated.
o) Borrowing Cost
Borrowing cost attributable to the acquisition or construction of fixed
assets which take substantial period of time to get ready for its
intended use is capitalised as part of the cost of that asset. Other
borrowing costs are recognized as an expense in the year in which they
are incurred.
Mar 31, 2012
A) Accounting Convention
These financial statements have been prepared in accordance with the
generally accepted accounting principles in India under the historical
cost convention on accrual basis. The financial statements have been
prepared to comply in all material respects with notifed accounting
standards by the Companies (Accounting Standards) Rules, 2006, as
amended, and the relevant provisions of the Companies Act, 1956 and
guidelines issued by the Securities and Exchange Board of India (SEBI),
to refect the financial position and the results of operations of Jagran
Prakashan Limited ("the Company"). Accounting policies have been
consistently applied, except where a newly issued accounting standard
or a revision to an existing accounting standard requires a change in
the accounting policy hitherto in use or to the extent disclosed in
this schedule.
All assets and liabilities have been classifed as current or
non-current as per the Company's normal operating cycle and other
criteria set out in the Schedule VI to the Companies Act, 1956. Based
on the nature of products and the time between the acquisition of
assets for processing and their realisation in cash and cash
equivalents, the Company has considered its operating cycle as 12
months for the purpose of classifcation of assets and liabilities
between current and non-current.
b) Tangible Assets and Intangible Assets
i. Tangible assets and Intangible assets are recorded by the Company
at the cost of acquisition or construction after considering the grants
received and depreciated on Written-Down Value basis, at the rates
prescribed in Schedule-XIV to the Companies Act, 1956.
ii. Assets individually costing less than Rs. 5,000 each are fully
depreciated in the year of acquisition. In respect of assets acquired,
sold or discarded during the year, depreciation is provided on pro-rata
basis for the period during which each asset was in use.
iii. Depreciation is provided on composite cost of Land and Building
wherever cost of Land is not separately available. In these cases, the
said composite cost is capitalised under Building.
i v. Leasehold land and Leasehold improvements are amortised on a
straight-line basis over the total period of lease including renewals.
v. Losses arising from the retirement of, and gains or losses arising
from disposal of fixed assets which are carried at cost are recognised
in the Statement of Profit and Loss.
vi. Title Dainik Jagran has an indefnite life and therefore not
amortized. (Also refer Note 13).
c) Investments
Investments that are readily realisable and are 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 are
classifed as long term investments.
Long term investments are stated at cost of acquisition inclusive of
expenditure incidental to acquisition. A provision for diminution is
made to recognise a decline, other than temporary in the value of long
term investments.
Current investments are stated at lower of cost and fair value
determined on an individual basis.
d) Inventories
Inventories are valued at cost or net realisable value, whichever is
lower. Cost of raw materials and stores is determined on
frst-in-frst-out basis and cost of fnished goods is determined on
direct cost basis. Net realisable value is the estimated selling price
in the ordinary course of business, less the estimated costs of
completion and the estimated costs necessary to make the sale.
e) Foreign Currency Transactions
On initial recognition, all foreign currency transactions are recorded
by applying to the foreign currency amount the exchange rate between
the reporting currency and the foreign currency at the date of the
transaction.
Exchange differences arising on the settlement of monetary items at
rates different from those at which they were initially recorded during
the year, or reported in the previous financial statements, are
recognized as income or as expense in the year in which they arise.
Non-monetary items which are carried at fair value or other similar
valuation denominated in a foreign currency are reported using exchange
rates that existed when values were determined.
Foreign Currency Monetary Items outstanding as at Balance Sheet date
are valued using the conversion rate prevailing as at Balance Sheet
date and the exchange differences on restatement are recognised as
income or as expense in the Statement of Profit and Loss.
The company does not have any derivative transactions.
f) Revenue Recognition
Revenues are recognized to the extent that it is probable that economic
benefit will fow to the company and revenue can be reliably measured.
It is accounted for net of trade discounts.
specifically the following bases are adopted in respect of various
sources of revenues of the company:
i. Advertisement
Revenue from sale of advertisement space is recognized, as and when the
relevant advertisement is published.
Revenue/Expense against all Barter-Contracts is recognised at the time
of actual performance of the contract to the extent of performance
completed by either party against its part of contract.
ii. Sale of Publications
Revenue from sale is recognised on dispatch, net of credits for unsold
copies.
iii. Others
Revenue from Outdoor activities is recognised as and when the relevant
advertisement is displayed.
Revenue from Event Management services is recognised when the event is
completed.
Revenue from printing job work is recognised on delivery of goods after
completion as set out in the relevant contracts.
Claims from insurance companies/ Interest on income tax refunds/
Government department are recognised as and when amount receivable can
be reasonably determined.
Interest income is recognised on a time proportion basis taking into
account the amount outstanding and the rate applicable.
Dividend income is recognised if the right to receive payment is
established by the Balance Sheet date.
g) Employee benefits
Short term employee benefits are recognised in the period during which
the services have been rendered. The Company's contribution to Employee
Provident Fund, Employee's State Insurance Fund and Employee's Pension
Scheme 1995 is charged to revenue. These are defned contribution plans
and the Company deposits these amounts with the fund administered and
managed by the provident fund authorities.
The Company has Defned benefit plans namely leave encashment and
gratuity for all employees, the liability for which is determined on
the basis of an actuarial valuation at the end of the year. Every
employee is entitled to benefit equivalent to ffteen days salary last
drawn for each completed year of service in line with the Payment of
Gratuity Act, 1972. The same is payable at the time of separation from
the Company or retirement, whichever is earlier. The benefits vest after
fve years of continuous service. Gratuity Fund is recognised by the
income tax authorities and is administered and managed by the Life
Insurance Corporation of India ("LIC"). The Company provides for the
liability on account of leave encashment at the year end as per the
actuarial valuation done by the actuary.
Termination benefits are recognised as an expense immediately.
Actuarial gains and losses comprise experience adjustments and the
effects of changes in actuarial assumptions and are recognised
immediately in the Profit and Loss Account as income or expense.
h) Taxation
i. Tax expense comprises current tax and deferred tax.
ii. Current tax comprises Company's tax liability for the current
financial year as well as additional tax paid, if any, during the year
in respect of earlier years on receipt of demand from the authorities.
For computation of taxable income under the Income Tax Act, 1961, cash
basis of accounting has been adopted and consistently followed by the
Company.
iii. Deferred tax assets and liabilities are computed on the timing
differences at the Balance Sheet date using the tax rate and tax laws
that have been enacted or substantially enacted by the Balance sheet
date. Deferred tax assets are recognised based on management estimates
of reasonable certainty that suffcient taxable income will be available
against which such deferred tax assets can be realised. Unrecognised
deferred tax assets of earlier years are re-assessed and recognised to
the extent that it has become reasonably certain that future taxable
income will be available against which such deferred tax assets can be
realised.
i) Lease
Assets acquired under finance leases are recognised as fixed assets.
Liability is recognised at the lower of the fair value of the leased
assets at inception of the lease and the present value of minimum lease
payments. Lease payments are apportioned between the finance charge and
the reduction of the outstanding liability. The finance charge is
allocated over the lease term so as to produce a constant periodic rate
of interest on the remaining balance of the liability and charge to the
Profit and loss account.
Payments made under operating leases are charged to Profit and Loss
Account on a straight line basis over the period of the lease.
In case of non-cancellable operating leases, the total rent payable
including future escalations till the expiry of lease is charged
equally to Profit and loss account over the period of lease including
renewals.
j) Impairment of Assets
At each balance sheet date, the Company reviews the carrying amounts of
its fixed assets to determine whether there is any indication that those
assets suffered an impairment loss. For the purpose of assessing
impairment, the smallest identifable group of assets that generates
cash infows from continuing use that are largely independent of the
cash infows from other assets or groups of assets, is considered as a
cash generating unit. If any such indication exists, the impairment
loss is recognised for the amount by which the assets carrying value
exceeds its recoverable amount. Recoverable amount is the higher of an
asset's net selling price and value in use. In assessing value in use,
the estimated future cash fows expected from the continuing use of the
asset and from its disposal are discounted to their present value using
a pre-tax discount rate that refects the current market assessments of
time value of money and the risks specific to the asset.
k) Provisions and Contingent Liability
i. The Company creates a provision when there is a present obligation
as a result of past event that probably requires an outfow of resources
and a reliable estimate can be made of the amount of obligation.
ii. A disclosure for a contingent liability is made when there is a
possible obligation or a present obligation that probably will not
require an outfow of resources or where a reliable estimate of the
obligation can not be made.
l) Earnings Per Share
Earnings Per Share (EPS) are computed on the basis of net Profit after
tax for the year. The number of shares used in computing basic EPS is
weighted average number of shares outstanding during the year.
The diluted EPS is calculated on the same basis as basic EPS, since
there are no dilutive equity shares.
m) Segment Information
The Company is engaged primarily in printing and publication of
Newspaper and Magazines in India. The other activities of the company
comprise outdoor advertising business, event management services and
digital business. However, these in the context of the Accounting
Standard 17 on Segment Reporting prescribed by the Companies
(Accounting Standards) Rules, 2006 are considered to constitute single
reportable business segment and single geographic segment. Accordingly,
no separate disclosure for primary or secondary segments is given.
n) Cash Flow Statement
Cash fows are reported using the indirect method, whereby net Profit
before tax is adjusted for the effects of transactions of non- cash
nature. The cash fows from operating, investing and fnancing activities
of the Company are segregated.
o) Borrowing Cost
Borrowing cost attributable to the acquisition or construction of fixed
assets which takes substantial period of time to get ready for its
intended use is capitalised as part of the cost of that asset. Other
borrowing costs are recognized as an expense in the year in which they
are incurred.
Mar 31, 2011
1. Accounting Convention
The financial statements are prepared to comply in all material respects
with notified accounting standards by the Companies (Accounting
Standards) Rules, 2006, the relevant provisions of the Companies Act,
1956 and guidelines issued by the Securities and Exchange Board of
India (SEBI), to reflect the financial position and the results of
operations of the Group. Accounting policies have been consistently
applied, except where a newly issued accounting standard or a revision
to an existing accounting standard requires a change in the accounting
policy hitherto in use or to the extent disclosed in this schedule.
2. Fixed Assets and Depreciation
a) Fixed Assets are recorded by the Company at the cost of acquisition
or construction afiter considering the grants received and depreciated
on Written-Down Value basis, at the rates prescribed in Schedule-XIV to
the Companies Act, 1956.
b) Assets individually costing less than Rs. 5000 each are fully
depreciated in the year of acquisition. In respect of assets acquired,
sold or discarded during the year, depreciation is provided on pro-rata
basis for the period during which each asset was in use.
c) Depreciation is provided on composite cost of Land and Building
wherever cost of Land is not separately available. In these cases, the
said composite cost is capitalised under Building.
d) Title Dainik Jagran has an indefinite life and therefore not
amortized. (Also refer Note 5 of Schedule 20B)
e) Leasehold land and Leasehold improvements are amortised on a
straight-line basis over the total period of lease including renewals.
3. Investments
Long term investments are stated at cost of acquisition inclusive of
expenditure incidental to acquisition. A provision for diminution is
made to recognise a decline, other than temporary in the value of long
term investments.
Current investments are stated at lower of cost and fair value
determined on an individual basis.
4. Inventories
Inventories are valued at cost or net realisable value, whichever is
lower. Cost of raw materials and stores is determined on
first-in-first-out basis and cost of fnished goods is determined on
direct cost basis.
5. Foreign Currency Transactions
Exchange differences arising on the settlement of monetary items at
rates different from those at which they were initially recorded during
the year, or reported in the previous financial statements, are
recognized as income or as expense in the year in which they arise.
Gain or loss on transactions relating to acquisition of Fixed Assets in
foreign currency is recognised as profit or loss in the profit and Loss
Account and adjusted to the corresponding liability. Non-monetary items
other than Fixed Assets are carried at fair value or other similar
values using exchange rates when values were determined. Foreign
Currency Monetary Items outstanding as at Balance Sheet date are valued
using the conversion rate prevailing as at Balance Sheet date. The
company does not have any derivative transactions.
6. Revenue Recognition
Revenues are recognized to the extent that it is probable that economic
benefit will flow to the company and revenue can be reliably measured.
It is accounted for net of trade discounts.
specifically the following bases are adopted in respect of various
sources of revenues of the company:-
a) Advertisement
Revenue from advertisement space is recognized, as and when the
relevant advertisement is published.
Revenue/Expense against all Barter-Contracts is recognised at the time
of actual performance of the contract to the extent of performance
completed by either party against its part of contract.
b) Sale of Publications
Revenue from sale is recognised on dispatch, net of credits for unsold
copies.
c) Others
Revenue from printing job work is recognised on delivery of goods afiter
completion as set out in the relevant contracts.
Revenue from Outdoor activities is recognised as and when the relevant
advertisement is displayed.
Revenue from Event Management services is recognised when the event is
completed.
Claims from insurance companies/ Interest on income tax refunds/
Government department are recognised as and when amount receivable can
be reasonably determined.
Interest income is recognised on a time proportion basis taking into
account the amount outstanding and the rate applicable.
Dividend income is recognised if the right to receive payment is
established by the Balance Sheet date.
7. Employee benefits
Short term employee benefits are recognised in the period during which
the services have been rendered. The CompanyÃs contribution to Employee
Provident Fund, EmployeeÃs State Insurance Fund and EmployeeÃs Pension
Scheme 1995 is charged to revenue.
The Company has defined benefit plans namely leave encashment and
gratuity for all employees, the liability for which is determined on
the basis of an actuarial valuation at the end of the year. Gratuity
Fund is recognised by the income tax authorities and is administered
and managed by the Life Insurance Corporation of India ("LIC").
Termination benefits are recognised as an expense immediately.
Actuarial gains and losses comprise experience adjustments and the
effects of changes in actuarial assumptions and are recognised
immediately in the profit and Loss Account as income or expense.
8. Taxation
a) Tax expense comprises current tax and deferred tax.
b) Current tax comprises CompanyÃs tax liability for the current
financial year as well as additional tax paid, if any, during the year
in respect of earlier years on receipt of demand from the authorities.
For computation of taxable income under the Income Tax Act, 1961, cash
basis of accounting has been adopted and consistently followed by the
Company.
c) Deferred tax assets and liabilities are computed on the timing
differences at the Balance Sheet date using the tax rate and tax laws
that have been enacted or substantially enacted by the Balance sheet
date. Deferred tax assets are recognised based on management estimates
of reasonable certainty that sufficient taxable income will be available
against which such deferred tax assets can be realised. Unrecognised
deferred tax assets of earlier years are re-assessed and recognised to
the extent that it has become reasonably certain that future taxable
income will be available against which such deferred tax assets can be
realised.
9. Lease
Assets acquired under finance leases are recognised as fixed assets.
Liability is recognised at the lower of the fair value of the leased
assets at inception of the lease and the present value of minimum lease
payments. Lease payments are apportioned between the finance charge and
the reduction of the outstanding liability. The finance charge is
allocated over the lease term so as to produce a constant periodic rate
of interest on the remaining balance of the liability and charge to the
profit and loss account.
Payments made under operating leases are charged to profit and Loss
Account on a straight line basis over the period of the lease.
In case of non-cancellable operating leases, the total rent payable
including future escalations till the expiry of lease is charged
equally to profit and loss account over the period of lease including
renewals.
10. Impairment of Assets
At each balance sheet date, the Company reviews the carrying amounts of
its fixed assets to determine whether there is any indication that those
assets suffered an impairment loss. If any such indication exists, the
impairment loss is recognised for the amount by which the assets
carrying value exceeds its recoverable amount. Recoverable amount is
the higher of an assetÃs net selling price and value in use. In
assessing value in use, the estimated future cash flows expected from
the continuing use of the asset and from its disposal are discounted to
their present value using a pre-tax discount rate that reflects the
current market assessments of time value of money and the risks specific
to the asset.
11. Provisions and Contingent Liability
a) The Company creates a provision when there is a present obligation
as a result of past event that probably requires an outflow of resources
and a reliable estimate can be made of the amount of obligation.
b) A disclosure for a contingent liability is made when there is a
possible obligation or a present obligation that probably will not
require an outflow of resources or where a reliable estimate of the
obligation can not be made.
12. Earnings Per Share
Earnings Per Share (EPS) are computed on the basis of net profit afiter
tax for the year. The number of shares used in computing basic EPS is
weighted average number of shares outstanding during the year.
The diluted EPS is calculated on the same basis as basic EPS, since
there are no dilutive equity shares.
13. Segment Information
The Company is engaged primarily in printing and publication of
Newspaper and Magazines in India. The other activities of the company
comprise outdoor advertising business, event management services and
digital business. However, these in the context of the Accounting
Standard 17 on Segment Reporting prescribed by the Companies
(Accounting Standards) Rules, 2006 are considered to constitute single
reportable business segment and single geographic segment. Accordingly,
no separate disclosure for primary or secondary segments is given.
14. Cash Flow Statement
Cash flows are reported using the indirect method, whereby net profit
before tax is adjusted for the effects of transactions of non- cash
nature. The cash flows from operating, investing and financing activities
of the Company are segregated.
15. Borrowing Cost
Borrowing cost attributable to the acquisition or construction of fixed
assets which takes substantial period of time to get ready for its
intended use is capitalised as part of the cost of that asset. Other
borrowing costs are recognized as an expense in the year in which they
are incurred.
Mar 31, 2010
1. ACCOUNTING CONVENTION
The financial statements are prepared in accordance with Indian
Generally Accepted Accounting Principles ("GAAP") under the historical
cost convention on the accrual basis. GAAP comprises mandatory
accounting standards as prescribed by 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)
Accounting policies have been consistently applied, except where a
newly issued accounting standard or a revision to an existing
accounting standard requires a change in the accounting policy hitherto
in use or to the extent disclosed in this schedule
2. FIXED ASSETS And DEPRECIATION
a) Fixed Assets are recorded by the Company at the cost of acquisition
or construction after considering the grants received and depreciated
on Written-Down Value basis, at the rates prescribed in Schedule-XIV to
the Companies Act, 1956
b) Assets individually costing less than Rs. 5000 each are fully
depreciated in the year of acquisition In respect of assets acquired,
sold or discarded during the year, depreciation is provided on pro-rata
basis for the period during which each asset was in use
c) Depreciation is provided on composite cost of Land and Building
wherever cost of Land is not separately available. In these cases, the
said composite cost is capitalised under Building
d) Title Dainik Jagran has an indefinite life and therefore not
amortized (Also refer Note 5 of Schedule 22B)
e) Leasehold land and Leasehold improvements are amortised over the
total period of lease including renewals
3. INVESTMENTS
Long term investments are stated at cost of acquisition inclusive of
expenditure incidental to acquisition A provision for diminution is
made to recognise a decline, other than temporary in the value of long
term investments Current investments are stated at lower of cost and
fair value determined on an individual basis
4. INVENTORIES
Inventories are valued at cost or net realisable value, whichever is
lower. Cost of raw materials and stores is determined on
first-in-first-out basis and cost of finished goods is determined on
direct cost basis
5. FOREIGN CURRENCY TRANSACTIONS
Exchange differences arising on the settlement of monetary items at
rates different from those at which they were initially recorded during
the year, or reported in the previous financial statements, are
recognized as income or as expense in the year in which they arise.
Gain or loss on transactions relating to acquisition of Fixed Assets in
foreign currency is recognised as profit or loss in the Profit and Loss
Account and adjusted to the corresponding liability. Non-monetary items
other than Fixed Assets are carried at fair value or other similar
values using exchange rates when values were determined. Foreign
Currency Monetary Items outstanding as at Balance Sheet date are valued
using the conversion rate prevailing as at Balance Sheet date.The
company does not have any derivative transactions.
6. REVENUE RECOGNITION
Revenues are recognized to the extent that it is probable that economic
benefit will flow to the company and revenue can be reliably measured.
It is accounted for net of trade discounts.
Specifically the following bases are adopted in respect of various
sources of revenues of the company:-
a) Advertisement
Revenue from advertisement space is recognized, as and when the
relevant advertisement is published.
Revenue/Expense against all Barter-Contracts is recognised at the time
of actual performance of the contract to the extent of performance
completed by either party against its part of contract.
b) sale of Publications
Revenue from sale is recognised on dispatch, net of credits for unsold
copies.
c) Others
Revenue from printing job work is recognised on delivery of goods after
completion as set out in the relevant contracts.
Revenue from Outdoor activities is recognised as and when the relevant
advertisement is displayed.
Revenue from Event Management services is recognised when the event is
completed.
Revenue from SMS service is recognised, when message is transmitted.
Claims from insurance companies / Interest on income tax refunds/
Government department are recognised as and when amount receivable can
be reasonably determined.
Interest is recognized on a time proportion basis taking into account
the amount outstanding and the rate applicable.
Dividend income is recognised if the right to receive payment is
established by the Balance Sheet date.
7. EMPLOYEE BENEFITS
The CompanyÃs contribution to Employee Provident Fund, EmployeeÃs State
Insurance Fund and EmployeeÃs Pension Scheme 1995 is charged to
revenue.
The Company has Defined Benefit plans namely leave encashment and
gratuity for all employees, the liability for which is determined on
the basis of an actuarial valuation at the end of the year. Gratuity
Fund is recognized by the income tax authorities and is administered
and managed by the Life Insurance Corporation of India ("LIC").
Termination benefits are recognised as an expense immediately.
Actuarial gains and losses comprise experience adjustments and the
effects of changes in actuarial assumptions and are recognised
immediately in the Profit and Loss Account as income or expense.
8. TAXATION
a) Tax expense comprises current tax, deferred tax and fringe benefit
tax.
b) Current tax comprises CompanyÃs tax liability for the current
Financial year as well as additional tax paid, if any, during the year
in respect of earlier years on receipt of demand from the authorities.
For computation of taxable income under the Income Tax Act, 1961, cash
basis of accounting has been adopted and consistently followed by the
Company.
c) Deferred tax assets (DTA) and liabilities are computed on the timing
differences at the Balance sheet date using the tax rate and tax laws
that have been enacted or substantially enacted by the Balance sheet
date. DTA is recognized based on management estimates of reasonable
certainty that sufficient taxable income will be available against
which such DTA can be realised.
9. LEASE
Assets acquired under fiance leases are recognised as fixed assets.
Liability is recognized at the lower of the fair value of the leased
assets at inception of the lease and the present value of minimum lease
payments. Lease payments are apportioned between the finance charge and
the reduction of the outstanding liability. The finance charge is
allocated over the lease term so as to produce a constant periodic rate
of interest on the remaining balance of the liability and charge to the
profit and loss account.
Payments made under operating leases are charged to Profit and Loss
Account on a straight line basis over the period of the lease.
In case of non-cancelable operating leases, the total rent payable
including future escalations till the expiry of lease is charged
equally to profit and loss account over the period of lease including
renewals.
10. IMPAIRMENT OF ASSETS
At each balance sheet date, the Company reviews the carrying amounts of
its fixed assets to determine whether there is any indication that
those assets suffered an impairment loss. If any such indication
exists, the impairment loss is recognized for the amount by which the
assets carrying value exceeds its recoverable amount. Recoverable
amount is the higher of an assetÃs net selling price and value in use.
In assessing value in use, the estimated future cash flows expected
from the continuing use of the asset and from its disposal are
discounted to their present value using a pre-tax discount rate that
refects the current market assessments of time value of money and the
risks specific to the asset.
11. PROVISIONS And CONTINGENT LIABILITY
a) The Company creates a provision when there is a present obligation
as a result of past event that probably requires an outflow of
resources and a reliable estimate can be made of the amount of
obligation.
b) A disclosure for a contingent liability is made when there is a
possible obligation or a present obligation that probably will not
require an outflow of resources or where a reliable estimate of the
obligation can not be made.
12. EARNINGS PER SHARE
Earnings Per Share (EPS) are computed on the basis of net profit after
tax . The number of shares used in computing basic EPS is weighted
average number of shares outstanding during the year. The weighted
average number of equity shares outstanding during the year is adjusted
for the events of bonus issue.
The diluted EPS is calculated on the same basis as basic EPS, after
adjusting for the effects of potential dilutive equity shares.
13. SEGMENT INFORMATION
The Company is engaged primarily in printing and publication of
Newspaper and Magazines in India. The other activities of the company
comprise outdoor advertising business, event management services and
SMS services. However, these in the context of the Accounting Standard
17 on Segment Reporting issued by the Institute of Chartered
Accountants of India are considered to constitute single reportable
business segment and single geographic segment. Accordingly, no
separate disclosure for primary or secondary segments is given.
14. CASH FLOW STATEMENT
Cash flows are reported using the indirect method, whereby net profit
before tax is adjusted for the effects of transactions of non-cash
nature. The cash flows from operating, investing and financing
activities of the Company are segregated.
15. BORROWING COST
Borrowing cost attributable to the acquisition or construction of fixed
assets which takes substantial period of time to get ready for its
intended use is capitalized as part of the cost of that asset. Other
borrowing costs are recognized as an expense in the year in which they
are incurred.
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