Notes to Accounts of Geodesic Ltd.

Jun 30, 2013

1 NATURE OF OPERATIONS:

Te Company is in the business of offering concrete solutions in Communication and Collaboration, financial products and services, providing content delivery platforms for mobile services and in electronic computing. Te Company continuously upgrades existing products and develops new products to keep ahead of the curve.

PRESENTATION OF FINANCIAL STATEMENTS

A revised schedule VI format is introduced and made mandatory for preparation of financial statements beginning from April 2011. Te revised schedule VI has classified the Assets and Liabilities into Current and Non-current based on the Company''s normal operating cycle and other criteria set out in the Schedule VI to the Companies Act, 1956. Te Company has ascertained its operating cycle as 12 months for the purpose of current and non-current classification of assets and liabilities, based on the nature of products and the time between the acquisition of assets for processing and their realisation in cash and cash equivalents.

2 Sales Returns and Purchase Returns:-

In April 2011, the Company developed a new version of one of their product with additional features to keep up with the latest changes in technology. However, the revised version developed certain problems with all the customers. Te Company continued its efforts to solve the problems and to provide improved services to the customers. In the meanwhile the Company restored the earlier version of the product temporarily so that the business loss to the customers was minimized. There was constant verbal and written communications with the customers, with Company offering the customers solutions and revised versions of the product. However, in spite of all its efforts the Company was unable to offer a permanent solution to the problems faced by the customers. Finally, in July 2013, the Company agreed to reverse all sales made to the customers of the said product from April 2011 to avoid further legal action from the customers. This has been booked as Sales Returns in the respective years in which the sales had taken place. An appropriate part thereof was reversed in the recanted accounts for the financial year ended 30th June, 2012 and the balance impact of the said sales returns on the financials for July 2012 to June 2013 is of Rs. 15,924.48 lac. This has resulted in reducing the profit of the Company to the extent of Rs. 15,924.48 lac.

This has given a very big set back to the Company so far as the recoveries are concerned. Due to this action the Company had started negotiations with the parties from whom these licenses were purchased. During this negotiation the Company has taken help of the clause mentioned in the agreement entered in to by the Company with the vendors. Ultimately the vendors have agreed for write off of the amount payable to them.

Considering this, against aggregate write off of sundry debtors for the said product of Rs.45,340.87 lac (both the financials years ended 30th June 2012 and 30th June 2013) the Company has written back creditors for the supply of the software used in manufacture of the aforesaid product, amounting to Rs.43,700.54 lac in the financial year ended 30th June 2013.`

3 Provision for Bad and Doubtful Debts:-

During the current year in accordance with the revised policy, the Company has made a provision of bad and doubtful debts of Rs.40,374.64. However, no provision has been made for the amount of Rs.36,745.50 lac, shown as Trade Receivable which is due over 2 years from Company''s wholly owned subsidiary GTSL in respect of supplies made to them by the Company, which GTSL in turn had supplied to its end customers, since the Company is in the process factorisation of the said dues.

4 Interest on overdue debtors

Te company had a policy of charging interest on its overdue debtors. However, on account of economic slowdown along with subsequent reversals of sales, the company has decided to write back the interest income amounting to Rs.233.83 lac thereby reducing the profit to that extent.

5 Te financial charges include amounts aggregating to Rs.3,528.16 lac demanded by Barclays Bank and Standard Chartered Bank towards interest and loss on hedging contracts on a conservative basis although the same are disputed by the Company. However, the Company has made counterclaims against both the above Banks for excess charges/profit on hedging contracts aggregating to Rs.9,300 lac. Te Company has also disputed amounts claimed by ICICI and HDFC Bank against the Hedging contracts. Te Company is in process of filling a counter claim against these Banks also.

6 On-going Product Development WIP amounting to Rs.1,447.95 lac represents amounts incurred on development of new products which either are in the process of development or are awaiting their launch, as per the past practice. Te same consists of four such products which are almost ready for launch. Management reviews on the balance sheet date the costs incurred on various project to consider recoverability of the amou8nts spent over the estimated life of the product. On 30th June, 2012 an amount of Rs.300 lac was written of based on such review. Paucity of funds and manpower has resulted in slow progress in finishing of the respective product during the year. Te management, however, believes that all the above products are going to have tremendous potential value in the coming years. Hence, the costs incurred on these products have been carried forward and will be capitalised in the year of their launch.

7 During the year the Company''s foreign subsidiaries GTSL and GHL have incurred losses. Tis has resulted in depletion in Company''s investment in the said subsidiaries. However considering the potential in the business of both the subsidiaries the management does not consider it necessary to provide for any depletion in the value of its investments in the said subsidiaries.

8 Te Company has investments in its wholly owned subsidiary, Chandamama India Limited to the tune of Rs.2,306.58 lac. Te net worth of this subsidiary is negative / less than 25% of investment in that subsidiary as on 30th June, 2013. Te Company has not made any provision against diminution in value of investment in shares of the aforesaid subsidiary. Te management is confident of fetching the value of investment based on the assets owned by the Company – both physical and non-physical. Te Company is in the process of producing two animation flm series, enhancing its subscription base and selling content on new media which will ultimately generate profits in the coming year.

9 Segment Reporting:

Te primary reporting of the Company has been disclosed on the basis of business segment. Te Company has only one business segment which is software product sale and related consultancy services. Accordingly, the amounts appearing in these financial statements relate to this primary segment. Further the Company sells and provides services mainly outside India and also within India. Thus disclosures under secondary segment reporting are as follows:

10 Contingent Liability (not provided for) exist in respect of:

Rs. in lac

Sr. For the period ended For the period ended Particulars No. 30 June 2013 30 June 2012*

a) Outstanding bank guarantees 21.71 96.06

b) Letter of Credit given by bank on behalf of the Company - 1,731.74

c) Times Internet disputed payment towards minimum guarantee fees Details given 223.15 below

d) Income tax Demand in respect of an earlier year(s) under dispute

1. Appeal pending with CIT Appeals VIII for Ay 2009-10 4.73 -

Total 26.44 2,050.95

11 Share Capital:

Employees have exercised 186,498 (P.y. Nil) stock options during the year ended 30th June, 2013 which has resulted in an increase in Equity Share Capital of Rs.3.73 lac (P.y. Nil).

12 Foreign Currency Convertible Bonds (FCCB):

In January 2008, the Company raised Rs.49,962.50 lac equivalent to US$ 125 million on the issue of Zero Coupon Convertible Bonds, due on 18th January, 2013 to overseas investors vide RBI approval no. FED.CO.EBCD/3013/03.02.766/2077-08 dated 5th December, 2007. As per the approval the funds could be utilised only for overseas acquisitions and investments in joint ventures / wholly owned subsidiaries and for any other use as may be permitted under applicable laws or regulations from time to time.

Till date the Company has not been able to discharge this liability. Te foreign currency convertible bond (FCCB) holders have fled a winding up petition against the Company for defaulting on the dues. Te London branch of Citi Bank is a trustee in this case where it has approached the Court in London to recover its dues from the Company on behalf of Bond Holders.

In the meanwhile the Company has made provision for interest on the said bonds at 9% amounting to Rs.2,890.11/- lac ,in accordance with the agreement with Bond Holders from the date of maturity till the Balance Sheet date.

13 Related Party Disclosures: a. List of Related Parties

Related Parties with whom transactions have taken place during the year:

Key Managerial Personnel (KMP):

Mr.Pankaj Kumar

Mr.KiranKulkarni

Mr.PrashantMulekar

Enterprise over which Key Management Personnel exercise signifcant infuence:

None

14 Subsidiary Companies / Acquisition of Companies:

During the year the Company invested Rs.22.32 lac (P.y. Rs.348.82 lac) towards 40,000 (P.y. 7,80,000) shares of US$ 1 each in Geodesic Holdings Limited, Mauritius.

Te Share Application as at the end of the period30th June 2013 for Geodesic Technology Solutions Limited, Hong Kong (GTSL) is Rs.2,450.55 lac.

During the period the Company has granted a loan of Rs.72.28lac to GTSL, Hong Kong. Te closing balance of loan Rs.7,856.98 lac (P.y. Rs.7,388.21 lac) net of foreign exchange rate fluctuation, is shown under "Long Term Loans and Advances" in Note 15 forming part of the financial statements.

During the year, the Company was allotted 586,660 convertible preference shares of Rs.10 each in Chandamama India Limited for an amount of Rs.352 lac (P.y. Rs. Nil). During the period the Company advanced Rs.94.48 lac to Chandamama India Limited which is shown under "Long Term Loans and Advances" in Note 15 forming part of financial statements. Also, the Company has in the current year received advance from Chandamama India Limited amounting to Rs.372.35 Lac as advance for purchase of tablets which is shown under other current liabilities.

During the year Company has advanced Rs.13.58 lac (P.y. Rs. 83.37 lac) to Filmorbit.Com India Private Limited which is shown under "Long Term Loans and Advances" in Note 15 forming part of fnancial statements.

During the period the Company invested additional funds at par in the following Indian subsidiaries and associates:

a) ITM Digital Private Limited (IDPL) was incorporated as a subsidiary in Fy 2009-10, but thereafter Zee Entertainment Limited invested 60% in the Company, after which it ceased to be a subsidiary of the Company. Te investment of Rs.40 lac made in the company has been purchased by Zee Entertainment Limited in the month of May 2011. Te investment as at end of period is Rs.99,990 (P.y. Rs.99,990).

b) Geodesic Gridpoint Energy Private Limited (GGEPL) with an investment of Rs.583.22 lac (P.y.Rs. Nil).During the period the Company advanced Rs.16.85 lac (P.y. Rs.143.58 lac) to Geodesic Gridpoint Energy Private Limited which is shown under "Long Term Loans and Advances" in Note 15 forming part of financial statements.

15 Disclosure for operating leases:

a. Non-cancellable lease:

Te Company''s significant leasing agreements are in respect of operating leases for official premises and guest house. These leasing arrangements are non-cancellable for a period of three years and are usually renewable by mutual consent on mutually agreeable terms.

16 Based on the information available with the Company, none of the vendors fall under the definition of micro, small and medium scale enterprises. This information is not verifiable by the auditors.

17 Figures of the previous year have been regrouped/ rearranged wherever necessary to correspond with the figures of the current period on account of revised schedule VI format. Amounts and other disclosures for the preceding year are included as an integral part of the current period financial statements and are to be read in relation to the amounts and other disclosures relating to the current period.

---

Mar 31, 2011

Nature of Operations:

The Company is the creator of Mundu ICE Information, Communication and Entertainment Stack based on a universal Instant Messaging Platform. The Company continuously upgrades existing products and develops new products to keep ahead of the curve.

1. Segment Reporting:

The primary reporting of the Company has been disclosed on the basis of business segment. The Company has only one business segment which is software product sale and related consultancy services. Accordingly, the amounts appearing in these financial statements relate to this primary segment. Further the Company sells and provides services mainly outside India and also within India. Thus disclosures under secondary segment reporting are as follows:

- Revenue by Geographical Segment

The Company's operating facilities are located in India.

The total cost incurred during the year to acquire fixed assets within India is disclosed at Schedule 6. Segment revenue is based on geographical locations of customers and segment asset is based on geographical location of assets.

2. Contingent Liability (not provided for) exist in respect of:

Rs. in lakhs

Sr. Particulars 2010-11 2009-10 No.

a) Outstanding bank guarantees 32.62 35.95

b) Letter of Credit given by bank on behalf of the Company 759.49 –

c) Income tax Demand in respect of an earlier year(s) under dispute

1. Appeal pending with CIT Appeals VIII for AY 2005-06 6.93 6.93

2. Appeal pending with CIT Appeals XXX for AY 2006-07 – 0.53

3. Appeal pending with CIT Appeals XXX for AY 2007-08 – 4.14

4. Appeal pending with CIT Appeals XXX for AY 2008-09 – 7.26

4. Appeal pending with CIT Appeals XXX for AY 2009-10 – 0.08

Total 799.04 54.89

3. Share Capital:

Employees have exercised 2,550 (P.Y. 28,825) stock options during the year, which has resulted in an increase in Equity Share Capital by Rs. 0.05 lakhs (P.Y. Rs. 0.58 lakhs) and Security Premium Account by Rs. 2.13 lakhs (P.Y. Rs. 24.04 lakhs).

The Board of Directors, in its meeting held on 7th May, 2010 announced a buy back of equity shares for upto 10% of the shares. On 26th November, 2010, the Board declared the completion of buy back process. The Company bought back 21,05,000 equity shares aggregating to Rs. 20,70,77,740/- (Rupees Twenty Crores Seventy Lakh Seventy Seven Thousand Seven Hundred Forty Only) which was within the limits specified. The company bought back 2.28 % of its pre buyback equity in the entire process. As a result of the buy back Equity Share Capital account has reduced by Rs. 42.10 lakhs and the Securities Premium Account by Rs. 2,035.81 lakhs.

4. Foreign Currency Convertible Bonds (FCCB):

In January 2008, the Company raised Rs. 49,962.50 lakhs equivalent to US$ 125 million on the issue of Zero Coupon Convertible Bonds, due on 18th January, 2013 to overseas investors vide RBI approval no. fied.CO.EBCD/3013/03.02.766/2077-08 dated 5th December, 2007. As per the approval the funds can be utilised only for overseas acquisitions and investments in joint ventures / wholly owned subsidiaries and for any other use as may be permitted under applicable laws or regulations from time to time.

The Bonds constitute the Company's direct, unconditional, unsubordinated and unsecured obligations and will at all times rank parri passu and without any priority amongst themselves. The Company's payment obligations under the Bonds shall, save for such exceptions as may be provided by mandatory provisions of applicable law, at all times rank at least equally with all of its other present and future direct, unconditional, unsubordinated and unsecured obligations.

The conversion price of the Bonds, subject to certain conditions, will initially be Rs. 302.27 per share with a fixed rate of exchange on conversion of Rs. 39.13 = US$ 1.00.

The Bonds are listed on the official list of the Singapore Exchange Securities Trading Ltd (SGX-ST) (the "Singapore Stock Exchange"). During the year ending March 2010, the Company has repurchased FCCB of the face value of US$ 8.50 Million, listed on the Singapore Stock Exchange, in accordance with the A.P. (DIR Series) Circular No. 39 dated 8th December, 2008 (the "Circular") issued by the Reserve Bank of India. As on 31st March, 2011 Bonds with the nominal value of US$ 113.50 million are outstanding. The Company may repurchase more of these bonds depending upon the market conditions.

During the current year the Company has not re-purchased FCCB's, therefore profit / loss on buy back is Rs. Nil (P.Y. Rs. 676.36 lakhs) and has also written back the provision for interest accrued but not due on the buy back of Bonds during the current year amounting to Rs. Nil (P.Y. Rs. 121.61 lakhs).

The Bonds carry an yield of 6.60% per annum based on the same, interest of Rs. 3,389.27 lakhs (P.Y. Rs. 3,677.44 lakhs) has been provided in the accounts (refer Schedule 21 of the Balance Sheet).

5. Related Party Disclosures:

(i) List of Related Parties

Related Parties with whom transactions have taken place during the year:

a. Key Managerial Personnel (KMP):

Mr. Pankaj Kumar

Mr. Kiran Kulkarni

Mr. Prashant Mulekar

b. Enterprise over which Key Management Personnel exercise significant infuence:

None

c. Subsidiary Companies:

(A) Direct Holding (B) Indirect Holding

Chandamama India Limited (CIL) –

Filmorbit.Com India Private Limited (FIPL) –

Geodesic Gridpoint Energy Private Limited –

(GGEPL)

Geodesic Technology Solutions Ltd, Hong Kong –

(GTSL)

Geodesic Holdings Limited (GHL) (i) Geodesic Information Systems Inc. (GIS)

(ii) Interactive Networks International (INI)

(iii) Publicidad Digital S.A. (PD)

(iv) Emiloto Associated Inc. (EAI)

(v) Geodesic (Hong Kong) Ltd (GHKL)

(vi) Geodesic Technology FZE (GT FZE)

(vii) Zomo Technologies Ltd (ZTL)

(viii) Spokn Communications Pte Ltd (SCPL)

6. Subsidiary Companies / Acquisition of Companies:

During the year the Company invested Rs. 35,332.47 lakhs (P.Y. Rs. 8,722.80 lakhs) towards 77,999,900 (P.Y. 19,000,000) shares of US$ 1 each in Geodesic Holdings Limited, Mauritius. The said investment amount will be utilised for streamlining the Company's stake in foreign subsidiaries for better integration, smoother flow of information and creating a strong base for future business growth.

The Company acquired Zomo Technologies Ltd through its 100% subsidiary Geodesic Holdings Ltd, Mauritius.

A sum of Rs. 14.92 lakhs (P.Y. Rs. 14.67 lakhs) has been accrued towards interest receivable from Geodesic (Hong Kong) Ltd., Hong Kong, a 100% subsidiary of the Company for the year and the same has been shown under "Loans and Advances" in Schedule 12 of the Accounts.

The Company had invested Rs. 3,021.96 lakhs in Geodesic Technology Solutions Limited a 100% subsidiary which is lying in Share Application which was to be allotted during financial year 2010-11. During the year Rs. 571.41 lakhs has been converted to equity by allotment of 100,00,000 equity shares of HKD 1 each at par, as a result of which the amount lying in Share Application as at the end of the financial year pending allotment is Rs. 2,450.55 lakhs.

As at the year end, closing balance of Rs. 5,492.41 lakhs (P.Y Rs. 5,662.02 lakhs) net of foreign exchange rate fuctuation, is shown under "Loans and Advances" in Schedule 12 of the Accounts.

During the year, the Company has applied for an additional 22,70,000 equity shares of Rs. 10 each in Chandamama India Limited on a preferential basis for an amount of Rs. 227 lakhs. This money is lying in Share Application pending allotment.

During the year the Company invested additional funds at par in the following Indian subsidiaries and associates:

a) ITM Digital Private Limited (IDPL) was incorporated as a subsidiary in FY 2009-10, but thereafter Zee Entertainment Limited invested 60% in the Company, after which it ceased to be a subsidiary of the Company. During the year the Company has made additional investment to Rs. 40,00,000 (P.Y. Rs. 99,990).

b) Geodesic Gridpoint Energy Private Limited (GGEPL) with an investment ofRs. 24,59,990 (P.Y. Rs. 99,990).

c) The Company has invested further funds ofRs. 31,50,000 (P.Y. Rs. 5,00,000) in Filmorbit.Com India Private Limited (FIPL) to increase its stake to 87.95%. Consequently, FIPL has become a subsidiary of the Company during the year.

7. Disclosure for operating leases:

a) Non-cancellable lease:

The Company's significant leasing agreements are in respect of operating leases for official premises and guest house. These leasing arrangements are non-cancellable for a period of three years and are usually renewable by mutual consent on mutually agreeable terms.

The aggregate lease rentals are charged as Rent under Schedule 20.

b) Cancellable lease:

The other leasing agreements for the premises are considered as cancellable leasing agreements. The aggregate lease rentals are charged as Rent under Schedule 20.

8. The Company has investments in its wholly owned subsidiary, Chandamama India Limited to the tune of Rs. 1,954.59 lakhs. The net worth of this subsidiary is negative / less than 25% of investment in that subsidiary as on 31st march, 2011. The Company has not made any provision against diminution in value of investment in shares of the aforesaid subsidiary. The management is confident of fetching the value of investment based on the assets owned by the Company – both physical and non-physical. The Company is in the process of producing two animation film series, enhancing its subscription base and selling content on new media which will ultimately generate profits in the coming year.

9. Based on the information available with the Company, none of the vendors fall under the definition of micro, small and medium scale enterprises. This information is not verifable by the auditors.

10. The production of software is not capable of being expressed in any generic unit. However, the Company manufactures/deals in a hardware product. The quantitative information as required by certain clauses of paragraphs 3, 4C and 4D of Part II of Schedule VI of the Companies Act, 1956 are attached separately. Also, as the activities of the Company do not require industrial licensing, the fgures for licensed capacity are not given.

11. Figures of the previous year have been regrouped/ rearranged wherever necessary to correspond with the fgures of the current year. Amounts and other disclosures for the preceding period are included as an integral part of the current year financial statements and are to be read in relation to the amounts and other disclosures relating to the current year.

---

Mar 31, 2010

1. Share Capital:

Employees have exercised 28,825 (P.Y. 62,035) stock options during the year, which has resulted in an increase in Equity Share Capital by Rs0.58 lakhs (P.Y Rs 1.24 lakhs) and Security Premium Account by Rs24.04 lakhs (P.Y. Rs 55.38 lakhs).

2. Foreign Currency Convertible Bonds (FCCB):

The Company raised Rs 49,962.50 lakhs equivalent to US$ 125 million on the issue of Zero Coupon Convertible Bonds, due on 18th January, 2013 to overseas investors vide RBI approval no. FED. CO.EBCD/3013/03.02.766/2077-08 dated 5th December, 2007. As per the approval the funds can be utilised only for overseas acquisitions and investments in joint ventures / wholly owned subsidiaries and for any other use as may be permitted under applicable laws or regulations from time to time.

The Bonds constitute the Companys direct, unconditional, unsubordinated and unsecured obligations and will at all times rank parri passu and without any priority amongst themselves. The Companys payment obligations under the Bonds shall, save for such exceptions as may be provided by mandatory provisions of applicable law, at all times rank at least equally with all of its other present and future direct, unconditional, unsubordinated and unsecured obligations.

The conversion price of the Bonds, subject to certain conditions, will initally be Rs 302.27 per share with a fixed rate of exchange on conversion of Rs 39.13 = US$ 1.00.

The Bonds are listed on the official list of the Singapore Exchange Securities Trading Ltd (SGX-ST) (the "Singapore Stock Exchange"). During the year, the Company has repurchased US$ 8.50 Million face value of FCCB, listed on the Singapore Stock Exchange, in accordance with the A.P. (DIR Series) Circular No. 39 dated 8th December, 2008 (the "Circular") issued by the Reserve Bank of India. As on date of this report Bonds with the nominal value of US$ 113.50 million are outstanding. The Company may repurchase more of these bonds depending upon the market conditions.

As a result of the above buy back, the Company has made a profit of Rs 676.36 lakhs (P.Y. Rs 2,100.31 lakhs) and has also written back the provision for interest accrued but not due on the said buy back Bonds amounting to Rs121.61 lakhs (P.Y. Rs 260.63 lakhs). Considering the nature of profit on account of buy back of Bonds and write back of the provision for interest, the same is shown as "Exceptional Income" on the face of the Profit and Loss Account.

The Bonds carry an yield of 6.60% per annum based on the same, interest of Rs 3,677.44 lakhs (P.Y. Rs 3.958.78 lakhs) has been provided in the accounts (refer Schedule 21 of the Balance Sheet).

3. Related Party Disclosures: (i) List of Related Partes

Related Partes with whom transactions have taken place during the year:

a. Key Managerial Personnel (KMP):

- Mr. Pankaj Kumar

- Mr. Kiran Kulkarni

- Mr. Prashant Mulekar

b. Enterprise over which Key Management Personnel exercise significant influence:

- None

c. Subsidiary Companies

(A) Direct Holding (B) Indirect Holding

- Chandamama India Limited (CIL) -

- ITM Digital Private Limited (ITM) -

- Geodesic Gridpoint Energy Private Limited (GGEPL) -

- Geodesic Technology Solutions Ltd, Hong Kong (GTSL) -

- Geodesic Holdings Limited (GHL) (i) Geodesic Information Systems Inc. (GIS)

(ii) Interactive Networks International (INI)

(iii) Publicidad Digital S.A. (PD)

(iv) Emiloto Associated Inc. (EAI)

(v) Geodesic (Hong Kong) Ltd (GHKL)

(vi) Geodesic Technology FZE, (GT FZE)

4. Subsidiary Companies / Acquisition of Companies:

During the year the Company invested Rs 8,722.80 lakhs (P.Y. Rs 36,870.60 lakhs) towards 19,000,000 (P.Y. 76,265,100) shares of US$ 1 each in Geodesic Holdings Limited, Mauritius. The investment will be utilised for streamlining the Companys stake in foreign subsidiaries for bet]ter integration, smoother flow of information and creating a strong base for future business growth.

The Company has formed a subsidiary, Geodesic Technology FZE through its 100% subsidiary Geodesic Holdings Ltd, Mauritius.

The entire shareholding in the Hong Kong subsidiary Geodesic (Hong Kong) Ltd. was transferred to Geodesic Holdings Limited at cost during the year amounting to Rs405.97 lakhs.

A sum of Rs 14.67 lakhs (P.Y. Rs 10.81 lakhs) has been accrued towards interest receivable from Geodesic (Hong Kong) Ltd., Hong Kong, a 100% subsidiary of the Company which has been shown under "Loans and Advances" in Schedule 12 of the Accounts.

The Company had invested Rs 3,021.96 lakhs in Geodesic Technology Solutions Limited a 100% subsidiary which is lying in Share Application which will be allotted during financial year 2010-11. As at the year end, closing balance of Rs 5,662.02 lakhs (P.Y. Rs 6,267.31 lakhs) net

The Company had applied for 35,07,525 rights shares of Chandamama India Limited in terms of the letter of offer dated 24th November, 2008 for the issue of 36,95,325 equity shares of Rs 10 each at par in the ratio of 1 share for every two held. During the year, the Company has paid the final call money of Rs5.00 per share amounting to 175.38 lakhs. During the year, the Company also invested in 20,00,000 equity shares of Rs` 10 each on a preferential basis for an amount of Rs 200 lakhs.

During the year the Company formed the following wholly owned subsidiaries in India:

a) ITM Digital Private Limited (IDPL) with an investment of Rs 99,990.

b) Geodesic Gridpoint Energy Private Limited (GGEPL) with an investment of 99,990.

The investment in all subsidiaries, other than RsIDPL and GGEPL, including step down subsidiaries is disclosed separately pursuant to the provisions of Section 212 of The Companies Act, 1956. IDPL and GGEPLs first financial year will close on 31 March, 2011.

5. Based on the information available with the Company, none of the vendors fall under the definition of micro, small and medium scale enterprises. This information is not verifiable by the auditors.

6. The production of software is not capable of being expressed in any generic unit and hence, it is not possible to give the information as required by certain clauses of paragraphs 3, 4C and 4D of part II of Schedule VI of the Companies Act, 1956. Also, as the activities of the Company do not require industrial licensing, the figures for licensed capacity are not given.

7. Figures of the previous year have been regrouped/ rearranged wherever necessary to correspond with the figures of the current year. Amounts and other disclosures for the preceding period are included as an integral part of the current year financial statements and are to be read in relation to the amounts and other disclosures relating to the current year.