To the Members of
Hindustan Media Ventures Limited
Report on the audit of the financial statements
1. We have audited the accompanying financial statements of Hindustan Media VenturesLimited ("the Company") which comprise the balance sheet as at March 31 2019the statement of Profit and Loss (including Other
Comprehensive Income) statement of changes in equity and statement of cash flows forthe year then ended and notes to the financial statements including a summary ofsignificant accounting policies and other explanatory information.
2. In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by theCompanies Act 2013 ("the Act") in the manner so required and give a true andfair view in conformity with the accounting principles generally accepted in India of thestate of affairs of the Company as at March 31 2019 and total comprehensive income(comprising of profit and other comprehensive income) changes in equity and its cashflows for the year then ended.
Basis for opinion
3. We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Act. Our responsibilities under those Standards are furtherdescribed in the Auditor's Responsibilities for the Audit of the Financial Statementssection of our report. We are independent of the Company in accordance with the Code ofEthics issued by the Institute of Chartered Accountants of India together with the ethicalrequirements that are relevant to our audit of the financial statements under theprovisions of the Act and the Rules thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the Code of Ethics. We believethat the audit evidence we have obtained is sufficient and appropriate to provide a basisfor our opinion.
Key audit matters
4. Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the financial statements of the current period. These matterswere addressed in the context of our audit of the financial statements as a whole and informing our opinion thereon and we do not provide a separate opinion on these matters.
|Key audit matter ||How our audit addressed the key audit matter |
|Assessment of the useful life of brand || |
|[Refer to Note 5 and Note 2.2 (j) (Intangible assets and Summary of significant accounting policies) || |
|In the year ended March 31 2016 the Company had acquired Hindi Business brands (i.e. Hindustan Hindustan.in Nandan Kadambini Hum Tum and other Hindi publications) and its related trademarks from its parent company HT Media Limited. ||In relation to assessing the useful life of Brand we performed procedures including the following: |
|Management based on its analysis of all of relevant factors believes that the Brand has indefinite life over which it will be generating net cash inflows for the Company. Relevant factors considered in this regard by the Management included: || We obtained an understanding from the management assessed and tested the design and operating effectiveness of the Company's control over the assessment of useful life of intangible assets. |
| || We developed our own expectation and assessed and tested those against the results of managements annual assessment to ascertain need for impairment. |
| the expected usage of the brand by the entity and whether the brand could be managed efficiently by the management team. ||We also discussed with the management on whether certain relevant factors such as industry trends or other external factors that could impact the useful life of the Brand have been considered. |
| potential commercial obsolescence of the brand. || We involved the auditor's expert to assess the appropriateness of the useful life of the brand. |
| the stability of the industry in which the Company operates using the brand and changes in the market demand for the products or services output from the brand. || We evaluated the adequacy of disclosures in the financial statements. |
|expected actions by competitors or potential competitors. || |
|We focused on this area due to the significance to the financial statements as the carrying value of Brand comprises 98% of the total intangible assets of the Company. ||Based on audit procedures performed we noted that the managements assessment of the useful life of the Brand is reasonable. |
5. The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the annual report but does not includethe financial statements and our auditor's report thereon.
Our opinion on the financial statements does not cover the other information and we donot express any form of assurance conclusion thereon.
In connection with our audit of the financial statements our responsibility is to readthe other information and in doing so consider whether the other information ismaterially inconsistent with the financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated. If based on the work we haveperformed we conclude that there is a material misstatement of this other information weare required to report that fact.
We have nothing to report in this regard.
Responsibilities of management and those charged with governance for the financialstatements
6. The Company's Board of Directors is responsible for the matters stated in section134(5) of the Act with respect to the preparation of these financial statements that givea true and fair view of the financial position financial performance changes in equityand cash flows of the Company in accordance with the accounting principles generallyaccepted in India including the Accounting Standards specified under section 133 of theAct This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
7. In preparing the financial statements management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so. Those Board of Directors are also responsible for overseeing theCompany's financial reporting process.
Auditor's responsibilities for the audit of the financial statements
8. Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these financial statements.
9. As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional scepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under Section 143(3)(i)of the Act we are also responsible for expressing our opinion on whether the company hasadequate internal financial controls with reference to financial statements in place andthe operating effectiveness of such controls.
Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe financial statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the Company to cease to continue asa going concern.
Evaluate the overall presentation structure and content of the financialstatements including the disclosures and whether the financial statements represent theunderlying transactions and events in a manner that achieves fair presentation.
10. We communicate with those charged with governance regarding among other mattersthe planned scope and timing of the audit and significant audit findings including anysignificant in internal control that we identify during our audit.
11. We also provide those charged with governance with a statement that we havecomplied with relevant ethical requirements regarding independence and to communicatewith them all relationships and other matters that may reasonably be thought to bear onour independence and where applicable related safeguards.
12. From the matters communicated with those charged with governance we determinethose matters that were of most significance in the audit of the financial statements ofthe current period and are therefore the key audit matters. We describe these matters inour auditor's report unless law or regulation precludes public disclosure about the matteror when in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.
Report on other legal and regulatory requirements
13. As required by the Companies (Auditor's Report) Order 2016 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act we give in the Annexure A a statement on the matters specified inparagraphs 3 and 4 of the Order to the extent applicable.
14. As required by Section 143(3) of the Act we report that:
a) We have sought and obtained all the information and explanations which to the bestof 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 theCompany so far as it appears from our examination of those books.
c) The Balance Sheet the Statement of Profit and Loss (including other comprehensiveincome) the Statement of Changes in Equity and Cash Flow Statement dealt with by thisReport are in agreement with the books of account.
d) In our opinion the aforesaid financial statements comply with the AccountingStandards specified under Section 133 of the Act.
e) On the basis of the written representations received from the directors as on March31 2019 taken on record by the Board of Directors none of the directors as on March 312019 from being appointed as a director in terms of Section 164
(2) of the Act.
f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure B".
g) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financialposition in its financial statements Refer Note 33 (c) to the financial statements;
ii. The Company has long-term contracts including derivative contracts as at March 312019 for which there were no material foreseeable losses.
iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.
iv. The reporting on disclosures relating to Specified Bank Notes is not applicable tothe Company for the year ended March 31 2019.
For Price Waterhouse & Co. Chartered Accountants LLP
Firm Registration Number: 304026E/E-300009
| ||Anupam Dhawan |
|Place : New Delhi ||Partner |
|Date : May 09 2019 ||Membership Number: 084451 |
ANNEXURE A TO INDEPENDENT AUDITORS' REPORT
Referred to in paragraph 13 of the Independent Auditors' Report of even date to themembers of Hindustan Media Ventures Limited on the financial statements as of and for theyear ended March 31 2019
i. (a) The Company is maintaining proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) The fixed assets are physically verified by the Management according to a phasedprogramme designed to cover all the items over a period of three years which in ouropinion is reasonable having regard to the size of the Company and the nature of itsassets. Pursuant to the programme a portion of the fixed assets has been physicallyverified by the Management during the year and no material discrepancies have been noticedon such verification.
(c) The title deeds of immovable properties as disclosed in Note 3 on fixed assets tothe financial statements are held in the name of the Company.
ii. The physical verification of inventory have been conducted at reasonable intervalsby the Management during the year. The discrepancies noticed on physical verification ofinventory as compared to book records were not material.
iii. The Company has not granted any loans secured or unsecured to companies firmsLimited Liability
Partnerships or other parties covered in the register maintained under Section 189 ofthe Act. Therefore the provisions of Clause 3(iii) (iii)(a) (iii)(b) and (iii)(c) ofthe said Order are not applicable to the Company.
iv. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Section 185 and 186 of the Companies Act 2013in respect of the loans and investments made and guarantees and security provided by it.
v. The Company has not accepted any deposits from the public within the meaning ofSections 73 74 75 and 76 of the Act and the Rules framed there under to the extentnotified.
vi. The Central Government of India has not specified the maintenance of cost recordsunder sub-section (1) of
Section 148 of the Act for any of the products of the
vii. (a) According to the information and explanations given to us and the records ofthe Company examined by us in our opinion the Company is regular in depositing theundisputed statutory dues including provident fund employees' state insurance incometax cess goods and service tax and other material statutory dues as applicable withthe appropriate authorities.
(b) According to the information and explanations given to us and the records of theCompany examined by us there are no dues of sales-tax duty of customs duty of excisevalue added tax goods and service tax which have not been deposited on account of anydispute. The particulars of dues of income tax as at March 31 2019 which have not beendeposited on account of a dispute are as follows:
|Name of the statute ||Nature of dues ||Amount (Rsin lakhs) ||Period to which the amount relates ||Forum where the dispute is pending |
|Income Tax Act 1961 ||Income Tax Demand ||215 ||AY 2016-17 ||Commissioner of Income tax (Appeals) |
|Income Tax Act 1961 ||Income Tax Demand ||72 ||AY 2015-16 ||Commissioner of Income tax (Appeals) |
|Income Tax Act 1961 ||Income Tax Demand ||6 ||AY 2012-13 ||Commissioner of Income tax (Appeals) |
viii. According to the records of the Company examined by us and the information andexplanation given to us the Company has not defaulted in repayment of loans or borrowingsto any financial institution or bank or Government as at March 31 2019. The Company didnot have any outstanding debentures as at the balance sheet date.
ix. In our opinion and according to the information and explanations given to us themoneys raised by way of term loans have been applied for the purposes for which they wereobtained. The Company has not raised moneys by way of initial public offer or furtherpublic offer (including debt instruments).
x. During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of material fraud by the Company or on the Company by its officers or employeesnoticed or reported during the year nor have we been informed of any such case by theManagement.
xi. The Company has paid/ provided for managerial remuneration in accordance with therequisite approvals mandated by the provisions of Section 197 read with Schedule V to theAct.
xii. As the Company is not a Nidhi Company and the Nidhi Rules 2014 are not applicableto it the provisions of Clause 3(xii) of the Order are not applicable to the
xiii. The Company has entered into transactions with related parties in compliance withthe provisions of Sections 177 and 188 of the Act. The details of such related partytransactions have been disclosed in the financial statements as required under IndianAccounting
Standard (Ind AS) 24 Related Party Disclosures specified under Section 133 of the Act.
xiv. The Company has not made any preferential allotment or private placement of sharesor fully or partly convertible debentures during the year under review. Accordingly theprovisions of Clause 3(xiv) of the Order are not applicable to the Company.
xv. The Company has not entered into any non-cash transactions with its directors orpersons connected with him. Accordingly the provisions of Clause 3(xv) of the Order arenot applicable to the Company.
xvi. The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934. Accordingly the provisions of Clause 3(xvi) of the Order are notapplicable to the Company.
| ||For Price Waterhouse & Co. Chartered Accountants LLP |
| ||Firm Registration Number: 304026E/E-300009 |
| ||Anupam Dhawan |
|Place : New Delhi ||Partner |
|Date : May 09 2019 ||Membership Number: 084451 |
ANNEXURE B TO INDEPENDENT AUDITORS' REPORT
Referred to in paragraph 14 (f) of the Independent Auditors' Report of even date to themembers of Hindustan Media Ventures Limited on the financial statements for the year endedMarch 31 2019.
Report on the Internal Financial Controls with reference to financial statements underClause (i) of Sub-section 3 of Section 143 of the Act
1. We have audited the internal financial controls with reference to financialstatements of Hindustan Media Ventures Limited ("the Company") as of March 312019 in conjunction with our audit of the financial statements of the Company for the yearended on that date.
Management's Responsibility for Internal Financial Controls
2. The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reportingissued by the Institute of Chartered Accountants of India (ICAI). These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including adherence to company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Act.
3. Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to financial statements based on our audit. We conducted our auditin accordance with the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting (the "Guidance Note") and the Standards on Auditing deemedto be prescribed under section 143(10) of the Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit of internal financial controlsand both issued by the ICAI. Those Standards and the Guidance Note require that we complywith ethical requirements and plan and perform the audit to obtain reasonable assuranceabout whether adequate internal financial controls with reference to financial statementswas established and maintained and if such controls operated effectively in all materialrespects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacyof the internal financial controls system with reference to financial statements and theiroperating effectiveness. Our audit of internal financial controls with reference tofinancial statements included obtaining an understanding of internal financial controlswith reference to financial statements assessing the risk that a material weaknessexists and testing and evaluating the design and operating effectiveness of internalcontrol based on the assessed risk. The procedures selected depend on the auditor'sjudgement including the assessment of the risks of material misstatement of the financialstatements whether due to fraud or error.
5. We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls systemwith reference to financial statements.
Meaning of Internal Financial Controls with reference to financial statements
6. A company's internal financial controls with reference to financial statements is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financial controlswith reference to financial statements includes those policies and procedures that (1)pertain to the maintenance of records that in reasonable detail accurately and fairlyreflect the transactions and dispositions of the assets of the company; (2) providereasonable assurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the company's assets that could have a material effect on the financialstatements.
Inherent Limitations of Internal Financial Controls with reference to financialstatements
7. Because of the inherent limitations of internal financial controls with reference tofinancial statements including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls withreference to financial statements to future periods are subject to the risk that theinternal financial control controls with reference to financial statements may becomeinadequate because of changes in conditions or that the degree of compliance with thepolicies or procedures may deteriorate.
8. In our opinion the Company has in all material respects an adequate internalfinancial controls system with reference to financial statements and such internalfinancial controls with reference to financial statements were operating effectively as atMarch 31 2019 based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reportingissued by the Institute of Chartered
Accountants of India.
|For Price Waterhouse & Co. Chartered Accountants LLP |
|Firm Registration Number: 304026E/E-300009 |
| ||Anupam Dhawan |
|Place : New Delhi ||Partner |
|Date : May 09 2019 ||Membership Number: 084451 |