i. Hinting Policies
 
 i.  Basis of Accounting
 
 The financial statements comply in all material aspects with all the
 applicable accounting principles in India, the applicable accounting
 standards notified under Section 211(3C) of the Companies Act, 1956
 (''''The Act) and the relevant provisions of the Act. The
 financial statements are prepared under the historical cost convention
 on an accrual basis. The accounting policies have been consistently
 applied by the Company and are consistent '' with those followed in the
 previous year.
 
 All assets and liabilities have been classified as current or
 non-current as per the criteria set out in the Revised Schedule VI to
 the Act.
 
 ii.  Use of Estimates
 
 The preparation of financial statements in accordance with the
 generally accepted accounting principles requires the Management to
 make estimates and assumptions that affect the reported amounts of
 assets and liabilities and disclosure of contingent liabilities as at
 the date of the financial statements and the reported amounts of
 revenues and expenses during the reporting period. Actual results could
 differ from these estimates. Any revise to
 
 -such accounting estimates is recognized prospectively in the
 accounting period in which such revision takes place.
 
 iii. Revenue Recognition
 
 a.  Revenue from radio broadcasting is recognized on an accrual basis
 on the airing of client''s commercials.  The revenue that is
 recognized is net of service tax. 
 
 b.  Dividend income on mutual fund units is accounted for when the
 right to receive the payment is established by the balance sheet date.
 
 c.  Interest income is recognized on time proportionate basis taking
 into account the amount outstanding and the rate applicable.
 
 d.  Profit on sale of units of mutual funds is recognized at the time
 of redemption and is determined as the difference between ''the
 redemption price and the carrying value.
 
 iv.  Fixed assets and Depreciation
 
 Cost of fixed assets comprises purchase price, duties, levies and any
 directly attributable cost of bringing the asset to its working
 condition and location for the intended use.
 
 Borrowing cost directly attributable to fixed assets which take
 substantial period of time to get ready for its intended use are
 capitalized to the extent they relate to the period till such assets
 are ready to be put to use.
 
 Cost of assets not ready for their intended use before such date, are
 disclosed as Capital Work-in-Progress.
 
 a.  Tangible assets
 
 Tangible fixed assets are stated at cost less accumulated depreciation
 and impairment losses, if any.
 
 Depreciation on tangible fixed assets is provided on written down value
 method at the rates and in the manner specified in Schedule XIV to the
 Act. The cost of leasehold improvements are amortized over the primary
 period of lease of the property. Leasehold land is not amortized since
 the term of lease is perpetual in nature. Tangible assets individually
 costing less than Rs  5,000 are depreciated fully in the year of
 purchase.
 
 b.  Intangible assets (other than Software) .  Migration fees paid by
 the Company for existing licenses upon migration to Phase II of the
 Licensing policy and One Time Entry Fees paid by the Company for
 acquiring new licenses have been capitalized as an asset.
 
 The migration fee capitalized is being amortized, with effect from
 April 1, 2005, equally over a period of ten years, being the period of
 the license. One Time Entry Fees is amortized over a period of ten
 years, being the period of license, from the date of operationalisation
 of the respective stations.
 
 c.  Software
 
 i.  Software obtained initially together with hardware is capitalized
 along with the cost of hardware and depreciated in the same manner as
 the hardware. All subsequent purchases of software licenses are treated
 as revenue expenditure and charged in the year of purchase.
 
 ii. Expenditure on acquired Computer Software
 
 (SAP) is recognized as intangible Asset and amortized over a period
 of twenty five months.  Expenditure on other software where the
 economic benefit is expected to be more than a year is amortized.
 
 v.  Foreign Currency Transactions
 
 Foreign currency transactions are recorded at the exchange rates
 prevailing on the date of the transaction. Gains and losses arising out
 of subsequent fluctuations are accounted for on actual payment or
 realization. Monetary items denominated in foreign currency as at the
 balance sheet date are converted at the exchange rates prevailing on
 that day. Exchange differences are recognized in the Profit and Loss
 Account. 
 
 vi.  Investments
 
 Investments that are intended to be held for not more than a year from
 the date of investment are classified as Current investments. All other
 investments are termed as Long term investments.
 
 Current investments are carried at cost or fair value, whichever is
 lower. Long term investments are stated at cost. However, provision for
 diminution in value is made to recognize a decline other than temporary
 in the value of the long term investments.
 
 vii. Retirement Benefits
 
 a.  Short Term Employee Benefits :
 
 The employees of the Company are entitled ,to leave encashment as per
 the leave policy of the Company.  The liability in respect of leave
 encashment which is expected to be encased / utilized within twelve
 months after the balance sheet date is considered to be of short term
 nature.
 
 b.  Long Term Employee Benefits :
 
 Defined Contribution Plans:
 
 The Company has Defined Contribution Plans for post employment benefits
 such as Provident Fund and Employee''s Pension Scheme, 1995. Under the
 Provident Fund Plan, the Company contributes to a Government
 administered Provident Fund on behalf of its employees and has no
 further obligation beyond making its contribution. 
 
 The Company contributes to a State Plan namely Employee''s Pension
 Scheme, 1995 and has no further obligation beyond making its
 contribution.
 
 The Company''s contributions to the above funds are charged to revenue
 every year.
 
 Defined Benefit Plans:
 
 The Company has a Defined Benefit Plan namely Gratuity and Leave
 Encashment for all its employees.  The liabilities in respect of Leave
 Encashment which is expected to be encased / utilized after twelve
 months from the balance sheet date is considered to be long
 
 term in nature.
 
 Liability for Defined Benefit Plan is provided on the basis of
 valuations, as at the balance heat date, carried out by an independent
 actuary. The actuarial valuation method used by the independent actuary
 for measuring the liability is the Projected Unit Credit Method.
 Actuarial losses/gains are recognized in the statement of profit and
 loss in the year in which they arise.
 
 c. Termination benefits are recognized as an expense as and when
 incurred.
 
 viii.  Operating Leases
 
 Leases in which a significant portion of the risks and rewards of
 ownership are retained by the less or are classified as operating
 leases. Payments made under operating leases are charged to the
 Statement of Profit and Loss on a straight-line basis over the period
 of the lease.
 
 ix.  Earnings per share
 
 Basic earnings per share is calculated by dividing the net profit or
 loss for the period attributable to equity shareholders by the weighted
 average number of equity shares outstanding during the period. Earnings
 considered in ascertaining the Company''s earnings per share is the
 net profit for the period after deducting preference dividends and any
 attributable tax thereto for the period. The weighted average number of
 equity shares outstanding during the period and for all periods
 presented is adjusted for events, such as bonus shares, other than the
 conversion of potential equity 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 for the period attributable to equity shareholders and
 the weighted average number of shares outstanding during the period is
 adjusted for the effects of all dilutive potential equity shares.
 
 x.  Income Taxes
 
 Tax expense comprises of Current and Deferred tax.  Current income tax
 and deferred tax are measured based on the amount expected to be paid
 to the tax authorities in accordance with the Income Tax Act, 1961.
 
 Minimum Alternate Tax (MAT) paid in accordance with tax laws which give
 rise to future economic benefits in the form of adjustment to future
 income tax liability is considered as an asset if there is convincing
 evidence that the company '' will pay normal tax in future. Accordingly,
 MAT is recognized 1 as an asset in the balance sheet when it is
 probable that the future economic benefit associated with it will flow
 to the Company and the asset can be measured reliably.
 
 Deferred tax is recognized, subject to the consideration of prudence,
 on timing differences, 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. Deferred tax assets are
 recognized only to the extent that there is reasonable certainty that
 sufficient future taxable income will be available against which such
 deferred tax assets can be realized. ''
 
 xi.  Impairment of Assets
 
 The Company assesses at each balance sheet date whether there is any
 indication that asset may be impaired.  If any such indication exists,
 the Company estimates the recoverable amount of the asset. If such
 recoverable amount of the asset or the recoverable amount of the cash
 generating unit to which the asset belongs is less than its carrying
 amount, the carrying amount is reduced to its recoverable amount. The
 reduction is treated as an impairment loss and is recognized in the
 Profit and Loss Account.  If at the balance sheet date, there is an
 indication that a previously assessed impairment loss no longer exists,
 the recoverable amount is reassessed and the asset is reflected at the
 recoverable amount.
 
 xii. Provisions and Contingent Liabilities
 
 The Company recognizes a provision when there is a present obligation
 as a result of a past event that probably requires an outflow of
 resources and a reliable estimate can be made of the amount of the
 obligation. Provisions are not discounted to its present date value and
 are determined based on best estimates of the amount required to settle
 the obligation at the balance sheet date. These are reviewed at each
 balance sheet date and adjusted to reflect the current best estimates.
 
 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 benefit. Where
 there is a possible obligation or a present obligation that the
 likelihood of outflow of resources is remote, no provision or
 disclosure is made.
 
 xiii.  License Fees
 
 As per the Frequency Module (FM) broadcasting policy, effective April
 1, 2005 license fees are charged to revenue at the rate of 4% of gross
 revenue for the period or 10% of Reserve One Time Entry Fee (ROTEF) for
 the concerned city, whichever is higher. Gross Revenue for this purpose
 shall mean revenue on the basis of billing rates inclusive of any taxes
 and without deduction of any discount given to the advertiser and any
 commission paid to advertising agencies. Barter advertising contracts
 shall also be included in the gross revenue on the basis of relevant
 billing rates. ROTEF means 25% of highest valid bid in the city.