Television Eighteen India Ltd Merged Auditor Reports

TELEVISION EIGHTEEN INDIA LIMITED ANNUAL REPORT 2009-2010 AUDITORS REPORT TO THE MEMBERS OF TELEVISION EIGHTEEN INDIA LIMITED 1. We have audited the attached Balance Sheet of Television Eighteen India Limited, (the Company) as at 31 March, 2010, the Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date, both annexed thereto. These financial statements are the responsibility of the Companys Management. Our responsibility is to express an opinion on these financial statements based on our audit. 2. We conducted our audit In accordance with the auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and the disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the Management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. 3. As required by the Companies (Auditors Report) Order, 2003 (CARO) issued by the Central Government in terms of Section 217(4A) of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order. 4. Without qualifying our report, attention is invited to Note 11 of Schedule 16 to the financial statements wherein it Is stated that Company has long term investments of Rs. 27,768.95 lakhs in quoted equity shares. The market value of these quoted investments as at 31 March, 2010 aggregates to Rs. 7,472.75 lakhs. The Company also has an investment of Rs. 1,335.43 lakhs in a subsidiary, the net worth of which has been eroded. However, having regard to continued long term strategic involvement, management is of the view that no provision is considered necessary for diminution in the value of these Investments. 5. Further to our comments in the Annexure referred to in paragraph 3 above, we report as follows: a. we have obtained ail the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit; b. In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books; c. the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this report are in agreement with the books of account; d. in our opinion, the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this report are in compliance with the Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956; e. In our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India: I. In the case of the Balance Sheet, of the state of affairs of the Company as at 31 March, 2010; II. in the case of the Profit and Loss Account, of the loss of the Company for the year ended on that date; and III. In the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date. f. On the basis of the written representations received from the Directors as on 31 March, 2010 taken on record by the Board of Directors, none of the Directors is disqualified as on 31 March, 2010 from being appointed as a director in terms of Section 274(1)(9) of the Companies Act, 1956. For DELOITTE HASKINS & SELLS Chartered Accountants (Registration No. 015125N) ALKA CHADHA Partner (Membership No. 93474) Noida 28 May, 2010. ANNEXURE TO THE AUDITORS REPORT (Referred to in paragraph 3 of our report of even date) i. In respect of its fixed assets: a. The Company has maintained proper records showing full particulars, including quantitative details other than for situation of some of its fixed assets. b. According to the information and explanations given to us, the Company has a regular programme of physical verification of its fixed assets by which fixed assets are verified by the Management in a phased manner over a period of three years. In accordance with this programme, certain fixed assets were verified during the year and no material discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets. c. The fixed assets disposed off during the year, In our opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, In our opinion, not affected the going concern status of the Company. II. In respect of its inventory: a. As explained to us, the Inventories were physically verified during the year by the Management at reasonable intervals. b. In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the Management were reasonable and adequate in relation to the size of the Company and the nature of its business. c. In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification. iii. In respect of loans, secured or unsecured, granted by the Company to companies, firms or other parties covered in the Register under Section 301 of the Companies Act, 1956, according to the information and explanations given to us: a. The Company has granted loans aggregating Rs. 1,893.18 lakhs to 2 parties during the year. At the year-end, the outstanding balances of such loan aggregated Rs. 592.16 lakhs (from 4 parties) and the maximum amount involved during the year was Rs. 4,946.84 lakhs (from 8 parties), b. The rate of interest and other terms and conditions of such loans are, in our opinion, prima facie not prejudicial to the interests of the Company. c. As per the Information and explanations given to us, the loans referred to in paragraph iii a above, being receivable on demand, together with interest, repayments made during the year are as mutually agreed. d. According to the information and explanations given to us, the other terms and conditions of the loans given by the Company are prima facie not prejudicial to the interest of the Company and there are no overdue amounts in respect of above loans including interest thereon. e. The Company has not taken any loans, secured or unsecured from parties listed in the register maintained under Section 301 of the Companies Act, 1956. IV. In our opinion, and according to the information and explanations given to us, having regard to the explanations that some of the fixed purchased, goods sold and services rendered are of a special nature and suitable alternative sources are not readily available for obtaining comparable quotations, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of inventory and fixed assets and the sale of goods and services. During the course of our audit, we have not observed any major weakness in such internal control system. V. In respect of contracts or arrangements entered in the Register maintained in pursuance of Section 301 of the Companies Act, 1956, to the best of our knowledge and belief and according to the information and explanations given to us: a. the particulars of contracts or arrangements referred to in Section 301 that needed to be entered in the Register maintained under the said Section have been so entered. b. the transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 and exceeding the value of Rs. 5 lakhs In respect of any party during the year having regard to the explanation that some of the services rendered/purchased are of a specialised nature for which there are no alternate sources of supply to enable comparison of prices, these have been made at prices which are reasonable to prevailing market prices as at the relevant time. VI. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Sections SSA and 58AA or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. According to the information and explanations given to us, no order has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal. vii. In our opinion, the Company has an adequate Internal audit system commensurate with the size and the nature of its business. viii. According to the information and explanations given to us, the Central Government has not prescribed maintenance of cost records under clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956 for the Company. ix. According to the information and explanations given to us In respect of statutory dues: a. The Company has been generally regular In depositing its undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service tax, Customs Duty, Cess and other material statutory dues applicable to it with the appropriate authorities. We are informed that the Companys operations did not give rise to any Excise Duty. b. There are no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service tax, Customs Duty, Cess and other material statutory dues In arrears as at 31 March, 2010 for a period of more than six months from the date they became payable. We are informed that the Companys operations did not give rise to any Excise Duty. c. Dues of Income tax that have not been deposited on account of disputes are as follows: Name of A B C D Statute Income Tax Transfer Pricing Income Tax 2001-02 2,474,434 Act, 1961 Appelate Tribunal Income Tax Transfer Pricing Commissioner 2002-03 51,614 Act, 1961 of Income Tax (Appeals) A = Nature of dispute B = Forum where the dispute is pending C = Period to which the amount relates D = Amount (Rs.) There are no dues in respect of Wealth Tax, Sales Tax, Customs Duty, Service Tax and Cess which have not been deposited on account of any dispute. X. The Company does not have any accumulated losses as at the year end and the Company has not incurred cash tosses m the financial year and in the immediately preceding financial year. xi. In our opinion and according to the information and explanations given to us, the Company has not defaulted In the repayment of dues to banks and financial institutions. According to the information and explanations given to us, the Company did not have any outstanding debentures during the year. xii. According to the information and explanations given to us, the Company has not granted loans and advances on the bases of security by way of pledge of shares, debentures and other securities. Accordingly, the provisions of clause 4(xu) of the Order are not applicable to the Company. xiii. According to the information and explanations given to us, the Company is not a chit fund or a nidhi/mutual benefit fund/society. Accordingly, the provisions of clause 4(xiii) of the Order are not applicable to the Company. xiv. According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Order are not applicable to the Company. xv. In our opinion and according to the information and explanations given to us, the terms and conditions of the guarantees given by the Company for loans taken by others from banks and financial institutions are not prima facie prejudicial to the interests of the Company. xvi. According to the information and explanations given to us, other than for term loans of Rs. 10,820.51 lakhs at the year end, which as indicated in Note 8 of Schedule 16 are yet to be utilised for the purpose for which these were obtained, In our opinion, other term loans have been applied for the purpose for which they were obtained. xvii. In our opinion and according to the information and explanations given to us and on an overall examination of the Balance Sheet, we report that funds raised on short-term basis have not been used during the year for long- term investment, xviii. According to the information and the explanation given to us, the Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, the provisions of clause 4(xvii) of the Order are not applicable to the Company. xix. According to the information and explanations given to us, the Company had not issued any debentures during the period covered by our audit report. Accordingly, the provisions of clause 4(xix) of the Order are not applicable to the Company. xx. The Management has disclosed the end use of money raised by rights issues and we have verified the same. xxi. To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no fraud on the Company has been noticed or reported during the year. For DELOITTE HASKINS & SELLS Chartered Accountants (Registration No. 015125N) ALKA CHADHA Partner (Membership No. 93474) Noida 28 May, 2010.