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,
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.
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
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.
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
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
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
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.
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
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
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