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Notes to Accounts of Zee Media Corporation Ltd.

Mar 31, 2017

1. Critical accounting judgment and estimates

The preparation of financial statements requires management to exercise judgment in applying the Company''s accounting policies. It also requires the use of estimates and assumptions that affect the reported amounts of assets, liabilities, income and expenses and the accompanying disclosures including disclosure of contingent liabilities . Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis, with revisions recognized in the period in which the estimates are revised and in any future periods affected.

a Contingencies

In the normal course of business, contingent liabilities may arise from litigation and other claims against the Company. Potential liabilities that have a low probability of crystallizing or are very difficult to quantify reliably, are treated as contingent liabilities. Such liabilities are disclosed in the notes but are not provided for in the financial statements. There can be no assurance regarding the final outcome of these legal proceedings.

b Useful lives and residual values

The Company reviews the useful lives and residual values of property, plant and equipment, investment property and intangible assets at each financial year end.

c Impairment testing

(i) Judgment is also required in evaluating the likelihood of collection of customer debt after revenue has been recognized. This evaluation requires estimates to be made, including the level of provision to be made for amounts with uncertain recovery profiles. Provisions are based on historical trends in the percentage of debts which are not recovered, or on more detailed reviews of individually significant balances.

(ii) Determining whether the carrying amount of these assets has any indication of impairment also requires judgment. If an indication of impairment is identified, further judgment is required to assess whether the carrying amount can be supported by the net present value of future cash flows forecast to be derived from the asset. This forecast involves cash flow projections and selecting the appropriate discount rate.

d Tax

(i) The Company''s tax charge is the sum of the total current and deferred tax charges. The calculation of the Company''s total tax charge necessarily involves a degree of estimation and judgment in respect of certain items whose tax treatment cannot be finally determined until resolution has been reached with the relevant tax authority or, as appropriate, through a formal legal process.

(ii) Accruals for tax contingencies require management to make judgments and estimates in relation to tax audit issues and exposures.

(iii) The recognition of deferred tax assets is based upon whether it is more likely than not that sufficient and suitable taxable profits will be available in the future against which the reversal of temporary differences can be deducted. Where the temporary differences are related to losses, the availability of the losses to offset against forecast taxable profits is also considered. Recognition therefore involves judgment regarding the future financial performance of the particular legal entity or tax Company in which the deferred tax asset has been recognized.

e Fair value measurement

A number of company''s accounting policies and disclosures require the measurement of fair values, for both financial and non- financial assets and liabilities. When measuring the fair value of an asset or a liability, the Company uses observable market data as far as possible. Fair values are categorized into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

-Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

-Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability either directly (i.e. prices) or indirectly (i.e. derived from prices).

-Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

If the inputs used to measure the fair value of an asset or a liability fall into different levels of a fair value hierarchy then the fair value measurement is categorized in its entirely in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

The Company recognizes transfers between levels of the fair value hierarchy at the end of reporting year during which the change has occurred.

f Television programs

The Company has several types of programming inventory: news current affairs and regional language. The key area of accounting for inventory requiring judgment is the assessment of the appropriate nature over which to programming inventory should be amortized. The key factors considered by the Company are as follows:

a) News / current affairs / chat shows / events etc. are fully expensed on telecast since such programs do not have repeat value. This treatment best represents our estimate of the benefits received from the acquired rights.

b) The programs (other than (a) above) are amortized over a period of three financial years over which revenue is expected to be generated from exploitation of programs.

g Defined benefit obligation

The costs of providing pensions and other post-employment benefits are charged to the statement of profit and loss in accordance with Ind AS 19 ''Employee benefits'' over the period during which benefit is derived from the employees'' services. The costs are assessed on the basis of assumptions selected by the management. These assumptions include salary escalation rate, discount rates, expected rate of return on assets and mortality rates. The same is disclosed in note 53.

2. Standards issued but not yet effective

In March 2017, the Ministry of Corporate Affairs issued the Companies (Indian Accounting Standards) (Amendments) Rules, 2017, notifying amendments to Ind AS 7, ''Statement of cash flows'' and Ind AS 102, ''Share-based payment.'' These amendments are in accordance with the recent amendments made by International Accounting Standards Board (IASB) to IAS 7, ''Statement of cash flows'' and IFRS 2, ''Share-based payment,'' respectively. The amendments are applicable to the Company from 1 April 2017.

Amendment to Ind AS 7:

The amendment to Ind AS 7 requires the entities to provide disclosures that enable users of financial statements to evaluate changes in liabilities arising from financing activities, including both changes arising from cash flows and noncash changes, suggesting inclusion of a reconciliation between the opening and closing balances in the balance sheet for liabilities arising from financing activities, to meet the disclosure requirement. The Company is evaluating the requirements of the amendment and the effect on the financial statements is being evaluated.

Amendment to Ind AS 102:

The amendment to Ind AS 102 provides specific guidance to measurement of cash-settled awards, modification of cash-settled awards and awards that include a net settlement feature in respect of withholding taxes. It clarifies that the fair value of cash-settled awards is determined on a basis consistent with that used for equity-settled awards. Market-based performance conditions and non-vesting conditions are reflected in the ''fair values'', but non-market performance conditions and service vesting conditions are reflected in the estimate of the number of awards expected to vest. Also, the amendment clarifies that if the terms and conditions of a cash-settled share-based payment transaction are modified with the result that it becomes an equity-settled share-based payment transaction, the transaction is accounted for as such from the date of the modification. Further, the amendment requires the award that include a net settlement feature in respect of withholding taxes to be treated as equity-settled in its entirety. The cash payment to the tax authority is treated as if it was part of an equity settlement. The Company is evaluating the requirements of the amendment and the impact on the financial statements is being evaluated.

* Refer note 43

(ii) Terms / rights attached to equity shares

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

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

As per the records of the Company, including its register of shareholders/ members and other declaration received from shareholders regarding beneficial interest, the above shareholding represents both legal and beneficial ownership of shares.

(v) The Company has instituted an Employee Stock Option Plan (ZNL ESOP 2009) as approved by the Board of Directors and Shareholders of the Company in 2009 and amended from time to time for issuance of stock options convertible into equity shares not exceeding in the aggregate 5% of the issued and paid up capital of the Company as at 31 March 2009 i.e. up to

1 1,988,000 equity shares of ''1 each, to the employees of the Company as well as that of its subsidiaries and also to the directors (excluding an independent director) of the Company at the market price determined as per the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014. The said Scheme is administered by the Nomination and Remuneration Committee of the Board. The Company has not granted any options till 31 March 2017.

# Income tax demands mainly include appeals filed by the Company before various appellate authorities against the disallowance of expenses / claims, non-deduction / short deduction of tax at source etc. The management is of the opinion that its tax cases will be decided in its favour and hence no provision is considered necessary at this stage.

A The amount represents the best possible estimate arrived at on the basis of available information. The Group has engaged reputed advocates to protect its interest and has been advised that it has strong legal position against such disputes.

* The Company has received legal notices of claims / law suits filed against it relating to infringement of copy rights, defamation suits etc. in relation to programs telecasted / other matters. In the opinion of the management, no material liability is likely to arise on account of such claims / law suits.

3. Managerial remuneration

(a) Remuneration paid or provided in accordance with Section 197 of the Companies Act, 2013 to Executive director and CEO/ COO, included in note 27 "Employee benefits expense" is as under :

Note: Salary and allowances include basic salary, house rent allowance, leave travel allowance and performance bonus but excluding leave encashment and gratuity provided on the basis of actuarial valuation.

# Mr. Rajiv Singh, Excecutive Director and COO from 09 September 2016.

# Mr. Jagdish Chandra, Excecutive Director - Regional News Channels from 03 February 2017.

* Mr. Rajendra Kumar Arora, Executive Director and CEO from 24 May 2016 to 30 August 2016.

* Mr. Ashish Kripal Pandit, Executive Director and CEO from 01 June 2015 to 12 October 2015.

(b) Commission payable to Non-executive directors of ''1.66 million (''1.42 million) based on profits for the year is included in Miscellaneous expenses under note 30 "Other expenses".

(c) Sitting fees paid to Non-executive directors of ''1.58 million (''1.10 million) is included in Miscellaneous expenses under note 30 "Other expenses".

4. These standalone financial statements of the Company for the year ended 31 March 2017, were authorized for issue by the Audit Committee and the Board of Directors at their respective meeting held on 24 May 2017.

5. Micro, small and medium enterprises

The Company has no dues to Micro, Small and Medium enterprises during the year ended 31 March 2017, on the basis of information provided by the parties and available on record. Further, there is no interest paid/payable to Micro, Small and Medium enterprises.

Note : All the loans are short term in nature given for general business purpose, and carry interest 012.50% per annum.

(b) Investments made

There are no investments made during the year except those mentioned in note 9 in the financial statements.

(c) Guarantees given

The Company has provided guarantees aggregating to ''2500 million for redeemable non convertible debentures issued (2016: ''2,500.00 million) by its wholly owned subsidiary viz. Pri-Media Services Private Limited and ''200 million (2016: ''200 million) for loans raised by it''s indirect subsidiary namely Diligent Media Corporation Limited.

(d) Securities given

There are no securities given during the year.

6.During the year, the Company has made political contribution of Nil (2016: ''1.00 million) to Rashtriya Janta Dal.

7.The Management is of the opinion that its international and domestic transactions are at arm''s length as per the independent accountants report for the year ended 31 March 2016. The Management continues to believe that its international transactions and the specified domestic transactions during the current financial year are at arm''s length and that the transfer pricing legislation will not have any impact on these financial statements, particularly on amount of tax expense and that of provision of taxation.

The Rights Issue expenses ofRs,5.47 million andRs,25.19 million incurred during the year ended 31 March 2016 and upto 31 March 2015 are adjusted against Equity Share Capital.

8. Scheme of Arrangement and Amalgamation

At the meeting held on 27 October 2016, the Board of Directors of the Company had approved a Scheme of Arrangement and Amalgamation between the Company Diligent Media Corporation Limited (DMCL), Mediavest India Pvt Ltd (Mediavest), Pri-Media Services Pvt Ltd (''Pri-Media''), Maurya TV Private Limited (''Maurya'') and their respective shareholders and creditors inter alia for (a) demerger of Print Media business of the Company in to DMCL; (b) consolidation of Print Media business under DMCL by way of merger of Mediavest and Pri-Media with DMCL; and (c) Merger of Maurya with the Company, with effect from Appointed Date of 1 April 2017. Subsequent to receipt of No-objection of the Stock Exchanges to the Scheme and approval of the Shareholders of the Company at the Meeting held on 27 March 2017. Petition(s) have been filed with Mumbai Bench of Hon''ble National Company Law Tribunal seeking its final approval to the Scheme. No effect of the Scheme has been given in these financial statements as the Appointed Date for the Scheme is 1 April 2017.

9. During the year ended 31 March 2017, the Board had approved acquisition of initial 49% Equity stake in the Radio Broadcasting business of Reliance Broadcast Network Limited (RBNL). The said proposal is awaiting approval from Ministry of Information and Broadcasting.

10. During the year ended 31 March 2017, the Company has acquired 49% equity stake in Today Merchandise Pvt Ltd (TMPL) and Today Retail Network Pvt Ltd (TRNPL), both engaged in E-commerce business.

11. Disclosures as required by Schedule V (A) (2) of the SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015

(a) Loans and advances given to Subsidiary (Loanee):

12. As per Section 135 of the Companies Act, 2013, a CSR Committee has been formed by the Company. The Company is required to spend ''3.37 million for the year against which ''3.37 million has been spent on activities specified in Schedule VII of the Companies Act, 2013.

13. Segment reporting

The Company is engaged in the business of broadcasting of satellite television channels which in the context of IND AS 108 "Operating Segment " is considered as the only reportable operating segment.

14. No dividend on equity shares is approved by the Board of Directors for the year ended 31 March 2017. Dividend paid on equity shares for the year ended 31 March 2016 is ''0.15 per equity share which aggregates to ''70.62 million excluding dividend distribution tax of ''14.37 million.

15. Financial instruments

a) Financial risk management objective and policies

The Company''s principal financial liabilities, comprise loans and borrowings, trade and other payables. The main purpose of these financial liabilities is to finance the Company''s operations. The Company''s principal financial assets include investments, trade and other receivables, and cash and cash equivalents that derive directly from its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The Company''s management oversees the management of these risks.

i) Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, foreign currency risk and other price risk such as equity price risk. Financial instruments affected by market risk include loans and borrowings, deposits, other financial instruments.

1) Interest rate risk

Interest rate risk can be either fair value interest rate risk or cash flow interest rate risk. Fair value interest rate risk is the risk of changes in fair value of fixed interest bearing investments because of fluctuations in the interest rates. Cash flow interest rate risk is the risk that the future cash flows of floating interest bearing investments will vary because of fluctuations in the interest rates.

The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s term loan from bank. Vehicle loans carries fixed coupon rate and hence not considered for calculation of interest rate sensitivity of the Company.

Interest rate sensitivity analysis

The sensitivity analysis below demonstrates the sensitivity to a reasonably possible change in interest rates on that portion of loans and borrowings affected. With all other variables held constant, the Company''s profit before tax is affected through the impact of change in interest rate of borrowings, as follows:

If interest rates had been 50 basis points higher or lower and all other variables were held constant, the Company''s profit before tax for the year ended 31 March, 2017 would decrease/increase byRs,3.46 million (2016:Rs,3.91 million).

2) Foreign currency risk

The Company enters into transactions in currency other than its functional currency and is therefore exposed to foreign currency risk. The Company analyses currency risk as to which balances outstanding in currency other than the functional currency of that Company. The management has taken a position not to hedge this currency risk.

The Company undertakes transactions denominated in foreign currencies; consequently, exposures to exchange rate fluctuations arise. Exchange rate exposures are not hedged considering the insignificant impact and period involved on such exposure.

Foreign currency sensitivity analysis

The following table demonstrates the sensitivity to a 10% increase / decrease in foreign currencies with all other variable held constant. The below impact on the Company''s profit before tax is based on changes in the fair value of unhedged foreign currency monetary assets and liabilities at balance sheet date.

3) Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company''s receivables from customers, deposits and loans given, investments and balances at bank.

The Company measures the expected credit loss of trade receivables based on historical trend, industry practices and the business environment in which the entity operates. Expected Credit Loss is based on actual credit loss experienced and past trends based on the historical data.

Credit risk on cash and cash equivalents is limited as the Company generally invest in deposits with banks and financial institutions with high credit ratings assigned by credit rating agencies. Investments primarily include investment in non convertible debentures, certificates of deposit and other debt instruments.

The following table gives details in respect of percentage of revenues generated from top 10 customers :

ii) Liquidity risk

Liquidity risk refers to the risk that the Company cannot meet its financial obligations. The Company''s principal source of liquidity are cash and cash equivalents and the cash flow i.e. generated from operations. The Company consistently generated strong cash flows from operations which together with the available cash and cash equivalents and current investment provides adequate liquidity in short terms as well in the long term.

* Current maturities of borrowings aggregatingRs,179.85 million form part of other financial liabilities hence the same is not considered separately in borrowings.

* Current maturities of borrowings aggregatingRs,113.19 million form part of other financial liabilities hence the same is not considered separately in borrowings.

* Current maturities of borrowings aggregatingRs,84.77 million form part of other financial liabilities hence the same is not considered separately in borrowings.

b) Capital management

For the purpose of the Company'' s capital management, capital includes issued capital and all other equity reserves. The Company manages its capital structure to ensure that it will be able to continue as a going concern while maximizing the return to the stakeholders.

For the purpose of the Company''s capital management, equity includes issued capital, securities premium and other reserves. Net debt includes loans less cash and bank balances. The Company manages capital by monitoring gearing ratio which is net debt divided by equity plus net debt.

# representsRs,50

* Other financial liabilities includes current maturities of long term borrowings.

The management assessed that cash and cash equivalents and bank balances, trade receivables, other financial assets, certain investments, trade payables and other current liabilities approximate their fair value largely due to the short-term maturities of these instruments. Difference between carrying amount and fair value of bank deposits, other financial assets, other financial liabilities and borrowings subsequently measured at amortized cost is not significant in each of the year presented.

d) Fair value hierarchy

All financial assets and liabilities at amortized cost are in Level 3 of fair value hierarchy and have been considered at carrying amount.

Other financial instruments measured at fair value through other comprehensive income and included in Level 3 categories have not been determined considering insignificant value.

16. Employee benefits

The disclosure as per Ind AS 19 - Employee Benefits is as follows:

a) Defined contribution plan:

"Contribution to provident and other funds" is recognized as an expense in note 27 "Employee benefit expenses" of the statement of profit and loss.

b) Defined benefit plans

The present value of gratuity obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave benefits (non funded) is also recognized using the projected unit credit method.

VII. Sensitivity analysis

The key actuarial assumptions to which the benefit obligation results are particularly sensitive to are discount rate and future salary escalation rate. The following table summarizes the impact in percentage terms on the reported defined benefit obligation at the end of the reporting period arising on account of an increase or decrease in the reported assumption by 100 basis points

Notes:

(a) The current service cost recognized as an expenses included in the note 27 ''Employee benefits expense'' as gratuity. The remeasurement of the net defined benefit liability is included in other comprehensive income.

(b) The estimates of rate of escalation in salary considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is certified by the Actuary.

(c) Significant actuarial assumptions for the determination of the defined obligation are discount rate, expected salary increase and mortality. The sensitivity analyses above have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant.

c) Other long term benefits

The obligation for leave benefits (non funded) is also recognized using the projected unit credit method and accordingly the long term paid absences have been valued. The leave encashment expense is included in the note 27 "Employee benefit expenses".

17. First time Adoption of Ind AS

For all periods up to and including the year ended 31 March 2016, the Company had prepared its financial statements in accordance with the Accounting Standards notified under Section 133 of the Companies Act, 2013, read together with Rule 7 of the Companies (Accounts) Rules, 2014 (Previous GAAP). This note explains the principal adjustments made by the Company in restating its financial statements prepared under Previous GAAP.

a) Exceptions and exemptions availed on first time adoption of Ind AS 101

(i) Investment in Subsidiary and Associates

The Company has elected to adopt the carrying value under previous GAAP as on the date of transition i.e. 1 April 2015 in its separate financial statements.

(ii) Business combinations

The Company has elected to apply Ind AS 103 Business Combinations prospectively from 1 April 2015.

(iii) Classification and measurement of financial assets

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

(iv) 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. Accordingly the Company has elected to apply the de-recognition provisions of Ind AS 109 prospectively from the date of transition to Ind AS.

(v) 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

b) Reconciliations between Previous GAAP and Ind AS

The following reconciliations provides the effect of transition to Ind AS from IGAAP in accordance with Ind AS 101

(i) Effect on the balance sheet

(ii) Effect on the statement of profit and loss and other comprehensive income

(iii) Reconciliation of total equity

(iv) Reconciliation of total comprehensive income

(v) Effect on the statement of cash flows

Explanations for reconciliation of balance sheet and statement of profit and loss and other comprehensive income as previously reported under IGAAP to Ind AS a) Deposits

Under Previous GAAP, the Company accounted for deposits received / given at transaction value. Under Ind AS, the deposits with inherent significant financing element are initially recorded at fair value with the difference between transaction value and fair value being treated as prepaid expenses.

b) Borrowings

Under Previous GAAP, transaction costs incurred in connection with borrowings were charged to statement of profit and loss. Under Ind AS, borrowings are recorded initially at fair value less transaction costs and are subsequently measured at amortized cost as per the Effective Interest Rate (EIR) method.

c) Dividend

Under previous GAAP, the Company had recognized liability on account of dividend proposed by the Board of directors pending approval from the shareholders. Under Ind AS, such dividends are recognized when the same is approved by the shareholders in the annual general meeting.

d) Property, plant and equipment

The Company elected to apply Ind AS 16 from the date of acquisition of Property , plant and equipment and the impact thereon has been taken into retained earnings.

e) Depreciation and amortization

Under Ind AS, the Company has elected to apply Ind AS 16-Property, plant and equipment from the date of acquisition of property, plant and equipment and accordingly depreciation has been retrospectively calculated and the resultant change has been adjusted in retained earnings.

f) Defined benefit obligations

As per Ind AS-19 Employee Benefits, actuarial gains and losses are recognized in other comprehensive income and not reclassified to Statement of profit and loss in a subsequent period.

g) Tax adjustments

Tax adjustments include deferred tax impact on account of differences between Previous GAAP and Ind-AS.

h) Share application money

Share application money pending allotment is considered into other equity.

i) Right issue expenses

Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax. j) Financial guarantee fees

The company has given corporate guarantee to banks/financial institutions for financing facilities sanctioned to subsidiaries. The Company has recognized the financial guarantee fees on such guarantees provided and the same is treated as investment in subsidiaries.

k) Capital work-in-progress

In Previous GAAP, CWIP included intangible assets under development, which in Ind-AS are reclassified to Intangible Assets under development.

l) Investment property under development

In Previous GAAP, Investment Property under development was included other current assets, which in Ind-AS is reclassified to Investment Property under development.

18. Related party transactions List of parties where control exists:-Direct Subsidiary :

- Zee Akaash News Private Limited (extent of holding 60%),

- Mediavest India Private Limited (extent of holding 100%)

- Pri - Media Services Private Limited (extent of holding 100%)

- Maurya TV Private Limited (extent of holding 100% )

Indirect Subsidiary :

- Diligent Media Corporation Limited (Mediavest India Private Limited holds 100% w.e.f. 02 November 2016)

(89,095,342 equity shares held out of a total of 89,095,542 equity shares ofRs,10 each upto 01 November 2016)

Associates :

- Today Merchandise Private Limited (extent of holding 49% w.e.f. 01 October, 2016)

- Today Retail Network Private Limited (extent of holding 49% w.e.f. 01 October, 2016)

Other related parties with whom transactions have taken place during the year and balance outstanding as on the last day of the year

ATL Media Limited, Cyquator Media Services Private Limited, Dish TV India Limited, Digital Subscriber Management and Consultancy Services Private Limited, Dr. Subhash Chandra Foundation, Essel Business Excellence Services Limited, Essel Corporate Resources Private Limited, Essel Vision Productions Limited, Essel Finance VKC Forex Limited, Planetcast Media Services Limited (formerly known as Essel Shyam Communication Limited), Jay Properties Private Limited, India Webportal Private Limited, Pan India Network Limited, Siti Networks Limited, Smart Wireless Private Limited, Taj Television (India) Private Limited, Zee Entertainment Enterprises Limited, Zee Foundation, Zee Learn Limited, Zee Turner Limited, Zee Digital Convergance Limited and Zee Unimedia Limited.

Key management personnel Directors

Dr. Subhash Chandra (Non-Executive Chairman upto 23 May 2016) Shri. Rajendra Kumar Arora (Executive Director and CEO of the Company from 24 May 2016 to 30 August 2016), Shri. Rajiv Singh (Excecutive Director and COO w.e.f. 09 September 2016), Shri Jagdeesh Chandra (Excecutive Director - Regional News Channels w.e.f. 03 February 2017) and Shri Ashish Kripal Pandit (Excecutive Director and CEO from 01 June 2015 to 12 October 2015).

"0.00" denotes less thanRs,10,000

* includes expense capitalized

Note:

(a) Parties with transaction less than 10% of the group total are grouped under the head "Other Related Parties".

(b) Salaries, allowances and perquisites paid to key managerial personnel for the year excludes leave encashment and gratuity provided on the basis of actuarial valuation on an overall Company basis. Allowances and perquisites are valued as per the Income Tax Act, 1961.

19. Previous year comparatives

Previous year''s figures have been regrouped, rearranged or recast wherever necessary to conform to current year''s classification. Figures in brackets pertain to previous year.


Mar 31, 2016

Note:

a. Effective 1 April 2015, the Company has changed its method of accounting in respect of expenses incurred on development of new television channels till the time it is ready for commercial launch as Intangible assets, as permitted under AS 26, instead of charging it to Statement of Profit and Loss. Accordingly, Rs, 18.67 million of development expenditure has been capitalized during the period. Had the Company continued to use the earlier method of accounting, the profit after tax for the current period would have been lower by Rs, 12.21 million.

b. With effect from 1 April, 2014, the Company has revised the useful life of some of its fixed assets to comply with the useful life as prescribed by Schedule II to the Companies Act, 2013. The carrying amount of the asset as on the date, (i.e., 1 April, 2014) has to be depreciated over the remaining prescribed useful life of the asset. Consequently, the depreciation charge of Rs, 54.78 million representing the written down value of fixed assets whose lives have expired as at 1 April, 2014 and deferred tax thereon of Rs, 18.62 million have been adjusted in surplus in the Statement of Profit and Loss. Previous year depreciation on tangible and intangible assets includes this depreciation of Rs, 54.78 million and Rs, 0 million (Rs, 2,662) respectively.

Note:

a) Each debenture is compulsorily convertible on or before seven years from the date of allotment at the option of the debenture holder at the fair value of the equity shares at the time of conversion.

b) Each debenture is compulsorily convertible on or before five years from the date of allotment at the option of the debenture holder at the fair value of the equity shares at the time of conversion.

c) Each debenture is compulsorily convertible on or before five years from the date of allotment at the option of the debenture holder at a conversion ratio of one equity share of Rs, 10 each for every Compulsorily Convertible Debenture of Rs, 10.

1. Operating Lease

The Company has taken office premises, residential premises and plant and machinery (including equipments) etc. under cancellable/non-cancellable lease agreements, that are renewable on a periodic basis at the option of both the Lesser and the Lessee. The initial tenure of the lease period is generally for 11 to 120 months.

# Income tax demands mainly include appeals filed by the Company before various appellate authorities against the disallowance of expenses / claims. The management is of the opinion that its tax cases will be decided in its favour and hence no provision is considered necessary at this stage.

* The Company has received legal notices of claims / law suits filed against it relating to infringement of copy rights, defamation suits etc. in relation to programs telecasted / other matters. In the opinion of the management, no material liability is likely to arise on account of such claims / law suits.

* Remuneration excludes leave encashment and gratuity provided on the basis of actuarial valuation on an overall Company basis.

Mr. Alok Agrawal who was appointed as Whole-time director of the Company w.e.f. 30 July, 2013 for a period of three years had resigned w.e.f. close of business on 12 May, 2014.

Mr. Ashish Kripal Pandit who was appointed as Executive director and CEO of the Company w.e.f. 01 June, 2015 has resigned w.e.f. close of business on 12, October 2015.

(b) Commission payable to Non executive directors of Rs, 1.42 million (Rs, 0.77 million) based on profits for the year is included in Miscellaneous expenses'' (Refer Note 24).

(c) Sitting fees paid to Non executive directors of Rs, 1.10 million (Rs, 1.18 million) is included in ''Miscellaneaous expenses'' (Refer Note 24).

2. As per the requirement of Section 135 of the Companies Act, 2013, a Corporate Social Responsibility (CSR) Committee has been constituted by the Company. The Company is required to spend Rs, 3.15 million (Rs, 4.94 million) on the activities specified in the Schedule VII of the Companies Act, 2013 which has been fully paid during the year and included in Note 24.

3. Pursuant to the Letter of Offer dated 16 March, 2015 for Rights Issue of equity shares, the Company has allotted 108,643,732 Rights Equity Shares of Rs, 1 each, fully paid up, on 18 April, 2015, at a price of Rs, 18 per share (including premium of Rs, 17 per share). The said Rights Issue was fully subscribed for an amount aggregating to Rs, 1,955.59 million, resulting in increase in Paid-up Share Capital of the Company to Rs, 470.79 million, comprising of 470,789,505 Equity Shares of Rs, 1 each. Out of the said proceeds,Rs, 1,480.61 million have been utilized for the stated purposes and the balance amount of Rs, 474.98 million, pending utilization have been temporarily deployed in fixed deposits and current accounts with banks as per details given below:

The Rights Issue expenses of Rs, 30.66 million are adjusted against Securities Premium in accordance with Section 52 of the Companies Act, 2013.

4. Micro, Small and Medium Enterprises

The Company has no dues to Micro, Small and Medium Enterprises during the year ended 31 March, 2016 on the basis of information provided by the parties and available on record. Further, there is no interest paid / payable to micro and small enterprises during the year.

5. Employee Benefits

As per the Accounting Standard 15 "Employee Benefits", the disclosure of Employee benefits are given below:

(A) Defined Benefit Plan

The present value of gratuity obligation is determined based on actuarial valuation using the Projected Unit Credit Method which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave benefits (non funded) is also recognised using the projected unit credit method.

Disclosure of gratuity in terms of AS 15 is as under:

(i) Expenses recognized during the year

Note:

(a) Amount recognised as an expense and included in Note 21 ''Employee benefit expense'' are gratuity '' 26.14 million ('' 35.93 million) and leave encashment Rs, 23.40 million (Rs, 33.80 million).

(b) The estimates of rate of escalation in salary considered in the actuarial valuation takes into account of inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is certified by the actuary.

(B) Defined Contribution Plan

"Contribution to provident and other funds" is recognized as an expense in Note 21 ''Employee benefits expense'' above.

6. Disclosures as required by Regulation 34(3) of the Listing Agreement

(a) Loans and advances given to subsidiary / associate:

(b) None of the loaners have made investments in the shares of the Company.

7. Related Party Transactions

(i) List of Parties where control exists:

Direct Subsidiary:

- Zee Akaash News Private Limited (extent of holding 60%),

- Mediavest India Private Limited (extent of holding 100%)

- Pri - Media Services Private Limited (extent of holding 100%)

- Maurya TV Private Limited (extent of holding 100% w.e.f. 12 December, 2014)

Indirect Subsidiary:

- Diligent Media Corporation Limited (Mediavest India Private Limited holds 99.99%)

(89,095,342 equity shares held out of a total of 89,095,542 equity shares)

Associate:

- Maurya TV Private Limited (extent of holding 37.87% up to 11 December, 2014)

(ii) Other Related Parties with whom transactions have taken place during the year and balance outstanding as on the last day of the year:

24 Ghantalu News Limited, ATL Media Limited (formerly known as Asia Today Limited), Cyquator Media Services Private Limited, Dish TV India Limited, Digital Subscriber Management and Consultancy Services Private Limited, Essel Business Excellence Services Private Limited, Essel Corporate Resources Private Limited, Essel Shyam Communication Limited, Essel Vision Production Limited, Essel Finance VKC Forex Limited, Jay Properties Private Limited, India Webportal Private Limited, Media Pro Enterprise India Private Limited, Pan India Network Limited, Siti Cable Network Limited, Smart Wireless Private Limited, Taj Television (India) Private Limited, Zee Entertainment Enterprises Limited, Zee Foundation, Zee Learn Limited, Zee Sports Limited, Zee Turner Limited, Zee Digital Convergence Limited.

Key Management Personnel Directors

Dr. Subhash Chandra (Non-Executive Chairman), Shri Alok Agrawal (up to 12 May, 2014), Shri Ashish Kripal Pandit (w.e.f. 01 June, 2015 up to 12 October, 2015)

* Includes interest Rs, 29.68 million.

Note: All the loans are short term in nature given for general business purpose, and carry interest ranging from 12.50% to 13.50% per annum.

(b) Investments made

There are no investments by the Company other than those stated under Note 11 in the Financial Statements.

(c) Guarantees given

The Company has provided guarantees aggregating to Rs, 2,500.00 million for redeemable non convertible debentures issued (previous year Rs, 2,540.00 million for loans raised) by its wholly owned subsidiary viz. Pri-Media Services Private Limited and Rs, 200.00 million (previous year Nil) for loans raised by its indirect subsidiary viz. Diligent Media Corporation Limited.

(d) Securities given

There are no securities given during the year.

8. (a) Consumption of Raw stock (included in operational cost)

9. Segment Reporting

The Company is engaged in the business of "Production and Broadcasting of Television software" which in the context of AS 17 "Segment Reporting" is considered as the only reportable business segment. The geographical segment is not relevant as exports are insignificant.

10. The Management is of the opinion that its international and domestic transactions are at arm length as per the independent accountants report for the year ended 31 March, 2015. The Management continues to believe that its international transactions and the specified domestic transactions during the current financial year are at arm''s length and that the transfer pricing legislation will not have any impact on these financial statements, particularly on amount of tax expense and that of provision of taxation.

11. Scheme of Amalgamation

The Scheme of Amalgamation (the ''Scheme'') under Section 391 to 394 and other applicable provisions of the Companies Act, 1956 for the amalgamation of Essel Publishers Private Limited ("EPPL") with the Company was approved by the Hon''ble High Court of Judicature at Mumbai vide Order passed on 2 May, 2014, with Appointed Date being 1 April, 2014. The Scheme has been made effective on 27 May, 2014 and hence given effect in the financial statements for the year ended 31 March 2015. Pursuant to the Scheme, the entire business and whole of the undertaking of EPPL, including all assets and liabilities of EPPL as detailed below, vested in the Company as a going concern and recorded at their respective fair values under the "Purchase Method" as per Accounting Standard 14.

Pursuant to the Scheme:

(i) The Company has issued and allotted 122,381,817 fully paid up Equity Shares of '' 1 each to the shareholders of EPPL in the ratio of 2 fully paid up Equity Shares Rs, 1 each of the Company for every 11 Equity Shares Rs, 1 each held in EPPL.

(ii) Rs, 1,671.62 million, i.e. excess of assets over liabilities transferred to the Company and cancellation of inter company balances and obligations, has been transferred to the Capital Reserve.

(iii) The authorised share capital of the Company is increased by Rs, 700 million to Rs, 1,700 million divided into 1700,000,000 Equity Shares of Rs, 1 each.

* Basic and diluted EPS of previous year is adjusted for equity shares issued pursuant to the Rights Issue.

12. Previous year comparatives

Previous year''s figures have been regrouped, rearranged or recast wherever necessary to conform to current year''s classification. Figures in brackets pertain to previous year.


Mar 31, 2013

1. Corporate Information

Zee News Limited ("ZNL" or "the Company") is incorporated in the State of Maharashtra, India. The Company is mainly in the business of broadcasting of news, current affairs programs uplinked from india and sale of television programs including program feeds.

2. Operating Lease

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

3. Contingent Liabilities not provided for

Rs. million

2013 2012

Custom Duty pending export obligations 18.18 18.18

disputed direct taxes 9.31 3.82

Legal cases against the Company

* Not Not

Ascertainable Ascertainable

* The Company has received legal notices of claims / law suits filed against it relating to infringement of copy rights, defamation suits etc. in relation to programs telecasted / other matters. in the opinion of the management, no material liability is likely to arise on account of such claims / law suits.

4. Capital and other Commitments

estimated amount of contracts remaining to be executed on capital account, not provided for (net of advances) is Rs. 53.21 million (Rs. 85.86 million).

5. Managerial remuneration

Commission payable to Non executive Directors of Rs. 1.60 million (Rs. 1.00 million) based on profits for the year ended 31 March 2013 is included in ''Miscellaneous expenses'' under Note 23 "Other expenses".

6. The Company has given advances/deposits of Rs. 640.90 million to various companies for the purpose of content and marketing. However, due to various reasons, the contract could not be executed and accordingly the advances/deposits have been received back.

7. The Company is in the process of reconciling Integrated Receiver Decoder (IRD) boxes included under Plant and Machinery and Capital work in progress - Fixed Assets. The Management is of the view that the financial impact on reconciliation, if any, would not be material.

8. Micro, Small and Medium Enterprises

The Company has no dues to Micro, Small and Medium enterprises during the year ended 31 March, 2013 on the basis of information provided by the parties and available on record.

9. employee Benefits

As per the Accounting Standard 15 "employee Benefits", the disclosure of employee benefits as defined in the Accounting standard are given below:

(A) defined Benefit plan

The present value of gratuity obligation is determined based on actuarial valuation using the Projected unit Credit Method which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit seperately to build up the final obligation. The obligation for leave benefits (non funded) is also recognised using the projected unit credit method.

10. related party transactions

(i) List of parties where control exists: Holding Company: 25 FPS Media Private Limited (Holding 53.34% w.e.f. 1 March, 2012) ultimate Holding Company:

- 25 FPS Media Private Limited held by essel Corporate Resources Private Limited

- essel Corporate Resources Private Limited held by Prime Publishing Private Limited

- Prime Publishing Private Limited held by Spirit Textiles Private Limited (w.e.f. 1 October 2012) subsidiary Company:

Zee Akaash News Private Limited (extent of holding 60%), 24 Ghantalu News Limited (extent of holding 100%)

Fellow subsidiary:

Bioscope Cinemas Private Limited, Direct Media Distribution Ventures Private Limited, Mediavest India Private Limited, Pri - Media Services Private Limited, Diligent Media Corporation Limited.

(ii) other related parties with whom transactions have taken place during the year and balance outstanding as on the last day of the year:

Asia Today Limited, Cyquator Media Services Private Limited, Dish TV India Limited, Digital Ventures Private Limited, e-City

Bioscope entertainment Private Limited, essel International Limited, essel Shyam Communication Limited, India Webportal Private Limited, Media Pro enterprise India Private Limited, Pan India Network Limited, Procall Private Limited, Rama Associates Limited, Siti Cable Network Limited (previously known as Wire and Wireless (India) Limited), Smart Wireless Private Limited, Taj TV Limited, Taj Television (India) Private Limited, Veena Investments Private Limited, Zee entertainment enterprises Limited, Zee Foundation, Zee Learn Limited, Zee Sports Limited, Zee Telefilms Middle east FZ LLC, Zee Turner Limited.

directors / Key Management personnel

Shri Subhash Chandra (Non-executive Director), Shri Punit Goenka (Managing Director)

11. Segment Reporting

The Company is engaged in the business of "Production and Broadcasting of Television software" which in the context of AS 17 "Segment Reporting" is considered as the only reportable business segment. The geographical segment is not relevant as exports are insignificant.

12. The international transactions with Associated enterprises (Ae''s) are at arm''s length price as per the independent accountants report for the year ended 31 March, 2013. Further, the Finance Bill, 2012 had sought to bring in certain class of domestic transactions in the ambit of the transfer pricing regulations with effect from 1 April, 2012. the management is of the opinion that its international transactions with Ae''s and the specified domestic transactions for the year are at arm''s length price and that the transfer pricing study will not have any impact on the amount of tax expense and provision of taxation in these financials.

13. Considering the business synergies, the Board of Directors of the Company, in their meeting held on 23 May 2013, has in- principle approved combination of ''News Publication Business'' of Diligent Media Corporation Limited - a Promoter Group company engaged in printing and publication of english daily ''DNA'' and the ''News Broadcasting Business'' of the Company and constituted a Committee to engage / appoint independent professionals to advice on the appropriate structure / manner of combination and its valuation, cost-benefit analysis, procedural and others aspects for consideration by the Audit Committee and the Board in due course.

14. previous year comparatives

Previous year''s figures have been regrouped, rearranged or recast wherever necessary to conform to current year''s classification. Figures in brackets pertain to previous year.


Mar 31, 2012

1. Background

Zee News Limited ("ZNL or "the Company) is incorporated in the State of Maharashtra, India. its shares are listed on two Stock Exchanges in India. The Company has been mainly in the business of broadcasting of news, current affairs and regional entertainment satellite television channels uplinked from India.

2.1 the rights attached to equity shares:

a) the Company has only one class of shares i.e. equity shares having face value of Rs1 per share. Each holder of the share has one voting right per share.

b) in the event of liquidation of the Company, the holder of the share will be entitled to receive remaining assets of the Company after distribution of all preferential amounts. the distribution of assets will be in proportion to the number of shares held by the shareholder.

3.1 Secured term loan of Rs500,000,000 was taken from bank in the financial year 2010-11 and is secured by way of first hypothecation charge on entire movable fixed assets of the Company, except vehicles, both present and future. The loan is repayable in 10 installments payable quarterly, commencing April 2011. The loan presently carries interest rate of 13.50% per annum payable monthly.

4.1 Secured working capital facility of Rs500,000,000, repayable on demand, is secured by way of first hypothecation charge on entire current assets as well as movable fixed assets of the Company, both present and future. The facility includes working capital demand loan of Rs400,000,000 which presently carries interest rate of 11.50% per annum, payable monthly and cash credit limit of Rs100,000,000 which presently carries interest rate of 14.75% per annum, payable monthly.

5.1 includes Rs5,033,730 (Previous Year Rs310,532) payable to subsidiary, Rs2,409,126 (Previous Year Rs Nil) payable to Holding Company and Rs45,343,237 (Previous Year Rs186,277,703) payable to Other Related Parties.

6.1 there is no amount due and outstanding to be credited to investors education and Protection Fund as at march 31, 2012.

7.1 Programs/Film Rights are intangible assets as defined in As - 26 but these are acquired and used for its broadcasting business hence considered and included in Operational Cost and Current Assets - inventories.

7.2 the Company has impaired Programs of Rs4,121,912 (Previous Year Rs606,565).

8. Leases:

in respect of assets taken on operating lease :

The Company's significant leasing arrangements are in respect of operating leases taken for office premises, residential premises and plant and machinery (including equipments). These leases are cancelable/non-cancelable, that are renewable on a periodic basis at the option of both the less or and the lessee. The initial tenure of the lease period is generally for 11 to 108 months.

9. Contingent Liabilities not provided for:

(Amount in Rs.)

2012 2011

Claims against the Company not acknowledged as debts - 2,130,000

Custom Duty on Pending Export Obligations 18,183,059 18,183,059

Disputed Direct Taxes 3,818,080 3,818,080

Legal cases against the Company Unascertained Unascertained

The Company has received legal notices of claims / law suits filed against it relating to alleged infringement of copy rights and defamation in relation to programs telecasted by it. in the opinion of the Management no material liability is likely to arise.

10. Capital and other Commitments:

Estimated amount of contracts remaining to be executed on capital account, not provided for (net of advances) is Rs85,863,021 (Rs32,657,810).

11. Managerial Remuneration:

Commission provided during the year for Non Executive Directors Rs1,000,000 (Rs1,350,000) is included in Miscellaneous Expenses under Note No. 23 "Other Expenses.

12. Foreign exchange Difference:

a) the foreign exchange loss (net) Rs2,139,216 (previous year gain Rs536,417) on settlement or realignment of foreign exchange transactions has been adjusted under the head "Gain/Loss on Foreign exchange difference in the statement of Profit and Loss.

b) Foreign currency exposures that are not hedged by derivative instruments as at March 31,

c) Derivative contracts (Forward Contracts for hedging purposes) entered into by the Company and outstanding at March 31, 2012 is RsNil (Previous Year RsNil).

13. Micro, small and Medium enterprises:

the Company has no dues to Micro, Small and Medium Enterprises during the year ended March 31, 2012, on the basis of information provided by the parties and available on record.

14. Retirement Benefits:

(A) Defined Benefit plan:

the present value of the defined benefit obligation and the related current service cost were measured using the projected unit credit method with actuarial valuation being carried out at each balance sheet date. the defined benefit obligations are not funded.

Note:

a) Amount recognized as an expense and included in Note No. 21 "Employee Benefit Expenses" are Gratuity Rs15,417,121 (Previous year Rs.12,728,030) and Leave Encashment Rs8,423,422 (Previous Year Rs.10,936,123).

b) the estimates of future salary increases considered in the actuarial valuation take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

(B) defined Contribution plan:

"Contribution to Provident Fund and Other Funds is recognized as an expense in Note No. 21 "Employee Benefit Expenses.

15. Related party Transactions:

i) List of parties where control exists:

Holding Company:

25 Fps Media private Limited (Holding 53.34% w.e.f. March 1, 2012) (A wholly owned subsidiary of Essel Corporate Resources Private Limited) essel Corporate resources private Limited (w.e.f. October 20, 2011 to February 28, 2012)

subsidiary Company:

Zee Akaash News Private Limited (extent of holding 60%)

ii) other related parties with whom transactions have taken place during the year and balance outstanding as on the last day of the year:

Asia today Limited, Agrani Convergence Limited, Cyquator Media services Private Limited, diligent Media Corporation Limited, dish Tv India Limited, E-City Bioscope Entertainment Private Limited, E-City Property Management and services Private Limited*, Essel international Limited, Essel shyam Communication Limited, Himgiri Navh Vishwavidyalaya, India Webportal Private Limited, interrex India Limited*, Media Pro Enterprise India Private Limited, Pan India Network Limited, Pan India Paryatan Private Limited*, Procall Private Limited, Rama Associates Limited, Real Media FZ LLC, RKJ Woods Plantations Private Limited*, smart Wireless Private Limited, taj Tv Limited, taj television (India) Private Limited, Wire and Wireless (India) Limited, Wire and Wireless Tisa satellite Limited, Veena investments Private Limited, Zee Entertainment Enterprises Limited, Zee Foundation, Zee Learn Limited, Zee sports Limited, Zee telefilms Middle East FZ LLC, Zee turner Limited.

* Not a related party during the current year

Key Management personnel

shri subhash Chandra, shri Punit Goenka

16. segment reporting:

the Company is engaged in the business of production and broadcasting of television software which in the context of AS 17 "Segment Reporting" is considered as the only reportable business segment. the geographical segment is not relevant as exports are insignificant.

17. Schedule Vi of the Companies Act, 1956 is revised effective from April 1, 2011 and the adoption of the revised Schedule Vi has significantly impacted the presentation and disclosures in the financial statements. Previous year's figures have been regrouped/ reclassified in accordance with current year's classifications/ disclosures. Further, current year's figures are not comparable with previous year's figures due to closure of operations of Tamil channel w.e.f. March 31, 2011.


Mar 31, 2011

Background

Zee News Limited ("ZNL" / "the Company") was incorporated in the State of Maharashtra, India. The Company has been mainly in the business of broadcasting of news, current affairs and regional entertainment satellite television channels uplinked from India. Operation of Zee Tamil channel has been discontinued on March 31, 2011.

1. Restructuring:

Pursuant to the Scheme of Arrangement under Section 391 to 394 and other applicable provisions of the Companies Act, 1 956 between Zee News Limited (ZNL) and Zee Entertainment Enterprises Limited (ZEEL) and their respective shareholders and creditors, sanctioned by the Honourable High Court at Mumbai on March 19, 201 0 and filed with the Registrar of Companies on March 29, 2010, the Regional General Entertainment Channel (RGEC) Business Undertaking of the Company, comprising of six television channels namely Zee Marathi, Zee Talkies, Zee Bangla, Zee Kannada, Zee Telugu and Zee Cinemalu, assets of Zee Gujrati, a discontinued television channel, has been transferred to and vested in ZEEL with effect from January 01, 201 0, on going concern basis. The Scheme has been given effect in the financial statements for the year ended March 31, 201 0. The excess of book value of the assets over the book value of liabilities transferred aggregating to Rs 1,247,833,726 was adjusted against Capital Reserve.

2. Secured Loans:

2.1 Short-term working capital loan of Rs Nil (Rs 1,1 80,546,808) from bank is secured by way of first hypothecation charge, on pari passu basis with other lenders, on the current assets as well as movable fixed assets of the Company, both present and future.

2.2 Long-term corporate loan of Rs 500,000,000 (Rs Nil) from bank is secured by way of first hypothecation charge on entire movable fixed assets of the Company, except vehicles, both present and future. Repayable within a yearRs 150,000,000.

2.3 Vehicle loans are secured against hypothecation of Vehicles [Due within one year Rs 9,109,81 6 (Rs 5,862,231)].

3. Programs/Film Rights etc. for broadcasting are intangible assets as defined in AS - 26 but considered and shown under current assets as are used for broadcasting in the ordinary course of business. The Company, for the current year, has recognized impairment loss of Rs 606,565 in respect to Programs/Film Rights and the loss is included in Operational Cost.

4. Investments:

tThe Company has long term investment of Rs 60,900,000 (Rs 60,900,000) in Akash Bangla Private Limited (ABPL). The Company has also advanced Share Application Money of Rs 105, 843,191 (Rs 70,593,191) to ABPL. As at Balance Sheet date, the networth of ABPL is eroded. The investment is strategic in nature considering Shareholding Agreement and having regard to the future business plan and projected profitability, the management perceives the erosion in the value of investment in ABPL as only temporary diminution in value. Hence, no provision for diminution in value is considered necessary in respect of Companys investment or of the Share Application Money to ABPL.

5. Fixed Deposits includes Rs 4,350,000 (Rs 4,350,000) lodged with Tax Authorities.

6. Leases:

In respect of assets taken on operating lease:

The Companys significant leasing arrangements are in respect of operating leases taken for offices premises and equipments. These leases are cancellable/non-cancellable, that are renewable on a periodic basis at the option of both the lessor and the lessee. The initial tenure of the lease period is for 11 to 1 08 months.

11. Other Disclosures:

11.1 Previous years figures are regrouped, rearranged or recast wherever considered necessary to conform to this years classification. Current years figures are not comparable with previous years figures due to demerger of Regional General Entertainment Channels from the Appointed Date i.e. January 1, 2010 (Refer Note 1). Figures in bracket pertain to previous year.

1 1.2 Sundry Creditors for Expenses and Other Liabilities includes cheques overdrawn of Rs Nil (Rs 51,221,586) and amount payable to subsidiary Rs 310,532 (Rs Nil)

11.3 Capital Work-in-progress includes capital advance of Rs 2,230,291 (Rs 32,636,466).

1 1.4 Advances given includes:

a) Share Application Money Rs 67,232,334 (Rs 67,232,334) and advance recoverable Rs Nil (Rs 2,475,288) from the subsidiary.

b) Share Application Money paid Rs 105,843,191 (Rs 70,593,191) to others.

c) Interest recoverable Rs 873,641 (Rs 128,487,866).

1 1.5 Micro, Small and Medium Enterprises:

The Company has no dues to Micro, Small and Medium Enterprises during the year ended March 31, 2011, on the basis of information provided by the parties and available on record.

1 1.6 Foreign Exchange Difference:

a) The foreign exchange gain (net) Rs 536,417 (Rs 2,954,478) on settlement or realignment of foreign exchange transactions has been adjusted in respective heads of the Profit and Loss Account.

b) As at Balance Sheet date, the Company has foreign currency payable and receivable amounting to Rs 36,227,81 6 (Rs 7,740,922) and Rs 35,154,067 (Rs 29,453,407) respectively which are not hedged by a derivative instrument or otherwise.

c) Derivative Contracts (Forward Contracts for hedging puposes) entered into by the Company and outstanding at March 31, 2011 is Rs Nil (Nil).

1 1.7 Contingent Liabilities not provided for:-

Amount (Rs)

Particulars 2011 2010

Claims against the Company not acknowledged as debts 2,130,006 2,130,006

Custom Duty on Pending Export Obligations 18,183,059 18,183,059

Bank Guarantee Outstanding 7,528,394 -

Disputed Direct Taxes 3,818,080 3,585,088

Legal cases against the Company Unascertained Unascertained

The Company has received legal notices of claims/law suits filed against it relating to alleged infringement of copy rights and defamation in relation to programs telecasted by it. In the opinion of the Management no material liability is likely to arise.

12. Capital Commitments:

Estimated amount of contracts remaining to be executed on capital account, not provided for (net of advances) is Rs 32,657,810 (Rs 8,940,660).

13. Related Party Transactions:

(i) List of Parties where control exists: Subsidiary Company:

Zee Akaash News Private Limited (extent of holding 60%)

(ii) Other Related Parties with whom transactions have taken place during the year and balance outstanding as on the last day of the year:

Agrani Convergence Limited, Asia Today Limited, Asia TV Limited, Continental Drugs Company Private Limited, Cyquator Media Services Private Limited, Dakshin Communication Private Limited, Diligent Media Corporation Limited, Dish TV India Limited, E-City Bioscope Entertainment Private Limited, E-City Projects Construction Private Limited, E-City Entertainment Network Limited, E-City Property Management Services Private Limited, Essel Corporate Resources Private Limited, Essel Shyam Communication Limited, Himgiri Navh Vishwavidyalaya, Interactive Tradex India Private Limited, Intrex Trade Exchange Limited, Pan India Network Limited, Pan India Network Infravest Private Limited, Pan India Paryatan Private Limited, Prime Publishing Limited, Procall Private Limited, Rama Associates Limited, Real Media FZ LLC, RKJ Woods Plantations Private Limited, Smart Wireless Private Limited, Wire and Wireless (India) Limited, Wire and Wireless Tisai Satellite Limited, Veena Investments Private Limited, Zee Entertainment Enterprises Limited, Zee Learn Limited, Zee Telefilms Middle East FZ LLC, Zee Turner Limited, Zee Sports Limited.

Key Management Personnel

Shri Subhash Chandra, Shri Punit Goenka, Shri Laxmi Narain Goel (upto September 30, 2010), Shri Naresh Kumar Bajaj, Shri K.U. Rao, Shri Vinod Bakshi

15. Segment Reporting:

The Company is engaged in the business of production and broadcasting of television software which in the context of AS 17 "Segment Reporting" is considered as the only reportable business segment. The geographical segment is not relevant as exports are insignificant.

16. Additional Information:

Other Additional Information required to be given pursuant to Part II of Schedule VI to the Companies Act, 1 956, are as under:

16.1 The Company is in the business of producing television programs and is not subject to any license hence there is no licensed capacity. Further the nature of business of the Company is such that the installed capacity is not quantifiable.

1 6.2 The details of opening stock, acquisitions/productions, sales and closing stock of programs and film rights are as under:

Notes:

1. Previous years figures are regrouped, rearranged or recast wherever considered necessary to conform to this years classification. Current years figures are not comparable with previous years figures due to demerger of Regional General Entertainment Channels from the Appointed Date i.e. January 1, 201 0 (Refer Note


Mar 31, 2010

1. Restructuring:

"The Scheme of Arrangement under Section 391 to 394 and other applicable provisions of the Companies Act, 1956 between Zee News Limited (ZNL) and Zee Entertainment Enterprises Limited (ZEEL) and their respective shareholders and creditors was sanctioned by the Honble Bombay High Court at Mumbai on March 19, 2010 and filed with the Registrar of Companies on March 29, 2010. Pursuant to the Scheme, the Regional General Entertainment Channel (RGEC) Business Undertaking of the Company, comprising of six television channels namely Zee Marathi, Zee Talkies, Zee Bangla, Zee Kannada, Zee Telugu and Zee Cinemalu (broadcasting yet to be commenced), assets of Zee Gujrati, a discontinued television channel, on a going concern basis has been transferred to and vested in ZEEL with effect from the appointed date i.e. January 1, 2010. The Scheme has been given effect to in these financial statements."

In consideration for the transfer and vesting of the RGEC Business Undertaking in ZEEL, the members of the Company holding fully paid-up equity shares in the Company, and whose names appear in the register of members of the Company, on the Record Date, are allotted 4 fully paid Equity Shares of Re. 1 each of ZEEL for every 19 fully paid Equity Shares of Re. 1 each held in ZNL.

In pursuance of the Scheme of Arrangement approved by the Honble Bombay High Court, Mumbai, the Board of Directors in the meeting held on March 25, 2010 has approved the transfer of assets and liabilities as under and approved adjustment of excess of the book value of the assets transferred over the book value of liabilities aggregating to Rs. 1,247,833,726 against Capital Reserve Account.

2. Secured Loans:

2.1 Short-term working capital loan of Rs. 1,180,546,808 (Rs. Nil) from bank is secured by way of first hypothecation charge, on pari passu basis with other lenders, on the current assets as well as movable fixed assets of the Company, both present and future.

2.2 Short-term working capital loan of Rs. Nil (Rs. 750,000,000) from others was secured by way of first hypothecation charge over the current assets (excluding a bank account on which the lender has first charge) of the Company ranking pari passu with other lenders.

2.3 Term Loans from Banks is secured by way of hypothecation charge on entire fixed assets (both movable and immovable) and current assets including program and media rights ranking pari passu with other term lenders. [Due within one year Rs. Nil (Rs. 150,000,000)]. The loan has been transferred to Zee Entertainment Enterprises Limited, pursuant to Scheme of Arrangement.

2.4 Vehicle loans are secured against hypothecation of Vehicles [Due within one year Rs. 5,862,231 (Rs. 8,023,546)].

3. Program/film rights etc. for broadcasting are intangible assets as defined in AS – 26 but considered and shown under current assets as are used for broadcasting in the ordinary course of business.

4. Fixed Deposits/Margin includes Rs. 4,380,000 (Rs. 4,380,000) lodged with Tax Authorities and Rs. Nil (Rs. 28,125,000) is under charge of Term Loan Lenders.

5. Leases:

In respect of assets taken on operating lease:

The Company’s significant leasing arrangements are in respect of operating leases taken for offices premises and equipments. These leases are cancellable/non-cancellable, that are renewable on a periodic basis at the option of both the lessor and the lessee. The initial tenure of the lease period is for 1 to 108 months.

Note: Salary and Allowances includes basic salary, house rent allowance but excluding leave encashment and gratuity provided on the basis of actuarial valuation.

6. Commission paid/payable to Non-Executive Directors Rs. 3,000,000 (Rs. 2,827,000) is included in Miscellaneous Expenses under Schedule 13 "Administrative and Other Expenses".

7. Other Disclosures:

7.1 Current years figures are not comparable with previous years figures due to demerger of Regional General Entertainment Channels from the appointed date i.e. January 1, 2010 (Refer Note 1). Previous years figures are regrouped/recasted wherever considered necessary. Figures in bracket pertain to previous year.

7.2 Sundry Creditors for Expenses and Other Liabilities includes cheques overdrawn of Rs. 51,221,586 (Rs. 115,570,032).

7.3 Capital work-in-progress includes capital advance of Rs. 32,636,466 (Rs.23,097,799).

7.4 Advances given includes:

a) Share application money Rs. 67,232,334 (Rs. 67,232,334) and Advance recoverable Rs. 2,475,288 (Rs. 650,511) recoverable from the subsidiary and also a private limited company in which Director of the Company is a Director.

b) Share Application Money paid Rs. 70,593,191 (Rs. 8,500,000) to others.

c) Interest recoverable Rs. 128,487,866 (Rs. 34,576,358).

7.5 Micro, Small and Medium Enterprises:

The Company has no dues to Micro and Small Enterprises during the period ended March 31, 2010, on the basis of information provided by the parties and available on record.

7.6 Foreign Exchange Difference:

a) The foreign exchange gain (net) Rs. 2,954,478 (Rs.11,325,047) on settlement or realignment of foreign exchange transactions has been adjusted in respective heads of the Profit and Loss Account.

b) As at Balance Sheet date, the Company has foreign currency payable and receivable amounting to Rs. 7,740,922 (Rs. 57,947,203) and Rs. 29,453,407 (Rs. 82,839,642) respectively which are not hedged by a derivative instrument or otherwise.

c) Derivative contracts (Forward Contracts for hedging puposes) entered into by the Company and outstanding at March 31, 2010 is Rs. Nil (Nil).

The Company has received legal notices of claims/law suits filed against it relating to alleged infringement of copy rights and defamation in relation to programs telecasted by it. In the opinion of the Management no material liability is likely to arise.

(A) Defined Benefit Plan:

The present value of the defined benefit obligation and the related current service cost were measured using the projected unit credit method with actuarial valuation being carried out at each balance sheet date. The defined benefit obligations are not funded.

Notes:

(a) The above information is in respect of continuing business remained after demerger of Regional General Entertainment Channels. The total Gratuity and Leave Encashment costs for the year recognized as an expense and included in the Schedule 12 - "Personnel Cost" are Gratuity Rs. 8,554,447 (Rs. 9,676,193) and Leave Encashment Rs. 12,183,594 (Rs. 7,744,567). The Gratuity and Leave Encashment liaibility of discontinued business transferred to ZEEL was Rs. 6,164,878 and Rs. 6,343,294 respectively.

(b) The estimates of future salary increases considered in the actuarial valuation take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

(B) Defined Contribution Plan:

“Contribution to Provident Fund and Other Funds” is recognised as an expense in Schedule 12 - "Personnel Cost" of the Profit and Loss Account.

8. Capital Commitments:

Estimated amount of contracts remaining to be executed on capital account, not provided for (net of advances) is Rs. 8,940,660 (Rs.45,545,849).

9. Related Party Transactions:

(i) List of Parties where control exists: Subsidiary Company:

Zee Aakash News Private Limited (extent of holding 60%)

(ii) Other Related Parties with whom transactions have taken place during the year and balance outstanding as on the last day of the year:

Agrani Convergence Limited, Asia Today Limited, Asia TV Limited, Asian Sky Shop Limited, Continental Drugs Company Private Limited, Cornershop Entertainment Company Private Limited, Cyquator Media Services Private Limited, Cyquator Technologies Limited, Dakshin Communication Limited, Diligent Media Convergence Limited, Diligent Media Corporation Limited, Dish TV India Limited, E-City Bioscope Entertainment Private Limited, E-City Projects Construction Private Limited, ETC Networks Limited, E-City Entertainment Network Limited, E-City Property Management Services Private Limited, Essel Corporate Resources Private Limited, Essel Shyam Communication Limited, Himgiri Navh Vishwavidyalaya, Interactive Tradex India Private Limited, Intrex Trade Exchange Limited, Pan India Network Limited, Pan India Network Infravest Private Limited, Pan India Paryatan Limited, Prime Publishing Limited, Playwin Infravest Private Limited, Procall Private Limited, Rama Associates Limited, Real Media FZ LLC, RKJ Woods Plantations Private Limited, Smart Wireless Private Limited, Suncity Projects Private Limited, United News of India, Wire and Wireless Tisai Limited, Veena Investment Private Limited, Wire and Wireless (India) Limited, Zee Entertainment Enterprises Limited, Zee Intractive Learning Systems Limited, Zee Telefilms Middle East FZ LLC, Zee Turner Limited, Zee Sports Limited.

10. Segment Reporting:

The Company is engaged in the business of production and broadcasting of television software which in the context of AS 17 "Segment Reporting" is considered as the only reportable business segment. The geographical segment is not relevant as exports are insignificant.

11. Additional Information:

Other Additional Information required to be given pursuant to Part II of Schedule VI to the Companies Act, 1956, are as under:

11.1 The Company is in the business of producing television programs and is not subject to any license hence there is no licensed capacity. Further the nature of business of the Company is such that the installed capacity is not quantifiable.

11.2 The details of opening stock, acquisitions/productions, sales and closing stock of programs and film rights are as under:

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