1. We have audited the attached Balance sheet of Zee entertainment
enterprises Limited (the Company) as at March 31, 2011, the profit
and Loss account and also the Cash Flow statement of the Company for
the year ended on that date, annexed thereto. These financial
statements are the responsibility of the Companys management. Our
responsibility is to express an opinion on these financial statements
based on our audit.
2. We conducted our audit in accordance with the auditing standards
generally accepted in India. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. an audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. an audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. as required by the Companies (auditors report) Order, 2003 (the
Order) issued by the Central Government of India in terms of section
227(4a) of the Companies act, 1956 (the act), and on the basis of
such checks as we considered appropriate and according to the
information and explanations given to us, we annex hereto a statement
on the matters specified in paragraph 4 and 5 of the said Order.
4. Without qualifying our report, we draw our attention to:
(a) note 3(a) in schedule 18 regarding amalgamation of foreign
subsidiaries viz. Zes holdings Limited and Zee Multimedia Worldwide
Limited (BVI) with the Company w.e.f. February 1, 2011 as per the
scheme of amalgamation u/s 391 to 394 and other applicable provisions,
approved by the honble high Court at Mumbai and effect thereof is
given in these financial statement as per pooling of interest method as
per as 14 and resultant difference of Rs. / Thousand 2,076,357 is
adjusted against General reserve.
(b) note 3(C) in schedule 18 regarding demerger of education business
undertaking to Zee Learn Limited as at april 1, 2010 as per the
Composite scheme of amalgamation and arrangement u/s 391 to 394,
approved by the honble high Court at Mumbai and in pursuance thereof,
assets and liabilities of the demerged undertaking are transferred and
the resultant difference of Rs. / Thousand 631,293 is adjusted against
General reserve.
5. Further to our comments in the annexure referred to in paragraph
(3) above, we report that:
(a) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
(b) In our opinion, proper books of account as required by law have
been kept by the company so far as appears from our examination of
those books;
(c) The Balance sheet, the profit and Loss account and the Cash Flow
statement dealt with by this report are in agreement with the books of
account;
(d) In our opinion, the Balance sheet, the profit and Loss account and
the Cash Flow statement dealt with by this report comply with the
accounting standards referred to in section 211 (3C) of the act;
(e) On the basis of written representations received from the
directors, as at March 31, 2011 and taken on record by the Board, we
report that none of the directors is disqualified as at March 31, 2011
from being appointed as a director in terms of clause (g) of
sub-section (1) of section 274 of the act;
(f) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts read together the
significant accounting policies and notes to accounts as per schedule
18, give the information required by the act, in the manner so required
and give a true and fair view in conformity with the accounting
principles generally accepted in India:
i) In the case of the Balance sheet, of the state of affairs of the
Company as at March 31, 2011;
ii) In the case of the profit and Loss account, of the profit of the
Company for the year ended on that date; and
iii) In the case of the Cash Flow statement, of the cash flows of the
Company for the year ended on that date.
Annexure referred to in Paragraph (3) of Auditors Report to the
members of Zee Entertainment Enterprises Limited on the accounts for
the year ended March 31, 2011
1) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of its fixed
assets.
(b) all the fixed assets, except assets lying with third parties, have
been physically verified by the management during the year. In our
opinion, this periodicity of physical verification is reasonable having
regard to the size of the Company and the nature of its assets. as
informed, no material discrepancies were noticed on such verification.
(c) during the year, there was no disposal of substantial part of fixed
assets.
2) (a) The inventory has been physically verified (copyrights of
programs and movie rights verified with reference to title
documents/agreements) by the management at reasonable intervals during
the year.
(b) In our opinion, the procedures of physical verification of
inventory followed by the management are reasonable and adequate in
relation to the size of the company and the nature of its business.
(c) In our opinion, the Company has maintained proper records of
inventory and no discrepancies were noticed on physical verification as
compared to the book records.
3) (a) The Company has not granted any loan, secured or unsecured, to
companies, firms or other parties covered in the register maintained
under section 301 of the act.
(b) The Company has not taken any loan, secured or unsecured, from
companies, firms or other parties covered in the register maintained
under section 301 of the act.
4) In our opinion and according to the information and explanations
given to us, there is adequate internal control system commensurate
with the size of the Company and the nature of its business with regard
to purchases of inventory, fixed assets and sale of goods and services.
during the course of our audit, no major weaknesses were noticed in the
internal control system in respect of the aforesaid areas.
5) according to the information and explanations given to us, there are
no contracts or arrangements the particulars of which are required to
be entered into the register maintained in pursuance to section 301 of
the act.
6) The Company has not accepted any deposits from the public during the
year.
7) In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
8) We are informed that the Central Government has not prescribed the
maintenance of cost accounting records under section 209 (1) (d) of the
act in respect of the Companys activities.
9) according to the records of the Company examined by us and
information and explanations given to us:
(a) Undisputed statutory dues including provident fund, investor
education and protection fund, income tax, sales tax, wealth tax,
service tax, custom duty, excise duty, cess and others as applicable
have generally been regularly deposited with appropriate authorities
except delay in few cases. There are no undisputed amounts payable in
respect of the aforesaid dues which have remained outstanding as at
March 31, 2011 for a period of more than six months from the date they
became payable.
(b) according to the records of the Company, the dues of service tax
and income tax, which are not deposited on account of any dispute are
as under:
(Rs./Thousand)
Name of
the Statute Nature of the Dues Amount (Rs./ Thousand)
The Central Excise
Act, 1944 Service Tax 241
312,239
148,240
44
177
Income Tax Tax Deducted at Source 982,067
(including interest)
Income Tax 649,758
Name of the Statue Period to which the Forum where dispute is
amount relate pending
The Central Excise Act,
1944 F.Y. 2003-2004 Commissioner of service Tax
F.Y. 2006-2007
F.Y. 2008-2009
F.Y. 2006-2007 to Commissioner of Central
F.Y. 2008-2009 excise (appeals)
F.Y. 2006-2007, Commissioner of
F.Y. 2007- 2008 Central excise (appeals)
Income Tax F.Y. 2005-2006 to Commissioner of Income Tax
F.Y. 2009-2010 (appeals)
F.Y. 2006-2007 Commissioner of Income Tax
(appeals)
10) The Company does not have accumulated losses at the end of the
financial year and has not incurred cash losses in the current
financial year and in the immediately preceding financial year.
11) The Company has not defaulted in repayment of dues to banks,
financial institutions and debenture holders during the year.
12) The Company has not granted any loans or advances on the basis of
security by way of pledge of shares, debentures and other securities.
13) The Company is not chit fund or a nidhi / mutual benefit fund /
society.
14) The Company is not dealing in or trading in shares, securities,
debentures and other investments.
15) In our opinion, the terms and conditions of guarantees given by the
Company for loans taken by subsidiaries and others are prima-facie not
prejudicial to the interests of the Company.
16) The Company has not raised any term loan during the year.
17) according to information and explanations given to us and on an
overall examination of the Balance sheet of the Company, we are of the
opinion that the funds raised on short term basis have not been used
for long term investments.
18) The Company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under section
301 of the act.
19) The Company has not issued any secured debentures during the year.
however, pursuant to the Composite scheme of arrangement, the Company
had been vested the liability of secured debentures issued by erstwhile
eTC networks Limited which is transferred on april 1, 2010 to Zee Learn
Limited on demerger.
20) The Company has not raised any money by public issue during the
year.
21) Based on the audit procedures performed and according to the
information and explanations given to us, we report that no fraud on or
by the Company has been noticed or reported during the year.
For MGB & Co
Chartered accountants
Firm registration no- 101169W
Hitendra Bhandari
Partner
Membership no. 107832
Mumbai, June 23, 2011
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