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Accounting Policies of Zee Media Corporation Ltd. Company
Mar 31, 2025
2.2 Summary of material accounting policies
a Property, plant and equipment
(i) Freehold land is carried at cost. Other property,
plant and equipment are stated at original
cost of acquisition / installation (net of goods
and service tax / cenvat credit availed), less
accumulated depreciation and impairment
loss, if any. The cost comprises purchase price,
borrowing costs if capitalization criteria are met
and directly attributable cost of bringing the
asset to its working condition for the intended
use and estimated cost for decommissioning
of an asset. Integrated Receiver Decoders
(IRD) boxes are capitalized, when available for
deployment.
(ii) Capital work-in-progress comprises cost of
property, plant and equipment and related
expenses that are not yet ready for their
intended use at the reporting date.
b Right-of-use (ROU) assets
Right-of-use (ROU) assets are stated at cost, less
accumulated depreciation and impairment loss, if
any. The carrying amount of ROU assets is adjusted
for remeasurement of lease liability, if any, in future.
Cost of ROU assets comprises the amount of initial
measurement of lease liability, lease payments made
before the commencement date (net of incentives
received), initial direct costs and present value of
estimated costs of dismantling and restoration.
c Intangible assets
(i) Intangible assets with finite useful lives that
are acquired or developed are measured on
initial recognition at cost and stated at cost less
accumulated amortization and impairment loss,
if any.
(ii) Intangible assets - television channels include
expenses incurred on development of new
television channels till the time it is ready for
commercial launch.
(iii) Intangible assets under development comprises
cost of intangible assets and related expenses
that are not yet ready for their intended use at
the reporting date.
d Depreciation / amortization on property, plant and
equipment / right-of-use assets / intangible assets
Depreciable / amortizable amount for property, plant
and equipment / right-of-use assets / intangible
assets is the cost of an asset, or other amount
substituted for cost, less its estimated residual value.
(i) Depreciation on property, plant and equipment
is provided on straight-line method over the
useful life of asset as specified in Part-C of
Schedule II to the Companies Act, 2013 except
in respect of the following categories of assets,
where the life of the assets has been assessed
lower than the life prescribed in Schedule II,
based on technical advice, taking into account
the nature of the asset, the estimated usage of
the asset, the operating conditions of the asset,
past history of replacement etc.
(ii) Leasehold improvements are amortized over
the period of lease or useful life of assets,
whichever is lower.
(iii) ROU assets are depreciated on straight line
basis from the commencement date to the end
of useful life of asset or lease term whichever is
earlier.
(iv) Intangible assets are amortized on straight line
basis over their respective individual useful
lives as follows:
e Impairment of non-financial assets
The carrying amounts of non-financial assets are
reviewed at each balance sheet date if there is any
indication of impairment based on internal / external
factors. An asset is treated as impaired when the
carrying amount exceeds its recoverable value. The
recoverable amount is the greater of the asset''s net
selling price and value in use. In assessing value in
use, the estimated future cash flows are discounted
to the present value using a pre-tax discount rate
that reflects current market assessment of the
time value of money and risks specific to the assets.
An impairment loss is charged to the standalone
statement of profit and loss in the year in which an
asset is identified as impaired. After impairment,
depreciation / amortisation is provided on the revised
carrying amount of the asset over its remaining
useful life. The impairment loss recognised in prior
accounting periods is reversed by crediting the
standalone statement of profit and loss if there has
been a change in the estimate of recoverable amount.
f Derecognition of property, plant and equipment /
right-of-use assets / intangible assets
The carrying amount of an item of property, plant
and equipment / right-of-use assets / intangible
assets is derecognized on disposal or when no
future economic benefits are expected from its
use or disposal. The gain or loss arising from the
derecognition of an item of property, plant and
equipment / ROU assets / intangible assets is
measured as the difference between the net disposal
in proceeds and the carrying amount of the item and
is recognised in the standalone statement of profit
and loss when the item is derecognized.
g Lease Liability
(i) The Company as a lessee
Lease liability associated with assets taken on
lease (except short-term and low value assets) is
measured at the present value of lease payments
to be made. Lease payments are discounted
using the interest rate implicit in the lease. Lease
payments comprise fixed payments in relation
to the lease (less lease incentives receivable),
variable lease payments, if any and other
amounts (residual value guarantees, penalties,
etc.) to be payable in future in relation to the lease
arrangement. Lease liability is subsequently
measured by increasing the carrying amount to
reflect interest on the lease liability, reducing the
carrying amount to reflect the lease payment
made and remeasuring the carrying amount to
reflect any reassessment or modification, if any.
(ii) The Company as a lessor
Leases for which the Company is a lessor
are classified as finance or operating leases.
Whenever the terms of the lease transfer
substantially all the risks and rewards of
ownership to the lessee, the contract is classified
as a finance lease. All other leases are classified
as operating leases. Rental income from
operating leases is recognised on a straight-line
basis over the term of the relevant lease.
h Cash and cash equivalents
(i) Cash and cash equivalents in the balance sheet
comprise cash at banks and on hand, cheques
on hand and short-term deposits with an original
maturity of three months or less, which are subject
to an insignificant risk of changes in value.
(ii) For the purpose of the standalone statement of
cash flows, cash and cash equivalents consist
of cash and short-term deposits, as defined
above, net of cash credit outstanding as they are
considered an integral part of the Company''s
cash management.
i Financial Instruments
Financial instruments is any contract that gives
rise to a financial asset of one entity and a financial
liability or equity instrument of another entity.
Initial recognition of financial assets and liabilities
Financial assets and financial liabilities (except
investment in subsidiaries and associates) are initially
measured at fair value. Transaction costs that are
directly attributable to the acquisition or issue of
financial assets and financial liabilities (other than
financial assets and financial liabilities at fair value
through profit or loss) are added to or deducted from the
fair value of the financial assets or financial liabilities,
as appropriate, on initial recognition. Transaction
costs directly attributable to the acquisition of financial
assets or financial liabilities at fair value through profit
or loss are recognised immediately in the standalone
statement of profit and loss.
I Financial assets
A Subsequent measurement
Financial assets are classified into the
specified categories i.e. amortized cost, fair
value through profit or loss (FVTPL) and fair
value through other comprehensive income
(FVTOCI). The classification depends on the
Company''s business model for managing
the financial assets and the contractual
terms of cash flows.
(i) Debt instruments
Amortized cost:
A financial asset is subsequently
measured at amortized cost if it is held
within a business model whose objective
is to hold the asset in order to collect
contractual cash flows and the contractual
terms of the financial asset give rise on
specified dates to cash flows that are
solely payments of principal and interest
on the principal amount outstanding.
Fair value through other comprehensive
income (FVTOCI):
A ''debt instrument'' is classified as
at the FVTOCI if both of the following
criteria are met:
(a) The objective of the business model
is achieved both by collecting
contractual cash flows and selling
the financial assets.
(b) The asset''s contractual cash flows
represent solely payments of
principal and interest.
Debt instruments included within the
FVTOCI category are measured initially as
well as at each reporting date at fair value.
Fair value movements are recognized
in the other comprehensive income
(OCI). However, the Company recognizes
interest income, impairment losses and
reversals and foreign exchange gain
or loss in the standalone statement of
profit and loss. On derecognition of the
asset, cumulative gain or loss previously
recognised in OCI is reclassified from
the equity to the standalone statement
of profit and loss. Interest earned whilst
holding FVTOCI debt instrument is
reported as interest income using the
effective interest rate (EIR) method.
Fair value through profit or loss
(FVTPL):
FVTPL is a residual category for debt
instruments. Any debt instrument,
which does not meet the criteria for
categorization as at amortized cost or
as FVTOCI, is classified as FVTPL.
In addition, the Company may elect to
designate a debt instrument, which
otherwise meets amortized cost or
FVTOCI criteria, as at FVTPL. However,
such election is considered only if doing
so reduces or eliminates a measurement
or recognition inconsistency (referred
to as ''accounting mismatch'').
Debt instruments included within the
FVTPL category are measured at fair
value with all changes recognized in the
standalone statement of profit and loss.
(ii) Investments in equity instruments
The Company subsequently measures
all equity instruments (other than
investments in subsidiaries and
associates) at fair value. Where the
Company''s management has elected
to present fair value gains and losses
on equity instruments in other
comprehensive income, there is no
subsequent reclassification of fair value
gains and losses to the standalone
statement of profit and loss. Dividends
from such instruments are recognised
in the standalone statement of profit and
loss as other income when the company''s
right to receive payment is established.
(iii) Investment in subsidiaries and
associates
Investment in subsidiaries and
associates are carried at cost less
impairment loss in accordance with
Ind AS 27 on "Separate Financial
Statementsâ. Refer note 7 for list of
investments.
B Derecognition of financial assets
A financial asset is derecognized only when
(a) The Company has transferred the rights
to receive cash flows from the financial
asset or the rights have expired or
(b) The Company retains the contractual
rights to receive the cash flows of the
financial asset, but assumes a contractual
obligation to pay the cash flows to one or
more recipients in an arrangement.
Where the entity has transferred an
asset, the Company evaluates whether
it has transferred substantially all risks
and rewards of ownership of the financial
asset. In such cases, the financial asset
is derecognized. Where the entity has
not transferred substantially all risks and
rewards of ownership of the financial asset,
the financial asset is not derecognized.
Where the entity has neither
transferred a financial asset nor retains
substantially all risks and rewards of
ownership of the financial asset, the
financial asset is derecognised if the
Company has not retained control of
the financial asset. Where the Company
retains control of the financial asset,
the asset is continued to be recognised
to the extent of continuing involvement
in the financial asset.
C Impairment of financial assets
In accordance with Ind AS 109, the Company
applies Expected Credit Losses ("ECL'')
model for measurement and recognition of
impairment loss on the following financial
assets:
⢠Financial assets that are debt
instruments, and are measured at
amortised cost, e.g. loans and deposits;
⢠Financial assets that are equity
instruments and are measured at fair
value through other comprehensive
income (FVTOCI);
⢠Trade receivables or any contractual
right to receive cash or another financial
asset that result from transactions that
are within the scope of Ind AS 115.
Expected Credit Losses are measured
through a loss allowance at an amount
equal to:
⢠The 12-months expected credit losses
(expected credit losses that result from
those default events on the financial
instrument that are possible within 12
months after the reporting date), if the
credit risk on a financial instrument has
not increased significantly; or
⢠Full lifetime expected credit losses
(expected credit losses that result from
all possible default events over the life
of the financial instrument), if the credit
risk on a financial instrument has
increased significantly.
In accordance with Ind AS 109 - Financial
Instruments, the Company applies ECL
model for measurement and recognition
of impairment loss on the trade
receivables or any contractual right to
receive cash or another financial asset
that result from transactions that are
within the scope of Ind AS 115 - Revenue
from Contracts with Customers.
For this purpose, the Company follows
''simplified approach'' for recognition
of impairment loss allowance on the
trade receivable balances and contract
assets. The application of simplified
approach requires expected lifetime
losses to be recognised from initial
recognition of the receivables based on
lifetime ECLs at each reporting date.
In case of other assets, the Company
determines if there has been a significant
increase in credit risk of the financial
asset since initial recognition. If the credit
risk of such assets has not increased
significantly, an amount equal to twelve
months ECL is measured and recognised
as loss allowance. However, if credit risk
has increased significantly, an amount
equal to lifetime ECL is measured and
recognised as loss allowance.
When determining whether the credit
risk of a financial asset has increased
significantly since initial recognition and
when estimating expected credit losses,
the Company considers reasonable
and supportable information that is
relevant and available without undue
cost or effort. This includes both
quantitative and qualitative information
and analysis, based on the Company''s
historical experience and informed
credit assessment and including
forward looking information.
The gross carrying amount of a financial
asset is written off (either partially or
in full) to the extent that there is no
realistic prospect of recovery. This is
generally the case when the Company
determines that the debtor does not
have assets or sources of income that
could generate sufficient cash flows
to repay the amounts subject to the
write off. However, financial assets that
are written off could still be subject
to enforcement activities in order to
comply with the Company''s procedures
for recovery of amounts due.
II Financial liabilities and equity instruments
Debt or equity instruments issued by the
Company are classified as either financial
liabilities or as equity in accordance with the
substance of the contractual arrangements
and the definitions of a financial liability and
an equity instrument. An equity instrument is
any contract that evidences a residual interest
in the assets of an entity after deducting all of
its liabilities. Equity shares are classified as
equity. Incremental costs directly attributable to
the issue of new shares or options are shown in
equity as a deduction, net of tax.
A Subsequent measurement
Financial liabilities measured at amortized
cost:
Financial liabilities are subsequently
measured at amortized cost using the
effective interest rate (EIR). Gains and losses
are recognized in the standalone statement
of profit and loss when the liabilities are
derecognized as well as through the EIR
amortization process. Amortized cost is
calculated by taking into account any discount
or premium on acquisition and fee or costs
that are an integral part of the EIR. The EIR
amortization is included in finance costs in
the standalone statement of profit and loss.
Financial liabilities measured at fair value
through profit or loss (FVTPL):
Financial liabilities at FVTPL include
financial liabilities held for trading and
financial liabilities designated upon initial
recognition as FVTPL. Financial liabilities
are classified as held for trading if they are
incurred for the purpose of repurchasing
in the near term. Derivatives, including
separated embedded derivatives are
classified as held for trading unless
they are designated as effective hedging
instruments. Financial liabilities at fair
value through profit or loss are carried in
the standalone financial statements at fair
value with changes in fair value recognized
in other income or finance costs in the
standalone statement of profit and loss.
B Derecognition of financial liabilities
A financial liability is derecognized when the
obligation under the liability is discharged
or cancelled or expired. When an existing
financial liability is replaced by another
from the same lender on substantially
different terms, or the terms of an existing
liability are substantially modified, such an
exchange or modification is treated as the
derecognition of the original liability and the
recognition of a new liability. The difference
in the respective carrying amounts is
recognized in the standalone statement of
profit and loss.
j Borrowings and borrowing costs
Borrowings are initially recognised net of transaction
costs incurred and subsequently measured at
amortized cost. Any difference between the proceeds
(net of transaction costs) and the redemption amount
is recognised in the standalone statement of profit and
loss over the period of the borrowings using the EIR.
Borrowing costs that are attributable to the
acquisition or construction of qualifying assets till
the time such assets are ready for intended use are
capitalized as part of cost of the assets. All other
borrowing costs are expensed in the period they
occur.
Mar 31, 2024
2.2 Summary of material accounting policies a Property, plant and equipment
(i) Freehold land is carried at cost. Other property, plant and equipment are stated at original cost of acquisition / installation (net of goods and service tax / cenvat credit availed), less accumulated depreciation and impairment loss, if any. The cost comprises purchase price, borrowing costs if capitalization criteria are met and directly attributable cost of bringing the asset to its working condition for the intended use and estimated cost for decommissioning of an asset. Integrated Receiver Decoders (IRD) boxes are capitalized, when available for deployment.
(ii) Capital work-in-progress comprises cost of property, plant and equipment and related expenses that are not yet ready for their intended use at the reporting date.
b Right-of-use (ROU) assets
Right-of-use (ROU) assets are stated at cost, less accumulated depreciation and impairment loss, if any. The carrying amount of ROU assets is adjusted for remeasurement of lease liability, if any, in future. Cost of ROU assets comprises the amount of initial measurement of lease liability, lease payments made before the commencement date (net of incentives received), initial direct costs and present value of estimated costs of dismantling and restoration.
c intangible assets
(i) Intangible assets with finite useful lives that are acquired or developed are measured on initial recognition at cost and stated at cost less accumulated amortization and impairment loss, if any.
(ii) Intangible assets - television channels include expenses incurred on development of new television channels till the time it is ready for commercial launch.
(iii) Intangible assets under development comprises cost of intangible assets and related expenses that are not yet ready for their intended use at the reporting date.
d Depreciation / amortization on property, plant and equipment / right-of-use assets / intangible assets
Depreciable / amortizable amount for property, plant and equipment / right-of-use assets / intangible assets is the cost of an asset or other amount substituted for cost, less its estimated residual value.
(i) Depreciation on property, plant and equipment is provided on straight-line method over the useful life of asset as specified in Part-C of Schedule II to the Companies Act, 2013 except in respect of the following categories of assets, where the life of the assets has been assessed lower than the life prescribed in Schedule II, based on technical advice, taking into account the nature of the asset, the estimated usage of
e impairment of non-financial assets
The carrying amounts of non-financial assets are reviewed at each balance sheet date if there is any indication of impairment based on internal / external factors. An asset is treated as impaired when the carrying amount exceeds its recoverable value. The recoverable amount is the greater of the asset''s net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to the present value using a pre-tax discount rate that reflects current market assessment of the time value of money and risks specific to the assets. An impairment loss is charged to the standalone statement of profit and loss in the year in which an asset is identified as impaired. After impairment,
depreciation / amortisation is provided on the revised carrying amount of the asset over its remaining useful life. The impairment loss recognised in prior accounting periods is reversed by crediting the standalone statement of profit and loss if there has been a change in the estimate of recoverable amount.
f Derecognition of property, plant and equipment / right-of-use assets / intangible assets / investment property
The carrying amount of an item of property, plant and equipment / right-of-use assets / intangible assets / investment property is derecognized on disposal or when no future economic benefits are expected from its use or disposal. The gain or loss arising from the derecognition of an item of property, plant and equipment / ROU assets / intangible assets / investment property is measured as the difference between the net disposal in proceeds and the carrying amount of the item and is recognised in the standalone statement of profit and loss when the item is derecognized.
g Lease Liability
(i) The Company as a lessee
Lease liability associated with assets taken on lease (except short-term and low value assets) is measured at the present value of lease payments to be made. Lease payments are discounted using the interest rate implicit in the lease. Lease payments comprise fixed payments in relation to the lease (less lease incentives receivable), variable lease payments, if any and other amounts (residual value guarantees, penalties, etc.) to be payable in future in relation to the lease arrangement. Lease liability is subsequently measured by increasing the carrying amount to reflect interest on the lease liability, reducing the carrying amount to reflect the lease payment made and remeasuring the carrying amount to reflect any reassessment or modification, if any.
(ii) The Company as a lessor
Leases for which the Company is a lessor are classified as finance or operating leases. Whenever the terms of the lease transfer substantially all the risks and rewards of
ownership to the lessee, the contract is classified as a finance lease. All other leases are classified as operating leases. Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease.
h. cash and cash equivalents
(i) Cash and cash equivalents in the standalone balance sheet comprise cash at banks and on hand, cheques on hand and short-term deposits with an original maturity of three months or less, which are subject to an insignificant risk of changes in value.
(ii) For the purpose of the standalone statement of cash flows, cash and cash equivalents consist of cash and short-term deposits, as defined above, net of cash credit outstanding as they are considered an integral part of the Company''s cash management.
i Financial instruments
Financial instruments is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.
initial recognition of financial assets and liabilities
Financial assets and financial liabilities (except investment in subsidiaries and associates) are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognised immediately in the standalone statement of profit and loss.
i Financial assets
A Subsequent measurement
Financial assets are classified into the specified categories i.e. amortized cost, fair
value through profit or loss (FVTPL) and fair value through other comprehensive income (FVTOCI). The classification depends on the Company''s business model for managing the financial assets and the contractual terms of cash flows.
(i) Debt instruments
Amortized cost:
A financial asset is subsequently measured at amortized cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
Fair value through other comprehensive income (FVTOCI):
A ''debt instrument'' is classified as at the FVTOCI if both of the following criteria are met:
(a) The objective of the business model is achieved both by collecting contractual cash flows and selling the financial assets.
(b) The asset''s contractual cash flows represent solely payments of principal and interest.
Debt instruments included within the FVTOCI category are measured initially as well as at each reporting date at fair value. Fair value movements are recognized in the other comprehensive income (OCI). However, the Company recognizes interest income, impairment losses and reversals and foreign exchange gain or loss in the standalone statement of profit and loss. On derecognition of the asset, cumulative
gain or loss previously recognised in OCI is reclassified from the equity to the standalone statement of profit and loss. Interest earned whilst holding FVTOCI debt instrument is reported as interest income using the effective interest rate (EIR) method.
Fair value through profit or loss (fvtpl) : FVTPL is a residual category for debt instruments. Any debt instrument, which does not meet the criteria for categorization as at amortized cost or as FVTOCI, is classified as FVTPL.
In addition, the Company may elect to designate a debt instrument, which otherwise meets amortized cost or FVTOCI criteria, as at FVTPL. However, such election is considered only if doing so reduces or eliminates a measurement or recognition inconsistency (referred to as ''accounting mismatch'').
Debt instruments included within the FVTPL category are measured at fair value with all changes recognized in the standalone statement of profit and loss.
(ii) investments in equity instruments
The Company subsequently measures all equity instruments (other than investments in subsidiaries and associates) at fair value. Where the Company''s management has elected to present fair value gains and losses on equity instruments in other comprehensive income, there is no subsequent reclassification of fair value gains and losses to the standalone statement of profit and loss. Dividends from such instruments are recognised in the standalone statement of profit and loss as other income when the company''s right to receive payment is established.
(iii) investment in subsidiaries and associates
Investment in subsidiaries and associates are carried at cost less impairment loss in accordance with Ind AS 27 on "Separate Financial Statements". Refer note 7 for list of investments.
B Derecognition of financial assets
A financial asset is derecognized only when
(a) The Company has transferred the rights to receive cash flows from the financial asset or the rights have expired or
(b) The Company retains the contractual rights to receive the cash flows of the financial asset, but assumes a contractual obligation to pay the cash flows to one or more recipients in an arrangement.
Where the entity has transferred an asset, the Company evaluates whether it has transferred substantially all risks and rewards of ownership of the financial asset. In such cases, the financial asset is derecognized. Where the entity has not transferred substantially all risks and rewards of ownership of the financial asset, the financial asset is not derecognized.
Where the entity has neither transferred a financial asset nor retains substantially all risks and rewards of ownership of the financial asset, the financial asset is derecognised if the Company has not retained control of the financial asset. Where the Company retains control of the financial asset, the asset is continued to be recognised to the extent of continuing involvement in the financial asset.
C impairment of financial assets
The Company applies the expected credit
loss model for recognizing impairment
loss on financial assets. Loss allowances for trade receivables are measured at an amount equal to lifetime expected credit losses. Lifetime expected credit losses are the expected credit losses that result from all possible default events over the expected life of a financial instrument. Lifetime expected credit loss is computed based on a provision matrix which takes into account historical credit loss experience adjusted for forward-looking information. For other financial assets, expected credit loss is measured at the amount equal to twelve months expected credit loss unless there has been a significant increase in credit risk from initial recognition, in which case, those are measured at lifetime expected credit loss.
ii Financial liabilities and equity instruments
Debt or equity instruments issued by the Company are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument. An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax.
A Subsequent measurement
Financial liabilities measured at amortized cost:
Financial liabilities are subsequently measured at amortized cost using the effective interest rate (EIR). Gains and losses are recognized in the standalone statement of profit and loss when the liabilities are derecognized as well as through the EIR amortization process. Amortized cost is calculated by taking into account any discount or premium on acquisition and fee
or costs that are an integral part of the EIR. The EIR amortization is included in finance costs in the standalone statement of profit and loss.
Financial liabilities measured at fair value through profit or loss (FVTPL):
Financial liabilities at FVTPL include financial liabilities held for trading and financial liabilities designated upon initial recognition as FVTPL. Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term. Derivatives, including separated embedded derivatives are classified as held for trading unless they are designated as effective hedging instruments. Financial liabilities at fair value through profit or loss are carried in the standalone financial statements at fair value with changes in fair value recognized in other income or finance costs in the standalone statement of profit and loss.
B Derecognition of financial liabilities
A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expired. When an existing financial liability is replaced by another from the same lender on substantially different terms or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in the standalone statement of profit and loss.
j Borrowings and borrowing costs
Borrowings are initially recognised net of transaction costs incurred and subsequently measured at amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in the standalone
statement of profit and loss over the period of the borrowings using the EIR.
Borrowing costs that are attributable to the acquisition or construction of qualifying assets till the time such assets are ready for intended use are capitalized as part of cost of the assets. All other borrowing costs are expensed in the period they occur.
Mar 31, 2023
1 Corporate Information
Zee Media Corporation Limited ("ZMCL" or "the Companyâ) is incorporated in the State of Maharashtra, India and is listed on BSE Limited (BSE) and The National Stock Exchange of India Limited (NSE) in India. The registered office of the Company is situated at 14th Floor, ''A'' Wing, Marathon Futurex, N M Joshi Marg, Lower Parel, Mumbai - 400013, Maharashtra, India. The Company is mainly engaged in the business of broadcasting of satellite television channels i.e. news / current affairs and regional language channels and sale of television programs and content.
The separate financial statements (hereinafter referred to as "Financial Statements") of the Company for the year ended 31 March 2023 were authorized for issue by the Board of Directors at their meeting held on 29 May 2023.
2 Basis of preparation and other significant accounting policies2.1 Basis of preparation of financial statements
a The financial statements have been prepared to comply in all material respects with the Indian Accounting Standards (Ind AS) as notified under Section 133 of the Companies Act, 2013 (''Act'') read with Companies (Indian Accounting Standards) Rules, 2015 (as amended) and other relevant provisions of the Act and rules framed thereunder and guidelines issued by the Securities and Exchange Board of India (SEBI). The financial statements have been prepared under the historical cost convention and on the accrual basis, except for certain financial assets and liabilities and defined benefit plan assets and liabilities being measured at fair value.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the Company takes into account the characteristics of the asset or liability if market participants would take those
characteristics into account when pricing the asset or a liability at the measurement date.
All amounts disclosed in the financial statements have been rounded off to the nearest million with two decimals thereof, unless otherwise stated. Zero "0.00" denotes amount less than '' 5,000.
c Current and non-current classification
Assets and liabilities are classified as current if expected to realize or settle within twelve months after the balance sheet date. Deferred tax assets and liabilities are classified as non-current assets and liabilities.
2.2 Summary of significant accounting policiesa-i Property, plant and equipment
(i) Freehold land is carried at cost. Other property, plant and equipment are stated at original cost of acquisition / installation (net of goods and service tax / cenvat credit availed), less accumulated depreciation and impairment loss, if any. The cost comprises purchase price, borrowing costs if capitalization criteria are met and directly attributable cost of bringing the asset to its working condition for the intended use and estimated cost for decommissioning of an asset. Integrated Receiver Decoders (IRD) boxes are capitalized, when available for deployment.
(ii) Capital work-in-progress comprises cost of property, plant and equipment and related expenses that are not yet ready for their intended use at the reporting date.
a-ii Right-of-use (ROU) assets
Right-of-use (ROU) assets are stated at cost, less accumulated depreciation and impairment loss, if any. The carrying amount of ROU assets is adjusted for remeasurement of lease liability, if any, in future. Cost of ROU assets comprises the amount of initial measurement of lease liability, lease payments made before the commencement date (net of incentives
received), initial direct costs and present value of estimated costs of dismantling and restoration.
(i) Intangible assets with finite useful lives that are acquired or developed are measured on initial recognition at cost and stated at cost less accumulated amortization and impairment loss, if any.
(ii) Intangible assets - television channels include expenses incurred on development of new television channels till the time it is ready for commercial launch.
(iii) Intangible assets under development comprises cost of intangible assets and related expenses that are not yet ready for their intended use at the reporting date.
c Depreciation / amortization on property, plant and equipment / Right-of-use assets / intangible assets
Depreciable / amortizable amount for property, plant and equipment / Right-of-use assets / intangible assets is the cost of an asset, or other amount substituted for cost, less its estimated residual value.
(i) Depreciation on property, plant and equipment is provided on straight-line method over the useful life of asset as specified in Part-C of Schedule II to the Companies Act, 2013 except in respect of the following categories of assets, where the life of the assets has been assessed lower than the life prescribed in Schedule II, based on technical advice, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement etc.
|
Assets |
Managementâs estimate of useful life |
|
Plant and machinery |
|
|
(i) Studio equipment -Linear |
10 years |
|
(ii) Studio equipment -Non-linear |
5 years |
|
(iii) Integrated receiver / decoder (IRD) boxes |
1 year |
|
Vehicles |
5 years |
(ii) Leasehold building and leasehold improvements are amortized over the period of lease or useful life of assets, whichever is lower.
(iii) ROU assets are depreciated on straight line basis from the commencement date to the end of useful life of asset or lease term whichever is earlier.
(iv) Intangible assets are amortized on straight line basis over their respective individual useful lives as follows:
|
Assets |
Managementâs |
|
estimate of useful life |
|
|
Software |
3 years |
|
Website |
5 years |
|
Television channels |
5 years |
d Impairment of non-financial assets
The carrying amounts of non-financial assets are reviewed at each balance sheet date if there is any indication of impairment based on internal / external factors. An asset is treated as impaired when the carrying amount exceeds its recoverable value. The recoverable amount is the greater of the asset''s net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to the present value using a pre-tax discount rate that reflects current market assessment of the time value of money and risks specific to the assets. An impairment loss is charged to the statement of profit and loss in the year in which an asset is identified as impaired. After impairment, depreciation / amortisation is provided on the revised carrying amount of the asset over its remaining useful life. The impairment loss recognised in prior accounting periods is reversed by crediting the statement of profit and loss if there has been a change in the estimate of recoverable amount.
e Investment property
Investment property is property (land or a building or part of a building or both) held to earn rentals and/or for capital appreciation (including property under construction for such purposes). Investment property is measured initially at cost including purchase price, borrowing costs. Subsequent to initial recognition, investment property is measured at cost less accumulated depreciation and impairment, if any.
f Derecognition of property, plant and equipment / Right-of-use assets / intangible assets / investment property
The carrying amount of an item of property, plant and equipment / ROU assets / intangible assets / investment property is derecognized on disposal or when no future economic benefits are expected from its use or disposal. The gain or loss arising from the derecognition of an item of property, plant and equipment / ROU assets / intangible assets / investment property is measured as the difference between the net disposal in proceeds and the carrying amount of the item and is recognised in the statement of profit and loss when the item is derecognized.
(i) The Company as a lessee
Lease liability associated with assets taken on lease (except short-term and low value assets) is measured at the present value of lease payments to be made. Lease payments are discounted using the interest rate implicit in the lease. Lease payments comprise fixed payments in relation to the lease (less lease incentives receivable), variable lease payments, if any and other amounts (residual value guarantees, penalties, etc.) to be payable in future in relation to the lease arrangement. Lease liability is subsequently measured by increasing the carrying amount to reflect interest on the lease liability, reducing the carrying amount to reflect the lease payment made and remeasuring the carrying amount to reflect any reassessment or modification, if any.
(ii) The Company as a lessor
Leases for which the Company is a lessor are classified as finance or operating leases. Whenever the terms of the lease transfer
substantially all the risks and rewards of ownership to the lessee, the contract is classified as a finance lease. All other leases are classified as operating leases. Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease.
(i) Cash and cash equivalents in the balance sheet comprise cash at banks and on hand, cheques on hand and short-term deposits with an original maturity of three months or less, which are subject to an insignificant risk of changes in value.
(ii) For the purpose of the statement of cash flows, cash and cash equivalents consist of cash and short-term deposits, as defined above, net of cash credit outstanding as they are considered an integral part of the Company''s cash management.
Television programs (completed, under production, available for sale) are stated at lower of cost / unamortized cost or realizable value. Cost comprises acquisition / direct production cost and other allocated production overheads. Where the realizable value on the basis of its estimated useful economic life is less than its carrying amount, the difference is expensed as impairment. Programs -news / current affairs / chat shows / events etc. are fully expensed on telecast.
Financial instruments is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.
Initial recognition of financial assets and liabilities
Financial assets and financial liabilities (except investment in subsidiaries and associates) are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities
(other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognised immediately in the statement of profit and loss.
I Financial assetsA Subsequent measurement
Financial assets are classified into the specified categories i.e. amortized cost, fair value through profit or loss (FVTPL) and fair value through other comprehensive income (FVTOCI). The classification depends on the Company''s business model for managing the financial assets and the contractual terms of cash flows.
(i) Debt instrumentsAmortized cost:
A financial asset is subsequently measured at amortized cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
Fair value through other comprehensive income (FVTOCI):
A ''debt instrument'' is classified as at the FVTOCI if both of the following criteria are met:
(a) The objective of the business model is achieved both by collecting contractual cash flows and selling the financial assets.
(b) The asset''s contractual cash flows represent solely payments of principal and interest.
Debt instruments included within the FVTOCI category are measured initially as well as at each reporting date at fair value. Fair value movements are recognized in the other comprehensive income (OCI). However, the Company recognizes interest income, impairment losses and reversals and foreign exchange gain or loss in the statement of profit and loss. On derecognition of the asset, cumulative gain or loss previously recognised in OCI is reclassified from the equity to the statement of profit and loss. Interest earned whilst holding FVTOCI debt instrument is reported as interest income using the effective interest rate (EIR) method.
Fair value through profit or loss (FVTPL):
FVTPL is a residual category for debt instruments. Any debt instrument, which does not meet the criteria for categorization as at amortized cost or as FVTOCI, is classified as FVTPL. In addition, the Company may elect to designate a debt instrument, which otherwise meets amortized cost or FVTOCI criteria, as at FVTPL. However, such election is considered only if doing so reduces or eliminates a measurement or recognition inconsistency (referred to as ''accounting mismatch''). Debt instruments included within the FVTPL category are measured at fair value with all changes recognized in the statement of profit and loss.
(ii) Investments in equity instruments
The Company subsequently measures all equity instruments (other than investments in subsidiaries and associates) at fair value. Where the
Company''s management has elected to present fair value gains and losses on equity instruments in other comprehensive income, there is no subsequent reclassification of fair value gains and losses to the statement of profit and loss. Dividends from such instruments are recognised in the statement of profit and loss as other income when the company''s right to receive payment is established.
(iii) Investment in subsidiaries and associates
Investment in subsidiaries and associates are carried at cost less impairment loss in accordance with Ind AS 27 on "Separate Financial Statements". Refer note 7 for list of investments.
B Derecognition of financial assets
A financial asset is derecognized only when
(a) The Company has transferred the rights to receive cash flows from the financial asset or the rights have expired or (b) The Company retains the contractual rights to receive the cash flows of the financial asset, but assumes a contractual obligation to pay the cash flows to one or more recipients in an arrangement.
Where the entity has transferred an asset, the Company evaluates whether it has transferred substantially all risks and rewards of ownership of the financial asset. In such cases, the financial asset is derecognized. Where the entity has not transferred substantially all risks and rewards of ownership of the financial asset, the financial asset is not derecognized.
Where the entity has neither transferred a financial asset nor retains substantially all risks and rewards of
ownership of the financial asset, the financial asset is derecognised if the Company has not retained control of the financial asset. Where the Company retains control of the financial asset, the asset is continued to be recognised to the extent of continuing involvement in the financial asset.
C Impairment of financial assets
The Company applies the expected credit loss model for recognizing impairment loss on financial assets. Loss allowances for trade receivables are measured at an amount equal to lifetime expected credit losses. Lifetime expected credit losses are the expected credit losses that result from all possible default events over the expected life of a financial instrument. Lifetime expected credit loss is computed based on a provision matrix which takes into account historical credit loss experience adjusted for forward-looking information. For other financial assets, expected credit loss is measured at the amount equal to twelve months expected credit loss unless there has been a significant increase in credit risk from initial recognition, in which case, those are measured at lifetime expected credit loss.
i
II Financial liabilities and equity instruments
i
Debt or equity instruments issued by the Company are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument. An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax.
A Subsequent measurementFinancial liabilities measured at amortized cost:
Financial liabilities are subsequently measured at amortized cost using the effective interest rate (EIR). Gains and losses are recognized in the statement of profit and loss when the liabilities are derecognized as well as through the EIR amortization process. Amortized cost is calculated by taking into account any discount or premium on acquisition and fee or costs that are an integral part of the EIR. The EIR amortization is included in finance costs in the statement of profit and loss.
Financial liabilities measured at fair value through profit or loss (FVTPL):
Financial liabilities at FVTPL include financial liabilities held for trading and financial liabilities designated upon initial recognition as FVTPL. Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term. Derivatives, including separated embedded derivatives are classified as held for trading unless they are designated as effective hedging instruments. Financial liabilities at fair value through profit or loss are carried in the financial statements at fair value with changes in fair value recognized in other income or finance costs in the statement of profit and loss.
B Derecognition of financial liabilities
A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expired. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition
of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in the statement of profit and loss.
k Borrowings and borrowing costs
Borrowings are initially recognised net of transaction costs incurred and subsequently measured at amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in the statement of profit and loss over the period of the borrowings using the EIR.
Borrowing costs that are attributable to the acquisition or construction of qualifying assets till the time such assets are ready for intended use are capitalized as part of cost of the assets. All other borrowing costs are expensed in the period they occur.
l Provisions, contingent liabilities and contingent assets
The Company recognizes provisions when a present obligation (legal or constructive) as a result of a past event exists and it is probable that an outflow of resources embodying economic benefits will be required to settle such obligation and the amount of such obligation can be reliably estimated. Provisions are not recognised for future operating losses.
If the effect of time value of money is material, provisions are discounted using a current pretax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.
A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not require an outflow of resources embodying economic benefits or the amount of such obligation cannot be measured reliably. When there is a possible obligation or a present obligation in respect of which likelihood of outflow of resources embodying economic benefits is remote, no provision or disclosure is made.
Contingent assets are not recognised in the financial statements, however they are disclosed where the inflow of economic benefits is probable. When the realization of income is virtually certain, then the related asset is no longer a contingent asset and is recognised as an asset.
m Revenue recognition(i) Revenue from contract with customers
Revenue from contract with customers is recognised when control of the goods or services is transferred to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. When the Company acts in the capacity of an agent rather than as the principal in a transaction, the revenue recognised is the net amount of commission earned by the Company.
Revenue from advertisement is recognized when advertising benefits are transferred to the customer i.e. when each advertisement is aired as per the contract terms.
Revenue is measured based on the transaction price, which is the consideration, adjusted for discounts and incentives if any, as specified in the contract with the customer. Revenue also excludes taxes collected from the customers.
Revenue from subscription is recognized over time on performance of television broadcasting service to subscribers as per the terms of the contract.
Revenue from sale of television programs and content including program feeds is recognized at a point in time, when the control of television programs and content is transferred to the customer involving single performance obligation, which is generally at the point of delivery as per the terms of the contract. Revenue from sale of content is recognized
over time, where the customer simultaneously receives and consumes the benefits provided by the entity''s performance as the entity performs.
Revenue from channel management fee is
recognized over a period of time on performance of obligation as per the terms of the contract.
Variable consideration
If the consideration promised in a contract includes a variable amount, the Company estimates the amount of consideration to which the Company will be entitled in exchange for transferring the promised goods or services to the customer. Where customers are provided with discounts, rebates etc., such discounts and rebates will give rise to variable consideration. The Company follows the ''most likely amount'' method in estimating the amount of variable consideration.
Contract balances
Contract assets
Contract assets is recognised where there is excess of revenue earned over billing done. Contract assets are classified as unbilled revenue where there is unconditional right to receive cash and only passage of time is required as per contractual terms.
Contract liabilities
i
i
A contract liability is the obligation to transfer goods or services to a customer for which the Company has received consideration from the customer. If a customer pays consideration before the Company transfers goods or services to the customer, a contract liability is recognised. Contract liabilities are recognised as revenue when the Company performs under the contract.
A receivable represents the Company''s right to an amount of consideration under the contract with a customer that is unconditional and realizable on the due date.
Arrangements with Multiple Performance Obligations
The Company''s contracts with customers may include multiple performance obligations. For such arrangements, the Company allocates revenue to each performance obligation based on its relative standalone selling price, which is generally determined based on the price charged to customers.
(ii) Interest income is recognized using the effective interest rate (EIR) method, which is the rate that exactly discounts the estimated future cash receipts through the expected life of the financial assets.
(iii) Dividend income is recognized when the Company''s right to receive dividend is established.
(iv) Rental and Service income is recognized on an accrual basis, in accordance with the terms of relevant agreements, as and when services are rendered.
Retirement and other employee benefits
(i) The Company operates both defined benefit and defined contribution schemes for its employees.
For defined contribution schemes the amount charged as expense is equal to the contributions paid or payable when employees have rendered services entitling them to the contributions.
For defined benefit plans, actuarial valuations are carried out at each balance sheet date using the Projected Unit Credit Method. All such plans are unfunded.
All expenses represented by current service cost, past service cost, if any, and net interest on the defined benefit liability/ (asset) are recognized in the statement of profit and loss. Remeasurements of the net defined benefit liability/ (asset) comprising actuarial gains and losses (excluding interest on the net defined benefit liability/ asset)) are recognised in Other Comprehensive Income (OCI). Such remeasurements are not
reclassified to the statement of profit and loss, in the subsequent periods.
(ii) Other long-term employee benefits: The Company has a policy on compensated absences which are both accumulated and non-accumulated. The expected cost of accumulated compensated absences is determined by actuarial valuation performed by an independent actuary at each balance sheet date using projected unit credit method on the additional amount expected to be paid/availed as a result of the unused entitlement that has accumulated at the balance sheet date. Expense on non-accumulated compensated absences is recognized in the period in which the absences occur.
The Company presents the leave as a current liability in the balance sheet, to the extent it does not have an unconditional right to defer its settlement for twelve months after the reporting date. Where Company has the unconditional legal and contractual right to defer the settlement for a period beyond twelve months, the same is presented as non-current liability.
(iii) Short-term employee benefits: All employee benefits payable wholly within twelve months of rendering the service are classified as short term employee benefits and they are recognized in the period in which the employee renders the related service. The Company recognizes the undiscounted amount of short-term employee benefits expected to be paid in exchange for services rendered as a liability.
o Transactions in foreign currency
The functional currency of the Company is Indian
Rupee (?) which is also the presentation currency. All
other currencies are accounted as foreign currency.
(i) Foreign currency transactions are accounted at the exchange rates prevalent on the date of such transactions.
(ii) Foreign currency monetary items are translated using the exchange rate prevalent at the reporting date. Exchange differences arising on
settlement of monetary items or on reporting such monetary items at rates different from those at which they were initially recorded during the year, or reported in previous financial statements are recognised as income or as expense in the period in which they arise.
(iii) Non-monetary foreign currency items are carried at historical cost and translated at the exchange rate prevalent at the date of transaction.
Tax expense comprises of current and deferred tax.
Current tax is the amount of income taxes payable in respect of taxable profit for a period. Current tax for current and prior periods is recognized at the amount expected to be paid to or recovered from the tax authorities, using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.
Deferred tax assets and liabilities are recognized for all temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements except when the deferred tax arises from the initial recognition of an asset or liability that effects neither accounting nor taxable profit or loss at the time of transition. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.
Deferred tax assets and liabilities are measured using tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date and are expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
(iii) Presentation of current and deferred tax
Current and deferred tax is recognised in the statement of profit and loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.
q Earnings per share
Basic earnings per share is calculated by dividing the net profit or loss (excluding other comprehensive income) for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year. The weighted average number of equity shares outstanding during the year is adjusted for events such as bonus issue, bonus element in a right issue, shares split and reserve share splits (consolidation of shares) that have changed the number of equity shares outstanding, without a corresponding change in resources. For the purpose of calculating diluted earnings per share, the net profit or loss (excluding other comprehensive income) for the year attributable to equity share holders and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.
The Company recognizes compensation expense relating to share-based payments in the statement of profit and loss using fair value in accordance with Ind AS 102, "Share-based Payments". The estimated fair value of awards is charged to statement of profit and loss on a straight-line basis over the requisite service period for each separately vesting portion of the award as if the award was in-substance, multiple awards with a corresponding increase to share based payment reserves.
Business combinations are accounted for using the acquisition method as per Ind AS 103, Business Combinations.
The cost of acquisition is measured at the fair value of the assets transferred, equity instruments issued and liabilities incurred or assumed at the date of acquisition, which is the date on which control is transferred to the Company. The cost of acquisition also includes the fair value of any contingent consideration. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair value on the date of acquisition.
Business combinations between entities under common control is accounted for at carrying value. Transaction costs that the Company incurs in connection with a business combination such as finder''s fees, legal fees, due diligence fees, and other professional and consulting fees are expensed as incurred.
Discontinued operation is a component of the Company that either has been disposed of, or is classified as held for sale, and:
(i) Represents a separate major line of business or geographical area of operations,
(ii) Is part of a single coordinated plan to dispose of a separate major line of business or geographical area of operations, and
(iii) Is a subsidiary acquired exclusively with a view to resale.
Discontinued operations are excluded from the results of continuing operations and are presented separately as profit or loss from discontinued operations in the statement of profit and loss. Also, comparative statement of profit and loss is
represented as if the operation had been discontinued from the start of the comparative period.
Assets and liabilities classified as discontinued operations are presented separately from other assets and liabilities in the balance sheet.
Provision is made for the amount of any dividend declared on or before the end of the reporting period but remaining undistributed at the end of the reporting period, where the same has been appropriately authorized and is no longer at the discretion of the entity.
Certain occasions, the size, type, or incidences of the item of income or expenses pertaining to the ordinary activities of the Company is such that its disclosure improves the understanding of the performance of the Company, such income or expenses is classified as an exceptional item and accordingly, disclosed in the financial statements.
w Non-current assets held for sale
Non-current assets and disposal groups classified as held for sale are measured at the lower of their carrying value and fair value less costs to sell.
Assets and disposal groups are classified as held for sale if their carrying value will be recovered through a sale transaction rather than through continuing use. This condition is only met when the sale is highly probable and the asset, or disposal group, is available for immediate sale in its present condition and is marketed for sale at a price that is reasonable in relation to its current fair value. The Company must also be committed to the sale, which should be expected to qualify for recognition as a completed sale within one year from the date of classification.
2.3 Recent Indian Accounting Standards (Ind AS)
Ministry of Corporate Affairs ("MCA") notifies new standard or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. On 31 March, 2023, MCA amended the Companies
(Indian Accounting Standards) Rules, 2015 by issuing the Companies (Indian Accounting Standards) Amendment Rules, 2023, applicable from April 1, 2023, as below:
Ind AS 1 - Presentation of Financial Statements
The amendments require companies to disclose their material accounting policies rather than their significant accounting policies. Accounting policy information, together with other information, is material when it can reasonably be expected to influence decisions of primary users of general-purpose financial statements. The Company does not expect this amendment to have any significant impact in its financial statements.
The amendments clarify how companies account for deferred tax on transactions such as leases and decommissioning obligations. The amendments narrowed the scope of the recognition exemption in paragraphs 15 and 24 of Ind AS 12 (recognition exemption) so that it no longer applies to transactions that, on initial recognition, give rise to equal taxable and deductible temporary differences. The Company is evaluating the impact, if any, in its financial statements.
Ind AS 8 - Accounting Policies, Changes in Accounting Estimates and Errors
The amendments will help entities to distinguish between accounting policies and accounting estimates. The definition of a change in accounting estimates has been replaced with a definition of accounting estimates. Under the new definition, accounting estimates are "monetary amounts in financial statements that are subject to measurement uncertaintyâ. Entities develop accounting estimates if accounting policies require items in financial statements to be measured in a way that involves measurement uncertainty. The Company does not expect this amendment to have any significant impact in its financial statements.
3 Critical accounting judgment and estimates
The preparation of financial statements in conformity with Ind AS requires the management to make estimates, assumptions and exercise judgement in applying the accounting policies that affect the reported amount of assets, liabilities and disclosure of contingent liabilities at the date of financial statements and the reported amounts of income and expenses during the year.
The Management believes that these estimates are prudent and reasonable and are based on the Management''s best knowledge of current events and actions. Actual results could differ from these estimates and differences between actual results and estimates are recognised in the periods in which the results are known or materialized.
This note provides an overview of the areas that involves a higher degree of judgement or complexity, and of items which are more likely to be materially adjusted due to estimates and assumptions turning out to be different than those originally assessed.
In the normal course of business, contingent liabilities may arise from litigation and other claims against the Company. Potential liabilities that have a low probability of crystallizing or are very difficult to quantify reliably, are treated as contingent liabilities. Such liabilities are disclosed in the notes but are not recognized.
b Useful lives and residual values
The Company reviews the useful lives and residual values of property, plant and equipment, ROU assets, investment property and intangible assets at each financial year end.
c Impairment testing(i) Impairment of financial assets1
The impairment provisions for financial assets disclosed are based on assumptions about risk of default and expected loss rates. The Company uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based on the Company''s past history, existing market conditions as well as forward looking estimates at the end of each reporting period.
(ii) Impairment of non-financial assets
Impairment exists when the carrying value of an asset or cash generating unit (CGU) exceeds its recoverable amount, which is the higher of its fair
value less costs of disposal and its value in use. The fair value less costs of disposal calculation is based on available data from binding sales transactions, conducted at arm''s length, for similar assets or observable market prices less incremental costs for disposing of the asset. The value in use calculation is based on a DCF model. The cash flows are derived from the budget for the future years and do not include restructuring activities that the Company is not yet committed to or significant future investments that will enhance the asset''s performance of the CGU being tested. The recoverable amount is sensitive to the discount rate used for the DCF model as well as the expected future cash-inflows and the growth rate.
(i) The Company''s tax charge is the sum of the total current and deferred tax charges. The calculation of the Company''s total tax charge necessarily involves a degree of estimation and judgment in respect of certain items whose tax treatment cannot be finally determined until resolution has been reached with the relevant tax authority or, as appropriate, through a formal legal process.
(ii) Accruals for tax contingencies require management to make judgments and estimates in relation to tax related issues and exposures.
(iii) The recognition of deferred tax assets is based upon whether it is more likely than not that sufficient and suitable taxable profits will be available in the future against which the reversal of temporary differences can be deducted. Where the temporary differences are related to losses, the availability of the losses to offset against forecast taxable profits is also considered. Recognition therefore involves judgment regarding the future financial performance of the particular legal entity or tax Company in which the deferred tax asset has been recognized.
e Fair value of financial instruments
The fair value of financial instruments that are not
traded in an active market is determined using
valuation techniques. In applying the valuation techniques, management makes maximum use of market inputs and uses estimates and assumptions that are, as far as possible, consistent with observable data that market participants would use in pricing the instrument. Where applicable data is not observable, management uses its best estimate about the assumptions that market participants would make. These estimates may vary from the actual prices that would be achieved in an arm''s length transaction at the reporting date. For details of the key assumptions used and the impact of changes to these assumptions refer note 45.
The cost of post-employment and other long term benefits is determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include determination of discount rates, expected rate of return on assets, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date. The assumptions used are disclosed in note 46.
g Leases
Ind AS 116 requires lessees to determine the lease term as the non-cancellable period of a lease adjusted with any option to extend or terminate the lease, if the use of such option is reasonably certain. The Company makes an assessment on the expected lease term on a lease-by-lease basis and thereby assesses whether it is reasonably certain that any options to extend or terminate the contract will be exercised. In evaluating the lease term, the Company considers factors such as any significant leasehold improvements undertaken over the lease term, costs relating to the termination of the lease and the importance of the underlying asset to the Company''s operations and the availability of suitable alternatives. The lease term in future periods is reassessed to ensure that the lease term reflects the current economic circumstances.
Mar 31, 2018
1 Significant accounting policies
a Basis of preparation of financial statements
The financial statements have been prepared to comply in all material respects with the Indian Accounting Standards (Ind AS) as notified under Section 133 of the Companies Act, 2013 (âActâ) read with Companies (Indian Accounting Standards) Rules, 2015 (as amended) and other relevant provisions of the Act and rules framed thereunder and guidelines issued by the Securities and Exchange Board of India (SEBI). The financial statements have been prepared under the historical cost convention and on the accrual basis, except for certain financial assets and liabilities and defined benefit plan assets and liabilities being measured at fair value.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability the Company takes into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or a liability at the measurement date.
Rounding of amounts
All amounts disclosed in the financial statements have been rounded off to the nearest million with two decimals thereof, unless otherwise stated. Zero â0.00â denotes amount less than Rs.5,000.
Current and non-current classification
Assets and liabilities are classified as current if expected to realize or settle within twelve months after the balance sheet date. Deferred tax assets and liabilities are classified as non-current assets and liabilities.
b Property, plant and equipment
(i) Freehold land is carried at cost. Other property, plant and equipment are stated at cost (net of goods and service tax / cenvat credit availed), less accumulated depreciation and impairment loss, if any. The cost comprises purchase price, borrowing costs if capitalization criteria are met and directly attributable cost of bringing the asset to its working condition for the intended use and estimated cost for decommissioning of an asset. Integrated Receiver Decoder (IRD) boxes are capitalized, when available for deployment.
(ii) Capital work-in-progress comprises cost of property plant and equipment and related expenses that are not yet ready for their intended use at the reporting date.
c Intangible assets
(i) Intangible assets acquired or developed are measured on initial recognition at cost and stated at cost less accumulated amortization and impairment loss, if any.
(ii) Intangible assets - television channels include expenses incurred on development of new television channels till the time it is ready for commercial launch.
(iii) Intangible assets under development comprises cost of intangible assets and related expenses that are not yet ready for their intended use at the reporting date.
d Depreciation / amortization on property, plant and equipment / intangible assets
Depreciable / amortizable amount for property, plant and equipment / intangible assets is the cost of an asset, or other amount substituted for cost, less its estimated residual value.
(i) Depreciation on property, plant and equipment is provided on straight line method over the useful life of asset as specified in Part-C of Schedule II to the Companies Act, 2013 except in respect of the following categories of assets, where the life of the assets has been assessed lower than the life prescribed in Schedule II, based on technical advice, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement etc.
(ii) Leasehold building and leasehold improvements are amortized over the period of lease or useful life of assets, whichever is lower
(iii) Intangible assets are amortized on straight line basis over their respective individual useful lives as follows:
e Impairment of non-financial assets
The carrying amounts of non-financial assets are reviewed at each balance sheet date if there is any indication of impairment based on internal / external factors. An asset is treated as impaired when the carrying amount exceeds its recoverable value. The recoverable amount is the greater of the assetâs net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to the present value using a pre-tax discount rate that reflects current market assessment of the time value of money and risks specific to the assets. An impairment loss is charged to the statement of profit and loss in the year in which an asset is identified as impaired. After impairment, depreciation / amortization is provided on the revised carrying amount of the asset over its remaining useful life. The impairment loss recognized in prior accounting periods is reversed by crediting the statement of profit and loss if there has been a change in the estimate of recoverable amount.
f Investment property
Investment property is property (land or a building or part of a building or both) held to earn rentals and/or for capital appreciation (including property under construction for such purposes). Investment property is measured initially at cost including purchase price, borrowing costs. Subsequent to initial recognition, investment property is measured at cost less accumulated depreciation and impairment, if any.
g Derecognition of property, plant and equipment / intangible assets / investment property
The carrying amount of an item of property plant and equipment / intangible assets / investment property is derecognized on disposal or when no future economic benefits are expected from its use or disposal. The gain or loss arising from the derecognition of an item of property plant and equipment / intangible assets / investment property is measured as the difference between the net disposal in proceeds and the carrying amount of the item and is recognized in the statement of profit and loss when the item is derecognized.
h Leases
(i) Finance lease
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee.
(ii) Operating lease
Lease of assets under which all the risks and rewards of ownership are effectively retained by the lessor are classified as operating leases. Operating lease payments / revenue are recognized on straight line basis over the lease period in the statement of profit and loss unless the payments / receipts are structured to increase in line with expected general inflation to compensate for the lessorâs expected inflationary cost increases.
i Cash and cash equivalents
(i) Cash and cash equivalents in the balance sheet comprise cash at banks and on hand and short-term deposits with an original maturity of three months or less, which are subject to an insignificant risk of changes in value.
(ii) For the purpose of the statement of cash flows, cash and cash equivalents consist of cash and short-term deposits, as defined above, net of cash credit outstanding as they are considered an integral part of the Companyâs cash management.
j Inventories
(i) Television programs (completed, under production, available for sale) are stated at lower of cost / unamortized cost or realizable value. Cost comprises acquisition / direct production cost and other allocated production overheads. Where the realizable value on the basis of its estimated useful economic life is less than its carrying amount, the difference is expensed as impairment. Programs are expensed / amortized as under:
1 Programs - news / current affairs / chat shows / events etc. are fully expensed on telecast.
2 Programs (other than (1) above) are amortized over three financial years starting from the year of first telecast, as per management estimate of future revenue potential.
(ii) Raw stock: Tapes are valued at lower of cost or estimated net realizable value. Cost is taken on weighted average basis.
k Financial instruments
Financial instruments is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.
Initial recognition of financial assets and liabilities
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in the statement of profit and loss.
(i) Financial assets
1. Subsequent measurement
Financial assets are classified into the specified categories i.e. amortized cost, fair value through profit or loss (FVTPL) and fair value through other comprehensive income (FVTOCI). The classification depends on the Companyâs business model for managing the financial assets and the contractual terms of cash flows.
(a) Debt instruments Amortized cost:
A financial asset is subsequently measured at amortized cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
Fair value through other comprehensive income (FVTOCI):
A âdebt instrumentâ is classified as at the FVTOCI if both of the following criteria are met:
(A) The objective of the business model is achieved both by collecting contractual cash flows and selling the financial assets.
(B) The assetâs contractual cash flows represent solely payments of principal and interest.
Debt instruments included within the FVTOCI category are measured initially as well as at each reporting date at fair value. Fair value movements are recognized in the other comprehensive income (OCI). However the Company recognizes interest income, impairment losses and reversals and foreign exchange gain or loss in the statement of profit and loss. On derecognition of the asset, cumulative gain or loss previously recognized in OCI is reclassified from the equity to the statement of profit and loss. Interest earned whilst holding FVTOCI debt instrument is reported as interest income using the effective interest rate (EIR) method.
Fair value through profit or loss (FVTPL):
FVTPL is a residual category for debt instruments. Any debt instrument, which does not meet the criteria for categorization as at amortized cost or as FVTOCI, is classified as FVTPL. In addition, the Company may elect to designate a debt instrument, which otherwise meets amortized cost or FVTOCI criteria, as at FVTPL. However, such election is considered only if doing so reduces or eliminates a measurement or recognition inconsistency (referred to as âaccounting mismatchâ). Debt instruments included within the FVTPL category are measured at fair value with all changes recognized in the statement of profit and loss.
(b) Investments in equity instruments
The Company subsequently measures all equity instruments (other than investments in subsidiaries and associates) at fair value. Where the Companyâs management has elected to present fair value gains and losses on equity instruments in other comprehensive income, there is no subsequent reclassification of fair value gains and losses to the statement of profit and loss. Dividends from such instruments are recognized in the statement of profit and loss as other income when the companyâs right to receive payment is established.
(c) Investment in subsidiaries and associates
Investment in subsidiaries and associates are carried at cost less impairment loss in accordance with Ind AS 27 on ââSeparate Financial Statementsââ. Refer note 8 for list of investments.
2. Derecognition of financial assets
A financial asset is derecognized only when
(a) The Company has transferred the rights to receive cash flows from the asset or the rights have expired or
(b) The Company retains the contractual rights to receive the cash flows of the financial asset, but assumes a contractual obligation to pay the cash flows to one or more recipients in an arrangement.
Where the entity has transferred an asset, the Company evaluates whether it has transferred substantially all risks and rewards of ownership of the financial asset. In such cases, the financial asset is derecognized. Where the entity has not transferred substantially all risks and rewards of ownership of the financial asset, the financial asset is not derecognized.
3. Impairment of financial assets
The Company measures the expected credit loss associated with its assets based on historical trend, industry practices and the business environment in which the entity operates or any other appropriate basis. The impairment methodology applied depends on whether there has been a significant increase in credit risk.
(ii) Financial liabilities and equity instruments
Debt or equity instruments issued by the Company are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument. An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax.
1. Subsequent measurement Financial liabilities measured at amortized cost:
Financial liabilities are subsequently measured at amortized cost using the effective interest rate (EIR). Gains and losses are recognized in the statement of profit and loss when the liabilities are derecognized as well as through the EIR amortization process. Amortized cost is calculated by taking into account any discount or premium on acquisition and fee or costs that are an integral part of the EIR. The EIR amortization is included in finance costs in the statement of profit and loss.
Financial liabilities measured at fair value through profit or loss (FVTPL):
Financial liabilities at FVTPL include financial liabilities held for trading and financial liabilities designated upon initial recognition as FVTPL. Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term. Derivatives, including separated embedded derivatives are classified as held for trading unless they are designated as effective hedging instruments. Financial liabilities at fair value through profit or loss are carried in the financial statements at fair value with changes in fair value recognized in other income or finance costs in the statement of profit and loss.
2. Derecognition of financial liabilities
A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in the statement of profit and loss.
l Borrowings and borrowing costs
Borrowings are initially recognized net of transaction costs incurred and subsequently measured at amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognized in the statement of profit and loss over the period of the borrowings using the EIR.
Borrowing costs that are attributable to the acquisition or construction of qualifying assets till the time such assets are ready for intended use are capitalized as part of cost of the assets. All other borrowing costs are expensed in the period they occur
m Provisions, contingent liabilities and contingent assets
The Company recognizes provisions when a present obligation (legal or constructive) as a result of a past event exists and it is probable that an outflow of resources embodying economic benefits will be required to settle such obligation and the amount of such obligation can be reliably estimated.
If the effect of time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.
A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not require an outflow of resources embodying economic benefits or the amount of such obligation cannot be measured reliably. When there is a possible obligation or a present obligation in respect of which likelihood of outflow of resources embodying economic benefits is remote, no provision or disclosure is made.
Contingent assets are not recognized in the financial statements, however they are disclosed where the inflow of economic benefits is probable. When the realization of income is virtually certain, then the related asset is no longer a contingent asset and is recognized as an asset.
n Revenue recognition
Revenue is recognized to the extent it is probable that economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured at the fair value of the consideration received or receivable. All revenues are accounted on accrual basis except to the extent stated otherwise.
(i) Broadcasting revenue - Advertisement revenue (net of discount and volume rebates) is recognized when the related advertisement or commercial appears before the public i.e. on telecast. Subscription revenue is recognized on time basis on the provision of television broadcasting service to subscribers or as per the agreed terms.
(ii) Revenue from sale of television programs and content including program feeds are recognized when the significant risks and rewards have been transferred to the customers in accordance with the agreed terms.
(iii) Revenue from channel management is recognized on time basis on delivery of services as per agreed terms.
(iv) Revenue from other services is recognized as and when such services are completed / performed.
(v) Interest income is recognized using the effective interest rate (EIR) method, which is the rate that exactly discounts the estimated future cash receipts through the expected life of the financial assets.
(vi) Dividend income is recognized when the Companyâs right to receive dividend is established.
(vii) Guarantee commission income is recognized on time basis, calculated on agreed rate on the amount of guarantee provided.
o Retirement and other employee benefits
(i) The Company operates both defined benefit and defined contribution schemes for its employees. For defined contribution schemes the amount charged as expense is equal to the contributions paid or payable when employees have rendered services entitling them to the contributions. For defined benefit plans, actuarial valuations are carried out at each balance sheet date using the Projected Unit Credit Method. All such plans are unfunded.
All expenses represented by current service cost, past service cost, if any, and net interest on the defined benefit liability/ (asset) are recognized in the statement of profit and loss. Remeasurements of the net defined benefit liability/ (asset) comprising actuarial gains and losses (excluding interest on the net defined benefit liability/asset) are recognized in Other Comprehensive Income (OCI). Such remeasurements are not reclassified to the statement of profit and loss, in the subsequent periods.
(ii) Other long-term employee benefits: The Company has a policy on compensated absences which are both accumulated and non-accumulated. The expected cost of accumulated compensated absences is determined by actuarial valuation performed by an independent actuary at each balance sheet date using projected unit credit method on the additional amount expected to be paid/availed as a result of the unused entitlement that has accumulated at the balance sheet date. Expense on non-accumulated compensated absences is recognized in the period in which the absences occur
The Company presents the leave as a current liability in the balance sheet, to the extent it does not have an unconditional right to defer its settlement for twelve months after the reporting date. Where Company has the unconditional legal and contractual right to defer the settlement for a period beyond twelve months, the same is presented as non-current liability.
(iii) Short-term employee benefits: All employee benefits payable wholly within twelve months of rendering the service are classified as short term employee benefits and they are recognized in the period in which the employee renders the related service. The Company recognizes the undiscounted amount of short-term employee benefits expected to be paid in exchange for services rendered as a liability.
p Transactions in foreign currency
The functional currency of the Company is Indian Rupee (â) which is also the presentation currency. All other currencies are accounted as foreign currency.
(i) Foreign currency transactions are accounted at the exchange rates prevalent on the date of such transactions.
(ii) Foreign currency monetary items are translated using the exchange rate prevalent at the reporting date. Exchange differences arising on settlement of monetary items or on reporting such monetary items at rates different from those at which they were initially recorded during the year or reported in previous financial statements are recognized as income or as expense in the period in which they arise.
(iii) Non-monetary foreign currency items are carried at historical cost and translated at the exchange rate prevalent at the date of transaction.
q Income taxes
Tax expense comprises of current and deferred tax.
(i) Current tax
Current tax is the amount of income taxes payable in respect of taxable profit for a period. Current tax for current and prior periods is recognized at the amount expected to be paid to or recovered from the tax authorities, using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.
(ii) Deferred tax
1 Deferred tax assets and liabilities are recognized for all temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements except when the deferred tax arises from the initial recognition of an asset or liability that effects neither accounting nor taxable profit or loss at the time of transition.
Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.
Deferred tax assets and liabilities are measured using tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date and are expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.
2 Minimum alternate tax (MAT) paid in accordance with tax laws, which give rise to future economic benefits in the form of adjustment of future tax liability, is recognized as deferred tax asset only when, based on convincing evidence, it is probable that the future economic benefits associated with it will flow to the Company and the assets can be measured reliably.
(iii) Presentation of current and deferred tax
Current and deferred tax is recognized in the statement of profit and loss, except to the extent that it relates to items recognized in other comprehensive income or directly in equity. In this case, the tax is also recognized in other comprehensive income or directly in equity respectively.
r Earnings per share
Basic earnings per share is calculated by dividing the net profit or loss (excluding other comprehensive income) for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year. The weighted average number of equity shares outstanding during the year is adjusted for events such as bonus issue, bonus element in a right issue, shares split and reserve share splits (consolidation of shares) that have changed the number of equity shares outstanding, without a corresponding change in resources. For the purpose of calculating diluted earnings per share, the net profit or loss (excluding other comprehensive income) for the year attributable to equity shareholders and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.
s Share based payments
The Company recognizes compensation expense relating to share-based payments in the statement of profit and loss using fair value in accordance with Ind AS 102, âShare-based Paymentsâ. The estimated fair value of awards is charged to statement of profit and loss on a straight-line basis over the requisite service period for each separately vesting portion of the award as if the award was in-substance, multiple awards with a corresponding increase to share based payment reserves.
t Business combinations
Business combinations are accounted for using the acquisition method as per Ind AS 103, Business Combinations.
The cost of acquisition is measured at the fair value of the assets transferred, equity instruments issued and liabilities incurred or assumed at the date of acquisition, which is the date on which control is transferred to the Company. The cost of acquisition also includes the fair value of any contingent consideration. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair value on the date of acquisition.
Business combinations between entities under common control is accounted for at carrying value. Transaction costs that the Company incurs in connection with a business combination such as finderâs fees, legal fees, due diligence fees, and other professional and consulting fees are expensed as incurred.
u Discontinued operations
Discontinued operations are excluded from the results of continuing operations and are presented separately as profit or loss from discontinued operations in the statement of profit and loss. Also, comparative statement of profit and loss is represented as if the operation had been discontinued from the start of the comparative period.
Assets and liabilities classified as discontinued operations are presented separately from other assets and liabilities in the balance sheet.
Discontinued operation is a component of the Company that either has been disposed of, or is classified as held for sale, and:
(i) Represents a separate major line of business or geographical area of operations,
(ii) Is part of a single coordinated plan to dispose of a separate major line of business or geographical area of operations, and
(iii) Is a subsidiary acquired exclusively with a view to resale v Dividend
Provision is made for the amount of any dividend declared on or before the end of the reporting period but remaining undistributed at the end of the reporting period, where the same has been appropriately authorized and is no longer at the discretion of the entity.
w Exceptional items
Certain occasions, the size, type, or incidences of the item of income or expenses pertaining to the ordinary activities of the Company is such that its disclosure improves the understanding of the performance of the Company, such income or expenses is classified as an exceptional item and accordingly disclosed in the financial statements.
Mar 31, 2017
1 Corporate information
Zee Media Corporation Limited ("ZMCL" or "the Company") is incorporated in the State of Maharashtra, India and is listed on BSE Limited (BSE) and The National Stock Exchange of India Limited (NSE) in India. The registered office of the Company is situated at Continental Building, 135, Dr Annie Besant Road, Worli, Mumbai - 400018, Maharashtra, India. The Company is mainly engaged in the business of broadcasting of satellite television channels i.e. news / current affairs and regional language channels and sale of television programs.
2 Significant accounting policies a Basis of preparation
These financial statements (hereinafter referred to as "standalone financial statements" or "financial statements") have been prepared in accordance with the Indian Accounting Standards (hereinafter referred to as the ''Ind AS'') as notified by Ministry of Corporate Affairs pursuant to Section 133 of the Companies Act, 2013 (''Act'') read with of the Companies (Indian Accounting Standards) Rules, 2015 as amended and other relevant provisions of the Act.
These financial statements for the year ended 31 March 2017 are the first financials with comparatives, prepared under Ind AS. For all previous periods including the year ended 31 March 2016, the Company had prepared its financial statements in accordance with the accounting standards notified under Companies (Accounting Standard) Rule, 2006 (as amended) and other relevant provisions of the Act (hereinafter referred to as ''Previous GAAP'') used for its statutory reporting requirement in India.
The accounting policies are applied consistently to all the periods presented in the financial statements, including the preparation of the opening Ind AS Balance Sheet as at 1 April 2015 being the date of transition to Ind AS.
These financial statements have been prepared and presented under the historical cost convention, on the accural basis of accounting except for certain financial assets and liabilities that are measured at fair values at the end of each reporting period, as stated in the accounting policies stated out below.
Reconciliations and descriptions of the effect of the transition has been summarized in note 54.
Rounding of amounts
All amounts disclosed in the financial statements and notes have been rounded off to the nearest millions as per the requirement of Schedule III, unless otherwise stated.
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 (twelve months) and other criteria set out in the Schedule III to the Act.
b Property, plant and equipment
(i) Property, plant and equipment are stated at cost, less accumulated depreciation and impairment loss, if any. The cost comprises purchase price, borrowing costs if capitalization criteria are met and directly attributable cost of bringing the asset to its working condition for the intended use. Integrated Receiver Decoders (IRD) boxes are capitalized, when available for deployment.
(ii) Capital work-in-progress comprises cost of property plant and equipment and related expenses that are not yet ready for their intended use at the reporting date.
c Intangible assets
Intangible assets acquired or developed are measured on initial recognition at cost and stated at cost less accumulated amortization and impairment loss, if any.
Intangible assets - television channels includes expenses incurred on development of new television channels till the time it is ready for commercial launch.
d Depreciation / amortization on property, plant and equipment / intangible assets
Depreciable amount for property, plant and equipment / intangible assets is the cost of an asset, or other amount substituted for cost, less its estimated residual value.
(i) Depreciation on property, plant and equipment is provided on straight-line method as per the useful life prescribed in Schedule II to the Companies Act, 2013 except in respect of the following categories of assets, where the life of the assets has been assessed lower than the life prescribed in Schedule II, based on technical advice, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement etc.
(ii) Leasehold building and leasehold improvements are amortized over the period of lease.
(iii) Intangible assets are amortized on straight line basis over their respective individual useful lives estimated by the management.
e Impairment of property, plant and equipment / intangible assets
The carrying amounts of the Company''s property plant and equipment and intangible assets are reviewed at each reporting date to determine whether there is any indication of impairment. If there are indicators of impairment, an assessment is made to determine whether the asset''s carrying value exceeds its recoverable amount. Where it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the cash generating unit to which the asset belongs.
An impairment is recognized in statement of profit and loss whenever the carrying amount of an asset or its cash generating unit exceeds its recoverable amount. The recoverable amount is the higher of net selling price, defined as the fair value less costs to sell, and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market rates and risks specific to the asset.
An impairment loss for an individual asset or cash generating unit is reversed if there has been a change in estimates used to determine the recoverable amount since the last impairment loss was recognized and is only reversed to the extent that the asset''s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized. Impairment loss is recognized in the statement of profit and loss.
f Investment property
Investment property is properties (land or a buildingâor part of a buildingâor both) held to earn rentals and/or for capital appreciation (including property under construction for such purposes). Investment property is measured initially at cost including purchase price, borrowing costs. Subsequent to initial recognition, investment property is measured at cost less accumulated depreciation and impairment, if any.
g Derecognition of property, plant and equipment / intangibles / investment property
The carrying amount of an item of property, plant and equipment / intangibles / investment property is derecognized on disposal or when no future economic benefits are expected from its use or disposal. The gain or loss arising from the derecognition of an item of property, plant and equipment / intangibles / investment property is measured as the difference between the net disposal in proceeds and the carrying amount of the item and is recognized in the statement of profit and loss when the item is derecognized.
h Leases (i) Finance lease
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards f of ownership to the lessee. All other leases are classified as operating leases.
(ii) Operating lease
Lease of assets under which all the risks and rewards of ownership are effectively retained by the lessor are classified
as operating leases. Operating lease payments / revenue are recognized on straight line basis over the lease period in the statement of profit and loss account unless increase is on account of inflation.
i Cash and cash equivalent
Cash and cash equivalent in the balance sheet comprise cash at banks and in hand and short-term deposits with an original maturity of three months or less, which are subject to an insignificant risk of changes in value.
For the purpose of the statement of cash flows, cash and cash equivalents consist of cash and short-term deposits, as defined above, net of cash credit outstanding as they are considered an integral part of the Company''s cash management.
j Inventories
(i) Television programs (completed, under production, available for sale) are stated at lower of cost / unamortized cost or realizable value. Cost comprises acquisition / direct production cost and other allocated production overheads. Where the realizable value on the basis of its estimated useful economic life is less than its carrying amount, the difference is expensed as impairment. Programs are expensed / amortized as under:
1 Programs - news / current affairs / chat shows / events etc. are fully expensed on telecast.
2 Programs (other than (1) above) are amortized over three financial years starting from the year of first telecast, as per management estimate of future revenue potential.
(ii) Raw stock: Tapes are valued at lower of cost or estimated net realizable value. Cost is taken on weighted average basis. k Financial instruments
Financial instruments is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.
(i) Initial recognition
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit and loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit and loss are recognized immediately in the statement of profit and loss.
(ii) Subsequent measurement Financial assets
Financial assets are classified into the specified categories i.e. amortized cost, fair value through profit or loss (FVTPL) and fair value through other comprehensive income (FVTOCI). The classification depends on the Company''s business model for managing the financial assets and the contractual terms of cash flows.
Debt instrument
Amortized cost:
A financial asset is subsequently measured at amortized cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. This category generally applies to trade and other receivables.
Fair value through other comprehensive income (FVTOCI):
A ''debt instrument'' is classified as at the FVTOCI if both of the following criteria are met:
(a) The objective of the business model is achieved both by collecting contractual cash flows and selling the financial assets.
(b) The asset''s contractual cash flows represent solely payments of principal and interest.
Debt instruments included within the FVTOCI category are measured initially as well as at each reporting date at fair value. Fair value movements are recognized in the other comprehensive income (OCI). However, the Company recognizes interest income, impairment losses and reversals and foreign exchange gain or loss in the statement of profit and loss. On derecognition of the asset, cumulative gain or loss previously recognized in OCI is reclassified from the equity to the statement of profit and loss. Interest earned whilst holding FVTOCI debt instrument is reported as interest income using the effective interest rate (EIR) method.
Fair value through profit and loss (FVTPL):
FVTPL is a residual category for debt instruments. Any debt instrument, which does not meet the criteria for categorization as at amortized cost or as FVTOCI, is classified as FVTPL.
In addition, the Company may elect to designate a debt instrument, which otherwise meets amortized cost or FVTOCI criteria, as at FVTPL. However, such election is considered only if doing so reduces or eliminates a measurement or recognition inconsistency (referred to as ''accounting mismatch'').
Debt instruments included within the FVTPL category are measured at fair value with all changes recognized in the statement of profit and loss.
Equity investments
The Company subsequently measures all equity instruments at fair value. Where the Company''s management has elected to present fair value gains and losses on equity instruments in other comprehensive income, there is no subsequent reclassification of fair value gains and losses to statement of profit and loss. Dividends from such investments are recognized in statement of profit and loss as other income when the company''s right to receive payment is established.
Investment in subsidiaries and associates
Investment in subsidiaries and associates are carried at cost less impairment loss in accordance with Ind AS 27 on "Separate Financial Statements". Refer note 9 for list of investments.
Derivative financial instruments
Derivative financial instruments are classified and measured at fare value through profit and loss.
Derecognition of financial assets
A financial asset is derecognized only when
(a) The Company has transferred the rights to receive cash flows from the asset or the rights have expired or
(b) The Company retains the contractual rights to receive the cash flows of the financial asset, but assumes a contractual obligation to pay the cash flows to one or more recipients in an arrangement.
Where the entity has transferred an asset, the Company evaluates whether it has transferred substantially all risks and rewards of ownership of the financial asset. In such cases, the financial asset is derecognized. Where the entity has not transferred substantially all risks and rewards of ownership of the financial asset, the financial asset is not derecognized.
Impairment of financial assets
The Company measures the expected credit loss associated with its assets based on historical trend, industry practices and the business environment in which the entity operates or any other appropriate basis. The impairment methodology applied depends on whether there has been a significant increase in credit risk.
Financial liabilities and equity instruments
Debt or equity instruments issued by the Company are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.
Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax.
Financial liabilities Subsequent measurement
Financial liabilities measured at amortized cost:
Financial liability are subsequently measured at amortized cost using the EIR method. Gains and losses are recognized in the statement of profit and loss when the liabilities are derecognized as well as through the EIR amortization process. Amortized cost is calculated by taking into account any discount or premium on acquisition and fee or costs that are an integral part of the EIR. The EIR amortization is included in finance costs in the statement of profit and loss.
Financial liabilities measured at fair value through profit or loss (FVTPL):
Financial liabilities at FVTPL include financial liabilities held for trading and financial liabilities designated upon initial recognition as FVTPL. Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term. Derivatives, including separated embedded derivatives are classified as held for trading unless they are designated as effective hedging instruments. Financial liabilities at fair value through profit or loss are carried in the financial statements at fair value with changes in fair value recognized in other income or finance costs in the statement of profit and loss.
Derecognition of financial liabilities
A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in the statement of profit and loss.
Determination of fair value
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an ordinary transaction between market participants at the measurement date.
In determining the fair value of its financial instruments, the Company uses a variety of methods and assumptions that are based on market conditions and risks existing at each reporting date. The methods used to determine fair value include discounted cash flow analysis and available quoted market prices. All methods of assessing fair value result in general approximation of value, and such value may never actually be realized.
l Borrowings and borrowing costs
Borrowings are initially recognized at net of transaction costs incurred and measured at amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognized in the statement of profit and loss over the period of the borrowings using the effective interest rate (EIR).
Borrowing costs attributable to the acquisition or construction of qualifying assets till the time such assets are ready for intended use are capitalized as part of cost of the assets. All other borrowing costs are expensed in the period they occur
m Provisions, contingent liabilities and contingent assets
The Company recognizes provisions when a present obligation (legal or constructive) as a result of a past event exists and it is probable that an outflow of resources embodying economic benefits will be required to settle such obligation and the amount of such obligation can be reliably estimated.
If the effect of time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.
A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not require an outflow of resources embodying economic benefits or the amount of such obligation cannot be measured reliably. When there is a possible obligation or a present obligation in respect of which likelihood of outflow of resources embodying economic benefits is remote, no provision or disclosure is made.
Contingent assets are not recognized in the financial statements, however they are disclosed where the inflow of economic benefits is probable. When the realization of income is virtually certain, then the related asset is no longer a contingent asset and is recognized as an asset.
n Revenue recognition
Revenue is recognized to the extent it is probable that economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured at the fair value of the consideration received or receivable. All revenues are accounted on accrual basis except to the extent stated otherwise.
(i) Broadcasting revenue - Advertisement revenue (net of discount and volume rebates) is recognized when the related advertisement or commercial appears before the public i.e. on telecast. Subscription revenue is recognized on time basis on the provision of television broadcasting service to subscribers or as per the agreed terms.
(ii) Sales of television programs including program feeds are recognized when the significant risks and rewards have been transferred to the customers in accordance with the agreed terms.
(iii) Revenue from other services is recognized as and when such services are completed / performed.
(iv) Interest income is recognized using the effective interest rate (EIR) method, which is the rate that exactly discounts the estimated future cash receipts through the expected life of the financial assets.
(v) Dividend income is recognized when the Company''s right to receive dividend is established.
o Retirement and other employee benefits
i) The Company operates both defined benefit and defined contribution schemes for its employees
For defined contribution schemes the amount charged as expense is equal to the contributions paid or payable when employees have rendered services entitling them to the contributions.
For defined benefit plans, actuarial valuations are carried out at each balance sheet date using the Projected Unit Credit Method. All such plans are unfounded.
All expenses represented by current service cost, past service cost, if any, and net interest on the defined benefit liability/ (asset) are recognized in the statement of profit and loss. Remeasurements of the net defined benefit liability/ (asset) comprising actuarial gains and losses (excluding interest on the net defined benefit liability/asset)) are recognized in other comprehensive income (OCI). Such remeasurements are not reclassified to the statement of profit and loss, in the subsequent periods.
(ii) Other long term employee benefits: The Company has a policy on compensated absences which are both accumulating and non-accumulating in nature. The expected cost of accumulating compensated absences is determined by actuarial valuation performed by an independent actuary at each balance sheet date using projected unit credit method on the additional amount expected to be paid/availed as a result of the unused entitlement that has accumulated at the balance sheet date. Expense on non-accumulating compensated absences is recognized in the period in which the absences occur.
The Company presents the leave as a current liability in the balance sheet, to the extent it does not have an unconditional right to defer its settlement for twelve months after the reporting date. Where Company has the unconditional legal and contractual right to defer the settlement for a period beyond twelve months, the same is presented as non-current liability.
(iii) Short term employee benefits: All employee benefits payable wholly within twelve months of rendering the service are classified as short term employee benefits and they are recognized in the period in which the employee renders the related service. The Company recognizes the undiscounted amount of short term employee benefits expected to be paid in exchange for services rendered as a liability.
p Transactions in foreign currencies
The functional currency of the Company is Indian Rupees ('').
(i) Foreign currency transactions are accounted at the exchange rates prevalent on the date of such transactions.
(ii) Foreign currency monetary items are translated using the exchange rate prevalent at the reporting date. Exchange differences arising on settlement of monetary items or on reporting such monetary items at rates different from those at which they were initially recorded during the year, or reported in previous financial statements are recognized as income or as expenses in the period in which they arise.
(iii) Non-monetary foreign currency items are carried at historical cost and translated at the exchange rate prevalent at the date of transaction.
q Accounting for taxes on income
Tax expense comprises of current and deferred tax.
(i) Current tax
Current tax is the amount of income taxes payable in respect of taxable profit for a period. Current tax for current and prior periods is recognized at the amount expected to be paid to or recovered from the tax authorities, using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.
(ii) Deferred tax
1 Deferred tax assets and liabilities are recognized for all temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements except when the deferred tax arises from the initial recognition of an asset or liability that effects neither accounting nor taxable profit or loss at the time of transition.
Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.
Deferred tax assets and liabilities are measured using tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date and are expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.
2 Minimum alternate tax (MAT) paid in accordance with tax laws, which give rise to future economic benefits in the form of adjustment of future tax liability is recognized as an asset only when, based on convincing evidence, it is probable that the future economic benefits associated with it will flow to the Company and the assets can be measured reliably.
(iii) Presentation of current and deferred tax
Current and deferred tax are recognized as income or an expense in the statement of profit and loss, except to the extent that the tax relates to items recognized directly in other comprehensive income, in which case, the current and deferred tax income / expense are recognized in other comprehensive income.
r Earnings per share
Basic earnings per share is computed and disclosed using the weighted average number of equity shares outstanding during the period. Dilutive earnings per share is computed and disclosed using the weighted average number of equity and dilutive equity equivalent shares outstanding during the period, except when the results would be anti-dilutive.
s Share based payments
The Company recognizes compensation expense relating to share-based payments in the statement of profit and loss using fair value in accordance with Ind AS 102, Share-Based Payment. The estimated fair value of awards is charged to statement of profit and loss on a straight-line basis over the requisite service period for each separately vesting portion of the award as if the award was in-substance, multiple awards with a corresponding increase to share based payment reserves.
t Business combinations
Business combinations have been accounted for using the acquisition method under the provisions of Ind AS 103, Business Combinations.
The cost of an acquisition is measured at the fair value of the assets transferred, equity instruments issued and liabilities incurred or assumed at the date of acquisition, which is the date on which control is transferred to the Company. The cost of acquisition also includes the fair value of any contingent consideration. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair value on the date of acquisition.
Business combinations between entities under common control is accounted for at carrying value.
Transaction costs that the Company incurs in connection with a business combination such as finder''s fees, legal fees, due diligence fees, and other professional and consulting fees are expensed as incurred.
u Dividend
Provision is made for the amount of any dividend declared on or before the end of the reporting period but remaining undistributed at the end of the reporting period, where the same has been appropriately authorized and is no longer at the discretion of the entity.
v Contributed equity
Equity shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax.
w Exceptional items
Certain occasions, the size, type, or incidences of the item of income or expenses pertaining to the ordinary activities of the Company is such that its disclosure improves the understanding of the performance of the Company such income or expenses is classified as an exceptional item and accordingly disclosed in the financial statements.
Mar 31, 2016
1 Corporate Information
Zee Media Corporation Limited ("ZMCL" or "the Company") is incorporated in the State of Maharashtra, India. The Company is mainly in the business of broadcasting of news / current affairs and regional language channels and sale of television programs including program feeds.
2 Significant Accounting Policies A Basis of preparation
The financial statements are prepared on going concern basis in accordance with Generally Accepted Accounting Principles in India (Indian GAAP). GAAP comprises mandatory accounting standards as prescribed under Section 133 of the Companies Act, 2013 (Act) read with Rule 7 of the Companies (Accounts) Rules, 2014, the provisions of the Act (to the extent notified) and guidelines issued by the Securities and Exchange Board of India (SEBI). The financial statements have been prepared on accrual basis and under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those of previous year.
B Use of estimates
The preparation of financial statements requires the management to make estimates and assumptions that affect the reported amounts of assets and liabilities, on the date of the financial statements and the reported amount of revenue and expenses of the year. Difference between the actual results and estimates are recognized in the period in which the results are known/ materialized.
C Tangible fixed assets
a) Tangible fixed assets are stated at cost, less accumulated depreciation and impairment loss, if any. The cost comprises purchase price, borrowing cost if capitalisation criteria are met and directly attributable cost of bringing the asset to its working condition for the intended use. Integrated Receiver Decoders (IRD) boxes are capitalised, when available for deployment.
b) Capital work in progress comprises cost of fixed assets and related expenses that are not yet ready for their intended use at the reporting date.
D Intangible assets
Intangible assets acquired or developed are measured on initial recognition at cost and stated at cost less accumulated amortisation and impairment loss, if any. Intangible assets - channels includes expenses incurred on development of new television channels till the time it is ready for commercial launch.
E Borrowing costs
Borrowing costs attributable to the acquisition or construction of qualifying assets till the time such assets are ready for intended use are capitalised as part of the cost of the asset. All other borrowing costs are expensed in the period they occur.
F Impairment of tangible and intangible assets
At each Balance Sheet date, the Company reviews the carrying amount of assets to determine whether there is an indication that those assets have suffered impairment loss. If any such indication exists, the recoverable amount of assets is estimated in order to determine the extent of impairment loss. The recoverable amount is higher of the net selling price and value in use, determined by discounting the estimated future cash flows expected from the continuing use of the asset to their present value.
G Depreciation / Amortization on tangible / intangible assets Tangible assets
Depreciable amount for tangible fixed assets is the cost of an asset, or other amount substituted for cost, less its estimated residual value. Depreciation on tangible fixed assets is provided on straight line method as per the useful life prescribed in
Schedule II to the Companies Act, 2013 except in respect of the following categories of assets, where the life of the assets has been assessed based on technical advice, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement etc.
Intangible assets
Intangible assets are amortised on straight line basis over their respective individual useful life estimated by the management.
H Investments
a) Investments, which are readily realisable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as long-term investments.
b) Current investments are stated at lower of cost and market value determined on an individual investment basis. Long-term investments are stated at cost less provision for diminution other than temporary in the value of such investments.
I Transactions in foreign currencies
a) Foreign currency transactions are accounted at the exchange rates prevailing on the date of such transactions.
b) Foreign currency monetary items are translated using the exchange rate prevailing at the reporting date. Exchange differences arising on settlement of monetary items or on reporting such monetary items at rates different from those at which they were initially recorded during the year, or reported in previous financial statements are recognised as income or as expenses in the year in which they arise.
c) Non-monetary foreign currency items are carried at cost.
J Revenue recognition
a) Broadcasting revenue - Advertisement revenue (net of discount and volume rebates) is recognized when the related advertisement or commercial appears before the public i.e. on telecast. Subscription revenue is recognized on time basis on the provision of television broadcasting service to subscribers or as per the agreed terms.
b) Sales (including television programs) are recognized when the significant risks and rewards have been transferred to the customers.
c) Revenue from other services is recognized as and when such services are completed / performed.
d) Dividend income is recognized when the Company''s right to receive dividend is established.
e) Interest income is recognized on a time proportion basis taking into account amount outstanding and the applicable interest rate.
K Inventories
a) Television programs (completed, under production, available for sale) are stated at lower of cost/ unamortized cost or net realizable value. Cost comprises acquisition / direct production costs and other allocated production overheads. Where the realizable value on the basis of its estimated useful life is less than its carrying amount, the difference is expensed as impairment. Programs are expensed / amortized as under:
i) Programs- news / current affairs / chat shows / events etc are fully expensed on telecast.
ii) Programs (other than (i) above) are amortized over three financial years starting from the year of first telecast, as per management estimate of future revenue potential.
b) Raw Stock - Tapes are valued at lower of cost or estimated net realizable value. Cost is taken on weighted average basis.
L Retirement and other employee benefits
a) Short-term employee benefits are expensed at the undiscounted amount in the Statement of Profit and Loss in the year the employee renders the service.
b) Post employment and other long term employee benefits are recognized as an expense in the Statement of Profit and Loss at the present value of the amount payable determined using actuarial valuation techniques in the year the employee renders the service. Actuarial gains and losses are charged to the Statement of Profit and Loss.
c) Payment to defined contribution retirement benefit schemes are recognised as an expense in the Statement of Profit and Loss, when due.
M Accounting for taxes on income
a) Current tax is determined as the amount of tax payable in respect of taxable income as per the provisions of the Income Tax Act, 1961.
b) Deferred tax is recognized, subject to consideration of prudence in respect of deferred tax asset, on timing difference, being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods and measured using relevant enacted tax rates and laws.
N Leases
a) Finance lease
Assets acquired under Finance Lease are capitalized and the corresponding lease liability is recorded at an amount equal to the fair value of the leased asset at the inception of the lease. Initial costs directly attributable to lease are recognized with the asset under lease.
b) Operating lease
Lease of assets under which all the risk and rewards of ownership are effectively retained by the lessor are classified as operating lease. Lease payments under operating lease are recognized as expense on accrual basis in accordance with the respective lease agreements.
O Earnings per share
Basic earnings per share is computed and disclosed using the weighted average number of equity shares outstanding during the year. Dilutive earnings per share is computed and disclosed using the weighted average number of equity and dilutive equity equivalent shares outstanding during the year, except when the results would be anti-dilutive.
P Provisions, Contingent liabilities and Contingent assets
Provisions involving substantial degree of estimation in measurement are recognized when there is present obligation as a result of past events and it is probable that there will be an outflow of resources. These estimates are revised at each reporting date and adjusted to reflect the current best estimates. Contingent liabilities are not recognized but are disclosed in the financial statements. Contingent assets are neither recognized nor disclosed in the financial statements.
b) Terms / rights attached to equity shares
The Company has only one class of equity shares having a par value of Rs, 1 each. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividend in Indian Rupees. The final dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.
In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.
As per the records of the Company, including its register of shareholders/ members and other declaration received from shareholders regarding beneficial interest, the above shareholding represents both legal and beneficial ownership of shares.
d) The Company has not issued any bonus shares or bought back any shares during five years preceding 31 March, 2016. Details of aggregate number of shares issued for consideration other than cash during five years preceding 31 March, 2016:
e) The Company has instituted an Employee Stock Option Plan (ZNL ESOP 2009) as approved by the Board of Directors and Shareholders of the Company in 2009 and amended from time to time for issuance of stock options convertible into equity shares not exceeding in the aggregate 5% of the issued and paid up capital of the Company as at 31 March, 2009 i.e. up to 11,988,000 equity shares of '' 1 each, to the employees of the Company as well as that of its subsidiaries and also to the directors (excluding an independent director) of the Company at the market price determined as per the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014. The said Scheme is administered by the Nomination and Remuneration Committee of the Board. The Company has not granted any options till 31 March, 2016.
a) Cash credit from bank is secured by way of pari passu hypothecation charge on entire current assets and collaterally secured by first hypothecation charge on entire movable fixed assets except vehicles.
b) Working capital loan from bank is secured by way of pari passu hypothecation charge on entire current assets and entire movable fixed assets except vehicles.
Mar 31, 2013
A Basis of preparation
the financial statements are prepared under the historical cost
convention on going concern basis in accordance with Indian Generally
Accepted Accounting Principles (GAAP) and comply in all material
aspects with the accounting standards notified under the Companies
(Accounting Standards) Rules, 2006, the provisions of the Companies
Act, 1956 and guidelines issued by the securities and exchange Board of
india (SeBI). The Company follows the mercantile system of accounting
and recognises income and expenditure on accrual.
B use of estimates
the preparation of financial statements requires the management to make
estimates and assumptions that affect the reported amounts of assets
and liabilities, on the date of the financial statements and the
reported amount of revenue and expenses of the year. difference
between the actual results and estimates are recognized in the period
in which the results are known/materialized.
C tangible fixed assets
a) Tangible fixed assets are stated at cost, less accumulated
depreciation and impairment loss, if any. the cost comprises purchase
price, borrowing cost if capitalisation criteria are met and directly
attributable cost of bringing the asset to its working condition for
the intended use. Integrated Receiver Decoders (IRD) boxes are
capitalised, when available for deployment.
b) Capital work in progress comprises cost of fixed assets and related
expenses that are not yet ready for their intended use at the reporting
date.
d Intangible assets
intangible assets acquired are measured on initial recognition at cost
and stated at cost less accumulated amortisation and impairment loss,
if any.
E Borrowing costs
Borrowing costs directly attributable to the acquisition, construction
or production of an asset that necessarily takes a substantial period
of time to get ready for its intended use or sale are capitalised as
part of the cost of respective asset. All other borrowing costs are
expensed in the year they occur.
F Impairment of tangible and intangible assets
At each Balance Sheet date, the Company reviews the carrying amount of
assets to determine whether there is an indication that those assets
have suffered impairment loss. if any such indication exists, the
recoverable amount of assets is estimated in order to determine the
extent of impairment loss. the recoverable amount is higher of the net
selling price and value in use, determined by discounting the estimated
future cash flows expected from the continuing use of the asset to
their present value.
G. depreciation / Amortization on tangible / intangible assets
a) Depreciation on tangible fixed assets is provided on straight line
method at the rates specified in Schedule XIV to the Companies Act,
1956.
b) Leasehold Improvements are amortised over the period of Lease.
c) Intangible assets are amortised on a straight line basis over the
economic useful life estimated by the management.
H Investments
a) Investments, which are readily realisable and intended to be held
for not more than one year from the date on which such investments are
made, are classified as current investments. All other investments are
classified as long-term investments.
b) Current investments are stated at lower of cost and market value
determined on an individual investment basis. Long-term investments are
stated at cost less provision for diminution other than temporary in
the value of such investments.
I transactions in foreign currencies
a) Foreign currency transactions are accounted at the exchange rates
prevailing on the date of such transaction.
b) Foreign currency monetary items are translated using the exchange
rate prevailing at the reporting date. exchange differences arising on
settlement of monetary items or on reporting such monetary items at
rates different from those at which they were initially recorded during
the year, or reported in previous financial statements are recognised
as income or as expenses in the year in which they arise.
c) Non-monetary foreign currency items are carried at cost.
J revenue recognition
a) Broadcasting revenue - Advertisement revenue (net of discount and
volume rebates) is recognized when the related advertisement or
commercial appears before the public i.e. on telecast. subscription
revenue is recognized on time basis on the provision of television
broadcasting service to subscribers or as per the agreed terms.
b) Sales (including television programs and film rights) are recognized
when the significant risks and rewards have been transferred to the
customers.
c) Revenue from other services including franchisee fee revenue is
recognized as and when such services are completed / performed.
d) Dividend income is recognized when the Company''s right to receive
dividend is established.
e) Interest income is recognized on a time proportion basis taking into
account principal outstanding and the applicable interest rate.
K Inventories
a) Inventories of television programs (completed, under production,
available for sale) and film rights are stated at lower of cost or net
realisable value. Cost includes direct production costs and other
allocated production overheads. where the realisable value on the basis
of its estimated useful life is less than its carrying amount, the
difference is expensed as impairment. Cost of news / current affairs /
chat shows / events etc are fully expensed on telecast.
b) Raw Stock  Tapes are valued at lower of cost or estimated net
realizable value. Cost is taken on weighted average basis.
L retirement and other employee benefits
a) Short-term employee benefits are expensed at the undiscounted amount
in the statement of Profit and Loss in the year the employee renders
the service.
b) Post employment and other long term employee benefits are recognized
as an expense in the statement of Profit and Loss at the present value
of the amount payable determined using actuarial valuation techniques
in the year the employee renders the service. Actuarial gains and
losses are charged to the statement of Profit and Loss .
M Accounting for taxes on income
a) Current Tax is determined as the amount of tax payable in respect of
taxable income as per the provisions of the Income Tax Act, 1961.
b) Deferred tax is recognized, subject to consideration of prudence in
respect of deferred tax asset, on timing difference, being the
difference between taxable income and accounting income that originate
in one period and are capable of reversal in one or more subsequent
periods and measured using relevant enacted tax rates and laws.
N Leases
a) Finance lease
Assets acquired under Finance Lease are capitalized and the
corresponding lease liability is recorded at an amount equal to the
fair value of the leased asset at the inception of the lease. initial
costs directly attributable to lease are recognized with the asset
under lease.
b) operating lease
Lease of assets under which all the risk and rewards of ownership are
effectively retained by the lessor are classified as operating leases.
Lease payments under operating leases are recognized as expense on
accrual basis in accordance with the respective lease agreements.
O Earnings per share
Basic earnings per share is computed and disclosed using the weighted
average number of equity shares outstanding during the year. dilutive
earnings per share is computed and disclosed using the weighted average
number of equity and dilutive equity equivalent shares outstanding
during the year, except when the results would be anti-dilutive.
p provisions, Contingent liabilities and Contingent assets
Provisions involving substantial degree of estimation in measurement
are recognized when there is present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent Liabilities are not recognized but are disclosed in the
notes. Contingent Assets are neither recognized nor disclosed in the
financial statements.
Mar 31, 2012
A Basis of preparation of Financial statements
These financial statements are prepared in accordance with Indian
Generally Accepted Accounting Principles (GAAP) under the historical
cost convention on the accrual basis and comply in all material aspects
with the accounting standards as notified under Section 211(3C), the
Companies (Accounting Standards) Rules, 2006, the provisions of the
Companies Act, 1956 and guidelines issued by the Securities and
Exchange Board of India (SEBi).
B use of Estimates
The preparation of financial statements requires the management to make
estimates and assumptions that affect the reporting amounts of assets
and liabilities, as of the date of financial statements and the
reported amount of revenue and expenses of the year. Actual results
could differ from these estimates. Any revision to estimates is
recognized prospectively in current and future periods.
C Tangible Fixed Assets
a) Fixed assets are stated at cost, net of accumulated depreciation and
accumulated impairment losses, if any. The cost comprise purchase
price, borrowing cost and directly attributable cost of bringing the
assets to its working condition for the intended use.
b) Capital work in progress comprises cost of fixed assets that are not
yet ready for their intended use at the reporting date.
D Intangible Assets
intangible assets acquired are measured on initial recognition at cost.
intangible assets are carried at cost less accumulated amortization and
accumulated impairment loss, if any.
E Borrowing Costs
Borrowing Costs directly attributable to the acquisition, construction
or production of an asset that necessarily takes a substantial period
of time to get ready for its intended use or sale are capitalized as
part of the cost of respective asset. All other borrowing cost are
expensed in the period they occur.
F impairment of tangible and intangible Assets
At each Balance Sheet date, the Company reviews the carrying amount of
assets to determine whether there is an indication that those assets
have suffered impairment loss. if any such indication exists, the
recoverable amount of assets is estimated in order to determine the
extent of impairment loss. The recoverable amount is higher of the net
selling price and value in use, determined by discounting the estimated
future cash flows expected from the continuing use of the asset to
their present value.
G depreciation on tangible and intangible Assets
a) Depreciation on tangible fixed assets is provided on Straight Line
Method at the rate specified in Schedule XiV to the Companies Act,
1956.
b) Leasehold improvements are amortized over the period of Lease.
c) intangible assets are amortized on a straight line basis over the
economic useful life estimated by the management.
H investments
a) investments, which are readily realizable and intended to be held
for not more than one year from the date on which such investments are
made, are classified as current investments. All other investments are
classified as long-term investments.
b) Current investments are stated at lower of cost and fair value
determined on an individual investment basis. Long-term investments are
stated at cost less provision for diminution other than temporary in
the value of such investments.
i transactions in Foreign Currencies
a) Foreign currency transactions are accounted at the exchange rates
prevailing on the date of such transactions.
b) Foreign currency monetary items are retranslated using the exchange
rates prevailing at the reporting date. Exchange difference are
recognized as income or expense in the period in which they arise.
c) Non-monetary items denominated in foreign currency are carried at
cost.
J Revenue Recognition
Revenue is recognized to the extent that it is probable that the
economic benefits that will flow to the Company and the revenue can be
reliably measured. Revenue recognition is as under :-
a) Broadcasting revenue - Advertisement revenue (net of agency
commission) is recognized when the related advertisement or commercial
appears before the public i.e. on telecast. subscription revenue is
recognized on completion of service.
b) sales (includes licensing of Programs, movies and Rights) are
recognized when the delivery is completed.
c) Franchisee Fee - Franchisee fee is recognized proportionately over
the period of service.
d) dividend income is recognized when the Company's right to receive
dividend is established by the reporting date.
e) interest income is recognized on a time proportion basis taking into
account outstanding and the applicable interest rate.
f) Revenue from other services are recognized as and when such services
are completed / performed.
K Inventories
a) Programs/ Film Rights :
Programs/ Film Rights are carried at lower of unamortized cost or
realizable value. where the realizable value on the basis of its useful
economic life is less than its carrying amount, the difference is
expensed as impairment.
i) Cost of news/ current affairs/ chat shows/ events etc are fully
expensed in the year incurred.
ii) Cost of Programs (other than (i) above) are amortized over three
financial years from the year of telecast as per management estimates
of future revenue potential.
iii) Cost of movie rights are charged on a straight- line basis over
the license period or 60 months from the date of acquisition, whichever
is shorter.
b) Work- in - progress- Programs and movies under production are stated
at cost. Cost comprises of raw stock, cost of services and other
expenses incurred upto the date of balance sheet.
c) Raw stock - tapes are valued at lower of cost or estimated net
realizable value. during the year, cost formula for valuation of raw
stock is changed to Moving Weighted Average Basis instead of First in
First Out Basis followed till the previous year ended March 31, 2011.
due to change in the cost formula, current year tape consumption is
higher by Rs52,229 and inventory value is lower by the same amount.
L retirement and other Employee Benefits
a) short-term employee benefits are expensed at the undiscounted amount
in the statement of Profit and Loss in the year employee renders the
service.
b) Post employment and other long term employee benefits are expensed
in the statement of Profit and Loss in the year the employee render the
service. the expense is recognized at the present value of the amount
payable determined using actuarial valuation techniques. Actuarial
gains and losses are charged to the statement of Profit and Loss.
M Accounting for Taxes on income
a) Current tax is determined as the amount of tax payable in respect of
taxable income for the year as per the provisions of the income tax
Act, 1961.
b) deferred tax is recognized, subject to consideration of prudence in
respect of deferred tax asset, on timing difference, being the
difference between taxable income and accounting income that originate
in one period and are capable of reversal in one or more subsequent
periods and measured using enacted tax rates and laws.
N Leases
a) Finance Lease
Assets acquired under Finance Lease are capitalized and the
corresponding lease liability is recorded at an amount equal to the
fair value of the leased asset at the inception of the lease. initial
costs directly attributable to lease are recognized with asset under
lease.
b) Operating Lease
Lease of assets under which all the risk and rewards of ownership are
effectively retained by the lesser are classified as operating leases.
Lease payments/ revenue under operating leases are recognized as
expense/income on accrual basis in accordance with the respective lease
agreements.
O Earnings Per Share
Basic earnings per share is computed and disclosed using the weighted
average number of common shares outstanding during the year. dilutive
earnings per share is computed and disclosed using the weighted average
number of common and dilutive common equivalent shares outstanding
during the year, except when the results would be anti-dilutive.
p provisions, Contingent Liabilities and Contingent Assets
Provisions involving substantial degree of estimation in measurement
are recognized when there is present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent Liabilities are not recognized but are disclosed in the
Notes. Contingent Assets are neither recognized nor disclosed in the
financial statements.
Mar 31, 2011
1. Basis of Accounting:
The Financial Statements have been prepared under the Historical Cost
Convention and on accrual basis in accordance with the Accounting
Standards referred to in Section 211 (3C) of the Companies Act, 1956.
2. Use of Estimates:
The preparation of financial statements requires the management to make
estimates and assumptions that affect the reported amounts of assets
and liabilities, as of the date of the financial statements and the
reported amount of revenue and expenses of the year. Actual results
could differ from these estimates. Any revision to estimates is
recognised prospectively in current and future periods.
3. Fixed Assets:
a) Fixed assets are stated at original cost of acquisition/installation
net of accumulated depreciation, amortization and impairment losses.
The cost of fixed assets includes taxes, duties, freight and other
incidental expenses related to the acquisition and installation of the
respective assets.
b) Capital Work-in-progress is stated at the amount expended upto the
date of Balance Sheet including advance for capital expenditure.
c) Computer software is capitalized as an intangible asset in the year
it is put to use.
4. Borrowing Costs:
Borrowing Costs attributable to the acquisition or construction of
qualifying assets are capitalized as a part of the cost of such assets.
All other borrowing costs are charged to revenue.
5. Depreciation/Amortization:
a) Depreciation on fixed assets is provided on Straight-Line Method at
the rate specified in Schedule XIV of the Companies Act, 1 956.
b) Leasehold Improvements are amortized over the period of Lease.
c) Computer software is amortised over a period of three years based on
managements estimate of useful life.
6. Investments:
Investments intended to be held for more than one year, from the date
of acquisition, are classified as long term investments and are carried
at cost. Provision for diminution in value of these investments is made
to recognize a decline other than temporary. Current investments are
carried at lower of cost or fair value.
7. Programs/Film Rights and Inventories:
a) Programs/Film Rights.
Programs/Film Rights are stated at the lower of net cost (cost minus
accumulated amortization/impairment) or realizable value. Where the
realizable value on the basis of its useful economic life is less than
its carrying amount, the difference is expensed as impairment.
i. Cost of news/ current affairs/ chat shows/ events etc. are fully
expensed.
ii. Programs [other than (i) above] are amortized over three financial
years from the year the related program is telecast, as per management
estimate of future revenue potential.
iii. Film rights are amortized on a straight-line basis over the
license period or 60 months from the date of purchase whichever is
shorter.
b) Inventory of Raw Stock - Tapes are valued at lower of cost or
estimated net realizable value. Cost is taken on First-In-First-Out
(FIFO) basis.
8. Retirement Benefits:
a) Short term employee benefits are recognized as an expense at the
undiscounted amount in the Profit and Loss Account of the year in which
the related service is rendered.
b) Post employment and other long term employee benefits are recognized
as an expense in the Profit and Loss Account for the year in which the
employee has rendered services. The expense is recognized at the
present value of the amount payable determined at Balance Sheet date
using acturial valuation techniques. Acturial gains and losses in
respect of post employment and other long-term benefits are charged to
the Profit and Loss Account.
9. Transactions in Foreign Currencies:
a) Transactions in foreign currency are accounted at the exchange rate
prevailing on the date of transaction.
b) Monetary assets and liabilities as at the Balance Sheet date are
translated at the rates of exchange prevailing on the date of Balance
Sheet. Gains and losses arising on account of settlement/translation of
monetary assets and liabilities are recognized in the Profit and Loss
Account. Non-monetary items are reported using exchange rate prevailing
on the date of transaction.
10. Revenue Recognition:
a) Broadcasting Revenues: Advertisement revenue (net of agency
commission) is recognized when the related advertisement or commercial
appears before the public i.e. on telecast. Subscription revenue is
recognized on completion of service.
b) Sales (Programs/Film Rights) are recognized when the risk and
rewards of ownership are passed onto the customers, which is generally
on dispatch of goods.
c) Income from services is recognised proportionately over the period
of service.
d) Dividend is recognised when the right to receive the dividend is
unconditional.
11. Taxes on Income:
a) Current tax is determined as the amount of tax payable in respect of
taxable income for the year under the Income Tax Act, 1961.
b) Deferred tax is recognized, subject to consideration of prudence, on
timing difference, being the difference between taxable income and
accounting income that originate in one period and are capable of
reversal in one or more subsequent periods and measured using relevant
enacted tax rates.
12. Operating Lease:
Lease of assets under which all the risks and rewards of ownership are
effectively retained by the lessor are classified as operating leases.
Lease payments under operating leases are recognized as an expense on
accrual basis in accordance with the respective lease agreements.
13. Impairment of Assets:
At each Balance Sheet date, the Company reviews the carrying amount of
fixed assets to determine whether there is an indication that those
assets have suffered impairment loss. If any such indication exists,
the recoverable amount of assets is estimated in order to determine the
extent of impairment loss. The recoverable amount is higher of the net
selling price and value in use, determined by discounting the estimated
future cash flows expected from the continuing use of the asset to
their present value.
14. Earnings Per Share:
Basic earnings per share is computed and disclosed using the weighted
average number of common shares outstanding during the year. Diluted
earnings per share is computed and disclosed using the weighted average
number of common and dilutive common equivalent shares outstanding
during the year, except when the results would be anti dilutive.
15. Provisions, Contingent Liabilities and Contingent Assets:
Provisions involving substantial degree of estimation in measurement
are recognized when there is present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent Liabilities are not recognized but are disclosed in the
notes to accounts. Contingent Assets are neither recognized nor
disclosed in the financial statements.
Mar 31, 2010
1. Basis of Accounting:
The Financial Statements have been prepared under the Historical Cost
Convention and on accrual basis in accordance with the accounting
standards referred to in Section 211 (3C) of the Companies Act, 1956.
2. Use of Estimates:
The preparation of financial statements requires the management to make
estimates and assumptions that affect the reported amounts of assets
and liabilities, as of the date of the financial statements and the
reported amount of revenue and expenses of the year. Actual results
could differ from these estimates. Any revision to estimates is
recognised prospectively in current and future periods.
3. Fixed Assets:
a) Fixed assets are stated at original cost of acquisition/installation
net of accumulated depreciation, amortization and impairment losses.
The cost of fixed assets includes taxes, duties, freight and other
incidental expenses related to the acquisition and installation of the
respective assets.
b) Capital Work-in-progress is stated at the amount expended upto the
date of Balance Sheet including advance for capital expenditure.
c) Software is capitalized as an intangible asset in the year it is put
to use.
4. Borrowing Costs:
Borrowing Costs attributable to the acquisition or construction of
qualifying assets are capitalized as a part of the cost of such assets.
All other borrowing costs are charged to revenue.
5. Depreciation/Amortization:
a) Depreciation on fixed assets is provided on Straight-Line Method at
the rate specified in Schedule XIV of the Companies Act, 1956.
b) Leasehold Improvements are amortised over the period of Lease.
c) Software is amortised over a period of three years based on
managements estimate of useful life.
6. Investments:
Investments intended to be held for more than one year, from the date
of acquisition, are classified as long-term investments and are carried
at cost. Provision for diminution in value of these investments is made
to recognize a decline other than temporary.
7. Programs/Film Rights and Inventories:
a) Program/Film Rights.
Program/Film rights are stated at the lower of net cost (cost minus
accumulated amortization/impairment) or realizable value. Where the
realizable value on the basis of its useful economic life is less than
its carrying amount, the difference is expensed as impairment.
i. Cost of news/ current affairs/ chat shows/ events etc. are fully
expensed.
ii. Programs [other than (i) above] are amortised over three years
from the year the related program is telecast.
iii. Film rights are amortised on a straight-line basis over the
license period or 60 months from the date of purchase whichever is
shorter.
b) Inventory of Raw Stock à Tapes are valued at lower of cost or
estimated net realisable value. Cost is taken on First-In-First-Out
(FIFO) basis.
8. Retirement Benefits:
a) Short-term employee benefits are recognised as an expense at the
undiscounted amount in the profit and loss account of the year in which
the related service is rendered.
b) Post employment and other long-term employee benefits are recognised
as an expense in the profit and loss account for the year in which the
employee has rendered services. The expense is recognised at the
present value of the amount payable determined at Balance Sheet date
using acturial valuation techniques. Acturial gains and losses in
respect of post employment and other long-term benefits are charged to
the Profit and Loss Account.
9. Transactions in Foreign Currencies:
a) Transactions in foreign currency are accounted at the exchange rate
prevailing on the date of transaction.
b) Monetary assets and liabilities as at the balance sheet date are
translated at the rates of exchange prevailing on the date of Balance
Sheet. Gains and losses arising on account of settlement/translation of
monetary assets and liabilities are recognised in the Profit and Loss
Account. Non-monetary items are reported using exchange rate prevailing
on the date of transaction.
10. Revenue Recognition:
a) Broadcasting Revenues: Advertisement revenue (net of agency
commission) is recognised when the related advertisement or commercial
appears before the public i.e. on telecast. Subscription revenue is
recognised on completion of service.
b) Sales (Program/Film Rights) are recognised when the risk and rewards
of ownership are passed onto the customers, which is generally on
dispatch of goods.
c) Income from services is recognised proportionately over the period
of service.
11. Taxes on Income:
a) Current tax is determined as the amount of tax payable in respect of
taxable income for the year under the Income Tax Act, 1961.
b) Deferred tax is recognised, subject to consideration of prudence, on
timing difference, being the difference between taxable income and
accounting income that originate in one period and are capable of
reversal in one or more subsequent periods and measured using relevant
enacted tax rates.
12. Operating Lease:
Lease of assets under which all the risks and rewards of ownership are
effectively retained by the lessor are classified as operating leases.
Lease payments under operating leases are recognized as an expense on
accrual basis in accordance with the respective lease agreements.
13. Impairment of Assets:
At each Balance Sheet date, the Company reviews the carrying amount of
fixed assets to determine whether there is an indication that those
assets have suffered impairment loss. If any such indication exists,
the recoverable amount of assets is estimated in order to determine the
extent of impairment loss. The recoverable amount is higher of the net
selling price and value in use, determined by discounting the estimated
future cash flows expected from the continuing use of the asset to
their present value.
14. Earnings Per Share:
Basic earnings per share is computed and disclosed using the weighted
average number of common shares outstanding during the year. Diluted
earnings per share is computed and disclosed using the weighted average
number of common and dilutive common equivalent shares outstanding
during the year, except when the results would be anti dilutive.
15. Provisions, Contingent Liabilities and Contingent Assets:
Provisions involving substantial degree of estimation in measurement
are recognised when there is present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent Liabilities are not recognised but are disclosed in the
notes to accounts. Contingent Assets are neither recognised nor
disclosed in the financial statements.
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