Your Directors have pleasure in presenting the Seventeenth Annual Report together with the audited financial statements of Entertainment Network (India) Limited [the Company/ ENIL/ Radio Mirchi] for the financial year ended March 31, 2016.
1 Financial Highlights
Amount in Rs.
|Financial Year||Financial Year||Financial Year||Financial Year|
|Profit before taxation||1,481,637,875||1,446,093,211||1,481,550,729||1,446,144,866|
|Profit after taxation||1,000,011,273||1,059,720,596||999,886,544||1,059,769,997|
|Profit brought forward||4,383,854,432||3,439,832,942||4,384,869,145||3,440,798,255|
|Equity (issued, subscribed & paid up share capital)||476,704,150||476,704,150||476,704,150||476,704,150|
|Transfer to General Reserve||Nil||Nil||Nil||Nil|
|Adjustments due to change in rates of Depreciation||Nil||58,324,116||Nil||58,324,117|
|Proposed dividend (including dividend distribution tax)||57,374,990||57,374,990||57,374,990||57,374,990|
|Surplus carried to Balance Sheet||5,326,490,715||4,383,854,432||5,327,380,699||4,384,869,145|
2 Financial Performance, Operations and state of the Companys affairs
Your Company retained its position as the market leader in Private FM Radio Broadcasting Industry. Total income of the Company increased from Rs. 4,706,548,014 during the previous year to Rs. 5,337,176,003 during the year under review. Profit after tax was Rs. 1,000,011,273.
On a consolidated basis, total income of the Company increased from Rs. 4,707,588,061 during the previous year to Rs. 5,337,314,234 during the year under review. Profit after tax was Rs. 999,886,544.
The financial performance is discussed in detail in the Management Discussion and Analysis Report which forms part of the Annual Report.
In July, 2015, the Company had received the approval from the Ministry of Information & Broadcasting (MIB) to purchase TVTNs four radio stations i.e. radio business in Amritsar, Jodhpur, Patiala and Shimla. The said purchase was subject to fulfilment of conditions specified by the MIB, execution of relevant documents with TVTN and completion of all other relevant formalities.
In September, 2015, the Company had executed a Business Transfer Agreement (BTA) with TVTN to purchase the aforementioned radio business on the terms and conditions stipulated in the BTA. The purchase consideration was Rupees Four Crores subject to closing net working capital adjustments as defined more specifically in the BTA and also payment of migration fees to MIB for migration of the aforesaid four stations from Phase II to Phase III.
The Company participated in the 1st batch of Phase - 3 auctions and has expanded its network substantially.
In the bidding, the Company focused on building a strong "2nd frequency" network in the biggest A+ and A category towns. ENIL has won a 2nd frequency in Bengaluru, Hyderabad, Ahmedabad, Pune, Kanpur, Lucknow, Jaipur, Nagpur and Surat. In addition to acquiring a second channel in the major cities, the Company also bid and won important cities that the Company was not already present in. These are Chandigarh (and along with Amritsar and Patiala acquired from TV Today, this has made the Companys North footprint strong), Guwahati (the gate-way to the North East), Shillong (a buzzing border town), Kochi and Kozhikode (which, along with the Companys existing Trivandrum, are the three biggest cities in Kerala) and Jammu and Srinagar (important border towns). With these seven cities, the core Mirchi brand will now be available in 43 cities (32 from Phase-2 + 4 acquired from TV Today + these 7).
The Company commenced broadcast from its radio stations at Guwahati, Kochi and Bengaluru (acquired under Phase 3 auctions) as on the date of this report.
In March 2016, the Company issued Unsecured Commercial Papers (CPs) to BNP Paribas. The amount raised through issuance of CPs was Rs. 249.43 crores. The CPs have a tenor of one year and will mature on March 17, 2017. The maturity value of CPs is Rs. 270 crores. The effective yield of the CPs is 8.25% per annum. The proceeds from the CPs were used to fully repay the outstanding bank loans.
The Scheme of Amalgamation and Arrangement (Scheme) of Times Infotainment Media Limited [TIML], the holding company of the Company with Bennett, Coleman & Company Limited (BCCL), the holding Company of TIML was filed under the Companies Act, 1956. The Scheme was approved by the Honble Bombay High Court vide Order dated July 3, 2015 (Order). The Honble Bombay High Courts approval was however subject to the approval of the Ministry of Information & Broadcasting, Government of India (MIB).
The MIB, vide its letter dated April 25, 2016 (received by the Company on April 26, 2016), accorded its approval to the change in ownership pattern of the Company under the Scheme. Consequently, TIMLs entire shareholding in the Company transferred to BCCL, and BCCL is the sole promoter shareholder of the Company.
There were no other material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which this financial statements relate and the date of this Report.
Your Directors are pleased to recommend a dividend of Rs. 1.00 (Rupee one only) per equity share of Rs. 10/- each for the financial year ended March 31, 2016, aggregating Rs. 573.75 lacs including dividend distribution tax of Rs. 97.05 lacs. The dividend payment is subject to the approval of the shareholders at the ensuing Annual General Meeting (AGM).
The dividend, if declared at the AGM, would be paid/ dispatched within thirty days from the date of declaration of dividend to those persons or their mandates:
whose names appear as beneficial owners as at the end of the business hours on July 27, 2016 in the list of the Beneficial Owners to be obtained from the Depositories i.e. National Securities Depository Limited [NSDL] and Central Depository Services (India) Limited [CDSL], in respect of the shares held in electronic/ dematerialized mode; and
whose names appear as Members in the Register of Members of the Company as on July 27, 2016, after giving effect to valid share transfers in physical forms lodged with the Company/ Registrar & Share Transfer Agents, in respect of the shares held in physical mode.
4 Deposits from public
The Company has not accepted any deposits from public and therefore the details relating the deposits covered under Chapter V of the Companies Act, 2013 are not required to be furnished.
5 Dir ectors and Key Managerial Personnel
In accordance with the provisions of the Companies Act, 2013 read with the applicable rules thereto, including any statutory modification(s) or re-enactment thereof for the time being in force (the Act), Mr. Vineet Jain (DIN: 00003962) retires by rotation at the ensuing AGM and being eligible, offers himself for reappointment.
The Members of the Company have approved the appointment of Ms. Punita Lal (DIN: 03412604) as the Independent Non-executive Director of the Company through postal ballot voting process. Her appointment as the Independent Non-executive Director is for a term of five consecutive years commencing from March 28, 2016.
On the basis of the approval and recommendation of the Nomination & Remuneration Committee, the Board of Directors of the Company, on May 19, 2016, unanimously approved the reappointment of Mr. Prashant Panday (DIN: 02747925) as the Managing Director & Chief Executive Officer (MD & CEO) pursuant to the provisions of sections 152, 196, 197, 203 read with Schedule V and all other applicable provisions of the Companies Act, 2013 and all applicable rules made under the Companies Act, 2013 (including any statutory modification(s) or re-enactment thereof from time to time) (hereinafter referred to as the Act), for a period of 5 (five) years commencing from July 1, 2016 and ending on June 30, 2021. The aforesaid reappointment is on a continuation basis, without any interruption/ break in the service and is subject to the approvals, consents, permissions, sanctions and the like of the Members of the Company and all other concerned statutory and other authorities, if and to the extent applicable and required. His term of office shall be liable to retire by rotation. Terms, conditions of his reappointment including remuneration and all other relevant details have been furnished in the Notice convening this AGM.
The Company has received the declarations from all the Independent Directors of the Company pursuant to the provisions of Section 149 and all other applicable provisions of the Act stating that they meet the criteria of independence as provided under the Act and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 [Listing Regulations] and that they are not disqualified to become directors under the Act; and in the opinion of the Board of Directors, all the Independent Directors fulfill the criteria of independence as provided under the Act, rules made thereunder, read with the Listing Regulations and that they are independent of the management.
Brief resume of the directors proposed to be reappointed, relevant information including nature of their expertise in specific functional areas, qualifications, terms of appointment, details of remuneration, names of the companies in which they hold directorships and the memberships/ chairmanships of Committees of the Board, their shareholding in the Company, etc., as stipulated under the Listing Regulations and Secretarial Standards have been furnished separately in the Notice convening the AGM read with the Annexure thereto forming part of this Report.
None of the Directors are related with each other or key managerial personnel (inter-se).
Details of the number of meetings of the Board of Directors and Committees and attendance at the meetings have been furnished in the Report on Corporate Governance.
Following persons are designated as Key Managerial Personnel (KMP):
Mr. Prashant Panday: Managing Director & CEO
Mr. N. Subramanian: Group CFO
Mr. Mehul Shah: SVP Compliance & Company Secretary
6 Board Evaluation
The Board of Directors is committed to continued improvement in its effectiveness. Accordingly, the Board participated in the annual formal evaluation of its performance. This was designed to ensure, amongst other things, that the Board, its Committees and each director continue to contribute effectively.
The Board and its Committees evaluations involved questionnaire-driven discussions that covered a number of key areas / evaluation criteria inter alia the roles and responsibilities, size and composition of the Board and its Committees, dynamics of the Board and its Committees and the relationship between the Board and management. The results of the reviews were discussed with the relevant Committees and collectively by the Board as a whole. Feedback was also sought on the contributions of individual directors. Independent directors, at their Meeting led by the Chairman of the Nomination & Remuneration Committee, conducted the performance review of the Chairman, Non-Independent Directors and the Board as a whole in respect of the financial year under review.
Formal Annual Evaluation was made in compliance with all the applicable provisions of the Act and the Listing Regulations. The Directors were satisfied with the evaluation results, which reflected the overall engagement of the Board and its Committees with the Company.
7 Boar d Familiarization Program
At the time of appointment of new director, through the induction process, he/ she is familiarized with the Company, directors roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company, etc. Detailed presentations are made before the Board Members at the Board and its Committee meetings covering various areas including business strategy, branding, programming, financial performance and forecast, compliances/ regulatory updates, audit reports, risk assessment and mitigation, etc. The details of the familiarization program are available on the Companys website at: www.enil.co.in at web link: http://www.enil.co.in/policies-code-of-conduct.php
8 P olicy on directors appointment and remuneration
The Companys Policy on the Directors appointment and remuneration including criteria for determining qualifications, positive attributes, independence of director and other matters as provided under Section 178 of the Act is annexed to this Report at the Nomination & Remuneration Policy and appended as Annexure A to this Report.
9 Audit Committee
The Audit Committee of the Company presently comprises of Mr. N. Kumar (Chairman), Mr. Ravindra Kulkarni, Mr. Richard Saldanha and Mr. B. S. Nagesh. The Internal Auditors of the Company report directly to the Audit Committee. All the recommendations of the Audit Committee were accepted by the Board of Directors. Brief description of terms of reference and other relevant details of the Audit Committee have been furnished in the Report on Corporate Governance.
10 Vigil Mechanism
The Company has a Whistle Blower Policy / Vigil Mechanism in place. The objective of the Vigil Mechanism is to provide the employees, directors, customers, vendors, contractors and other stakeholders of /in the Company an impartial and fair avenue to raise concerns and seek their redressal, in line with the Companys commitment to the highest possible standards of ethical, moral and legal business conduct and fair deal to all its stakeholders and constituents and its commitment to open communication channels. The Company is also committed to provide requisite safeguards for the protection of the persons who raise such concerns from reprisals or victimization, for whistle blowing in good faith. The Board of Directors affirms and confirms that no personnel has been denied access to the Audit Committee. The Policy contains the provision for direct access to the chairperson of the Audit Committee in appropriate or exceptional cases. Whistle Blower Policy/ Vigil Mechanism is available on the Companys website at: www.enil.co.in at http://www.enil.co.in/policies-code-of-conduct.php
11 CSR Committee
The constitution, composition, quorum requirements, terms of reference, role, powers, rights, obligations of Corporate Social Responsibility Committee [CSR Committee] are in conformity with the provisions of Section 135 and all other applicable provisions of the Companies Act, 2013, read with the Companies (Corporate Social Responsibility Policy) Rules, 2014 and all other applicable rules made under the Companies Act, 2013 (including any statutory modification(s) or re-enactment or amendments thereof).
The Committee comprises of the following Directors as on the date of this Report:
Mr. Vineet Jain (Non- Executive Director)
Mr. B. S. Nagesh (Independent Non- Executive Director)
Mr. Ravindra Kulkarni (Independent Non- Executive Director)
Mr. Prashant Panday (Managing Director & CEO)
During the financial year under review, the Committee met four times, i.e. on May 19, 2015; August 4, 2015; October 26, 2015; and February 8, 2016.
Brief description of terms of reference of the Committee inter alia includes to:
f ormulate and recommend to the Board of Directors (Board), a Corporate Social Responsibility (CSR) Policy which shall indicate the activities to be undertaken by the Company as specified in Schedule VII of the Companies Act, 2013
approve CSR activities
recommend to the Board the amount of expenditure to be incurred on the CSR activities
monitor the CSR Policy of the Company from time to time
ins titute a transparent monitoring for implementation of the CSR projects or programs or activities undertaken by the Company
carry out any other functions as authorized by the Board of Directors from time to time or as enforced by statutory/ regulatory authorities
CSR Policy development and implementation:
The CSR Policy is available on the Companys website at www.enil.co.in http://www.enil.co.in/ policies-code-of-conduct.php
Annual report on CSR activities as required under the Companies (Corporate Social Responsibility Policy) Rules, 2014 has been appended as Annexure B to this Report.
12 Nomination and Remuneration Committee
The Nomination and Remuneration Committee of the Company presently comprises of Mr. N. Kumar (Chairman), Mr. Ravindra Kulkarni, Mr. Richard Saldanha and Mr. Vineet Jain. Brief description of terms of reference and other relevant details of the Nomination and Remuneration Committee have been furnished in the Report on Corporate Governance.
13 St akeholders Relationship Committee
The Stakeholders Relationship Committee of the Company presently comprises of Mr. Richard Saldanha (Chairman), Mr. Ravindra Kulkarni and Mr. Prashant Panday. Brief description of terms of reference and other relevant details of the Stakeholders Relationship Committee have been furnished in the Report on Corporate Governance.
14 Audit Report
The Audit Report does not contain any qualification, reservation or adverse remark.
At the 15th AGM held on August 12, 2014, the Members had approved the appointment of S. R. Batliboi & Associates LLP, Chartered Accountants (ICAI Firm Registration number - 101049W/ E300004) as the statutory auditors of the Company to hold the office from the conclusion of the 15th AGM till the conclusion of the sixth consecutive AGM (with the meeting wherein such appointment has been made being counted as the first meeting). As per the provisions of Section 139 of the Act, the Company shall place the matter relating to such appointment for ratification by members at every AGM. Accordingly, the appointment of S. R. Batliboi & Associates LLP, Chartered Accountants, as the statutory auditors of the Company is placed for ratification by the members of the Company.
S. R. Batliboi & Associates LLP have furnished a certificate in terms of the Companies (Audit and Auditors) Rules, 2014 and confirmed their eligibility in terms of Section 141 and all other applicable provisions of the Act, read with the applicable rules thereto.
Other relevant information has been furnished at Item No. 5 of the Notice convening the AGM.
16 Secr etarial Auditor and report
The Board of Directors had appointed M/s. Hemanshu Kapadia & Associates, Company Secretaries (C. P. No: 2285), to conduct Secretarial Audit for the financial year 2015-16. The Secretarial Audit Report for the financial year ended March 31, 2016 is appended as Annexure C to this Report.
The Secretarial Audit Report dated May 19, 2016 contains one qualification for not appointing a woman director as per the provisions of Section 149 of the Companies Act, 2013 during the financial year under review. The Company wishes to place on record that a woman director (Ms. Vibha Paul Rishi) was on the Board since August 2012. As per the relevant regulatory policy applicable to the Company, she resigned from the Board effective from March 5, 2015. As per the provisions of section 149 of the Companies Act, 2013 read with the applicable rules thereto, any intermittent vacancy of a woman director shall be filled- up by the Board at the earliest but not later than the immediate next Board meeting or three months from the date of such vacancy whichever is later.
The Board of Directors, at their meeting held on May 19, 2015, had proposed the appointment of Ms. Punita Lal (DIN: 03412604) as an Independent Director of the Company. The Company, in compliance with the applicable regulatory requirements requiring it to obtain prior permission of the Ministry of Information & Broadcasting (MIB) for any appointment of director to its Board of Directors, duly applied to the MIB on June 1,
2015. MIB, vide its letter dated February 5, 2016, conveyed its approval for Ms. Lals appointment as a Director. Members of the Company have approved the appointment of Ms. Punita Lal (DIN: 03412604) as the Independent Non-executive Director of the Company through postal ballot voting process. Her appointment as the Independent Non-executive Director is for a term of five consecutive years commencing from March 28, 2016. With effect from March 28, 2016, the Company is in compliance with the requirements of the Companies Act, 2013 and Listing Regulations relating to the composition of the Board of Directors.
17 Cos t Auditor and report
The Board of Directors, on recommendation of the Audit Committee and pursuant to Section 148 and all other applicable provisions of the Act, read with the Companies (Audit and Auditors) Rules, 2014 and all other applicable rules made under the Act (including any statutory modification(s) or re-enactment thereof for the time being in force), has approved the appointment and remuneration of the Cost Auditors, M/s. R. Nanabhoy & Co., Cost Accountants (Firm registration number- 00010) to conduct the audit of the cost records of the Company for the financial year ending on March 31, 2017. The aforesaid appointment of M/s. R. Nanabhoy & Co. is subject to the relevant notifications, orders, rules, circulars, etc. issued by the Ministry of Corporate Affairs and other regulatory authorities from time to time. The remuneration payable to M/s. R. Nanabhoy & Co. shall be Rs. 4,50,000 (Rupees four lacs fifty thousand only) plus out of pocket expenses and applicable taxes for the aforesaid audit. The remuneration payable to the Cost Auditors is required to be ratified subsequently by the shareholders. Accordingly, consent of the members has been sought for passing the resolution as set out at Item No. 6 of the Notice convening the AGM for ratification of the remuneration payable to the Cost Auditors for the financial year ending on March 31, 2017.
The Cost Audit Report for the financial year 2014-15 was filed on September 24, 2015. The Cost Audit Report for the financial year 2015-16 will be filed on/ before the due date.
18 Conserv ation of energy, Technology absorption and Foreign exchange earnings and Outgo
The Company is in the business of Private
FM Radio Broadcasting. Hence, most of the information required to be provided relating to the Conservation of energy and Technology absorption is not applicable.
However the information, as applicable, is given hereunder:
i) Conservation of energy:
The operations of the Company are not energy intensive. Nevertheless, continuous efforts such as installation of energy efficient electronic devices, implementation of SOPs etc. aimed at reducing energy consumption are being made by the Company and its employees to reduce the wastage of scarce energy resources.
ii) Technology absorption:
The efforts made towards technology absorption and benefits derived like product improvement, cost reduction, product development or import substitution:
The Customer Relationship Management (CRM) solutions has seen high level of adoption. And with this headway, the natural progression for ENIL is to get to Mobility and Analytics. We are in the process of rolling out CRM on mobile and also build reporting and analytical tools to improve business opportunities.
We have rolled out Digital Content Repository system to manage the programming content. This helps in archival, meta tag and easy search of content at any given point of time. We look forward to reaping the benefits during the ensuing years.
As part of the expansion of Mirchi under Phase III, we have taken care to adopt the best of technology at optimum pricing, to ensure good return on investments.
Imported technology (imported during last three years reckoned from the beginning of the financial year): Nil
The expenditure incurred on Research & Development (R & D): Foray in the
We have strengthened our presence and now stream 14 radio stations with many more in the pipeline. We have launched regional online radio stations too - in Tamil, Telugu, Punjabi to diversify our appeal. Our partnership with Gaana is helping us get a world class technology and marketing infrastructure to reach our online consumers. We have plans for strengthening our online presence through a refresh of our website and development of new apps. We now stream more than 8Mn video views a month on our YouTube channel.
iii) Foreign exchange earnings and outgo:
The Foreign Exchange earned in terms of actual inflows during the year and the Foreign Exchange outgo during the year in terms of actual outflows.
Amount in Rs.
|Financial Year||Financial Year|
|Foreign exchange earnings||56,684,997||47,964,561|
|Foreign exchange outgo||64,831,617||4,145,846|
19 Particulars of Employees
Disclosures pertaining to remuneration and other details as required under Section 197 of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are appended as Annexure D to this Report.
The Managing Director of the Company does not receive any remuneration or commission from holding Company or any of its subsidiaries.
As per the provisions of Section 197 of the Act read with the Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other relevant particulars of the employees drawing remuneration in excess of the limits set out in the said rules forms part of the Annual Report. As per the first proviso to Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. The said information is made available for inspection at the Registered Office and Corporate Office of the Company during working hours for a period of 21 days before the date of AGM. Any member interested in obtaining such informationmaywritetotheCompanySecretaryand the same will be furnished on request. The Annual Report is available on the Companys website at: www.enil.co.in
20 Extract of Annual Return
Extract of Annual Return of the Company as required under Section 92 of the Act is attached as Annexure E to this Report in the Form MGT 9.
21 Share Capital & Listing of Securities
During the financial year under review, the Company has not issued:
any equity shares with differential rights as to dividend, voting or otherwise;
any shares to its employees under the Employees Stock Option Scheme;
any Sweat Equity Shares.
The equity shares of the Company are listed and admitted to dealings on BSE Limited (BSE) and National Stock Exchange of India Limited (NSE) since February 15, 2006. Annual Listing Fee has been paid to each exchange. As required under the Listing Regulations, the Company has executed the Uniform Listing Agreement with NSE and BSE.
22 Management Discussion and Analysis Report
Management Discussion and Analysis Report for the financial year under review as stipulated under Regulation 34 of the Listing Regulations is set out in a separate section forming part of this Report.
23 Business Responsibility Report
As per the amendment in the Regulation 34 of the Listing Regulations notified on December 22, 2015, the requirement of mandatory reporting of Business Responsibility Report in the Annual Report has been raised from top hundred to top five hundred listed entities based on market capitalization and said notification is applicable effective from April 1, 2016 and should form part of the Annual Report for the financial year 2016-17 onwards. As a matter of proactive corporate governance compliance, the Company has voluntarily published a separate
Business Responsibility Report (BRR) for the
financial year under review as stipulated under Regulation 34 of the Listing Regulations. BRR is in line with the key principles stated in the National Voluntary Guidelines on Social, Environmental and Economic Responsibilities of Business framed by the Ministry of Corporate Affairs.
As a green initiative, the BRR is made available on your Companys website, www.enil.co.in. The BRR shall be kept open for inspection at the Registered Office and Corporate Office of the Company. Any member interested in obtaining a hard copy of the BRR may write to the Company Secretary.
24 Corporate Governance
The Company is adhering to good corporate governance practices in every sphere of its operations. The Company has taken adequate steps to comply with the applicable provisions of Corporate Governance as stipulated under the Listing Regulations. A separate report on Corporate Governance is enclosed as a part of this Report along with the Certificate from the Practicing Company Secretary.
25 Directors Responsibility Statement
Pursuant to the provisions of Section 134 of the Act, the Directors hereby confirm that:
a) in the preparation of the annual accounts for the financial year ended on March 31, 2016, the applicable accounting standards have been followed and that there are no material departures from the same;
b) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year ended on March 31, 2016 and of the profit of the Company for that period;
c) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) they have prepared the annual accounts on a going concern basis;
e) they have laid down internal financial controls for the Company and such internal financial controls are adequate and operating effectively; and f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively.
26 Contracts and arrangements with related parties
All contracts / arrangements / transactions entered into by the Company during the financial year under review with related parties were in the ordinary course of business and on an arms length basis. During the financial year under review, the Company has not entered into any contract / arrangement / transaction with related parties which could be considered material in accordance with the Companys Policy on materiality of related party transactions. Since no Material Related Party Transactions, i.e. transactions exceeding ten percent of the annual consolidated turnover as per the last audited financial statements, were entered during the year by the Company, the disclosure of Related Party Transactions as required under Section 134(3) (h) of the Act in the Form AOC 2 is not applicable.
The Companys Policy on Materiality of related party transactions and dealing with related party transactions is available on the Companys website at: www.enil.co.in at http://www.enil.co.in/policies-code-of-conduct.php
The related party transactions are entered into based on business exigencies such as synergy in operations, profitability, market share enhancement etc. and are intended to further the Companys interests. In accordance with the applicable accounting standards, transactions with related parties are furnished in the financial statements.
27 Particulars of loans given, investment made, guarantees given and securities provided
The Company has not given any loans, guarantees under Section 186 of the Act. Particulars of investments made by the Company during the financial year 2015-16 are provided in the financial statements. Please refer to the Note no. 12 to the standalone financial statements for details of investments made by the Company.
28 Risk Management
The Board of Directors is entrusted with various key functions including framing, implementing and monitoring the risk management plan for the Company; ensuring the integrity of the Companys accounting and financial reporting systems, including the independent audit, and that appropriate systems of control are in place, in particular, systems for risk management, financial and operational control, and compliance with the laws and relevant standards.
The Board of Directors has adopted the Risk Management Policy coupled with the Enterprise Risk Management framework and also established related procedures to inform Board Members about the risk assessment and minimization procedures. Major risks are identified, adequately mitigated continuously and the same are reported to the Audit Committee and Board of Directors along with the action taken report. Risk Management Policy envisages assessment of strategy risk, operational risk, financial risk, regulatory risk, human resource risk, technological risk.
Risk Management Policy adopted by the Company involves identification and prioritization of risk events, categorization of risks into High, Medium and Low based on the business impact and likelihood of occurrence of risks and Risk Mitigation & Control.
The Audit Committee reviews adequacy and effectiveness of the Companys internal control environment and monitors the implementation of audit recommendations, including those relating to strengthening of the Companys Risk Management policies, systems and procedures. Internal Audit function is entrusted to KPMG- the independent Internal Auditors. Internal Audit covers all the radio stations at pan India level and corporate office as per the annual audit plan approved by the Audit Committee. Internal Audit report is presented to the Audit Committee on regular basis and the Chairman of the Audit Committee briefs the Board of Directors about the same.
29 Internal Financial Controls
The Company has in place adequate internal financial controls with reference to financial statements. The Companys internal control systems, including internal financial controls, are commensurate with the nature of its business and the size and complexity of its operations and same are adequate and operating effectively. These systems are periodically tested and no reportable material weakness in the design or operation was observed. The Audit Committee reviews adequacy and effectiveness of the Companys internal control system including internal financial controls.
30 Consolidated Financial Statements
In accordance with the Companies Act, 2013 and applicable accounting standard, the audited Consolidated Financial Statements are provided and forms part of the Annual Report.
31 Subsidiary Company
Alternate Brand Solutions (India) Limited (ABSL) is the Companys wholly owned subsidiary since 2007. ABSL recorded a total income of Rs. 138,231 during the financial year 2015-16. Loss after Tax stood at Rs. 134,671 for the financial year under review.
As per Section 129 of the Companies Act, 2013, separate statement containing the salient features of the financial statements of the Subsidiary Company are attached along with the financial statements in the prescribed Form AOC-1. The Company does not have any associate company or joint venture.
The Company shall make available the financial statements and the related detailed information of its subsidiary to any Member of the Company or its subsidiary who may be interested in obtaining the same at any point of time and same is also available on the website: www.enil.co.in. These documents will also be available for inspection during business hours at the Registered Office and Corporate Office of the Company. The Consolidated Financial Statements presented by the Company include financial results of its Subsidiary Company.
The audited financial statements, including consolidated financial statements and all other relevant documents required to be attached thereto are available on the Companys website: www.enil.co.in
The Policy for determining material subsidiaries is available on the Companys website: www.enil.co.in at http://www.enil.co.in/policies-code-of-conduct.php
32 Significant or material order
During the financial year under review, no significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status and the Companys operations in future.
33 Disclosure under the Sexual Harassment Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
Your Company has always believed in providing a safe and harassment-free workplace for every individual working in the Company. During the financial year under review, four complaints pertaining to sexual harassment were reported to the Internal Complaints Committee of the Company. After detailed investigation and following due procedure under the applicable law, guidelines and regulations, the said complaints were appropriately dealt with during the financial year under review and appropriate action was taken.
Your Directors take this opportunity to convey their appreciation to all the members, listeners, advertisers, media agencies, dealers, suppliers, bankers, regulatory and government authorities and all other business associates for their continued support and confidence in the management of the Company. Your Directors are pleased to place on record their appreciation of the consistent contribution made by employees at all levels through their hard work, dedication, solidarity and co-operation and acknowledge that their efforts have enabled the Company to achieve new heights of success.
For and on behalf of the Board of Directors
Mumbai, May 19, 2016
Entertainment Network (India) Limited,
4th Floor, A-Wing, Matulya Centre,
Senapati Bapat Marg, Lower Parel (West),
Mumbai - 400 013.
Annexure A to the Directors Report
Nomination & Remuneration Policy:
The Policy on Nomination and Remuneration of Directors, Key Managerial Personnel, Senior Management and other employees was formulated, approved and adopted by the Board of Directors based on the recommendation of the Nomination and Remuneration Committee (Committee). The features of the Policy are as under:
1. Appointment / Nomination criteria and qualifications
a) The Committee shall identify and ascertain the integrity, qualification, background, standing in profession, positive attributes, expertise and experience of the person for appointment as a director and will conduct evaluation of candidates in accordance with a process that it sees fit and appropriate and recommend to the Board his / her appointment.
b) A person should possess relevant qualification, expertise and experience for the position he / she is considered for appointment as a director. The Committee has the discretion to decide whether qualification, expertise and experience possessed by a person are sufficient / satisfactory for the concerned position.
c) The Company shall not appoint or continue the employment of any person as whole-time director or managing director who has attained the age of seventy years. Provided that the term of the person holding this position may be extended beyond the age of seventy years with the approval of the Members by passing a special resolution based on the explanatory statement annexed to the notice for such motion indicating the justification for extension of appointment beyond seventy years.
d) In addition to the above, the Independent Director shall fulfil all the criteria of independence as laid down in the Companies Act, 2013 and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 [Listing Regulations]. The Independent Director shall adhere to the Schedule IV [Code for Independent Directors] of the Companies Act, 2013. Every independent director shall at the first meeting of the Board in which he participates as a director and thereafter at the first meeting of the Board in every financial year or whenever there is any change in the circumstances which may affect his status as an independent director, give a declaration that he meets the criteria of independence as provided in sub-section (6) of Section 149 of the Companies Act, 2013 and the Listing Regulations.
2. Performance evaluation criteria
Performance evaluation of every director, KMP, Senior Management Personnel and other employees shall be carried out based on detailed performance parameters. Usefulness and relevance of such performance parameters shall be evaluated on regular basis. The performance parameters / criteria includes but not limited to the following:
Qualifications, academic profile, experience and expertise
Professional and business standing
Ability to take constructive stands when necessary
Understanding of the Companys business and engagement level
Understanding and commitment to duties and responsibilities
Willingness to devote the time needed to prepare for and participate in deliberations
Responsiveness (timeliness and quality)
Approach to conflict, and whether the conflict is constructive and productive
Achievement of set targets/ Key Result Areas (KRAs) (for KMP, Senior Management Personnel and other employees)
3. Remuneration Policy
The Company has adopted the Remuneration Policy for its directors, KMP and other employees keeping in view the following guidelines:
The Remuneration Policy followed by the Company rewards employees based on the aforesaid performance evaluation criteria. Through this Policy, the Company endeavors to attract, retain, develop and motivate its highly skilled and dedicated workforce. The Company follows a compensation mix of fixed pay and performance based pay.
The Remuneration Policy shall be simple, open and transparent.
The level and composition of remuneration shall be reasonable and sufficient to attract, retain and motivate directors of the quality required to run the Company successfully.
Relationship of remuneration to performance shall be clear and meets appropriate performance benchmarks.
Remuneration to directors, KMP and senior management shall involve a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the Company and its goals.
4. Remuneration to Managing Director, Whole-time/ Executive Director(s), KMP, Senior Management Personnel and other employees
The Company follows a remuneration/ compensation mix of fixed pay and performance based pay. The Managing Director, Whole-time / Executive Director(s), KMP and Senior Management Personnel shall be eligible for a monthly remuneration, allowances, performance bonus/ incentive, profit based remuneration, etc. as may be approved by the Board on the recommendation of the Committee. The breakup of the pay scale and quantum of perquisites including employers contribution to provident fund, pension scheme, medical expenses, club fees etc. shall be decided and approved by the Board on the recommendation of the Committee and approved by the shareholders and Central Government, if and to the extent required. Payment of managerial remuneration shall be pursuant to the provisions of Section 197 and all other applicable provisions of the Companies Act, 2013.
Remuneration payable to other employees shall be based on the performance evaluation criteria set out above.
5. Remuneration to Non- Executive / Independent Director
Non- Executive / Independent Directors may be paid managerial remuneration (including remuneration as a percentage to the net profits) pursuant to the provisions of Section 197 and all other applicable provisions of the Companies Act, 2013.
The Non- Executive / Independent Directors may receive remuneration by way of fees for attending meetings of Board or Committee(s) thereof and in line with the applicable provisions of the Companies Act, 2013.
For and on behalf of the Board of Directors
Mumbai, May 19, 2016