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Notes to Accounts of TV Today Network Ltd.

Mar 31, 2017

Note 1: Critical estimates and judgments’

The preparation of financial statements requires the use of accounting estimates which, by definition, will seldom equal the actual results. Management also needs to exercise judgment in applying the Company’s accounting policies.

This note provides an overview of the areas that involved a higher degree of judgment or complexity, and of items which are more likely to be materially adjusted due to estimates and assumptions turning out to be different that those originally assessed. Detailed information about each of these estimates and judgments’ is included in relevant notes together with information about the basis of calculation for each affected line item in the financial statements.

Critical estimates

The areas involving critical estimates are:

i) Estimated fair value of unlisted securities - Note 5(a)

ii) Estimation of defined benefit obligations - Note 13

iii) Impairment of trade receivables - Note 24

Critical judgments’

The areas involving critical judgments’ are:

i) Estimate useful life of property, plant and equipment and intangible assets - Notes 1(m), 1(n), 3 and 4

ii) Estimation of provision for legal claim and contingent liabilities - Notes 12 and 28

Estimates and judgments’ are continually evaluated. They are based on historical experience and other factors, including expectations of future events that may have a financial impact on the Company and that are believed to be reasonable under the circumstances.

(i) Leased assets

The Company has acquired a leasehold land from New Okhla Industrial Development Authority under finance lease. The lease term in respect of land acquired under finance lease is 73 years.

(ii) Contractual obligations

Refer to note 29 for disclosure of contractual commitments for the acquisition of property, plant and equipment.

(iii) Capital work in progress

Capital work in progress mainly comprises of broadcast equipment not yet ready to use.

Nature and purpose of other reserves Securities premium reserve

Securities Premium reserve represents the amount received in excess of par value of securities (equity shares). The reserve is utilized in accordance with the provisions of the Companies Act, 2013.

Capital contribution

During the year, the Company received 100% equity shares of India Today Online Private Limited (“ITOPL''), which holds 66.78% of ownership interest in Mail Today Newspaper Private Limited (MTNPL), by way of a gift (involving no monetary consideration) from Living Media India Limited, the holding company. The gift received by the Company has been recognized at fair value with corresponding credit to capital contribution considering the parent-subsidiary relationship and the economic substance of the transaction. Refer additionally relevant accounting policy, (refer note 10b).

General reserve

General reserve represents the statutory reserve created in accordance with Indian Corporate law, wherein a portion of profit is required to be apportioned to such reserve. Under the Companies Act, 1956, it was mandatory to transfer a required amount to general reserve before a company could declare dividend, however, under the Companies Act, 2013, the transfer of any amount to general reserve is at the discretion of the Company.

Share options outstanding account

The share options outstanding account is used to recognize the grant date fair value of options issued to employees under TV Today Network Limited stock employee option plan.

Retained earnings

Retained earnings represent the undistributed profits of the Company.

Secured borrowings and assets pledged as security

(a) Cash credit facility has been secured by way of first charge against the whole of book debts of the Company.

The carrying amounts of financial and non financial assets pledged as security for current borrowings are disclosed in note 33.

(i) information about individual provisions and significant estimates

Legal claim

Claim from Prasar Bharti towards unlinking charges: A provision has been recognized on an estimated basis amounting to Rs,674.92 lacs (March 31, 2016: Rs,648.88 lacs, April 1, 2015: Rs,622.84 lacs). In the opinion of the management, based on its understanding of the case and consideration of the opinion received from its counsel, the provision made in the books is considered to be adequate

Wealth tax

Represents provision for wealth tax payable under the Wealth Tax Act,1957.

(i) Leave obligations

The lease obligations cover the Company’s liability of earned leave.

The amount of the provision of Rs,606.76 lacs (March 31, 2016 : Rs,554.12 lacs, April 1, 2015 : Rs,476.40 lacs) is presented as current since the Company does not have an unconditional right to defer settlement for any of these obligations. However, based on past experience, the Company does not expect all employees to take full amount of accrued leave or require payment within the next 12 months. The following amounts reflect leave that is not expected to be taken or paid within the next 12 months.

(ii) Post-employment obligations a) Gratuity

The Company provides for gratuity for employees as per the Payment of Gratuity Act, 1972. The employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement / termination is the employee''s last drawn basic salary per month computed proportionately for 15 days’ salary multiplied with the number of years of service. The gratuity plan is a funded plan and the Company makes contributions to recognized funds in India. The Company does not fully fund the liability and maintains a target level of funding to be maintained over a period of time based on estimations of expected gratuity payments.

(iii) Defined contribution plans

The Company also has certain defined contribution plans. Contributions are made to provident fund, employee pension scheme and employee’s state insurance scheme for employees as per regulations. The contributions are made to registered funds administered by the government. The obligation of the Company is limited to the amount contributed and it has no further contractual or any constructive obligation. The expense recognized during the period towards defined contribution plan is Rs,551.23 lacs (March 31, 2016 Rs,498.14 lacs).

Balance sheet amounts - Gratuity

(iii) Changes in defined benefit obligation due to 1% increase/decrease in mortality rate, is negligible.

The above sensitivity analysis are based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumption the same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied as when calculating the defined benefit liability recognized in the balance sheet.

The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to the prior period.

(vii) Risk exposure

Through its defined benefit plan, the Company is exposed to a number of risks, the most significant of which are defined below: investment risk The present value of the defined benefit plan liability is calculated using a discount rate determined by reference to yield on government bonds. If plan liability is funded and return on plan assets is lower than yield on the government bonds, it will create a plan deficit. interest risk (discount rate risk) A decrease in the bond interest rate (discount rate) will increase the plan liability.

Mortality risk The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants. The mortality table used for the purpose is Indian Assured Lives Mortality (2006-08) ultimate table published by the Institute of Actuaries of India. A change in mortality rate will have a bearing on the plan''s liability.

Salary risk The present value of the defined benefit plan liability is calculated with the assumption of salary increase rate of plan participants in future. Deviation in the rate of increase of salary in future for plan participants from the rate of increase in salary used to determine the present value of obligation will have a bearing on the plan''s liability.

The Company ensures that investment positions are managed within an asset/liability matching (ALM) framework that has been developed to achieve long term investments that are in line with the obligations under employee benefit plans. Within this framework, the Company’s ALM objective is to match assets to the Gratuity obligations by investing in Plan assets with recognized gratuity trust which has taken a gratuity policy with the Life Insurance Corporation of India (LIC) with maturities that match the benefit payments as they fall due.

The Company actively monitors how the duration and the expected yield of the investments are matching the expected cash outflows arising from the employee benefit obligations. The Company has not changed the processes to manage its risk from previous periods.

The Company believes the LIC policy offers reasonable returns over the long-term with an acceptable level of risk.

The plan asset mix is in compliance with the requirements of the local regulations.

(viii) Defined benefit liability and employer contributions

The Company has agreed that it will aim to eliminate the deficit in defined benefit gratuity plan over the coming years. Funding levels are monitored on an annual basis and the current agreed contribution rate as advised by the LIC. The Company considers that the contribution rates set at the last valuation date are sufficient to eliminate the deficit over the coming years and that regular contributions, which are based on service costs, will not increase significantly.

Expected contribution to post-employment benefit plan for the year ending March 31, 2018 is Rs,144.96 lacs.

‘Represents fair value loss on investment in Mail Today Newspapers Private Limited and amortization expense pertaining to leasehold land, but no deferred tax asset has been recognized on such temporary differences as the Company does not expect the same to be deductible in determining taxable profit of future periods.

**The unused tax losses represents long term capital losses for which no deferred tax asset has been recognized as it is not probable that future taxable income (capital gains) will be available against which such tax losses can be utilized. These losses can be carried forward for eight assessment years subsequent to the year in which such losses are incurred by the Company, i.e., FY - 2019-2020.

As at March 31, 2017, the dividend distribution tax on dividends recommended by Directors amounting to Rs,242.88 lacs (March 31, 2016 : Rs,212.52 lacs, April 1, 2015 : Rs,178.89 lacs) has not been recognized as liability, pending approval of shareholders in the ensuing annual general meeting.

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices (for example listed equity instruments, traded bonds and mutual funds that have quoted price).

Level 2: The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over-the-counter derivatives) is determined using valuation techniques which maximize the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is the case for unquoted equity securities and derivative financial asset - guarantee are included in level 3.

(ii) Valuation technique used to determine fair value

Specific valuation techniques used to value financial instruments include:

- the fair value of the derivative financial assets is determined using Binomial Lattice Model.

- the fair value of the remaining financial instruments is determined using discounted cash flow analysis.

All of the resulting fair value estimates are included in level 3, where the fair values have been determined based on present values and the discount rates used were adjusted for counterparty or own credit risk.

‘There were no significant inter-relationships between unobservable inputs that materially affect fair values.

(v) Valuation processes

The finance department of the Company includes a team that performs the valuations of financial assets and liabilities required for financial reporting purposes, including level 3 fair values, except the valuations of derivative financial asset and unquoted equity shares which are performed by an external valuation expert. This team and the valuation expert report directly to the Chief Financial Officer (CFO) and the Audit Committee (AC). Discussions of valuation processes and results are held between the CFO, AC and the valuation team at least once every three months, in line with the Company’s quarterly reporting periods.

The main level 3 inputs for the unquoted equity shares and derivative financial asset used by the Company are derived and evaluated as follows:

- Discount rates are determined using a capital asset pricing model to calculate a pre-tax rate that reflects current market assessments of the time value of money and the risk specific to the asset.

- Risk free rate is computed based on the 10 year Indian Government Bond yield.

- Earnings growth factor for unquoted equity shares are estimated based on market information for similar types of companies.

- Volatility rate is computed based on monthly stock prices sourced from Capital IQ Database.

Changes in level 2 and 3 fair values are analyzed at the end of each reporting period during the quarterly valuation discussion between the CFO, AC and the valuation team. As part of this discussion, the team presents a report that explains the reason for the fair value movements.

Note 24: Fair value measurements (contd.)

The carrying amounts of trade receivables, cash and cash equivalents, other bank balances, advance recoverable, claims recoverable, current borrowings, trade payables, employee benefits payables, interest accrued, book overdraft, unpaid dividends, capital creditors and other financial liabilities are considered to be the same as their fair values, due to their short-term nature.

The fair values for loans to employees, security deposits and long - term deposits with banks with remaining maturity period more than 12 months were calculated based on cash flows discounted using a current lending rate. They are classified as level 3 fair values in the fair value hierarchy due to the inclusion of unobservable inputs, including counterparty credit risk.

The fair values of security deposits received were calculated based on discounted cash flows using a current borrowing rate. They are classified as level 3 fair values in the fair value hierarchy due to the inclusion of unobservable inputs, including own credit risk.

For financial assets and liabilities that are measured at fair value, the carrying amounts are equal to the fair values.

Significant estimates

The fair value of financial instruments that are not traded in an active market is determined using valuation techniques. The Company uses its judgment to select a variety of methods and makes assumptions that are mainly based on market conditions existing at the end of each reporting period. For details of the key assumptions used and the impact of changes to these assumptions, see (ii) and (iv) above.

The senior management of the Company oversees the management of these risks. The Company’s senior management is supported by a financial risk team that advises on financial risks and the appropriate financial risk governance framework for the Company. The financial risk team provides assurance to the Company’s senior management that the Company’s financial risk activities are governed by appropriate policies and procedures and that the financial risks are identified, measured and managed in accordance with the Company’s policies and risk objectives.

(A) Credit risk

Credit risk arises from cash and cash equivalents, financial assets carried at Amortized cost and deposits with banks and financial institutions, as well as credit exposures to customers including outstanding receivables.

(i) Credit risk management

For banks and financial institutions, only high rated banks/institutions are accepted.

For other financial assets, the Company assesses and manages credit risk based on internal credit rating system. The finance function consists of a separate team who assess and maintain an internal credit rating system. Internal credit rating is performed for each class of financial instruments with different characteristics. The Company assigns the following credit ratings to each class of financial assets based on the assumptions, inputs and factors specific to the class of financial assets.

VL 1 : High-quality assets, negligible credit risk

VL 2 : Quality assets, low credit risk

VL 3 : Standard assets, moderate credit risk

VL 4 : Substandard assets, relatively high credit risk

VL 5 : Low quality assets, very high credit risk

VL 6 : Doubtful assets, credit-impaired

The Company considers the probability of default upon initial recognition of asset and whether there has been a significant increase in credit risk on an ongoing basis throughout each reporting period. To assess whether there is a significant increase in credit risk, the Company compares the risk of a default occurring on the asset as at the reporting date with the risk of default as at the date of initial recognition. It considers available reasonable and supportive forwarding-looking information. Especially the following indicators are incorporated:

- Internal credit rating

- external credit rating (as far as available)

- actual or expected significant adverse changes in business, financial or economic conditions that are expected to cause a significant change to the party’s ability to meet its obligations.

In general, it is presumed that credit risk has significantly increased since initial recognition if the payments are more than 180 days past due for non-government customers and 365 days for government customers.

A default on a financial asset is when the counterparty fails to make contractual payments within 1 year of when they fall due for nongovernment customers and 2 years for government customers. This definition of default is determined by considering the business environment in which the Company operates and other macro-economic factors.

Significant estimates and judgments

Impairment of financial assets

The impairment provisions for financial assets disclosed above are based on assumptions about risk of default and expected loss rates. The Company uses judgment in making these assumptions and selecting the inputs to the impairment calculation, based on the Company past history, existing market conditions as well as forward looking estimates at the end of each reporting period.

(B) Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due. Due to the dynamic nature of the underlying businesses, the Company treasury maintains flexibility in funding by maintaining availability under committed credit lines.

Management monitors rolling forecasts of the Company’s liquidity position (comprising the undrawn borrowing facilities below) and cash and cash equivalents on the basis of expected cash flows. This is generally carried out in accordance with practice and limits set by the Company. In addition, the Company’s liquidity management policy involves projecting cash flows and considering the level of liquid assets necessary to meet cash requirements, monitoring balance sheet liquidity ratios against internal and external regulatory requirements and maintaining debt financing plans.

The cash credit facilities may be drawn at any time and may be terminated by the bank without notice. Subject to the continuance of satisfactory credit ratings, the bank loan facility may be drawn at any time in INR and have an average maturity of 1 year (March 31, 2016: 1 year, April 1, 2015: 1 year).

(C) Market risk

(i) Foreign currency risk

The Company operates internationally and is exposed to foreign exchange risk arising from foreign currency transactions, primarily with respect to the GBP and USD. Foreign exchange risk arises from future commercial transactions and recognized assets and liabilities denominated in a currency that is not the Company’s functional currency (INR). The risk is measured through a forecast of highly probable foreign currency cash flows.

(iii) Price risk

(a) Exposure

The Company’s exposure to equity securities price risk arises from investments held by the Company and classified in the balance sheet as fair value through through profit or loss.

The Company’s unquoted equity shares are susceptible to market price risk arising from uncertainties about future value of the investment securities. The Company’s investment in unquoted equity shares are of strategic importance to the Company (for details refer note 24).

(b) Sensitivity

Sensitivity analyses of these investments have been provided in Note 24(iv).

Note 26: Capital management

(a) Risk management

The Company’s objectives when managing capital are to

- safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders, and

- Maintain an optimal capital structure to reduce the cost of capital

In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.

In addition to the above, the Company received key management personnel services from the parent entity, for which a management fee of Rs,741.74 lacs (March 31, 2016: Rs,644.47 lacs) was charged and paid, being an appropriate allocation of costs incurred by the parent entity.

* Short-term employee benefits for Mr Aroon Purie is remuneration by way of commission paid @ 5% of net profits of the Company.

The remuneration of Key Management Personnel is determined by the Board / Nomination and Remuneration Committee having regard to the performance of individual and market trends.

(f) Terms and conditions

Transactions relating to dividends were on the same terms and conditions that applied to other shareholders.

Goods and services were sold to the related parties during the year based on the price lists in force / other appropriate basis, as applicable, and terms that would be available to third parties. Management services were bought from the immediate parent entity on cost basis. Contribution to gratuity trust and expenditure towards Corporate Social Responsibility activities were in accordance with the applicable laws and regulations.

The guarantee was received from the parent entity for indemnifying any loss to the Company arising from the sale of investment in equity shares of Mail Today Newspapers Private Limited (“Mail Today”). Also refer note 5(f).

The Company acquired 8% stake in Mail Today Newspapers Private Limited (Mail Today) at a cost of Rs,4,552.12 lacs in earlier years. Also, a guarantee was obtained from the holding company, Living Media India Limited (LMIL), according to which any loss to the Company arising from the sale of the said investment would be indemnified by LMIL. As at March 31, 2015, the Company did a fair valuation of Mail Today investment and LMIL guarantee, and the fair value loss and gain in respect of investment and guarantee amounting to Rs,3,395.00 lacs and Rs,3,031.00 lacs respectively was adjusted against Retained Earnings.

During the year ended March 31, 2016, the Company contemplated to acquire the balance 92% stake in Mail Today to consolidate its business and achieve business, content and editorial synergies. For this purpose, the Company entered into an arrangement with AN (Mauritius) Limited and LMIL for transferring their stake in Mail Today free of cost in the form of gifts. Consequent to this arrangement, the guarantee from LMIL was no longer required and necessary adjustment was made in the financial statements for the year ended March 31, 2016 in respect of the guarantee. A further fair value loss of Rs,831.30 lacs was also recorded in relation to the investment in the said year.

The shares in Mail Today have been acquired in the current year as per the above arrangement and recognized at fair value. The fair value of shares acquired from LMIL (through acquisition of shares of India Today Online Private Limited, holding company of Mail Today), free of cost, amounting to Rs,2,275.38 lacs has been treated as a capital contribution and credited to equity while the fair value of shares received from AN (Mauritius) Limited, free of cost, amounting to Rs,855.80 lacs has been credited to the statement of profit and loss in the current year.

All other transactions were made on normal commercial terms and conditions and at market rates.

All outstanding balances are unsecured and settled in cash, except barter transactions, as mentioned above, which are settled on receipt or provision of service by the parties.

Note 30: Share-based payments

(a) Employee stock option plan

The Company instituted the Employee Stock Option Plan (TVTN ESOP 2006) to grant equity - based incentives to its eligible employees. The TVTN ESOP 2006 was approved by the board of directors in their meeting held on August 21, 2006 and by shareholders in their meeting held on September 28, 2006, for grant of 2,900,000 options, representing one share for each option upon exercise by the employees of the Company, at an exercise price determined by the Board / Remuneration Committee. The equity shares covered under the scheme shall vest over a period of four years; vesting shall vary based on the meeting of the performance criteria. Participation in the plan is at the boardRs,s discretion and no individual has a contractual right to participate in the plan or to receive any guaranteed benefits. The Optionees may exercise their vested options at any moment after the earliest applicable vesting date and prior to the completion of ten years from the grant date. Options are granted under the plan for no consideration and carry no dividend or voting rights. The exercise price is based on the market value of the underlying equity shares on the date of grant.

*No options were exercised during the year ended March 31, 2017. The weighted average share price at the date of exercise of options exercised during the year ended March 31, 2016: Rs,83.15 (April 1, 2015: Rs,71.44).

No options were forfeited during the periods covered in the above table.

Fair value of options granted

No option was granted during the year ended March 31, 2017 and March 31, 2016.

(e) information concerning the classification of securities

Options

Options granted to employees under the Employee Stock Option Plan are considered to be potential equity shares. They have been included in the determination of diluted earnings per share to the extent to which they are dilutive. The options have not been included in the determination of basic earnings per share. Details relating to the options are set out in note 30.

Note 7: Offsetting financial assets and financial liabilities

The following table presents the recognized financial instruments that are offset, or subject to enforceable master netting arrangements and other similar agreements but not offset, as at March 31, 2017, March 31, 2016 and April 1, 2015. The column ‘net amount’ shows the impact on the Company’s balance sheet of all set-off rights were exercised.

(i) Master netting arrangement - not currently enforceable

A guarantee was provided by the parent entity to the Company for indemnifying any loss to the Company arising from the sale of investment in equity shares of Mail Today Newspapers Private Limited (‘Mail Today’). Accordingly, the guarantee can be invoked (to claim loss) only in the event of sale of investment by the Company. Hence, the fair value loss recorded by the Company in respect of the said investment has not been offset against the fair value of the guarantee in the balance sheet (as the Company currently does not have a legally enforceable right to set off the recognized amounts) and these amounts have been presented separately in the table above.

(ii) Offsetting arrangements

Trade receivables and trade payables

(a) The Company gives volume based incentives to advertisement agencies. Under the terms of the agreements, the amounts payable by the Company are offset against receivables from the agencies and only the net amounts are settled. The relevant amounts have therefore been presented net in the balance sheet.

(b) The Company enter into various transactions for purchase and sale of goods and services with the related parties which are settled in net. The relevant amounts have therefore been presented net in the balance sheet.

‘Specified Bank Notes (SBNs) mean the bank notes of denominations of the existing series of the value of five hundred rupees and one thousand rupees as defined under the notification of the Government of India, in the Ministry of Finance, Department of Economic Affairs no. S.O. 3407(E), dated the 8th November, 2016.

Note 8: Event occuring after the reporting period

(a) Migration of radio business to Phase III Policy Regime

The Company sold four of its FM radio stations at Amritsar, Patiala, Jodhpur and Shimla on September 18, 2015 to Entertainment Network (India) Limited, as a going concern, on a slump sale basis, after obtaining approval from Ministry of Information and Broadcasting (“MIB”) on July 20, 2015, for a lump sum consideration of Rs,400.00 lacs adjusted for net working capital as per the business transfer agreement. The CompanyRs,s application to the MIB to grant approval for sale of its three FM radio stations at New Delhi, Mumbai and Kolkata was declined by the Ministry. The Company filed a writ petition before the Honourable High Court of Delhi against such decline. The MIB also demanded a payment of Rs,7,136.80 lacs towards additional migration fee for migration of its FM radio stations from Phase II to Phase III Policy Regime, against which the Company obtained an interim relief till the disposal of the aforesaid case.

Meanwhile, the Committee of Senior Officials of the Company in its meeting held on December 19, 2016 approved the initiation of necessary procedural formalities for migration of its FM radio stations from Phase II to Phase III Policy Regime. Accordingly, the Company filed an application with the MIB on January 30, 2017 seeking approval for the migration of its FM radio stations to Phase III Policy Regime.

The Company received an offer letter dated April 20, 2017 from MIB for migration of its three FM radio stations from Phase II to Phase III, subject to, inter-alia, the execution of Grant of Permission Agreement (GOPA) for the said migration and payment of migration fee and other charges and interest. The Company paid the migration fee and other charges and interest totalling Rs,8,515.28 lacs in two instalments, i.e., Rs,2,124.42 lacs on April 25, 2017 and balance Rs,6,390.86 lacs on May 4, 2017 and executed the GOPA on May 23, 2017. Consequently, the three FM radio stations of the Company now stand migrated to Phase III w.e.f. April 1, 2015 (GOPA commencement date) for a period of 15 years.

(b) Other event

Refer to note 26 for the final dividend recommended by the directors which is subject to the approval of shareholders in the ensuing annual general meeting.

Note 9: Dues to Micro and Small Enterprises

Based on information available with the Company, there are no outstanding dues to micro and small enterprises as at March 31, 2017. No interest has been paid / is payable by the Company in terms of Section 16 of the Micro, Small and Medium Enterprises Development Act, 2006.

Note 10: First-time adoption of Ind AS Transition to Ind AS

These are the Company’s first financial statements prepared in accordance with Ind AS.

The accounting policies set out in note 1 have been applied in preparing the financial statements for the year ended March 31, 2017, the comparative information presented in these financial statements for the year ended March 31, 2016 and in the preparation of an opening Ind AS balance sheet as at April 1, 2015 (the Company’s date of transition). In preparing its opening Ind AS balance sheet, the Company has adjusted the amounts reported previously in financial statements prepared in accordance with the accounting standards notified under Companies (Accounting Standards) Rules, 2006 (as amended) and other relevant provisions of the Act (previous GAAP or Indian GAAP). An explanation of how the transition from previous GAAP to Ind AS has affected the Company’s financial position, financial performance and cash flows is set out in the following tables and notes.

A. Exemptions and exceptions availed

Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition from previous GAAP to Ind AS.

A.1 Ind AS optional exemptions A.1.1 Business combinations

Ind AS 101 provides the option to apply Ind AS 103 prospectively from the transition date or from a specific date prior to the transition date. This provides relief from full retrospective application that would require restatement of all business combinations prior to the transition date.

The Company elected to apply Ind AS 103 prospectively to business combinations occurring after its transition date. Business combinations occurring prior to the transition date have not been restated.

A.1.2 Deemed cost

Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognized in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for de-commissioning liabilities. This exemption can also be used for intangible assets covered by Ind AS 38 Intangible Assets.

Accordingly, the Company has elected to measure all of its property, plant and equipment and intangible assets at their previous GAAP carrying value.

A.1.3 Share - based payments

Ind AS 101 permits a first-time adopter to not apply Ind AS 102, Share - based payments for the equity instruments that vested before the date of transition to Ind AS and liabilities arising from share - based payment transactions that were settled before the date of transition to Ind AS.

Accordingly, the Company has not applied Ind AS 102, to the equity instruments that vested before the transition date and liabilities arising from share - based payment transactions that were settled before the date of transition to Ind AS. Further, no options have vested after the transition date.

A.1.4 Designation of previously recognized financial instruments

Ind AS 101 allows an entity to designate investments in equity instruments at FVOCI on the basis of the facts and circumstances at the date of transition to Ind AS.

The Company has not elected to apply this exemption for its investment in equity investments.

A. 1.5 Leases

Appendix C to Ind AS 17 requires an entity to assess whether a contract or arrangement contains a lease. In accordance with Ind AS 17, this assessment should be carried out at the inception of the contract or arrangement. Ind AS 101 provides an option to make this assessment on the basis of facts and circumstances existing at the date of transition to Ind AS, except where the effect is expected to be not material.

The Company has elected to apply this exemption for such contracts/arrangements.

A.2 Ind AS mandatory exceptions A.2.1 Estimates

An entity’s estimates in accordance with Ind AS at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error.

Ind AS estimates as at April 1, 2015 are consistent with the estimates as at the same date made in conformity with previous GAAP. The Company made estimates for following items in accordance with Ind AS at the date of transition as these were not required under previous GAAP:

- Investment in equity instruments carried at FVPL;

- Impairment of financial assets based on expected credit loss model.

A.2.2 De-recognition of financial assets and liabilities

Ind AS 101 requires a first-time adopter to apply the de-recognition provisions of Ind AS 109 prospectively for transactions occurring on or after the date of transition to Ind AS. However, Ind AS 101 allows a first-time adopter to apply the de-recognition requirement in Ind AS 109 retrospectively from a date of the entity’s choosing, provided that the information needed to apply Ind AS 109 to financial assets and financial liabilities derecognized as a result of past transactions was obtained at the time of initially accounting for those transactions.

The Company has elected to apply the de-recognition provisions of Ind AS 109 prospectively from the date of transition to Ind AS.

A.2.3 Classification and measurement of financial assets

Ind AS 101 requires an entity to assess classification and measurement of financial assets on the basis of the facts and circumstances that exist at the date of transition to Ind AS.

The Company has applied the above requirement on transition date.

C: Notes to first-time adoption

Note 1: Fair valuation of investments

Under the previous GAAP, investments in equity instruments were classified as long-term investments or current investments based on the intended holding period and readability. Long-term investments were carried at cost less provision for diminution, other than temporary decline, in the value of such investments. Current investments were carried at lower of cost and fair value. Under Ind AS, these investments are required to be measured at fair value.

Reduction in fair value of the investment in Mail Today Newspapers Private Limited has been recognized in retained earnings as at the date of transition and subsequently in the Statement of profit or loss for the year ended March 31, 2016. This decreased the retained earnings by Rs,3,688.30 lacs as at March 31, 2016 (April 1, 2015 - Rs,3,395.00 lacs).

Note 2: Fair value of guarantee (derivative financial asset)

Under the previous GAAP, the guarantee received from the holding company, Living Media India Limited, for indemnifying any loss to the Company arising from the sale of investment in equity shares of Mail Today Newspapers Private Limited, was considered for the purpose of determining other than temporary decline in the value of such investment. Under Ind AS, the said guarantee is a separate transaction, and hence, is accounted for separately from the investment in equity shares. The guarantee meets the definition of derivative financial instrument given in Ind AS 109. All derivatives in scope of Ind AS 109, including those linked to unquoted equity investments, are measured at fair value and changes in fair value are recognized in profit or loss. Consequent to this change, the Company has recognized the guarantee at its fair value of Rs, Nil as at March 31, 2016 (April 1, 2015 - Rs,3,031.00 lacs). Total equity increased by Rs,3,031.00 lacs as at April 1, 2015. The profit for the year and total equity as at March 31, 2016 decreased by Rs,3,031.00 lacs due to recognition of fair value loss in respect of the guarantee.

Note 3: Deferred tax

Under Ind AS, deferred tax has been recognized on the adjustments made on transition to Ind AS.

Note 4: Cash credit / book overdraft

Under Ind AS, cash credit repayable on demand and book overdraft, which form an integral part of the cash management process are included in cash and cash equivalents for the purpose of presentation of statement of cash flows. Under previous GAAP, cash credit of Rs,672.58 lacs as at April 1, 2015 was considered as part of borrowings and movement in cash credit was shown as part of financing activities. While, book overdraft of Rs,328.62 lacs as at March 31, 2016 was shown as a part of operating activities. Consequently, cash and cash equivalents have reduced by Rs,328.62 lacs as at March 31, 2016 (April 1, 2015: Rs,672.58 lacs) with corresponding increase / decrease in cash flows from financing / operating activities respectively for the year ended March 31, 2016 to the effect of the movements in cash credit and book overdraft.

Note 5: Proposed dividend

Under the previous GAAP, dividends proposed by the board of directors after the balance sheet date but before the approval of the financial statements were considered as adjusting events. Accordingly, provision for proposed dividend was recognized as a liability. Under Ind AS, such dividends are recognized when the same is approved by the shareholders in the general meeting. Accordingly, the liability for proposed dividend of Rs,1,043.94 lacs as at March 31, 2016 (April 1, 2015: Rs,894.73 lacs) and dividend distribution tax thereon of Rs,212.52 lacs as at March 31, 2016 (April 1, 2015: Rs,178.89 lacs) included under provisions have been reversed with corresponding adjustment to retained earnings. Consequently, the total equity increased by an equivalent amount. [Refer Note 26 (b)]

Note 6: Remeasurements of post-employment benefit obligation

Under Ind AS, remeasurements, i.e. actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability are recognized in other comprehensive income instead of profit or loss. Under the previous GAAP, these remeasurements were forming part of the profit or loss for the year. As a result of this change, the profit for the year ended March 31, 2016 increased by Rs,9.37 lacs. There is no impact on total equity as at March 31, 2016.

Note 7: Security deposits - assets

Under the previous GAAP, interest free lease security deposits (that are refundable in cash on completion of the lease term) are recorded at their transaction value. Under Ind AS, all financial assets are required to be recognized at fair value. Accordingly, the Company has fair valued these security deposits under Ind AS. Difference between the fair value and transaction value of the security deposit has been recognized as prepaid rent. Consequent to this change, the amount of security deposits decreased by Rs,28.26 lacs as at March 31, 2016 (April 1, 2015: Rs,41.26 lacs). The prepaid rent increased by Rs,22.19 lacs as at March 31, 2016 (April 1, 2015: Rs,33.36 lacs). Total equity decreased by Rs,7.90 lacs as at April 1, 2015. The profit for the year and total equity as at March 31, 2016 increased by Rs,1.77 lacs due to notional interest income of Rs,16.77 lacs recognized on security deposits which is partially off-set by the amortization of the prepaid rent by Rs,15.00 lacs.

Note 8: Security deposits - liabilities

Under the previous GAAP, interest free security deposits received (that are payable in cash on termination of the contract) are recorded at their transaction value. Under Ind AS, all financial liabilities are required to be recognized at fair value. Accordingly, the Company has fair valued these security deposits received under Ind AS. Difference between the fair value and transaction value of the security deposit has been recognized as unearned income. Consequent to this change, the amount of security deposits decreased by Rs,7.07 lacs as at March 31, 2016 (April 1, 2015: Rs,10.15 lacs). The unearned income increased by Rs,5.36 lacs as at March 31, 2016 (April 1, 2015: Rs,8.23 lacs). Total equity increased by Rs,1.92 lacs as on April 1, 2015. The profit for the year and total equity as at March 31, 2016 decreased by Rs,0.20 lacs due to notional interest expense of Rs,10.50 lacs recognized on security deposits which is partially off-set by recognition of the unearned income of Rs,10.30 lacs as revenue from operations.

Note 9: Loan to employees - assets

Under the previous GAAP, interest free loan to employees (that are repayable in cash on completion of the agreed term) are recorded at their transaction value. Under Ind AS, all financial assets are required to be recognized at fair value. Accordingly, the Company has fair valued these loans under Ind AS. Difference between the fair value and transaction value of the loan has been recognized as deferred employee expense. Consequent to this change, the amount of loan decreased by Rs,1.86 lacs as at March 31, 2016 (April 1, 2015: Rs,1.33 lacs). The deferred employee expense increased by Rs,2.63 lacs as at March 31, 2016 (April 1, 2015: Rs,1.86 lacs). Total equity increased by Rs,0.53 lacs as on April 1, 2015. The profit for the year and total equity as at March 31, 2016 increased by Rs,0.24 lacs due to notional interest income of Rs,2.50 lacs recognized on loan which is partially off-set by the amortization of the deferred employee expense by Rs,2.26 lacs.

Note 10: Revenue - barter transactions involving advertising services

Under the previous GAAP, the Company regarded the barter transactions entered into to provide advertising services in exchange for receiving advertising services from its customers, amounting to exchange of services of a similar nature, as a transaction which generates revenue.

Under Ind AS, exchange of services of a similar nature is not regarded as a transaction which generates revenue. Consequent to this change, the amount of trade receivables and trade payables decreased by Rs,60.62 lacs and Rs,24.22 lacs respectively as on March 31, 2016 (April 1, 2015: Rs, Nil and Rs, Nil respectively). The profit for the year and total equity as at March 31, 2016 decreased by Rs,36.40 lacs due to derecognition of advertisement revenue of Rs,60.62 lacs from such transactions which is partially off-set by derecognition of advertisement expense of ''24.22 lacs from such transactions.

Note 11: Lease rent equalization reserve

Under the previous GAAP, the lease payments under an operating lease were recognized as an expense in the statement of profit and loss on a straight line basis over the lease term.

Under Ind AS, the lease payments under an operating lease shall be recognized as an expense on a straight-line basis over the lease term unless the payments are structured to increase in line with expected general inflation to compensate for the less or’s expected inflationary cost increases. If payments to the less or vary because of factors other than general inflation, then this condition is not met. Since the lease payments under all the operating leases entered into by the Group as a lessee are structured to increase in line with expected general inflation to compensate for the lessor’s expected inflationary cost increases, the lease rent equalization reserve created in respect of such leases amounting to Rs,80.90 lacs under the previous GAAP, has been reversed with corresponding adjustment to retained earnings as at April 1, 2015. Consequently, the total equity increased by an equivalent amount. The profit for the year and total equity as at March 31, 2016 decreased by Rs,12.57 lacs and Rs,68.33 lacs respectively, due to reversal of utilization of lease rent equalization reserve created in respect of the aforesaid leases under the previous GAAP.

Note 12: Discontinued operations

The application for approval of sale of three radio stations of the Company was declined by the Ministry of Information and Broadcasting (“''''MIB''”'') in the previous year. The Company filed a writ petition before the Honorable High Court of Delhi against such decline. The Company was pursuing the case legally and expected a favorable outcome.

Accordingly, under the previous GAAP, the radio business was classified as a discontinuing operation as the Company’s board of directors had both (i) approved a detailed, formal plan for the discontinuance and (ii) made an announcement of the plan.

Under Ind AS, a discontinued operation is a component of an entity that either has been disposed of, or is classified as held for sale. An entity shall classify a non-current asset (or disposal group) as held for sale if its carrying amount will be recovered principally through a sale transaction rather than through continuing use. For this to be the case, the asset (or disposal group) must be available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such assets (or disposal groups) and its sale must be highly probable. Considering the above decline of approval by the MIB, the disposal group (radio business) is not considered to be available for immediate sale in its present condition. Hence, the radio business has not been considered as a discontinued operation under Ind AS.

Consequently, the loss from discontinuing operations before tax (Rs,1,349.14 lacs), profit from disposal of assets and liabilities of discontinuing operations (Rs,207.01 lacs) and income tax expense thereon (Rs, nil) for the year ended March 31, 2016 under the previous GAAP has been adjusted / included against / in the profit from continuing operations for the year ended March 31, 2016. As a result of this change, the profit from continuing operations for the year ended March 31, 2016 has decreased by Rs,1,142.13 lacs and the loss from discontinued operations for the year ended March 31, 2016 is nil. There is no impact on the total equity and profit.

Note 13: Agency incentive

Under previous GAAP, the incentive paid to the advertisement agencies was recognized as an expense in the statement of profit and loss.

Under Ind AS, if the agencies are acting as a principal, the incentive payable should be adjusted against the advertisement income. Accordingly the advertisement income and agency incentive expenses have decreased by Rs,764.62 lacs for the year ended March 31, 2016. There is no impact on the total equity and profit.

Note 14: Provisions / liabilities written back to the extent no longer required

Under the previous GAAP, the provisions / liabilities written back to the extent no longer required were credited to Other income. Under Ind AS, where the original provision was charged as an expense, any subsequent reversal should be credited to the same line in the statement of profit and loss in accordance with the principle of consistency. Accordingly, the aforesaid provisions / liabilities written back to the extent no longer required have been credited to the respective expense line in the statement of profit and loss. This change has resulted in a decrease in other income, increase in revenue from operations and decrease in other expenses for the year ended March 31, 2016 by Rs,1,334.83 lacs, Rs,415.43 lacs and Rs,919.40 lacs respectively. There is no impact on the total equity and profit.

Note 15: Retained earnings

Retained earnings as at April 1, 2015 has been adjusted consequent to the above Ind AS transition adjustments.

Note 16: Other comprehensive income

Under Ind AS, all items of income and expense recognized in a period should be included in profit or loss for the period, unless a standard requires or permits otherwise. Item of income / expense that is not recognized in profit or loss but is shown in the statement of profit and loss as ‘other comprehensive income’ includes remeasurements of defined benefit plan. The concept of other comprehensive income did not exist under the previous GAAP.


Mar 31, 2016

1. Employee Stock Option Plan

The Company instituted the Employee Stock Option Plan (TVTN ESOP 2006) to grant equity - based incentives to its eligible employees. The TVTN ESOP 2006 was approved by the board of directors in their meeting held on 21st August, 2006 and by shareholders in their meeting held on 28th September, 2006, for grant of 2,900,000 options, representing one share for each option upon exercise by the employees of the Company, at an exercise price determined by the Board / Remuneration Committee. The equity shares covered under the scheme shall vest over a period of four years; vesting shall vary based on the meeting of the performance criteria. The Optioned may exercise their vested options at any moment after the earliest applicable vesting date and prior to the completion of ten years from the grant date.

Accordingly, the Company under the intrinsic value method, as permitted by the Guidance Note on Accounting for Employee Share Based Payment issued by the Institute of Chartered Accountants of India, has recognized the excess of the market price over the exercise price of the option amounting to Rs. (-) 25,000 (previous year Rs. (-) 280,531) as expense during the year. Further, the liability as at March 31, 2016 in respect of Employee Stock Options Outstanding is Rs. 375,000 (previous year Rs. 450,000).

2. Discontinuing Operations

On February 6, 2015, the Board of Directors of the Company approved the sale of Radio FM Business (seven radio stations). The decision was intimated to the stock exchanges on the same date. The disposal plan is consistent with the Company''s long-term strategy to focus its activities on Television Broadcasting. The Company signed a non-binding Memorandum of Understanding (MoU) with Entertainment Network (India) Limited on February 13, 2015, in relation to the sale of seven radio stations to Entertainment Network (India) Limited, subject to fulfillment of the contractual obligations and receipt of all necessary regulatory approvals, including permission from the Ministry of Information and Broadcasting, Government of India. The purchase price for the whole of Radio Business, as per the said MoU, is Rs. 485,000,000, to be paid on the closing date.

On receipt of approval from the Ministry of Information and Broadcasting on July 20, 2015, the Company sold four of its radio stations at Amritsar, Patiala, Jodhpur and Shimla on September 18, 2015 to Entertainment Network (India) Limited, as a going concern, on a slump sale basis, for a lump sum consideration of Rs. 40,000,000, adjusted for net working capital, as per the business transfer agreement. Such transaction resulted in a profit of Rs. 20,701,133 included in ‘Other Income’.

The application to the Ministry to grant approval for sale of its three radio stations at New Delhi, Mumbai and Kolkata, was declined by the Ministry. The Company has filed a writ petition before the Honorable High Court of Delhi against such denial, which is pending before the Honourable Court. The Ministry also demanded a payment of Rs. 713,600,000 towards additional migration fee for migration of its radio stations from Phase II to Phase III Policy Regime, against which the Company has obtained an interim relief till the disposal of the aforesaid case and accordingly, the same has been disclosed as a contingent liability (refer note 20). The Company is pursuing the case legally and expects a favorable outcome. Operating results of the Company''s discontinued operations are summarized as follows:

3. Segment Reporting

The Company is primarily engaged in television broadcasting, which is considered the only reportable business segment as per Accounting Standard 17[AS-17], “Segment Reporting”. Therefore, as per the requirements of AS-17 are Company does not have any reportable primary segment and accordingly disclosure requirements of AS-17 in this regard are not applicable, further the company has determined its operations in India as its single reportable geographical segment.

4. Related Party Disclosures

(a) Names of related parties and nature of relationship

(i) Where control exists:

Holding company: Living Media India Limited (Refer Note - e)

Ultimate holding company: World Media Private Limited [till December 18, 2015] (Refer Note - a)

Subsidiary: T.V. Today Network (Business) Limited

(Refer Note - b)

(ii) Other related parties with whom transactions have taken place during the year:

Fellow subsidiaries: Mail Today Newspapers Private Limited

Today Merchandise Private Limited

Thomson Press (India) Limited [till December 18, 2015]

Integrated Databases India Limited

ITAS Media Private Limited

Radio Today Broadcasting Limited [till December 18, 2015]

Today Retail Network Private Limited Key management personnel (KMP): Mr. Aroon Purie (Managing Director)

Mrs. Koel Purie Rinchet (Whole-time Director till June 26, 2015)

Mrs. Kalli Purie Bhandal (Whole-time Director w.e.f. February 8, 2016)

Entity over which Key Management Personnel (KMP) Care Today Fund exercise significant influence Vasant Valley School

5. Operating Leases As a lessee:

The Company has cancellable and non-cancellable lease arrangements mainly for office premises and company leased accommodation for employees. These lease arrangements range for a period between 11 months and 10 years. Most of the leases are renewable for further period on mutually agreeable terms and also include escalation clauses. The operating lease payments recognized in the Statement of Profit and Loss amount to Rs. 47,532,785 (previous year Rs. 48,620,015). With respect to non-cancellable operating leases, the future minimum lease payments are as follows:-

6. Dues to Micro and Small Enterprises

Based on information available with the Company, there are no outstanding dues to micro and small enterprises as at March 31, 2016. No interest has been paid / is payable by the Company in terms of Section 16 of the Micro, Small and Medium Enterprises Development Act, 2006.

7. The Company, as a strategic decision, considered entering into the print media and, accordingly, acquired in earlier years some stake in Mail Today Newspapers Private Limited (“Mail Today”), a differentiated newspaper published in Delhi market. Based on the valuation of the equity shares of Mail Today, carried out by an independent value, the Company acquired the shares through direct subscription and through purchase from existing shareholders at a cost of Rs. 455,212,482. Mail Today is presently incurring losses, but is close to operating break-even. The Company, in view of such losses and considering the current business / industry conditions, has carried out a valuation of shares of Mail Today through an independent value and the said valuation shows a decline of Rs. 422,500,000 in the carrying amount of the Company''s existing shareholding in Mail Today. Mail Today is of strategic importance to the Company, as it has a network of journalists generating original content, which can be of great value to the Company in future. In view of such strategic value, the Company is in the process of acquiring the remaining stake in Mail Today from the other shareholders, viz., Living Media India Limited, the holding company and AN (Mauritius) Limited, who have confirmed to transfer their existing shares to the Company without any monetary consideration, making Mail Today a wholly-owned subsidiary of the Company. The reduction in the value of the Company''s investments after considering such proposed acquisition from the other shareholders without any monetary consideration amounts to Rs. 53,800,000, which has been provided for in these financial statements as decline, other than temporary. The management of Mail Today is making all possible efforts to improve its performance.

8. Previous Year Figures

Previous year figures have been reclassified to conform to this year’s classification.


Mar 31, 2015

1. Employee Stock Option Plan

The Company instituted the Employee Stock Option Plan (TVTN ESOP 2006) to grant equity - based incentives to its eligible employees. The TVTN ESOP 2006 was approved by the board of directors in their meeting held on 21st August, 2006 and by shareholders in their meeting held on 28th September, 2006, for grant of 2,900,000 options, representing one share for each option upon exercise by the employees of the Company, at an exercise price determined by the Board / Remuneration Committee. The equity shares covered under the scheme shall vest over a period of four years; vesting shall vary based on the meeting of the performance criteria. The Optionee may exercise their vested options at any moment after the earliest applicable vesting date and prior to the completion of ten years from the grant date.

Accordingly, the Company under the intrinsic value method, as permitted by SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 and the Guidance Note on Accounting for Employee Share Based Payment issued by the Institute of Chartered Accountants of India, has recognized the excess of the market price over the exercise price of the option amounting to Rs. (-) 280,531 (Previous Year Rs. (-) 674,496) as expense during the year. Further, the liability as at March 31,2015 in respect of Employee Stock Options Outstanding is Rs. 450,000 (Previous Year Rs. 3,037,500). The balance deferred compensation expense of Rs. Nil (Previous Year Rs. 101,969) will be amortized over the remaining vesting period of options.

2. Segment Reporting

The Company has considered the business segment as the primary reporting segment on the basis that the risks and returns of the Company are primarily determined by the nature of services. Consequently, the geographical segment has been considered as a secondary segment.

The business segments have been identified on the basis of :

* the nature of services

* the risks and returns

* internal organization and management structure and

* the internal performance reporting systems

The business segments comprise of the following :

* Television Broadcasting

* Radio Broadcasting

3. Related Party Disclosures

(a) Names of related parties and nature of relationship

(i) Where control exists:

Holding company : Living Media India Limited

Ultimate holding company: World Media Private Limited (Refer Note - a)

Subsidiary : T.V. Today Network (Business) Limited (Refer Note - b)

(ii) Other related parties with whom transactions have taken place during the year:

Fellow subsidiaries : Thomson Press (India) Limited Today Merchandise Private Limited Radio Today Broadcasting Limited Mail Today Newspapers Private Limited World Media Trading Limited ITAS Media Private Limited Today Retail Network Private Limited

Key management personnel: Mr. Aroon Purie (Managing Director) (KMP) Ms. Koel Purie Rinchet (Whole Time Director)

Entity over which Key Care Today Fund Management Personnel (KMP) exercise significant influence

4. Dues to Micro and Small Enterprises

Based on information available with the Company, there are no outstanding dues to micro and small enterprises as at March 31,2015. No interest has been paid / is payable by the Company in terms of Section 16 of the Micro, Small and Medium Enterprises Development Act, 2006.

40. The Company as a strategic decision considered entering into the print media and, accordingly, acquired in earlier years some stake in Mail Today Newspapers Private Limited (Mail Today), a differentiated newspaper with respect to content as well as value to its advertisers. Based on the valuation of the equity shares of Mail Today, carried out by an independent valuer, the Company acquired the shares through direct subscription and also through purchase from existing shareholders at a cost of Rs. 455,212,482. Though, Mail Today is presently incurring losses, the Company is confident of its long-term strategic value and it has also received a guarantee from its holding company, Living Media India Limited, for indemnifying any loss to the Company arising from the sale of the said investment, based on which the carrying value of the said investment is considered appropriate.

5. The Company has decided to enter into digital news space to tap significant growth potential and business opportunity in digital news industry. Consequently, the Company has acquired digital rights of its news channels from its holding company, Living Media India Limited, for a consideration of Rs. 387,500,000. Such consideration has been recognized as an intangible asset, to be amortized over a period of 10 years.

6. Previous Year Figures

Previous year figures have been reclassified to conform to this year''s classification.


Mar 31, 2014

1. Contingent Liabilities

Particulars As at March 31, 2014 March 31, 2013 Amount (Rs.) Amount (Rs.)

Claims against the Company not acknowledged as debts:

Income Tax Matters : 3,499,211 99,519,245

The Company has received demand notices from the Income Tax department, which the Company has contested. In the opinion of the management, no liability is likely to arise on account of such demand notices.

Other Matters :

(1) Claim from Prasar Bharti towards up linking charges :- 18,989,020 26,486,082 Provision made in the books on an estimated basis is Rs. 59,679,814 (Previous Year Rs. 48,276,437). In the opinion of the management, based on its understanding of the case and as advised by their counsel, the provision made in the books is considered to be adequate.

(2) Claim from Phonographic Performance Limited (PPL) towards royalty 17,733,300 - for use of PPL''s sound recordings over Company''s radio stations :- Provision made in the books on an estimated basis is Rs. 2,531,401 (Previous Year Rs. Nil). In the opinion of the management, based on its understanding of the case and as advised by their counsel, the provision made in the books is considered to be adequate.

(3) The Company has received legal notice of claims / lawsuits filed against it in respect of programmes aired on its television channels. In the opinion of the management, no liability is likely to arise on account of such claims / lawsuits.

Guarantees:

Bank guarantees 23,083,379 25,069,899

(a) It is not practicable for the Company to estimate the timings of cash outflows, if any, in respect of the above, pending resolution of the respective proceedings.

(b) The Company does not expect any reimbursements in respect of the above contingent liabilities.

2. Employee Stock Option Plan

The Company instituted the Employee Stock Option Plan (TVTN ESOP 2006) to grant equity - based incentives to its eligible employees. The TVTN ESOP 2006 was approved by the board of directors in their meeting held on 21st August, 2006 and by shareholders in their meeting held on 28th September, 2006, for grant of 2,900,000 options, representing one share for each option upon exercise by the employees of the Company, at an exercise price determined by the Board / Remuneration Committee. The equity shares covered under the scheme shall vest over a period of four years; vesting shall vary based on the meeting of the performance criteria. The Optionee may exercise their vested options at any moment after the earliest applicable vesting date and prior to the completion of ten years from the grant date.

Accordingly, the Company under the intrinsic value method, as permitted by SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 and the Guidance Note on Accounting for Employee Share Based Payment issued by the Institute of Chartered Accountants of India, has recognized the excess of the market price over the exercise price of the option amounting to Rs. (-) 674,496 (Previous Year Rs. (-) 649,153) as expense during the year. Further, the liability as at March 31, 2014 in respect of Employee Stock Options Outstanding is Rs. 3,037,500 (Previous Year Rs. 4,440,000). The balance deferred compensation expense of Rs. 101,969 (Previous Year Rs. 357,473) will be amortized over the remaining vesting period of options.

3. Segment Reporting

The Company has considered the business segment as the primary reporting segment on the basis that the risks and returns of the Company are primarily determined by the nature of services. Consequently, the geographical segment has been considered as a secondary segment.

The business segments have been identified on the basis of :

- the nature of services

- the risks and returns

- internal organization and management structure and

- the internal performance reporting systems

The business segments comprise of the following :

- Television Broadcasting

- Radio Broadcasting

4. Related Party Disclosures

(a) Names of related parties and nature of relationship

(i) Where control exists:

Holding company: Living Media India Limited

Ultimate holding company: World Media Private Limited (Refer Note - a)

Subsidiary: T.V. Today Network (Business) Limited (Refer Note - b)

Company under common control: Integrated Databases India Limited (Refer Note - a)

(ii) Other related parties with whom transactions have taken place during the year:

Fellow subsidiaries: Thomson Press (India) Limited

Today Merchandise Private Limited

Radio Today Broadcasting Limited

Mail Today Newspapers Private Limited

World Media Trading Limited

ITAS Media Private Limited

Today Retail Network Private Limited

Key management personnel (KMP): Mr. Aroon Purie (Managing Director)

Ms. Koel Purie Rinchet (Whole Time Director)

5. Dues to Micro and Small Enterprises

Based on information available with the Company, there are no outstanding dues to micro and small enterprises as at March 31, 2014. No interest has been paid / is payable by the Company in terms of Section 16 of the Micro, Small and Medium Enterprises Development Act, 2006.

6. The Company has as a strategic decision considered entering into the print media. In this regard, it has acquired some stake in Mail Today Newspapers Private Limited (Mail Today), a differentiated newspaper with respect to content as well as value to its advertisers. Based on the valuation of the equity shares of Mail Today, carried out by an independent valuer, the Company acquired some stake through direct subscription and also through purchase from existing shareholders amounting to Rs. 455,212,482. Though Mail Today is in the initial stages of operations and is presently incurring losses, the Company, based on projections / independent valuation, is confident of the future Profitability of Mail Today and consequently of the carrying value of the investment.

7. Previous Year Figures

Previous year figures have been reclassified to conform to this year''s classification.


Mar 31, 2013

1. Contingent Liabilities

Particulars As at

March 31, 2013 March 31, 2012 Amount (Rs.) Amount (Rs.)

Claims against the Company not acknowledged as debts:

(A) Income Tax Matters : 99,519,245 82,707,017 The Company has received demand notices from the Income Tax department, which the Company has contested. In the opinion of the management, no liability is likely to arise on account of such demand notices.

(B) Other Matters: (1) Claim from Prasar Bharti towards uplinking charges 26,486,082 24,532,931

The total claim as at March 31, 2013 amounted to Rs. 74,762,519. Pending final outcome in respect of such dispute, the Company is carrying provision on an estimated basis amounting to Rs. 48,276,437, including Rs. 1,953,160 provided for in the current year. In the opinion of the management, based on its understanding of the case and as advised by their counsel, the provision made in the books is considered adequate and the balance amount is considered as a contingent liability.

(2) The Company has received legal notice of claims / lawsuits filed against it in respect of programmes aired on its television channels. In the opinion of the management, no liability is likely to arise on account of such claims / lawsuits.

Note:- (a) It is not practicable for the Company to estimate the timing of cash outflows, if any, in respect of the above, pending resolution of the respective proceedings.

(b) The Company does not expect any reimbursements in respect of the above contingent liabilities.

2. Employee Stock Option Plan

The Company instituted the Employee Stock Option Plan (TVTN ESOP 2006) to grant equity - based incentives to its eligible employees. The TVTN ESOP 2006 had been approved by the board of directors in their meeting held on 21st August, 2006 and by shareholders in their meeting held on 28th September, 2006, for grant of 2,900,000 options, representing one share for each option upon exercise by the employees of the Company, at an exercise price determined by the Board / Remuneration Committee. The equity shares covered under the scheme shall vest over a period of four years; vesting shall vary based on the meeting of the performance criteria. The Optionee may exercise their vested options at any moment after the earliest applicable vesting date and prior to the completion of ten years from the grant date.

Accordingly, the Company under the intrinsic value method has recognized the excess of the market price over the exercise price of the option amounting to Rs. (-) 649,153 (Previous Year Rs. (-) 819,263) as expense during the year. Further, the liability as at March 31, 2013 in respect of Employee Stock Options Outstanding is Rs. 4,440,000 (Previous Year Rs. 5,662,500). The balance deferred compensation expense of Rs. 357,473 (Previous Year Rs. 930,820) will be amortized over the remaining vesting period of options.

3. Related Party Disclosures

(a) Names of related parties and nature of relationship

(i) Where control exists:

Holding Company: Living Media India Limited

Ultimate Holding Company: World Media Private Limited (Note-1)

Subsidiary: T.V. Today Network (Business) Limited (Note-2)

(ii) Other Related Parties with whom transactions have taken place during the year: Fellow Subsidiaries: Thomson Press (India) Limited

Today Merchandise Private Limited Radio Today Broadcasting Limited Mail Today Newspapers Private Limited

Company under Common Control: Integrated Databases India Limited (Note-1)

Key Management Personnel (KMP): Mr. Aroon Purie (Managing Director)

Ms. Koel Purie Rinchet (Whole Time Director)

4. Operating Leases

The Company has entered into lease transactions mainly for office premises and company leased accommodation for employees. Terms of lease include terms of renewal, increase in rent in future period and terms of cancellation. The operating lease payments and lease / sub-lease rentals received recognized in the Statement of Profit and Loss amount to Rs. 95,828,741 (Previous Year Rs. 148,493,097) and Rs. 21,375,991 (Previous Year Rs. 726,024, netted off against rent expense) respectively.

5. Dues to Micro and Small Enterprises

Based on information available with the Company, there are no outstanding dues to Micro and Small enterprises as at March 31, 2013. No interest is paid / payable by the Company in terms of Section 16 of the Micro, Small and Medium Enterprises Development Act, 2006.

6. The Company has as a strategic decision considered entering into the print media. In this regard, it has acquired some stake in Mail Today Newspapers Private Limited (Mail Today), a differentiated newspaper with respect to content as well as value to its advertisers. Based on the valuation of the equity shares of Mail Today, carried out by an independent valuer, the Company acquired some stake through direct subscription and also through purchase from existing shareholders amounting to Rs. 455,212,482. Though, Mail Today is in the initial stages of operations and is presently incurring losses, the Company, based on independent projections, is confident of the future profitability of Mail Today and consequently of the carrying value of the investment.

7. Previous Year Figures

Previous year figures have been reclassified to conform to this year''s classification.


Mar 31, 2012

(a) Rights, preferences and restrictions attached to shares

The Company has only one class of equity shares having a par value of Rs. 5 per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding. However, no such preferential amounts exist currently.

(b) Shares reserved for issue under Options

Refer Note 27 for details of shares to be issued under the Employee Stock Option Plan

(a) Cash Credit facilities have been secured by way of first charge against the whole of book-debts.

(b) Working Capital Loan has been secured by (hypothecation deed pending to be executed as at year end)

(i) Charge on book debts of the Company (both present and future) on a first pari passu basis with another bank.

(ii) Exclusive charge on proposed rental income received from all other India Today group companies for NOIDA Property.

(iii) Negative lien on the NOIDA property.

1. Contingent Liabilities

Particulars As at

March 31, 2012 March 31, 2011 Amount (Rs.) Amount (Rs.)

Claims against the Company not acknowledged as debts:

Income Tax Matters: 82,707,017 87,411,396

The Company has received demand notices from the Income Tax department, which the Company has contested. In the opinion of the management, no liability is likely to arise on account of such demand notices.

Other Matters:

(1) Claims from Prasar Bharti 24,532,931 32,713,529

The Company received claims from Prasar Bharti in earlier years towards unlinking charges and telecast fees, which were dis puted by the Company.

Prasar Bharti also raised claims towards interest for non-payment of dues from time to time, which were also disputed by the Company.

During the year, the telecast fees matter with Prasar Bharti has been settled vide Delhi High Court order dated February 24, 2012. The total amount payable by the Company as per the said order is Rs. 30,184,406 (net of interest earned on amount already deposited with the Court). The Company had paid and expensed Rs. 23,320,971 till previous year and therefore, the charge to the Statement of Profit and Loss in the current year amounts to Rs. 6,864,406, included in "Others" under "Other Current Liabilities" (Note 9).

In relation to the up linking charges matter, the total claim as at March 31, 2012 amounted to Rs. 70,856,205. Pending final outcome in respect of such dispute, the Company is carrying provision on an estimated basis amounting to Rs 46,323,274, including Rs. 10,315,922 provided for in the current year. In the opinion of the management, based on its understanding of the case and as advised by their counsel, the provision made in the books is considered adequate and the balance amount is considered as a contingent liability.

(2) The Company has received legal notice of claim / lawsuit filed against it in respect of programmes aired on the Channels. In the opinion of the management, no liability is likely to arise on account of such claim / lawsuit.

Guarantees:

Bank Guarantees 25,069,899 28,554,699

(a) It is not possible for the Company to estimate the timing of cash outflows, if any, in respect of the above, pending resolution of the respective proceedings.

(b) The Company does not expect any reimbursements in respect of the above contingent liabilities.

2. Employee Stock Option Plan

The Company instituted the Employee Stock Option Plan (TVTN ESOP 2006) to grant equity - based incentives to its eligible employees. The TVTN ESOP 2006 had been approved by the board of directors in their meeting held on 21st August, 2006 and by shareholders in their meeting held on 28th September, 2006, for grant of 2,900,000 options, representing one share for each option upon exercise by the employees of the Company, at an exercise price determined by the Board / Remuneration Committee. The equity shares covered under the scheme shall vest over a period of four years; vesting shall vary based on the meeting of the performance criteria. The Optioned may exercise their vested options at any moment after the earliest applicable vesting date and prior to the completion of ten years from the grant date.

Accordingly, the Company under the intrinsic value method has recognized the excess of the market price over the exercise price of the option amounting to Rs. (-)819,263 (Previous Year Rs. 1,556,816) as expense during the year. Further, the liability as at March 31, 2012 in respect of Employee Stock Options Outstanding is Rs. 5,662,500 (Previous Year Rs. 8,692,500). The balance deferred compensation expense of Rs. 930,820 (Previous Year Rs. 3,141,557) will be amortized over the remaining vesting period of options.

3. Operating Leases

The Company has cancellable lease arrangements mainly for office premises and company leased accommodation for employees. Terms of lease include terms of renewal, increase in rents in future period and terms of cancellation. The operating lease payments recognized in the Statement of Profit and Loss amount to Rs. 148,493,097 (Previous Year Rs. 125,811,031), net of sub-lease rental received Rs. 726,024 (Previous Year Rs. 572,926).

4. Dues to Micro and Small Enterprises

Based on information available with the Company, there are no outstanding dues to Micro and Small enterprises as at March 31, 2012. No interest is paid / payable by the Company in terms of Section 16 of the Micro, Small and Medium Enterprises Development Act, 2006.

5. The Company has as a strategic decision considered entering into the print media. In this regard, it has acquired some stake in Mail Today Newspapers Private Limited (Mail Today), a differentiated newspaper with respect to content as well as value to its advertisers. Based on the valuation of the equity shares of Mail Today, carried out by an independent value, the Company acquired some stake through direct subscription and also through purchase from existing shareholders amounting to Rs. 455,212,482. Though, Mail Today is in the initial stages of operations and is presently incurring losses, the Company, based on independent projections, is confident of the future profitability of Mail Today and consequently of the carrying value of the investment.

6. Previous Year Figures

The financial statements for the year ended March 31, 2011 had been prepared as per the then applicable, pre-revised Schedule VI to the Companies Act, 1956. Consequent to the notification of Revised Schedule VI under the Companies Act, 1956, the financial statements for the year ended March 31, 2012 are prepared as per Revised Schedule VI. Accordingly, the previous year figures have also been reclassified to conform to this year's classification. The adoption of Revised Schedule VI for previous year figures does not impact recognition and measurement principles followed for preparation of financial statements.-


Mar 31, 2011

1. Capital Commitments / Contingent Liabilities:

(a) Estimated amounts of contract remaining to be executed on capital account, net of advances, not provided for Rs. 299,551,612 (Previous year Rs. 235,817,263)

(b) The Company received claims from Prasar Bharti in earlier years towards uplinking charges and telecast fees which were disputed by the Company. Prasar Bharti also raised claims towards interest for non payment of dues from time to time, which also were disputed by the Company. Total ciaims as at 31st March 2011 amounted to Rs. 100,197,555 and the disputes were referred to various legal forums. Pending final outcome in respect of such disputes, the Company made provision on an estimated basis which amounted to Rs.67,484,026 including Rs. 1,953,157 which was made in current year, in the opinion of the management, based on its understanding of the cases and as advised by their counsel, the provision made in the books is considered adequate.

(c) The Company has received legal notice of claim / lawsuit filed against it in respect of programmes aired on the Channels, in the opinion of the management, no liability is likely to arise on account of such claim / lawsuit.

(d) The Company has received demand notices from Income Tax department amounting to Rs. 87,411,396 (Previous Year54,995,989). The Company has contested the same and in the opinion of the management, no liability is likely to arise on account of such demand notices.

(e) Bank Guarantees outstanding Rs. 28,554,699 (Previous Year Rs. 8,714,420)

2. During the year, the Company has recognised the following amounts in the Profit and Loss Account

II. Defined Benefit Plans

The expected return on plan assets is based on actuariai expectation of average long term rate of return expected on investment of the funds during the estimated term of the obligation.

3. EMPLOYEE STOCK OPTION PLAN - ESOP 2006

The Company instituted the Employee Stock Option Plan - (TVTN ESOP 2006), to grant equity - based incentives to its eligible employees. The TVTN ESOP 2006 had been approved by the board of directors in their meeting held on 21st August 2006 and by shareholders in their meeting held on 28th September 2006, for grant of 2,900,000 options representing one share for each option upon exercise by the employees of the Company at a exercise price determined by Board/Remuneration Committee. The equity shares covered under the scheme shall vest over a period of four years; vesting shall vary based on the meeting of the performance Criteria. The Optionee may exercise their vested options at any moment after the earliest applicable vesting date and prior to the completion of ten years from the grant date.

Accordingly the Company under the intrinsic value method has recognized the excess of the market price over the exercise price of the option amounting to Rs. 1,556,816 as an expense during the year. Further, the liability Outstanding as at the March 31, 2011 in respect of Employees Stock Options Outstanding is Rs. 8,692,500. The balance deferred compensation expense Rs. 3,141,557 will be amortized over the remaining vesting period of Options.

4. As identified and certified by the Company, Related Party Disclosures as per the requirement of Accounting Standard 18 issued by the Institute of Chartered Accountants of India:

(I). Name of the related party and nature of related party relationship where control exists:

(a) Key Management Personnel (KMP):

- Mr. Aroon Purie (Managing Director)

- Ms. Koel Purie Rinchet (Whole Time Director)

(b) Entities Controlling the Company (Holding Companies):

- World Media Private Limited ^

- Living Media India Limited

(c) Subsidiary Companies :

- T.V. Today Network (Business) Limited

(d) Fellow Subsidiary Companies :

- Thomson Press (India) Ltd,

- Living Media International Ltd.

- Radio Today Broadcasting Limited

- Mail Today News Papers Ltd.

(e) Companies under common control:

- Integrated Databases India Limited

^ There are no transactions during the year

5. Segment Reporting:

The Company has considered business segment as the primary segment for disclosure. The products included in each of the reported domestic business segments are as follows:

- TV Broadcasting

- Radio Business

The above business segments have been identified considering :

- the nature of services

- the differing risks and return

- the organizations structure and

- the internal financial reporting systems

6. Operating Leases

The Company has cancelable lease arrangements mainly for leasing of office premises and Company leased accommodations for its employees. Terms of lease include terms of renewal, increase in rents in future periods and terms of cancellation. The operating lease payments recognized in the Profit & Loss account amount to Rs. 125,811,031 (Previous Year Rs. 115 313 260) net of sublease rental received Rs. 6,637,955 (Previous Year Rs. 5,290,142).

7. The Company has as a strategic decision considered entering into the print media. In this regard, it has acquired some stake in Mail Today Newspapers Private Limited (Mail Today), a differentiated newspaper with respect to content as well as value to its advertisers. Based on the valuation of the equity shares of Mail Today, carried out by an independent valuer the Company, the acquired some stake through direct subscription and also through purchase from existing shareholders amounting to Rs. 45.5 crores. Though, Mail Today is in the initial stages of operations and presently is incurring losses, the Company based on independent projections, is confident of the future profitability of Mail Today and consequently of the carrvina value of the Investment.

8. Based on information available with the Company, there are no outstanding dues to Micro and Small enterprises as at March 31,2011, No interest is paid/payable by the Company in terms of-section 16 of the Micro, Small and Medium Enterprises Development Act, 2006.

9. The figures for the previous year have been regrouped/ rearranged wherever considered necessary to conform to the current year's classification..


Mar 31, 2010

1. Capital Commitments/Contingent Liabilities:

(a) Estimated amounts of contract remaining to be executed on capital account, net of advances, not provided for Rs 235,817,263 (Previous year Rs. 208,699,397)

(b) The Company had received some claims from Prasar Bharti in earlier years towards uplinking charges and telecast fees which were disputed by the Company. Prasar Bharti also raised claims towards interest for non payment of dues from time to time, which also were disputed by the Company. Total claims as at 31st March 2010 amounted to Rs.97,905,479 and the disputes were referred to various legal forums. Pending final outcome in respect of such disputes, the Company made provision on an estimated basis which amounted to Rs.65, 530,869 including Rs. 25,330,260 which was made in current year. In the opinion of the management, based on its understanding of the cases and as advised by their counsel, the provision made in the books is considered adequate.

(c) The Company has received legal notice of claim / lawsuit filed against it in respect of programmes aired on the Channels. In the opinion of the management, no liability is likely to arise on account of such claim / lawsuit.

(d) The Company has received demand notices from Income Tax department amounting to Rs. 54,995,989 (Previous Year 21,011,432). The Company has contested the same and in the opinion of the management, no liability is likely to arise on account of such demand notices.

2. Particulars of Managerial Remuneration

(a) The remuneration paid to the managerial personnel during the year aggregates to:

3. Employee Stock Option Plan - ESOP 2006

The Company instituted the Employee Stock Option Plan - (TVTN ESOP 2006), to grant equity - based incentives to its eligible employees. The TVTN ESOP 2006 had been approved by the board of directors in their meeting held on 21st August 2006 and by shareholders in their meeting held on 28th September 2006, for grant of 2,900,000 options representing one share for each option upon exercise by the employees of the Company at a exercise price determined by Board/Remuneration Committee. The equity shares covered under the scheme shall vest over a period of four years; vesting shall vary based on the meeting of the performance Criteria. The Optionee may exercise their vested options at any moment after the earliest applicable vesting date and prior to the completion of ten years from the grant date.

Accordingly the Company under the intrinsic value method has recognized the excess of the market price over the exercise price of the option amounting to Rs. 1,189,303 as an expense during the year. Further, the liability Outstanding as at the March 31, 2010 in respect of Employees Stock Options Outstanding is Rs. 5,077,500. The balance deferred compensation expense Rs. 948,373 will be amortized over the remaining vesting period of Options.

4. As identified and certified by the Company, Related Party Disclosures as per the requirement of Accounting Standard 18 issued by the Institute of Chartered Accountants of India:

(I). Name of the related party and nature of related party relationship where control exists:

(a) Key Management Personnel (KMP):

- Mr. Aroon Purie (Managing Director)

(b) Entities Controlling the Company (Holding Companies):

- World Media Private Limited ^

- Living Media India Limited

(c) Subsidiary Companies :

- T.V. Today Network (Business) Limited

(d) Fellow Subsidiary Companies :

- Thomson Press (India) Ltd.

- Living Media International Ltd.

- Radio Today Broadcasting Limited

- Mail Today News Papers Ltd.

(e) Companies under common control:

- Integrated Databases India Limited ^

(f) Others:

- Vasant Valley School

^ there are no transactions during the year

The Company has considered business segment as the primary segment for disclosure. The products included in each of the reported domestic business segments are as follows:

- TV Broadcasting

- Radio Business

The above business segments have been identified considering :

- the nature of services

- the differing risks and return

- the organizations structure and

- the internal financial reporting systems

The Company was operating under a single segment in the previous year ended March 31, 2009

5. Operating Leases

The Company has cancelable lease arrangements mainly for leasing of office premises and Company leased accommodations for its employees. Terms of lease include terms of renewal, increase in rents in future periods and terms of cancellation. The operating lease payments recognized in the Profit & Loss account amount to Rs. 115,313,260 (Previous Year: Rs. 60,702,890), net of sublease rental received Rs. 5,290,142 (Previous Year Rs. 4,494,528).

6. The Company has as a strategic decision considered entering into the print media. In this regard it has decided to acquire some stake in Mail Today Newspapers Private Limited (Mail Today), a differentiated newspaper with respect to content as well as value to its advertisers. Based on the valuation of the equity shares of Mail Today, carried out by an independent valuer, the Company has decided to acquire some stake through direct subscription and also through purchase from existing shareholders. Total commitment on this count is Rs.45.50 crores out of which as at 31st March 2010, the Company has paid Rs.18.50 crores towards advance payment for purchase of equity shares which is disclosed as Advance towards Share Subscription under Loans & Advances. Though, Mail Today is in the initial stages of operations and presently is incurring losses, the Company, based on projections, is confident of the future profitability of Mail Today and consequently of the carrying value of the advance against equity.

7. Pursuant to the Composite Scheme of Arrangement, under the provisions of the Companies Act, 1956 (The Scheme), approved by the shareholders, sanctioned by the Honble High Court at Delhi and the Ministry of Information and Broadcasting on November 21,2009, February 24,2010 and May 20, 2010 respectively, the undertaking of the radio broadcasting business of Radio Today Broadcasting Limited, a company engaged in the radio broadcasting and trading business (the Transferor Company), was transferred to and vested in the Company (the Transferee Company) with effect from 1 st April 2009 (Appointed Date). The Scheme, a copy of which was filed with the Registrar of Companies subsequent to the year end on 13th April, 2010, is an amalgamation in the nature of merger and has been given effect to in these accounts under pooling of interest method.

In accordance with The Scheme, the Company will issue 1,655,999 equity shares of Rs.5 each as fully paid up to the equity shareholders of Radio Today Broadcasting Limited, in the ratio of 1 equity share of Rs 5 each fully paid up of the Company for every 6 equity shares of the face value of Rs 10 each fully paid up, held in Radio Today Broadcasting Limited towards consideration for the aforesaid transfer and vesting of radio business, which will be credited in its books at face value, pending issuance of the shares as at the year- end, the face value of Rs 8,279,995 has been credited to Share Capital Suspense.

In accordance with The Scheme, all assets and liabilities pertaining to the radio broadcasting business of the Transferor Company, as on the appointed date, have been incorporated in the books of the Company at book value and the excess of the Share Capital Suspense over the book value of net assets acquired, amounting to Rs 423,622,791, has been adjusted against Securities Premium Account of the Company. The unamortized license fees pertaining to the Transferor Company and transferred to the Company pursuant to the Scheme, amounting to Rs, 244,229,509 has also been adjusted against the Securities Premium Account. Further, the Company has determined the deferred tax assets, amounting to Rs 249,529,332, based on the assets and liabilities of the radio broadcasting business which has been adjusted with the General Reserve Account.

The accounting treatment in respect of excess of Share Capital Suspense over the book value of net assets acquired and unamortized license fee are different from that prescribed by the Accounting Standard (AS) 14, Accounting for Amalgamations, notified under Section 211 (3C) of the Companies Act, 1956 with respect to Amalgamation in the nature of Merger. AS 14 requires the difference between the amount recorded as share capital and the amount of share capital of the transferor company to be adjusted against reserve.

The difference in accounting treatment as above, in compliance with the High Court Order, is as permitted by paragraph 42 of the AS - 14. As the said paragraph 42 of AS - 14 requires disclosure of the impact of the amalgamation on all accounts, had the accounting treatment as per AS - 14 been followed, this is given below for information.

Had the accounting treatment prescribed in AS 14 been followed, amortisation of intangible assets would have been higher by Rs 27,990,000 with its consequential impact on the profit of the Company, General Reserve would have lower by Rs 423,622,791, Unamortized License Fees would have been higher by Rs.216,239,509 and Share Premium Account would have been higher by Rs. 667,852,300.

8. The company has bought back and extinguished 203,752 equity shares during the year, under its buy back scheme which commenced on March 16, 2009 ended on July 13, 2009.

9. As per the information available with the Company, during the year, there have been no transactions with the enterprises covered under the Micro, Small & Medium Enterprises Development Act, 2006.

10. The figures for the previous year have been regrouped / rearranged wherever considered necessary to conform to the current years classification. Figures for the current year include those of the radio business of the erstwhile Radio Today Broadcasting Limited (Refer note 13 above). Accordingly, the current year figures are not comparable to those of the previous year.

Note: 2

Figures in brackets indicate cash outflow Note: 3

Note: 3

The above Cash flow statement has been prepared under the indirect method setout in AS- 3 (Cash Flow Statements), notified under section 211(3C) of the Companies Act, 1956 Note : 4

Note: 4

Movement in balances have been adjusted for Net Assets acquired on amalgamation. (Refer Note 13 on Schedule Q)

This is the Cash Flow Statement referred to in our report of even date. The notes referred to above forms an integral part of the Cash Flow statement

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