Notes to Accounts of Pritish Nandy Communications Ltd.

Mar 31, 2024

The equity shares are entitled to dividend proposed by Board of Directors subject to approval of the share holders in the Annual General Meeting except in case of interim dividend. In the event of liquidation of the Company, holder of equity shares are entitled to receive remaining assets of the Company, after distribution of all preferential amounts in proportion to their share holding.

During the period of five years immediately preceeding the year March 31, 2024, the Company has not issued any bonus shares or shares for consideration other than cash and also the Company has not bought back any shares during this period.

The company has not reserved any shares for issue under options and contracts/ commitments for the sale of shares/ disinvestment as at March 31, 2024 and March 31, 2023.

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

Nature and purpose

a. Capital Reserve

This represents profit earned by the Company before receipt of incorporation certificate.

b. Securities premium

Securities premium is used to record the premium on issue of shares. The reserve is utilised in accordance with the provisions of the Companies Act, 2013.

c. General reserve

General reserve represents the amount appropriated out of retained earnings pursuant to the earlier provisions of Companies Act, 1956.

d. Retained earnings

Retained earnings are the profits/ losses that Company has earned/ incurred till date, as reduced by transfer to reserves, dividend or other distribution paid to the share holders and transfer from/ to OCI.

14.2 Rights, preferences, restrictions of equity shares

The Company has only one class of equity shares having a face value of '' 10 per share. Each holder of equity share is entitled to one vote per share.

16.2 Amendment to Ind AS 7

Amendment to Ind AS 7 effective from April 1, 2017 require 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 non-cash changes, suggesting inclusion of a reconciliation between the opening and closing balances in the Balance Sheet for liabilities arising from financing activities, to meet disclosure requirement. Accordingly, the Company has given the said disclosure as below

*The above matter is currently being considered by the tax authorities and the Company expects the outcome will be in its favour and has therefore, not recognised the provision in relation to aforesaid liabilities. Future cash outflow in respect of above will be determined only on receipt of judgement/ decision pending with tax authorities.

30. EMPLOYEE BENEFITS

Defined Benefit Plan

Group gratuity liability is recognised on the basis of gratuity report provided by Actuary.

The disclosures as required under the Indian Accounting Standard (Ind AS 19) in respect of gratuity, is as follows

Every employee is entitled to a benefit equivalent to 15 days salary drawn for each completed year of service in line with the Payment of Gratuity Act, 1972 or Company scheme, whichever is beneficial. The same is payable at the time of separation from the company or retirement, whichever is earlier. The benefits vest after five years of continuous service

The sensitivity analysis 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.

The sensitivity analysis presented above may not be representative of the actual change in the projected benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

Furthermore, in presenting the above sensitivity analysis, the present value of the projected benefit obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same method as applied in calculating the defined benefit obligation as recognised in the Balance Sheet.

Gratuity is payable as per entity’s scheme as detailed in the report.

Actuarial gains/ losses are recognized in the period of occurrence under Other Comprehensive Income (OCI). All above reported figures of OCI are gross of taxation.

Salary escalation and attrition rate are considered as advised by the entity; they appear to be in line with the industry practice considering promotion and demand and supply of the employees.

Maturity Analysis of Benefit Payments is undiscounted cashflows considering future salary, attrition and death in respective year for members as mentioned above.

Average Expected Future Service represents Estimated Term of Post - Employment Benefit Obligation.

Weighted Average Duration of the Defined Benefit Obligation is the weighted average of cashflow timing, where weights are derived from the present value of each cash flow to the total present value.

Any benefit payment and contribution to plan assets is considered to occur end of the year to depict liability and fund movement in the disclosures.

Value of asset provided by the entity is not audited by us and the same is considered as unaudited fair value of plan asset as on the reporting date.

In absence of specific communication as regards contribution by the entity, Expected Contribution in the Next Year is considered as the sum of net liability/assets at the end of the current year and current service cost for next year, subject to maximum allowable contribution to the Plan Assets over the next year as per the Income Tax Rules.

QUALITATIVE DISCLOSURE

Para 139 (a) Characteristics of defined benefit plan

The entity has a defined benefit gratuity plan in India (funded). The entity’s defined benefit gratuity plan is a final salary plan for employees, which requires contributions to be made to a separately administered fund.

The fund is managed by a trust which is governed by the Board of Trustees. The Board of Trustees are responsible for the administration of the plan assets and for the definition of the investment strategy.

Para 139 (b) Risks associated with defined benefit plan

Gratuity is a defined benefit plan and entity is exposed to the Following Risks

Interest rate risk: A fall in the discount rate which is linked to the Government Securities Rate will increase the present value of the liability requiring higher provision. A fall in the discount rate generally increases the mark to market value of the assets depending on the duration of asset.

Salary Risk: The present value of the defined benefit plan liability is calculated by reference to the future salaries of members. As such, an increase in the salary of the members more than assumed level will increase the plan’s liability.

Investment Risk: The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting period on government bonds. If the return on plan asset is below this rate, it will create a plan deficit. Currently, for the plan in India, it has a relatively balanced mix of investments in government securities, and other debt instruments.

Asset Liability Matching (ALM) Risk: The plan faces the ALM risk as to the matching cash flow. Since the plan is invested in lines of Rule 101 of Income Tax Rules, 1962, this generally reduces ALM risk.

Mortality risk: Since the benefits under the plan is not payable for life time and payable till retirement age only, plan does not have any longevity risk.

Concentration Risk: Plan is having a concentration risk as all the assets are invested with the insurance company

Para 139 (c) Characteristics of defined benefit plans.

During the year, there were no plan amendments, curtailments and settlements.

Para 147 (a) Trust fund and contribution thereto

A separate trust fund is created to manage the Gratuity plan and the contributions towards the trust fund is done as guided by rule 103 of Income Tax Rules, 1962.

33. INVESTMENT IN SUBSIDIARIES

a. PNC Wellness Limited

The Company has impaired value of entire investment in equity shares of wholly owned subsidiary viz PNC Wellness Limited in earlier years. The net worth of this subsidiary is ''12.96 lakh as on March 31, 2024. The Subsidiary has not earned any revenue during the year under review. The subsidiary however continues, intending to use the brand’s goodwill and reputation to build a digital opportunity.

b. PNC Digital Limited

The Company has an impaired investment of ''19.26 lakh in equity shares of subsidiary viz PNC Digital Limited as at March 31, 2024. During the year this subsidiary has earned a nominal income from its non-operational activities. The net worth of this subsidiary is ''19.33 lakh as on March 31, 2024.This subsidiary will continue its efforts in future. Although, this subsidiary has unfettered access to the film content of the holding company and requires no additional capital deployment to earn revenue, Company has impaired the value of its investment in this subsidiary by '' 33.39 lakh for the period under review, based on fair valuation report.

34. OPERATING LEASES (LESSEE)

a. The Company has elected not to recognize right-of-use assets and lease liabilities for short-term leases that have a lease term of 12 months or less. All leases of the Company are short-term in nature and therefore no additional disclosure is provided as per Ind AS - 116.

b. The total of future minimum sublease payment expected to be received under non - cancellable subleases at the end of reporting period is nil.

c. Lease payment is recognised as an expense in the period in which it is incurred.

35. LEGAL PROCEEDINGS

a. The Company has initiated proceedings for the recovery of an amount of ''1.50 crore given to Saboo Films Pvt Ltd and Bharat film Works against film rights. Proceedings are ongoing before the City Civil Court and the management considers the same as fully recoverable and hence no provision is made. Legal opinion obtained by the Company supports this.

b. The Company had received an award of '' 3.52 crore plus interest of '' 35 lakh in its favour in the arbitration filed against White Feather Films (Proprietor Sanjay Gupta). White Feather Films has gone in appeal against the award and was directed to deposit an amount of '' 3 crore by the Bombay High Court, which they failed to do. The Company has filed a petition for execution of the arbitration award. The Bombay High Court has restrained Sanjay Gupta from disposing of, encumbering, alienating, transferring, and parting with the possession of or creating any third party rights or interest in his 3 properties in Pune and Khandala valued at ''12 crore. The advance of '' 3.18 crore is therefore considered as fully recoverable.

36. Company carries out in-house content development projects, which includes costs for payments to writers, actors, pre shoot expenses, professional fees etc. These amounts have different ageing depending on the progress of each project. These costs are classified under a broad head as “Advance for Content”. The technical team has assessed its realizable value, its future viability and management contention to continue with the project including considerations for write off/ impairment based on future plans of the Company, considering trends in the country as well global trends. The Company has accordingly written off an amount of ''13.42 lakh (PY ''47.86 lakh) incurred on developing contents, which are no longer viable to take up in future.

37. INVENTORIES

a. The Company estimate the useful life of its audio-visual entertainment contents, which are intangible in nature as 40 years considering the following

i The economic useful life of content post digitisation.

ii. New avenues of content exploitation with the emergence of new technologies.

iii. Long tail realisations from the library of produced content.

iv Increased reach of Indian content in new and existing global markets.

Transactions with related parties have been done at arm’s length and are in the ordinary course of business. Remuneration/ reimbursement to key management personnel includes an amount of '' 97.13 lakh being remuneration/ reimbursement to Whole Time directors which exceeds the prescribed limits under Section 197 read with Schedule V to the Companies Act, 2013 (“the Act “) by '' 13.13 lakh. As per the provisions of the Act, the excess remuneration is subject to approval of the shareholders which the Company proposes to obtain in the forthcoming Annual General Meeting.

MICRO AND SMALL ENTERPRISES

The details given below are based on the information received from Suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006. This information has been relied upon by the auditor.

v. Increased scope of content exploitation in many new ways and languages as well as through multiple exploitation of content IPRs.

vi The continuing exploitation of the PNC library on existing platforms.

News-based content as well as content being produced currently for international streaming platform on commissioned basis will continue to be 100% written off on exploitation as per the current practice.

During the year the Company has amortised ''15.90 lakh against the revenue earned from exploitation of streaming rights of its existing library and unfinished content of ''30 lakh used for production of web series.

There is no individual content that is material to the financial statements of the Company as a whole. There is no content whose title is restricted.

Based on a review of estimates of future realisations taken as a whole, the management is of the view that future recoverable amount from content rights is expected to be more than its carrying unamortised cost of content. Hence, no impairment/ write down is considered necessary on this account.

41. SEGMENT INFORMATION

The Company has presented data relating to it’s segments in it’s Consolidated Financial Statements. Accordingly, in term of paragraph 4 of the Indian Accounting Standard (Ind AS 108) “Operating Segments”, no disclosure related to it’s segments are presented in the standalone financial statements. The Company operates in only one segment i.e. content.

42. FINANCIAL INSTRUMENT

a. Methods and assumptions used to estimate the fair values

The fair values of the financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

The following methods and assumptions were used to estimate the fair values

i. The carrying amounts of receivables and payables which are short term in nature such as trade receivables, other bank balances, deposits, loans to employees, trade payables, demand loans from banks and cash and cash equivalents are considered to be the same as their fair values.

ii. The fair values for long term security deposits given were calculated based on cash flows discounted using a current bank rate applicable to Company’s deposits with the bankers. They are classified as level 3 fair values in the fair value hierarchy due to the inclusion of unobservable inputs.

Categories of financial instruments

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

Level 1 : unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 : directly or indirectly observable market inputs, other than Level 1 inputs; and Level 3 : inputs which are not based on observable market data

b. Financial risk management objective and policies

The Company’s principal financial liabilities comprise borrowings, trade and other payables. The main purpose of these financial liabilities is to finance the Company’s operations including acquiring of property, plant and equipment (PPE). The Company’s principal financial assets include investments, trade and other receivables, and cash and bank balances that derive directly from its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The Board provides guidance for overall risk management. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below

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, currency risk and other price risk, such as equity price risk and commodity risk. Financial instruments affected by market risk include borrowings and other financial instruments.

Interest rate risk

The interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates.

The Company borrows at variable as well as fixed interest rates and the same is managed by the Company by constantly monitoring the trends and expectations. In order to reduce the overall interest cost, the Company has borrowed in a mix of short term and long term loans.

As variations in interest rate are not expected to have a significant impact on the results of operations, a sensitivity analysis is not presented.

Currency risk

Currency risk is the risk that the fair value of future cash flows of financial instruments will fluctuate because of the change in foreign currency exchange rates.

The Majority of the Company’s revenue and expenses are in Indian Rupees. Company also operates internationally with miniscule business transacted in foreign currency namely US Dollar and Singapore Dollar. Management considers currency risk to be low and hence does not hedge its currency risk. As variations in foreign currency exchange rates are not expected to have a significant impact on the results of operations, a sensitivity analysis is not presented.

ii. 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 given, investments and balances at bank.

The Company has used expected credit loss (ECL) model for assessing the impairment loss. For the purpose, the Company uses a provision matrix to compute the expected credit loss amount. The provision matrix takes into account external and internal risk factors and historical data of credit losses from various customers.

Outstanding customer receivables are regularly monitored. The Company considers the concentration of risk with respect to trade receivables as low, as its customers are well established companies besides in few cases Company receives advances from customers.

The risk of default is assessed as low.

iii. Liquidity risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at a reasonable price.

The Company actively monitors its cash flows to ensure there is sufficient cash available to meet its working capital requirements. Due to the dynamic nature of the underlying businesses, the Company maintains flexibility in funding by maintaining availability under committed credit lines. Management monitors rolling forecasts of the Company’s cash and cash equivalents on the basis of expected cash flow.

c. Capital risk management

The Board policy is to maintain a strong capital base so as to maintain shareholder, creditor and market confidence and to sustain the future development need of the business. The capital structure of the Company is based on Management’s judgement of the appropriate balance of key elements in order to meet its strategic and day to day needs. The Company considers the amount of capital in proportion to risk and manage the capital structure in light of changes in economic conditions and the risk characteristics of the underlying assets. There were no changes to the Company’s approach to capital management during the year.

Total Equity includes Capital Reserve, Securities Premium, General Reserve, Retained Earnings and Share Capital. Total Debt includes current debt plus non-current debt.

44. OTHER STATUTORY INFORMATION

a. The Company have not given any loans or advances to its promoters, directors or KMPs in the nature of loans.

b. The Company does not have any benami property, where any proceeding has been initiated or pending against the Company for holding any benami property.

c. The Company has not been declared wilful defaulter by any bank or financial institution or other lender during the year.

d. The Company does not have any transactions or balances with companies struck off under Section 248 of the Companies Act, 2013 or under Section 560 of the Companies Act, 1956 during the year.

e. The Company does not have any charges which are yet to be registered or satisfied with ROC, Mumbai except in respect of certain Vehicle loans which are fully repaid and no amount is outstanding , the documentation for satisfaction of the aforesaid charges is in process.

f. The Company has complied with the number of layers prescribed under clause (87) of Section 2 of the Act read with the Companies (Restriction on number of Layers) Rules, 2017.

g. UTILISATION OF BORROWED FUNDS AND SHARE PREMIUM

i. The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall

a. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (ultimate beneficiaries) or

b. drovide any guarantee, security or the like to or on behalf of the ultimate beneficiaries

ii. The Company has not received any fund from any person(s) or entity(ies), including foreign entities (funding party) with the understanding (whether recorded in writing or otherwise) that the Company shall

a. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the funding party (ultimate beneficiaries) or

b. provide any guarantee, security or the like on behalf of the ultimate beneficiaries.

h. The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.

i. The Company does not have any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 such as, search or survey or any other relevant provisions of the Income Tax Act, 1961.

j Since the Company have not taken any term loan or working capital facility from any bank or any financial institutions, have not filed any quarterly financial statements with them.

45. There are no subsequent events upto the date of issue of this financial statements.

46. Previous year figures have been regrouped/ recast/ rearranged wherever necessary in order to conform with the current year’s presentation.

47. Disclosures which are not given are either nil or not applicable.

48. The Company uses an accounting software for maintaining books of account which complies with audit trail requirements as specified under Rule 3(1) of Companies (Accounts) Rules, 2014 and Rule 11 of Companies (Audit & Auditors) Rules, 2014.

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Mar 31, 2018

CORPORATE INFORMATION

Pritish Nandy Communications Limited (“the Company”) is a public company incorporated and domiciled in India.

It was one of the first media and entertainment Company to go public in the year 2000, when it was listed on India’s two best known stock exchanges, Bombay Stock Exchange and National Stock Exchange. The registered office of the Company is situated at 87/88 Mittal Chambers, Nariman Point, Mumbai 400021.

The Company is a media and entertainment company. The Company is engaged in the business of production and exploitation of content including cinematographic films, TV serials and Digital Series etc. for worldwide exploitation in all formats.

The Company produces cinematographic films, TV serials and Digital Series etc. The Company, through its subsidiary, PNC Digital Ltd, is engaged in creating content for digital streaming, setting up delivery system for digital streaming, running the business of content streaming, and other technology business using the Internet as its primary delivery platform, and through its subsidiary, PNC Wellness Ltd, is engaged in wellness business and owns several wellness brands like Moksh, Power Yoga, Passion Yoga, Cool Yoga and Couple Yoga.

These financial statements were authorised for issue by the Board of Directors on May 25, 2018.

1. BASIS OF PREPARATION

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

1.1 Compliance with Ind AS

The financial Statements comply in all material respects with Indian Accounting Standards (Ind AS) notified under Section 133 of the Companies Act, 2013 (“the Act”) [Companies (Indian Accounting Standards) Rules, 2015] and other relevant provisions of the Act.

The financial statements up to the year ended March 31, 2017 were prepared in accordance with the Accounting Standards notified under Companies (Accounting Standard) Rules, 2006 (as amended) (“Previous GAAP”) and other relevant provisions of the Act.

These financial statements are the first financial statements of the Company prepared in accordance with Ind AS. Refer note 36 for an explanation of how the transition from Previous GAAP to Ind AS has affected financial position, financial performance and cash flows of the Company.

a. Historical cost convention

The Financial Statements have been prepared on a historical cost basis except for the following:

i. Certain financial assets and liabilities that are measured at fair value

ii. Defined benefit plans: plan assets measured at fair value

b. The financial statements have been prepared on accrual basis of accounting.

Rounding of amounts

The financial statements are presented in INR and all values are rounded to the nearest lakh, except when otherwise indicated.

1.2 Significant estimates, judgements and assumptions

The preparation of financial statements in conformity with Ind AS requires the management to make estimates, assumptions and exercise judgment in applying the accounting policies that affect the reported amount of assets, liabilities and disclosure of contingent liabilities at the end of the financial statements and reported amounts of income and expense during the year.

The management believes that these estimates are prudent and reasonable and are based on management’s best knowledge of current events and actions. Actual results could differ from these estimates and difference between actual results and estimates are/ shall be recognised in the period in which results are known or materialised.

1.3 Current and non-current classification

All assets and liabilities have been classified as current or non-current as per the Company’s normal operating cycle (12 months) and other criteria set out in the Schedule III to the Act.

b. Rights, preferences, restrictions of equity shares

The Company has only one class of equity shares having a face value of Rs. 10 per share. Each holder of equity share is entitled to one vote per share.

The equity shares are entitled to dividend proposed by Board of Directors subject to approval of the share holders in the Annual General Meeting except in case of interim dividend. In the event of liquidation of the Company, holder of equity shares are entitled to receive remaining assets of the Company, after distribution of all preferential amounts in proportion to their share holding.

1.4 Amendment to Ind AS 7 effective from April 1, 2017 require 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 non-cash changes, suggesting inclusion of a reconciliation between the opening and closing balances in the Balance sheet for liabilities arising from financing activities, to meet disclosure requirement. Accordingly, the Company has given the said disclosure as below

2. EMPLOYEE BENEFITS

Defined benefit plan

Group gratuity liability is recognised on the basis of gratuity report provided by Actuary.

The disclosures as required under the Indian Accounting Standard (Ind AS 19) in respect of gratuity, is as follows

Sensitivity analysis

Below is the sensitivity analysis determined for significant actuarial assumption for determination of defined benefit obligation and based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period.

Note

The sensitivity analysis 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.

The sensitivity analysis presented above may not be representative of the actual change in the projected benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

Furthermore, in presenting the above sensitivity analysis, the present value of the projected benefit obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same method as applied in calculating the projected benefit obligation as recognised in the balance sheet.

Gratuity is payable as per Company’s scheme as detailed in the report.

Actuarial gains/ losses are recognized in the period of occurrence under other comprehensive income (OCI). All above reported figures of OCI are gross of taxation.

Salary escalation and attrition rate are considered as advised by the Company; they appear to be in line with the industry practice considering promotion and demand and supply of the employees.

Maturity analysis of benefit payments is undiscounted cash flows considering future salary, attrition and death in respective year for members as mentioned above.

Average expected future service represents estimated term of post - employment benefit obligation.

Value of asset provided by the client is considered as fair value of plan asset for the period of reporting as same is not evaluated by us.

Investment details

The Company made annual contribution to LIC of India of an amount advised by them. The Company was not informed by LIC of the investments made or the break down of plan assets by investment type.

3. MICRO, SMALL AND MEDIUM ENTERPRISES

The Company has not received the required information from suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006. Hence, disclosures, if any, relating to amounts unpaid as at the year end together with interest payable as required under the said Act are NIL as given below. This information has been relied upon by the auditor.

4. FIRST TIME ADOPTION OF IND AS

For all periods upto and including the year ended March 31, 2017 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.

Exemptions and exceptions availed

In preparing these Ind AS Financial Statements, the Company has availed certain exemptions and exceptions in accordance with Ind AS 101 First-time adoption of Indian Accounting Standards, as explained below. The resulting difference between the carrying values of the assets and liabilities in the Financial Statements as at the transition date under Ind AS and IGAAP have been recognised directly in equity (retained earnings or another appropriate category of equity). This Note explains the adjustments made by the Company in restating its IGAAP Financial Statements, including the Balance Sheet as at April 1, 2016 and the Financial Statements as at and for the year ended March 31, 2017.

4.1 Ind AS optional exemptions:

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

a. Deemed cost

Para D7 AA of Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognised in the Financial Statements as at the date of transition to Ind AS, measured under IGAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for decommissioning liabilities. The Company has exercised this option of adopting deemed cost.

b. Designation of previously recognised financial instruments

Ind AS 101 allows an Company to designate investments in equity instruments at fair value through other comprehensive income on the basis of the facts and circumstances at the date of transition to Ind AS. The Company has elected to apply this exemption for its investment in equity investments. Exchange differences on account of depreciable assets can be added/ deducted from the cost of the depreciable asset, which will be depreciated over the balance life of the asset. Ind AS 101 includes an optional exemption that allows a first-time adopter to continue the above accounting treatment in respect of the long-term foreign currency monetary items recognised in the Financial Statements for the period ending immediately before the beginning of the first Ind AS financial reporting period. The Company has opted to apply this exemption.

c. Investments in equity instruments:

An Company may make an irrevocable election at initial recognition of a financial asset to present subsequent changes in the fair value of an investment in an equity instrument in other comprehensive income. Ind AS 101 allows such designation of previously recognized financial assets, as ‘fair value through other comprehensive income’. The Company has accordingly designated certain equity instruments as at April 1, 2016 as fair value through other comprehensive income.

d. Investments in subsidiary companies, associate company and joint venture company

Ind AS 101 permits a first-time adopter to measure it’s investment, at the date of transition, at cost determined in accordance with Ind AS 27, or deemed cost, The deemed cost of such investment shall be it’s fair value at date of transition to Ind AS of the Company, or IGAAP carrying amount at that date. The Company has elected to measure its investment in subsidiary companies, associate company and joint venture company under IGAAP carrying amount as its deemed cost on the transition date.

4.2 Ind AS mandatory exceptions:

a. Estimates

An Company’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. Classification and measurement of financial assets

Ind AS 101 requires an Company 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.

c. 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.

I. Deferred tax

The previous GAAP required deferred tax accounting using the profit and loss approach the which focused on differences between taxable profits and accounting profits for the period. Ind AS 12 requires entities to account for deferred taxes using balance sheet approach which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base. Various transitional adjustments has resulted in recognition of temporary differences.

II. Expected credit loss

Under Indian GAAP allowances of doubtful debt was provided as per management estimate whereas under Ind AS allowances are based on expected credit loss model as per Ind - AS 109 - Financial Instruments.

III. Other comprehensive income (OCI)

Ind-AS requires preparation of statement of other comprehensive income in addition to Statement of profit and loss. Re-measurement gain/ loss on defined benefit plans earlier accounted for in statement of profit and loss under Indian GAAP has been reclassified to OCI as required by Ind-AS 19 - Employee Benefits.

IV. Employee benefits expenses

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

V. Retained earnings

Retained earnings as at April 1, 2016 have been adjusted consequent to the above Ind AS transition adjustments.

5. INVESTMENT IN SUBSIDIARIES

a. PNC Wellness Ltd

The Company has an investment of Rs. 174.60 lakh (L Y Rs. 232.80 lakh) in equity shares of wholly owned subsidiary viz. PNC Wellness Limited. The net worth of this subsidiary is Rs. 72.38 lakh as on March 31, 2018. This subsidiary, which owns several wellness brands like Moksh, Power Yoga, Passion Yoga, Cool Yoga, Couple Yoga, etc. is exploring avenues to commercialise its aforesaid brands. This subsidiary is in the process of realigning its business by making efforts to commercialise and lease its various brands through collaborative arrangements with other parties. The Company is facilitating and supporting the revival of this subsidiary’s business. There was no revenue generation by this subsidiary during the year under review. Considering that there was no revenue generation during the year under review the management has made provision for diminution in value of investment in this subsidiary by 1/5th of its book value and considers the retained book value as fully realizable. No further provision is made for the diminution in book value of investment which is considered as temporary.

b. PNC Digital Ltd

The Company has an investment of Rs. 70.20 lakh (L Y Rs. 70.20 lakh) in equity shares of subsidiary viz. PNC Digital Limited. The net worth of this subsidiary is Rs. 8.37 lakh as on March 31, 2018.

The Company has agreed to provide its films to this subsidiary to explore revenue opportunities on the digital platform and exploit it to its commercial advantage but this subsidiary Company was not able to generate income from its operational activities in the year gone by. This subsidiary will continue its efforts. In view of the fact that this subsidiary has unfettered access to the film content of the holding company and requires no additional substantive capital deployment to generate revenue, no provision for diminution in value of investment, which is considered temporary, has been made in the accounts. This Company will leverage its market standing to facilitate other smaller production houses to gain access to large digital content distributors to facilitate them getting better prices and commercial terms for their content.

6. OPERATING LEASES: (LESSEE)

a. At the reporting date the Company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

b. The total of future minimum sublease payment expected to be received under non - cancellable subleases at the end of reporting period is NIL

c. Lease payments recognised as an expense in the period in which it is incurred.

7. LEGAL PROCEEDINGS

a. The Company has initiated legal proceedings for recovery of an advance of Rs. 150.00 lakh which was given against the music, Asian and Indian satellite rights of a film, where the Company has lien over the exploitation of the said rights. The management considers the same as good and fully recoverable. Legal opinion obtained by the Company supports this. Auditors have relied on the opinion and consequently no provision has been made in the accounts at this stage. Legal proceedings are ongoing.

b. The Company has received an award of Rs. 352.00 lakh in its favour in the arbitration case filed against White Feather Films. The Company has also received a revised order for the amount of interest, which the Company has not found satisfactory and hence it has moved an appeal with the Bombay High Court. White Feather Films has gone in appeal against the above said award and has been directed to deposit an amount of Rs. 300.00 lakh by the Bombay High Court. Proceedings are ongoing and in view of the same, outstanding of Rs. 317.53 lakh is considered as fully recoverable.

8. Arbitration proceedings initiated by the Company against Prasar Bharati on account of wrongful encashment of bank guarantee of Rs. 750.50 lakh. The Company has obtained legal opinion from Justice AM Ahmadi, former Chief Justice of Supreme Court of India, which supports the Company’s stand that the amount is fully recoverable and hence no provision is made there against.

9. In the absence of persuasive evidence, there is presumption that intangible assets have a useful life of 10 years. In respect of cinematic content, the Company has persuasive evidence that the useful life of cinematic content is over 20 years.

The management has considered the following factors viz. the expected usage of the asset by the enterprise, typical product life cycles, technical, technological or other types of obsolescence, expected actions by competitors or potential competitors, the level of maintenance expenditure required to obtain the expected future economic benefits from the asset, the period of control over the asset, the useful life of the asset and for reasons viz. shelf lives of movies have substantially increased since the year 2000, getting better value for longer lease in excess of ten years, emergence of channels dedicated only for featuring content more than ten years old, growth in the number of distribution channels, rapid multiplication of remaking, animation and versions etc., and hence is of the view that the useful life of the cinematic content is 20 years. Hence, amortisation of Rs. 2,103.32 lakh in respect of cinematic content having life of more than 10 years, is not required to be made.

There is no individual content that is material to the financial statements of the Company as a whole.

There is no content whose title is restricted. The content is pledged to Yes Bank Ltd as security for working capital overdraft facility of Rs. 1,000.00 lakh.

The total cost of content as at March 31, 2018 is Rs. 5,802.99 lakh. Based on a review of estimates of future realisations taken as a whole, the management is of the view that future recoverable amount from content rights to be more than its carrying unamortised cost of content. Hence, no impairment/ write down is considered necessary on this account.

---

Mar 31, 2015

NOTE 1.

The Company is engaged in the production/ making of cinematic and television content, which requires various types, qualities and quantities of raw materials and inputs in different denominations. Due to the multiplicity and complexity of the items it is not practicable to maintain the quantitative record/ continuous stock register, as the process of making content is not amenable to the same. Hence quantitative details are not maintained. Physical stock of fnished content is taken at the end of year.

NOTE 2.

Arbitration proceedings initiated by the Company against Prasar Bharati on account of wrongful encashment of bank guarantees of R 75,050,000 were ongoing before former Chief Justice YV Chandrachud. The parties completed the pleadings before the Arbitrator but unfortunately he passed away in July 2008 while the cross examinations were on. The Company had fled a petition before the Hon. High Court at Bombay for appointment of a sole Arbitrator in place and stead of Justice Chandrachud in January 2009. The Bombay High Court appointed Justice BN Srikrishna, former Judge of Supreme Court of India as Sole Arbitrator vide order dated November 27, 2009 and the arbitration proceedings are ongoing. Opinion obtained by the Company from Justice AM Ahmadi, former Chief Justice of the Supreme Court of India, supports the Company's stand that the amount is fully recoverable. In view of this, the management of the Company does not consider it necessary to make a provision there against in the accounts. The Company is showing amount withheld by Prasar Bharti as "Long Term Loans and Advances".

NOTE 3.

Accounting Standard (AS) 26 on "Intangible Assets" states that in the absence of persuasive evidence, there is presumption that intangible assets have a useful life of 10 years. In respect of cinematic content, the Company has persuasive evidence that the useful life of cinematic content is over 20 years.

The management has considered the following factors viz. the expected usage of the asset by the enterprise, typical product life cycles, technical, technological or other types of obsolescence, expected actions by competitors or potential competitors, the level of maintenance expenditure required to obtain the expected future economic benefts from the asset, the period of control over the asset, the useful life of the asset and for reasons viz. shelf lives of movies have substantially increased since 2000, getting better value for longer lease in excess of ten years, emergence of channels dedicated only for featuring content more than ten years old, growth in the number of distribution channels, rapid multiplication of remaking, animation and other new The total cost of content as at March 31, 2015 is R 537,125,897. Based on a review of estimates of future realisations taken as a whole, the management is of the view that future recoverable amount from content rights to be more than its carrying unamortised cost of content. Hence, no impairment/ write down is considered necessary on this account.

There is no individual content that is material to the fnancial statements of the Company as a whole. There is no content whose title is restricted. The content was pledged to Ye s Bank Ltd as security for overdraft facility of R 50,000,000.

NOTE 4.

As per Accounting Standard (AS) 28 on "Impairment of Assets", the Company has assessed whether there is any indications that any assets has impaired. Since the carrying amount is less than the recoverable amount, there is no necessity for making any provision for impairment.

NOTE 5.

SEGMENT INFORMATION

During the year, the Company operated in only one business segment viz content segment.

NOTE 6.

RELATED PARTY DISCLOSURE

In accordance with Accounting Standard (AS) 18 "Related Party Disclosure", the disclosure in respect of transactions with the companies related parties are as given below:

1. Subsidiaries of the Company a. PNC Digital Ltd

b. PNC Wellness Ltd (wholly owned subsidiary)

2. Key managerial personnel a. Pallab Bhattacharya – Wholetime Director and CEO

b. Rangita Pritish Nandy – Wholetime and Creative Director

c. Rupali Vaidya – Erstwhile Company Secretary

3. Non executive Directors a. Pritish Nandy – Non Executive Chairman and their relationships b. Rina Pritish Nandy – Non Executive Director

c. Udayan Bose – Non Executive, Independent Director

d. Nabankur Gupta – Non Executive, Independent Director

e. Vishnu Kanhere – Non Executive, Independent Director

f. Hema Malini – Non Executive, Independent Director

g. Ishita Pritish Nandy – daughter of Non Executive Chairman

Related Party relationship is as identifed by the Company and relied upon by the Auditors.

The Company has incurred loss during the year. In view of the loss and based on effective capital of the Company, managerial remuneration as prescribed by Schedule V read with Section 197 of the Companies Act 2013 is restricted to R 4,200,000 for the year. The company has paid managerial remuneration of R 5,754,000 which is in excess of the limits prescribed by R 1,554,000. The excess remuneration paid is subject to approval of the shareholders of the Company by a special resolution in the forthcoming annual general meeting. Alternatively the same shall be recoverable from the managerial personnel.

NOTE 7.

The company has an investment of R 29,100,000 (L Y R 29,100,000) in equity shares of wholly owned subsidiary viz PNC Wellness Limited and of R 7,019,700 (L Y R 7,019,700) in equity shares of subsidiary viz PNC Digital Limited as at March 31, 2015. Further temporary advances of R 21,843,002 given to wholly owned subsidiary viz PNC Wellness Limited towards operating expenses were waived and written off during the year to support the revival of the subsidiary.

NOTE 8.

Loans and Advances of R 46,753,181 includes: i) R 15,000,000 advanced against the Music, Asian and Indian Satellite rights of a flm, where the Company has lien over the exploitation of the said rights and ii) R 31,753,181 being balance amount advanced towards joint production of a flm where the Company has joint re-exploitation rights. The Company has initiated recovery proceedings in respect of the aforesaid advances. i) The Company has fled a Summary Suit with the Hon. High Court at Bombay which is pending hearing and disposal and ii) The Company has initiated arbitration proceedings which are ongoing before Justice Smt KK Baam (Retired). The management considers the same are good and fully recoverable. Legal opinion obtained by the Company from SF Rego, Judge (Retired), City Civil and Sessions Court, Mumbai, supports this and consequently no provision has been made in the accounts at this stage. The Company is showing these amounts as "Long Term Loans and Advances".

NOTE 9.

In the opinion of the management investments, current assets and loans and advances are of the value stated in the fnancial statements are realisable in the ordinary course of business. The provisions for all known liabilities and depreciation are adequate and are not in excess of the amounts considered, reasonably necessary.

NOTE 10.

There are no dues payable to the Investor Education and Protection Fund as at March 31, 2015.

NOTE 11.

All known liabilities have been provided in the books of accounts.

NOTE 12.

The previous year fgures have been regrouped/ reclassifed, wherever necessary to bring conformity to the current year's presentation.

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Mar 31, 2014

1. SHORT TERM BORROWINGS

The Company has not received any intimation from suppliers regarding the status under The Micro, Small And Medium Enterprises Development Act, 2006. Accordingly, disclosure as required by the said Act is made on that basis.

2. CINEMATIC AND TELEVISION CONTENT

Trade receivables over six months includes an amount aggregating to R 1,185,000 (L Y R 2,985,000) in respect of which legal proceedings have been initiated by the company. The management considers the same are good and fully recoverable; hence no provision has been made in the accounts at this stage.

3. The Company is engaged in the production/ making of cinematic and television content, which requires various types, qualities and quantities of raw materials and inputs in different denominations. Due to the multiplicity and complexity of the items it is not practicable to maintain the quantitative record/ continuous stock register, as the process of making content is not amenable to the same. Hence quantitative details are not maintained. Physical stock of finished content is taken at the end of the year.

4. Arbitration proceedings initiated by the Company against Prasar Bharati on account of wrongful encashment of bank guarantees of Rs. 75,050,000 were ongoing before former Chief Justice YV Chandrachud. The parties completed the pleadings before the Arbitrator but unfortunately he passed away in July 2008 while the cross examinations were on. The Company had filed a petition before the Hon. High Court at Bombay for appointment of a sole Arbitrator in place and stead of Justice Chandrachud in January 2009. The Bombay High Court appointed Justice BN Srikrishna, former Judge of Supreme Court of India as sole Arbitrator vide order dated November 27, 2009 and the arbitration proceedings are ongoing. Opinion obtained by the Company from Justice AM Ahmadi, former Chief Justice of the Supreme Court of India, supports the Company''s stand that the amount is fully recoverable. In view of this, the management of the Company does not consider it necessary to make a provision there against in the accounts. The Company is showing amount withheld by Prasar Bharti as "Long Term Loans and Advances".

5. Accounting Standard (AS) 26 on "Intangible Assets" states that in the absence of persuasive evidence, there is presumption that intangible assets have a useful life of 10 years. In respect of cinematic content, the Company has persuasive evidence that the useful life of cinematic content is over 20 years.

The management has considered the following factors viz the expected usage of the asset by the enterprise, typical product life cycles, technical, technological or other types of obsolescence, expected actions by competitors or potential competitors, the level of maintenance expenditure required to obtain the expected future economic benefits from the asset, the period of control over the asset, the useful life of the asset and for reasons viz shelf lives of movies have substantially increased since 2000, getting better value for longer lease in excess of ten years, emergence of channels dedicated only for featuring content more than ten years old, growth in the number of distribution channels, rapid multiplication of remaking, animation and other new versions etc, and hence is of the view that the useful life of the cinematic content is 20 years. Hence, amortisation of Rs. 103,457,552 in respect of cinematic content having life of more than 10 years, is not required to be made. The Company is in line with International Accounting Practices and is a step towards complying with IFRS norms.

The total cost of content as at March 31, 2014 is Rs. 403,812,765. Based on a review of estimates of future realisations taken as a whole, the management is of the view that future recoverable amount from content rights to be more than its carrying unamortised cost of content. Hence, no impairment/ write down is considered necessary on this account.

There is no individual content that is material to the financial statements of the Company as a whole. There is no content whose title is restricted. The content was pledged to yes bank Ltd as security for working capital loan of Rs. 50,000,000 which has been squared-off during the year.

6. As per Accounting Standard (AS) 28 on "Impairment of Assets", the Company has assessed whether there is any indications that any assets has impaired. Since the carrying amount is less than the recoverable amount, there is no necessity for making any provision for impairment.

7. Segment information:

During the year, the Company operated in only one business segment viz content segment.

8. Related Party Disclosure

In accordance with Accounting Standard (AS) 18 "Related Party Disclosure", the disclosure in respect of transactions with the companies related parties are as given below:

9. The company has an investment of Rs. 29,100,000 (L Y Rs. 29,100,000) in wholly owned subsidiary viz PNC Wellness Limited as at March 31, 2014. Further temporary advances of Rs. 18,868,870 were receivable as at March 31, 2014.

10. Loans and Advances of Rs. 46,753,181 includes: i) Rs. 15,000,000 advanced against the Music, Asian and Indian Satellite rights of a film, where the Company has lien over the exploitation of the said rights and ii) Rs. 31,753,181 being balance amount advanced towards joint production of a film where the Company has joint re-exploitation rights. The Company has initiated recovery proceedings in respect of the aforesaid advances. i) The Company has filed a Summary Suit with the Hon. High Court at Bombay which is pending hearing and disposal and ii) The Company has initiated arbitration proceedings which are ongoing before Justice Smt KK Baam (Retired). The management considers the same are good and fully recoverable. Legal opinion obtained by the Company from SF Rego, Judge (Retired), City Civil and Sessions Court, Mumbai, supports this and consequently no provision has been made in the accounts at this stage. The Company is showing these amounts as "Long Term Loans and Advances".

11. In the opinion of the management investments, current assets and loans and advances are of the value stated in the financial statements are realisable in the ordinary course of business. The provisions for all known liabilities and depreciation are adequate and are not in excess of the amounts considered, reasonably necessary. NOTE 40

There are no dues payable to the Investor Education and Protection Fund as at March 31, 2014.

12. All known liabilities have been provided in the books of accounts.

13. The previous year figures have been regrouped/ reclassified, wherever necessary to bring conformity to the current year''s presentation.

---

Mar 31, 2013

NOTE 1

The Company is engaged in the production/ making of cinematic and television content, which requires various types, qualities and quantities of raw materials and inputs in different denominations. Due to the multiplicity and complexity of the items it is not practicable to maintain the quantitative record/ continuous stock register, as the process of making content is not amenable to the same. Hence quantitative details are not maintained. Physical stock of finished content is taken at the end of year.

NOTE 2

Arbitration proceedings initiated by the Company against Prasar Bharati on account of wrongful encashment of bank guarantees of 75,050,000 were ongoing before former Chief Justice YV Chandrachud. The parties completed the pleadings before the Arbitrator but unfortunately he passed away in July 2008 while the cross examinations were on. The Company had filed a petition before the Hon. High Court at Bombay for appointment of a sole Arbitrator in place and stead of Justice Chandrachud in January 2009. The Bombay High Court appointed Justice BN Srikrishna, former Judge of Supreme Court of India as Sole Arbitrator vide order dated November 27, 2009 and the arbitration proceedings are ongoing. Opinion obtained by the Company from Justice AM Ahmadi, former Chief Justice of the Supreme Court of India, supports the Company''s stand that the amount is fully recoverable. In view of this, the management of the Company does not consider it necessary to make a provision there against in the accounts. The Company is showing amount withheld by Prasar Bharti as "Long Term Loans and Advances''*.

NOTE 3

Accounting Standard (AS) 26 on "Intangible Assets" states that in the absence of persuasive evidence, there is presumption that intangible assets have a useful life of 10 years. In respect of cinematic content the Company has persuasive evidence that the useful life of cinematic content is over 20 years.

The management has considered the following factors viz the expected usage of the asset by the enterprise, typical product life cycles, technical, technological or other types of obsolescence, expected actions by competitors or potential competitors, the level of maintenance expenditure required to obtain the expected future economic benefits from the asset, the period of control over the asset, the useful life of the asset and for reasons viz. shelf lives of movies have substantially increased since 2000, getting better value for longer lease in excess often years, emergence of channels dedicated only for featuring content more man ten years old, growth in the number of distribution channels, rapid multiplication of remaking, animation and other new versions etc, and hence is of the view that the useful life of die cinematic content is 20 years. Hence, amortisation of 112,075,738 is not required to be made. The Company is in line with International Accounting Practices and is a step towards complying with IFRS norms which will become mandatory from 2014.

NOTE 4

As per Accounting Standard (AS) 28 on "Impairment of Assets", the Company has assessed whether there are any indications that any assets have impaired. Since the carrying amount is less than the recoverable amount, there is no necessity for making any provision for impairment.

NOTE 5

Segment information

During the year, die Company operated in only one business segment viz content segment

NOTE 6

Related party disclosure

hi accordance with Accounting Standard (AS) 18 "Related Party Disclosure", the disclosure in respect of transactions with the companies related parties are as given below

i. Subsidiaries of the Company a. PNC Productions Ltd

b. PNC Wellness Ltd (wholly owned subsidiary) ii. Key managerial personnel a. Pallab Bhattacharya - Wholetime Director and CEO

b. Rangita Pritish Nandy - Wholetime Director and Creative Director

c. Rupali Vaidya Company Secretary

iii. Non executive Directors and their relatives a. Pritish Nandy-Non Executive Chairman

b. Rina Pritish Nandy - Non Executive Director

c. Udayan Bose - Non Executive, Independent Director

d. Nabankur Gupta Non Executive, Independent Director

e. Vishnu Kanhere - Non Executive, Independent Director

f. Tapan Chaki - Non Executive, Independent Director

g. Hema Malini - Non Executive, Independent Director h. Ishita Pritish Nandy - Daughter of Non Executive Chairman

NOTE 7

The company has an investment of 29,100,000 (L Y 29,100,000) in wholly owned subsidiary viz PNC Wellness Ltd as at March 31,2013. Further temporary advances of 5,369,753 were receivable as at March 31,2013,

NOTE 8

In view of loss, no provision has been made for income tax liability during the year.

NOTE 9

Loans and advances of 46,753,181 includes: i) 15,000,000 advanced against the Music, Asian and Indian Satellite rights of a film, where the Company has lien over the exploitation of the said rights and ii) 31,753,181 being balance amount advanced towards joint production of a film where the Company has joint re-exploitation rights. The Company has initiated recovery proceedings in respect of the aforesaid advances i) The Company has filed a Summary Suit with the Hon. High Court at Bombay which is pending hearing and disposal and ii) The Company has initiated arbitration proceedings which are ongoing before Justice Smt KK Baam (Retired). The management considers the same are good and fully recoverable. Legal opinion obtained by the Company from SF Rego, Judge (Retired), City Civil and Sessions Court, Mumbai, supports this and consequently no provision has been made in the accounts at this stage. The Company is showing these amounts as "Long Term Loans and Advances".

NOTE 10

In the opinion of the management investments, current assets and loans and advances are of the value stated in the financial statements are realisable in the ordinary course of business. The provisions for all known liabilities and depreciation are adequate and are not in excess of the amounts considered, reasonably necessary.

NOTE 11

There are no dues payable to the Investor Education and Protection Fund as at March 31,2013.

NOTE 12

All known liabilities have been provided in the books of accounts.

NOTE 13

Refer annexure for additional information to Part IV of Schedule VI to the Companies Act, 1956.

NOTE 14

The previous year figures have been regrouped/ reclassified, wherever necessary to bring conformity to the current year''s presentation.

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Mar 31, 2012

NOTF 1.1

Company has only one class of share referred to as equity share with voting right.

NOTE 2

The Company is engaged in the production/ making of cinematic and television content, which requires various types, qualities and quantities of raw materials and inputs in different denominations. Due to the multiplicity and complexity of the items it is not practicable to maintain the quantitative record/ continuous stock register, as the process of making content is not amenable to the same. Hence quantitative details are not maintained. Physical stock of finished content is taken at the end of year. The Ministry of Corporate Affairs vide its Notification dated February 8, 2011 has granted exemption from giving quantitative details of para 3(ii)(a)(I) & (2) of Part II, Schedule VI to the Companies Act, 1956 to manufacturing Companies like our Company. The Board has given the consent required under the aforesaid notification.

NOTE 3

Arbitration proceedings initiated by the Company against Prasar Bharati on account of wrongful encashment of bank guarantees of Rs. 75,050,000 were ongoing before former Chief Justice YV Chandrachud. The parties completed the pleadings before the Arbitrator but unfortunately he passed away in July 2008 while the cross examinations were on. The Company had filed a petition before the Hon. High Court at Bombay for appointment of a sole Arbitrator in place and stead of Justice Chandrachud in January 2009. The Bombay High Court appointed Justice BN Srikrishna, former Judge of Hon. Supreme Court of India as Sole Arbitrator vide order dated November 27, 2009 and the arbitration proceedings are ongoing. Opinion obtained by the Company from Justice AM Ahmadi, former Chief Justice of the Supreme Court of India, supports the Company's stand that the amount is fully recoverable. In view of this, the management of the Company does not consider it necessary to make a provision there against in the accounts. The Company is showing amount withheld by Prasar Bharti as "Long Term Loans and Advances".

NOTE 4

Accounting Standard (AS) 26 on "Intangible Assets" states that in the absence of persuasive evidence there is a presumption that intangible assets have a useful life of 10 years. In respect of cinematic content, the Company has persuasive evidence that the useful life of cinematic content is over 20 years.

The management has considered the following factors viz. the expected usage of the asset by the enterprise, typical product life cycles, technical, technological or other types of obsolescence, expected actions by competitors or potential competitors, the level of maintenance expenditure required to obtain the expected future economic benefits from the asset, the period of control over the asset, the useful life of the asset and for reasons viz. shelf lives of movies have substantially increased since 2000, getting better value for longer lease in excess of ten years, emergence of channels dedicated only for featuring content more than ten years old, growth in the numbers of distribution channels, rapid multiplication of remaking, animation and other new versions etc. is of the view that the useful life of the cinematic content is over 20 years. Hence, amortisation of t 46,444,466 is not required to be made. The Company is in line with International Accounting Practices and this is a step towards complying with IFRS norms which will become mandatory from 2014.

There is no individual content that is material to the financial statements of the Company as a whole. There is no content whose title is restricted. The cinematic content of carrying value of Rs. 413,771,841 is pledged to Yes Bank Ltd as security for working capital loan of Rs. 50,000,000.

The total cost of content as at March 31, 2012 is Rs. 443,437,138. Based on a review of estimates of future realisations taken as a whole, the management is of the view that future recoverable amount from content rights to be more than its carrying unamortised cost of content. Hence, no impairment/ write down is considered necessary on this account.

NOTE 5

As per Accounting Standard (AS) 28 on "Impairment of Assets", the Company has assessed whether there is any indications that any assets has impaired. Since the carrying amount is less than the recoverable amount, there is no necessity for making any provision for impairment.

NOTE 6

Segment information

During the year, Company operated in only one business segment viz content business.

NOTE 7

Related Party Disclosure

In accordance with Accounting Standard (AS) 18 "Related Party Disclosure", the disclosure in respect of transactions with the Company's related parties are as given below

i. Subsidiaries of the Company

a. PNC Productions Ltd

b. PNC Wellness Ltd

(wholly owned subsidiary)

ii. Key managerial personnel

a. Pal lab Bhattacharya - Wholetime Director and CEO

b. Rangita Pritish Nandy - Wholetime Director and Creative Director

c. Anand Upadhyay - Company Secretary (Resigned wef January 9, 2012)

d. Rupali Vaidya - Company Secretary (Appointed wef January 9, 2012)

iii. Non executive Directors ;ind their relatives a. Pritish Nandy - Non-Executive Chairman

b. Rina Pritish Nandy - Non-Executive Director

c. Udayan Bose - Non-Executive, Independent Director

d. Nabankur Gupta - Non-Executive, Independent Director

e. Vishnu Kanhere - Non-Executive, Independent Director

f. Tapan Chaki - Non-Executive, Independent Director

g. Hema Malini - Non-Executive, Independent Director

h. Ishita Pritish Nandy - daughter of Non-Executive Chairman

NOTE 8

The Company has incurred loss during the year. Managerial remuneration paid/ payable is within the limit of minimum remuneration payable as per Part II of Schedule XIII of the Companies Act, 1956. The payment of remuneration is duly approved by the Remuneration Committee.

NOTE 9

The company has an investment of Rs. 29,100,000 (LY Rs. 5,100,000) in wholly owned subsidiary viz PNC Wellness Limited as at March 31, 2012. Further temporary advances of Rs. 713,510 were receivable as at March 31, 2012.

NOTE 10

In view of loss, no provision has been made for income tax liability during the year.

NOTE 11

Loans and Advances of f 46,753,181 includes: i) f 15,000,000 advanced against the Music, Asian and Indian Satellite rights of a film, where the Company has lien over the exploitation of the said rights and ii) Rs. 31,753,181 being balance amount advanced towards joint production of a film where the Company has joint re-exploitation rights. The Company has initiated recovery proceedings in respect of the aforesaid advances, i) The Company has filed a Summary Suit with the Hon. High Court at Bombay which is pending hearing and disposal and ii) The Company has initiated arbitration proceedings which are ongoing before Justice Smt KK Baam (Retired). The management considers the same are good and fully recoverable. Legal opinion obtained by the Company from SF Rego, Judge (Retired), City Civil and Sessions Court, Mumbai, supports this and consequently no provision has been made in the accounts at this stage.

NOTE 12

Balances of trade receivable, trade payables and loans and advances are subject to confirmation by the respective parties.

NOTE 13

In the opinion of the management investments, current assets and loans and advances are of the value stated in the financial statements are realisable in the ordinary course of business. The provisions for all known liabilities and depreciation are adequate and are not in excess of the amounts considered, reasonably necessary.

NOTE 14

There are no dues payable to the Investor Education and Protection Fund as at March 31, 2012.

NOTE 15

All known liabilities have been provided in the books of accounts.

NOTE 16

The previous year figures have been regrouped/ reclassified wherever necessary to bring conformity to the current year's presentation.

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Mar 31, 2011

2010-2011 2009-2010 (Rs.) (Rs.)

1. Contingent liabilities

a. Claims against the 150,100,000 150,100,000 Company not acknowledged as debts.

b. Disputed VAT demand 1,876,028 1,876,028

c. Disputed Income Tax Nil 629,204 liability

Future cash outflow in respect of (a), (b) and (c) above are determinable only on receipt of

2. The Company is engaged in the production/ making of cinematic and television content, which requires various types, qualities and quantities of raw materials and inputs in different denominations. Due to the multiplicity and complexity of the items it is not practicable to maintain the quantitative record/ continuous stock register, as the process of making content is not amenable to the same. Hence quantitative details are not maintained. Physical stock of finished content is taken at the end of year. The Company has received approval from Ministry of Corporate Affairs vide letter number 46/ 36/ 2011-CL-III dated January 12, 2011 for financial year ending on March 31, 2011 under section 211(4) of the Companies Act, 1956 granting exemption from giving quantitative details of para 3(ii)(a)(1) & (2) of Part II, Schedule VI to the Companies Act, 1956.

3. Arbitration proceedings initiated by the Company against Prasar Bharati on account of wrongful encashment of bank guarantees of Rs. 75,050,000 were ongoing before former Chief Justice YV Chandrachud. The parties completed the pleadings before the Arbitrator but unfortunately he passed away in July 2008 while the cross examinations were on. The Company had filed a petition before the High Court at Bombay for appointment of a sole Arbitrator in place and stead of Justice Chandrachud in January 2009. The Bombay High Court appointed Justice BN Srikrishna, former Judge of Supreme Court of India as Sole Arbitrator vide order dated November 27, 2009 and the arbitration proceedings are ongoing. Opinion obtained by the Company from Justice AM Ahmadi, former Chief Justice of the Supreme Court of India, supports the Company's stand that the amount is fully recoverable. In view of this, the management of the Company does not consider it necessary to make a provision there against in the accounts. The Company is showing amount withheld by Prasar Bharti as “Loans and Advances”.

4. Accounting Standard (AS) 26 on “Intangible Assets” states that in the absence of persuasive evidence that there is presumption that intangible assets have a useful life of 10 years. In respect of cinematic content, the Company has persuasive evidence that the useful life of cinematic content is over 20 years.

The management has considered the following factors viz. the expected usage of the asset by the enterprise, typical product life cycles, technical, technological or other types of obsolescence, expected actions by competitors or potential competitors, the level of maintenance expenditure required to obtain the expected future economic benefits from the asset, the period of control over the asset, the useful life of the asset and for reasons viz. shelf lives of movies have substantially increased since 2000, getting better value for longer lease in excess of ten years, emergence of channels dedicated only for featuring content more than ten years old, growth in the numbers of distribution channels, rapid multiplication of remaking, animation and other new versions etc, is of the view that the useful life of the cinematic content is 20 years. Hence,

5. As per Accounting Standard (AS) 28 on “Impairment of Assets”, the Company has identified certain fixed assets with written down value of Rs.709,750 as on March 31, 2011 as “impaired assets”. The said amount of Rs. 709,750 has been provided for as impairment loss and debited to profit and loss account.

6. Segment information

During the year, Company operated in only one business segment viz content business.

7. Related Party Disclosure

In accordance with Accounting Standard (AS) 18 “Related Party Disclosure”, the disclosure in respect of transactions with the companies related parties are as given below

i. Subsidiaries of a. PNC Productions Ltd the Company b. PNC Wellness Ltd (wholly owned subsidiary)

ii. Key managerial personnel a. Pallab Bhattacharya, Wholetime Director and CEO

b. Rangita Pritish Nandy, Wholetime Director and Creative Director

c. Nirav Joshi, Company Secretary (resigned wef February 21, 2011)

d. Anand Upadhyay, Company Secretary (appointed wef February 22, 2011)

iii. Non executive a. Pritish Nandy, Non-Executive Chairman Directors and their relatives

b. Rina Pritish Nandy, Non-Executive Director

c. Udayan Bose, Non-Executive, Independent Director

d. Nabankur Gupta, Non-Executive, Independent Director

e. Vishnu Kanhere, Non-Executive, Independent Director

f. Tapan Chaki, Non-Executive, Independent Director (appointed wef July 28, 2010)

g. Hema Malini, Non-Executive, Independent Director

h. Ishita Pritish Nandy, daughter of Non-Executive Chairman

8. The Company has not received any intimation from suppliers regarding the status under The Micro, Small And Medium Enterprises Development Act, 2006. Accordingly, disclosure as required by the said Act is made on that basis.

9. During the financial year 2006-2007, the Company concluded its QIP issue, through which 4,000,000 Equity Shares of Rs. 10 each for cash at a price of Rs. 70 per equity share. The entire QIP issue proceeds of Rs. 280,000,000 has been utilised towards cinematic content, QIP expenses, working capital and general corporate purpose etc. as at March 31, 2011.

10. The company has an investment of Rs. 5,100,000 (LY Rs. 5,100,000) in wholly owned subsidiary viz PNC Wellness Limited as at March 31, 2011. Further the Company has 7.5% p.a. interest bearing unsecured loan amounting to Rs. 17,910,820, interest of Rs. 3,472,612 and receivable on current account of Rs. 2,782,339 as at March 31, 2011. The net worth of the wholly owned subsidiary company as per the audited balance sheet has been fully eroded as at March 31, 2011. However, having regard to the continued long term and strategic involvement with the wholly owned subsidiary, no provision is considered necessary in the accounts for probable loss that may arise.

11. In view of loss, no provision has been made for income tax liability during the year.

12. Loans and Advances of Rs. 46,753,181 includes: i) Rs. 15,000,000 advanced against the Music, Asian and Indian Satellite rights of a film, where the Company has lien over the exploitation of the said rights and ii) Rs. 31,753,181 being balance amount advanced towards joint production of a film where the Company has joint re-exploitation rights. The Company has initiated recovery proceedings in respect of the aforesaid advances. i) The Company has filed a Summary Suit with the High Court at Bombay which is pending hearing and disposal and ii) The Company has initiated arbitration proceedings which are ongoing before Justice Smt KK Baam (Retired). The management considers the same are good and fully recoverable. Legal opinion obtained by the Company from SF Rego, Judge (Retired), City Civil and Sessions Court, Mumbai, supports this and consequently no provision has been made in the accounts at this stage.

13. Sundry debtors includes an amount aggregating to Rs. 3,085,000 (LY Rs. 3,385,000) in respect of which legal proceedings have been initiated by the company. The management considers the same are good and fully recoverable, hence no provision has been made in the accounts at this stage.

14. Certain sundry debtors, sundry creditors and loans and advances are subject to confirmation by the respective parties.

15. In the opinion of the management investments, current assets and loans and advances are of the value stated in the financial statements and realisable in the ordinary course of business. The provisions for all known liabilities and depreciation are adequate and are not in excess of the amounts considered, reasonably necessary.

16. There are no dues payable to the Investor Education and Protection Fund as at March 31, 2011.

17. All known liabilities have been provided in the books of accounts.

18. There are no claims against the Company, except as stated in point no 3, which are not acknowledged as debts. Further, contingent liability on account of VAT that may arise due to non receipt of necessary declarations amounting to Rs. 610,000.

19. Refer Annexure for additional information to Part IV of Schedule VI to the Companies Act, 1956.

20. Figures in respect of previous year have been re-grouped, re-arranged and re-cast to correspond with the figures of the current year.

21. Schedules referred to above form an integral part of Balance Sheet and Profit and Loss account.

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Mar 31, 2010

2009-2010 2008-2009

(Rs) (Rs)

1. Contingent liabilities

a. Claims against the Company not 150,100,000 150,100,000 acknowledged as debts.

b. Disputed VAT demand 1,876,028 1,520,760

c. Disputed Inome Tax liability 629,204 Nil

Future cash outflow in respect of (a), (b) and (c) above are determinable only on receipt of judgment/ decision pending with authorities.

2. The Company is engaged in the production/ making of cinematic and television content, which requires various types, qualities and quantities of raw materials and inputs in different denominations. Due to the multiplicity and complexity of the items it is not practicable to maintain the quantitative record/ continuous stock register, as the process of making content is not amenable to the same. Hence quantitative details are not maintained. Physical stock of finished content is taken at the end of year. The Company has received approval from Ministry of Corporate Affairs vide letter number 46/ 16/ 2010-CL-III dated January 20, 2010 for financial year ending on March 31, 2010 under section 211(4) of the Companies Act, 1956 granting exemption from giving quantitative details of para 3(ii)(a)(1) & (2) of Part II, Schedule VI to the Companies Act, 1956.

3. Arbitration proceedings initiated by the Company against Prasar Bharati on account of wrongful encashment of bank guarantees of Rs 75,050,000 were ongoing before former Chief Justice YV Chandrachud. The parties completed the pleadings before the arbitrator but unfortunately he passed away in July 2008 while the cross examinations were on. The Company had filed a petition before the High Court at Bombay for appointment of a sole Arbitrator in place and stead of Justice Chandrachud in January, 2009. The Bombay High Court appointed Justice BN Srikrishna, former Judge of Supreme Court of India as Sole Arbitrator vide order dated November 27, 2009 and the arbitration proceedings are ongoing. Opinion obtained by the Company from Justice AM Ahmadi, former Chief Justice of the Supreme Court of India, supports the Company’s stand that the amount is fully recoverable. In view of this, the management of the Company does not consider it necessary to make a provision there against in the accounts. The Company is showing amount withheld by Prasar Bharti as "Loans and Advances".

4. Accounting Standard (AS) 26 on "Intangible Assets" states that in the absence of persuasive evidence that there is presumption that intangible assets have a useful life of 10 years. In respect of cinematic content, the Company has persuasive evidence that the useful life of cinematic content is over 20 years.

The management has considered the following factors viz. the expected usage of the asset by the enterprise, typical product life cycles, technical, technological or other types of obsolescence, expected actions by competitors or potential competitors, the level of maintenance expenditure required to obtain the expected future economic benefits from the asset, the period of control over the asset, the useful life of the asset and for reasons viz. shelf lives of movies have substantially increased since 2000, getting better value for longer lease in excess of ten years, emergence of channels dedicated only for featuring content more than ten years old, growth in the numbers of distribution channels, rapid multiplication of remaking, animation and other new versions etc., is of the view that the useful life of the cinematic content is 20 years. The Company is in line with International Accounting Practices and is a step towards complying with IFRS norms which will become mandatory from 2014. The details of cinematic and television content is as under

The total unamortised cost of content as at March 31, 2010 is Rs 431,089,936. Based on a review of estimates of future realisations taken as a whole, the management is of the view that future recoverable amount from content rights to be more than its carrying unamortised cost of content. Hence, no impairment/ write down is considered necessary on this account.

5. As per Accounting Standard (AS) 28 on "Impairment of Assets”, the Company has assessed whether there is any indication that any assets has impaired. Since the carrying amount is less than the recoverable amount, there is no necessity for making any provision for impairment.

6. Segment information

During the year, Company operated in only one business segment viz content business.

7. Related party disclosure

In accordance with Accounting Standard (AS) 18 "Related Party Disclosure", the disclosure in respect of transactions with the companies related parties are as given below

i.. Subsidiaries of the Company

a. PNC Productions Ltd

b. PNC Wellness Ltd (wholly owned subsidiary)

ii. Key managerial personnel

a. Pallab Bhattacharya, Wholetime Director and CEO

b. Rangita Pritish Nandy, Wholetime Director and Creative Director

c. Nirav Joshi, Company Secretary

iii. Non-Executive Directors

a. Pritish Nandy, Non-Executive Chairman and their relatives

b. Rina Pritish Nandy, Non-Executive Director

c. Udayan Bose, Non-Executive, Independent Director

d. Nabankur Gupta, Non-Executive, Independent Director

e. Vishnu Kanhere, Non-Executive, Independent Director

f. Harshawardhan Sabale, Non-Executive, Independent Director (Resigned wef 31.08.2009)

g. Hema Malini, Non-Executive, Independent Director

h. Ishita Pritish Nandy, daughter of Non-Executive Chairman

8. The Company has incurred loss during the year. Managerial remuneration paid/ payable is within the limit of minimum remuneration payable as per Part II of Schedule XIII of the Companies Act, 1956. The payment of remuneration is duly approved by the Remuneration Committee.

9. The Company has not received any intimation from suppliers regarding the status under The Micro, Small And Medium Enterprises Development Act, 2006 and hence disclosures if any relating to the amount unpaid as at year end and together with interest paid/ payable as required under the Act have not been given.

10. During the financial year 2006-2007, the Company concluded its QIP issue, through which 4,000,000 Equity Shares of Rs 10 each for cash at a price of Rs 70 per equity share. Out of the total QIP issue proceeds of Rs 280,000,000, the Company has utilized Rs 269,313,469 towards cinematic content, QIP expenses, working capital and general corporate purpose etc. as at March 31, 2010.

The balance unutilized amount of Rs 10,686,531 has been kept in fixed deposits with Banks.

11. The Company is taking necessary steps for repayment of External Commercial Borrowing (ECB) unsecured loan of Rs 10,000,000 along with interest @ 3% p.a. taken from International Communications & Investments (Mauritius) Ltd for a period of three years with grace period of one year. The repayment period along with grace period of one year has expired in financial year 2005-2006.

12. Loans and Advances of Rs 46,753,181 includes: i) Rs 15,000,000 advanced against the music, Asian and Indian satellite rights of a film where the Company has lien over the exploitation of the said rights and ii) Rs 31,753,181 being balance amount advanced towards joint production of a film where the Company has joint re-exploitation rights. The Company has initiated recovery proceedings in respect of the aforesaid advances. i) The Company has filed a Summary Suit with the High Court at Bombay which is pending hearing and disposal and ii) The Company has initiated arbitration proceedings which are ongoing before Justice Smt KK Baam (Retired). The management considers the same are good and fully recoverable. Legal opinion obtained by the Company from SF Rego, Judge (Retired), City Civil and Sessions Court, Mumbai supports this and consequently no provision has been made in the accounts at this stage.

13. Sundry debtors includes an amount aggregating to Rs 3,385,000 in respect of which legal proceedings have been initiated by the company. The management considers the same are good and fully recoverable, hence no provision has been made in the accounts at this stage.

14. Certain sundry debtors, sundry creditors and loans and advances are subject to confirmation by the respective parties.

15. In the opinion of the management investments, current assets and loans and advances are of the value stated in the financial statements and realisable in the ordinary course of business. The provisions for all known liabilities and depreciation are adequate and are not in excess of the amounts considered reasonably necessary.

16. There are no dues payable to the Investor Education and Protection Fund as at March 31, 2010.

17. All known liabilities have been provided in the books of accounts.

18. There are no claims against the Company, except as stated in point no 3, which are not acknowledged as debts. Further, contingent liability on account of VAT that may arise due to non receipt of necessary declarations amounting to Rs 610,000.

19. Refer Annexure for additional information to Part IV of Schedule VI to the Companies Act, 1956.

20. Figures in respect of previous year have been re-grouped, re-arranged and re-cast to correspond with the figures of the current year.

21. Schedules referred to above form an integral part of Balance Sheet and Profit and Loss account.