To the Members of Hindustan Media Ventures Limited
Report on the Audit of the Standalone Financial Statements
We have audited the standalone financial statements of Hindustan Media Ventures Limited("the Company") which comprise the standalone balance sheet as at 31 March2021 and the standalone statement of profit and loss (including other comprehensiveincome) standalone statement of changes in equity and standalone statement of cash flowsfor the year then ended and notes to the standalone financial statements including asummary of the significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Companies Act 2013 ("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 31 March 2021 and profit and other comprehensiveincome changes in equity and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Act. Our responsibilities under those SAs are furtherdescribed in the Auditor's Responsibilities for the Audit of the Standalone FinancialStatements section of our report. We are independent of the Company in accordance withthe Code of Ethics issued by the Institute of Chartered Accountants of India together withthe ethical requirements that are relevant to our audit of the standalone financialstatements under the provisions of the Act and the Rules thereunder and we have fulfilledour other ethical responsibilities in accordance with these requirements and the Code ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our opinion on the Standalone financial statements.
Key Audit Matters
Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the standalone financial statements of the current period.These matters were addressed in the context of our audit of the standalone financialstatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters.
Description of Key Audit Matters
Revenue from operations
See note 19 to the standalone financial statements
|The key audit matter ||How the matter was addressed in our audit |
|As disclosed in Note 19 to the standalone financial statements the Company's revenue from Sale of newspaper and publications' and Advertisement revenue' for the year ended 31 March 2021 was H 16363 lakhs and H 36790 lakhs respectively. ||Our audit procedures included: |
|Revenue is recognized upon transfer of control of promised services / goods to the customers and when it is "probable" that the Company will collect the consideration. In specific revenue from advertisement and circulation is recognized when the advertisement is published and newspaper is delivered to the distributor. || Assessed the appropriateness of the accounting policy for revenue recognition as per the relevant accounting standard; |
|There is a risk that revenue is recognized for goods / services before the transfer of control of the goods / service to customer is completed. || Evaluated the design and implementation of key controls in relation to revenue recognition and tested the operating effectiveness of such controls for a sample of transactions; |
|Standards on Auditing presume that there is fraud risk with regard to revenue recognition. Also revenue is one of the key performance indicators of the Company which makes it susceptible to misstatement. || Involved our IT specialists to assist us in testing of key IT system controls which impact revenue recognition; |
| || Performed detailed testing by selecting samples of revenue transactions recorded during and after the year. For such samples verified the underlying documents supporting revenue recognition; |
| || Tested sample journal entries for revenue recognized during the year selected based on specified risk-based criteria to identify unusual transactions. |
|Impairment testing of property plant and equipment See note 3 to the standalone financial statements || |
|The Company is engaged in printing and publishing of newspapers and periodicals through various plants operated in India. ||Our audit procedures included: |
|The carrying value of property plant and equipment (excluding capital work in progress) amounts to H 13371 lakhs as at 31 March 2021. || Assessed the Company's identification of CGU with reference to the guidance in the applicable accounting standards; |
|The Company performs annual assessment of the property plant and equipment at cash generating unit (CGU) level to identify indicators of impairment if any. The recoverable amount of the CGU based on value in use (VIU') has been derived using discounted cash flow model. The model uses several key assumptions. The economic slowdown owing to the Covid-19 pandemic and other economic factors may impact the key assumptions taken while computing VIU. || Tested design implementation and operating effectiveness of key controls over the impairment assessment process. |
|Considering the inherent uncertainty complexity and judgment involved and the significance of the value of the assets impairment assessment of above-mentioned assets has been considered as a key audit matter. || The Company's assessment included computation of VIU. We obtained and assessed the VIU as determined by the Company as under: |
| || Assessed the method of determining VIU and key assumptions used therein through historical information budgets / projections and other relevant information. |
| || Challenged the key assumptions contained including growth assumptions and discount rates. |
| || Assessed the sensitivity of the outcome of impairment assessment to changes in key assumptions. |
The Company's management and Board of Directors are responsible for the otherinformation. The other information comprises the information included in the Company'sannual report but does not include the financial statements and our auditors' reportthereon.
Our opinion on the standalone financial statements does not cover the other informationand we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statements our responsibilityis to read the other information and in doing so consider whether the other informationis materially inconsistent with the standalone financial statements or our knowledgeobtained in the audit or otherwise appears to be materially misstated. If based on thework we have performed we conclude that there is a material misstatement of this otherinformation we are required to report that fact. We have nothing to report in thisregard.
Management's and Board of Directors' Responsibility for the Standalone FinancialStatements
The Company's Management and Board of Directors are responsible for the matters statedin section 134(5) of the Act with respect to the preparation of these standalone financialstatements that give a true and fair view of the state of affairs profit/loss and othercomprehensive income changes in equity and cash flows of the Company in accordance withthe accounting principles generally accepted in India including the Indian AccountingStandards (Ind AS) specified under section 133 of the Act. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and designimplementation and maintenance of adequate internal financial controls that were operatingeffectively for ensuring accuracy and completeness of the accounting records relevant tothe preparation and presentation of the standalone financial statements that give a trueand fair view and are free from material misstatement whether due to fraud or error.
In preparing the standalone financial statements the Management and Board of Directorsare responsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless the Board of Directors either intends to liquidate the Companyor to cease operations or has no realistic alternative but to do so.
The Board of Directors is also responsible for overseeing the Company's financialreporting process.
Auditor's Responsibilities for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalonefinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the standalonefinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.
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 in the standalone financial statementsmade by the Management and Board of Directors.
Conclude on the appropriateness of the Management and Board of Directors use ofthe going concern basis of accounting and based on the audit evidence obtained whether amaterial uncertainty exists related to events or conditions that may cast significantdoubt on the Company's ability to continue as a going concern. If we conclude that amaterial uncertainty exists we are required to draw attention in our auditor's report tothe related disclosures in the standalone financial statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditions maycause the Company to cease to continue as a going concern.
Evaluate the overall presentation structure and content of the standalonefinancial statements including the disclosures and whether the standalone financialstatements represent the underlying transactions and events in a manner that achieves fairpresentation.
We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.
From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the standalone financial statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditors' report unless law or regulation precludes public disclosure about thematter or 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
1. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government in terms of section 143 (11) of the Act we give in the"Annexure A" a statement on the matters specified in paragraphs 3 and 4 of theOrder to the extent applicable.
2. (A) 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 standalone balance sheet the standalone statement of profit and loss (includingother comprehensive income) the standalone statement of changes in equity and thestandalone statement of cash flows dealt with by this Report are in agreement with thebooks of account.
d) In our opinion the aforesaid standalone financial statements comply with the Ind ASspecified under section 133 of the Act.
e) On the basis of the written representations received from the directors as on 31March 2021 taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2021 from being appointed as a director in terms of Section164(2) of the Act.
With respect to the adequacy of the internal financial controls with reference tofinancial statements of the
Company and the operating effectiveness of such controls refer to our separate Reportin "Annexure B".
(B) With respect to the other matters to be included in the Auditors' 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 as at 31 March 2021 onits financial position in its standalone financial statements - Refer Note 33 to thestandalone financial statement.
ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.
iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company;
iv. The disclosures in the standalone financial statements regarding holdings as wellas dealings in specified bank notes during the period from 8 November 2016 to 30 December2016 have not been made in these financial statements since they do not pertain to thefinancial year ended 31 March 2021.
(C) With respect to the matter to be included in the Auditors' Report under section197(16):
In our opinion and according to the information and explanations given to us theremuneration paid by the Company to its directors during the current year is in accordancewith the provisions of Section 197 of the Act. The remuneration paid to any director isnot in excess of the limit laid down under Section 197 of the Act. The Ministry ofCorporate Affairs has not prescribed other details under Section 197(16) which arerequired to be commented upon by us.
referred to in our Independent Auditor's Report to the members of Hindustan MediaVentures Limited on the standalone financial statements for the year ended 31 March 2021.
With reference to the Annexure A referred to in the Independent Auditor's Report to themembers of the Company on the standalone financial statements for the year ended 31 March2021 we report the following:
(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets (i.e. property plant and equipment)
(b) The Company has a regular programme of physical verification of its fixed assetsby which all fixed assets are verified in a phased manner over a period of three years. Inour opinion this periodicity of physical verification by management is reasonable havingregard to the size of the Company and the nature of its assets. In accordance with thisprogramme certain fixed assets were physically verified during the year. As informed tous no material discrepancies were noticed on such verification.
(c) The title deeds of immovable properties as disclosed in Note 3 on property plantand equipment to the financial statements are held in the name of the Company.
(ii) Inventories except for goods-in-transit have been physically verified by themanagement during the year. In our opinion the frequency of such verification isreasonable. According to the information and explanations given to us the procedures forphysical verification of inventories followed by the management during the year arereasonable and adequate in relation to the size of the Company and the nature of itsbusiness. The discrepancies noticed on verification between the physical stocks and thebook records were not material.
(iii) According to the information and explanations given to us the Company has notgranted any loans secured or unsecured to companies firms limited liabilitypartnerships or other parties covered in the register maintained under Section 189 of theCompanies Act 2013. Accordingly the provisions of paragraph 3 (iii) of the Order are notapplicable to the Company.
(iv) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company there are no loans or investments made by theCompany which are not in compliance with Section 185 and 186 of the Companies Act2013.There are no guarantees given or securities provided by the Company as specified underSection 185 and 186 of the Companies Act 2013.
(v) As per the information and explanations given to us the Company has not acceptedany deposits as mentioned in the directives issued by the Reserve Bank of India and theprovisions of Section 73 to 76 or any other relevant provisions of the Companies Act 2013and the rules framed there under. Accordingly paragraph 3(v) of the Order is notapplicable.
(vi) According to the information and explanations given to us the Central Governmenthas not prescribed the maintenance of cost records under Sub-section (1) of Section 148 ofthe Companies Act 2013 for any of the services rendered and goods sold by the Company.Accordingly paragraph 3(vi) of the Order is not applicable.
(vii) (a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company amounts deducted/ accrued in the books ofaccount in respect of undisputed statutory dues including provident fund employees' stateinsurance income-tax goods and services tax duty of customs cess professional taxand other statutory dues have been regularly deposited during the year by the Company withthe appropriate authorities. As explained to us the Company did not have any dues onaccount of sales tax service tax duty of excise and value added tax.
According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees' state insurance income-tax goods andservices tax duty of customs cess professional tax and other statutory dues were inarrears as at 31 March 2021 for a period of more than six months from the date they becamepayable.
(b) According to the information and explanations given to us there are no dues ofincome-tax sales tax service tax goods and services tax duty of customs duty ofexcise and value added tax which have not been deposited by the Company with theappropriate authorities on account of any dispute as at 31 March 2021 except as mentionedbelow :-
Statement of Disputed Tax Dues
|Name of the Statute ||Nature of dues ||Amount (in lakhs) ||Amount paid under protest (in lakhs) ||Period to which amount relates ||Forum where the dispute is pending |
|Income tax act 1961 ||Disallowance of certain expenditure ||376 || ||AY 2017-18 ||Commissioner of Income Tax (Appeals) |
|Income tax act 1961 ||Disallowance of certain expenditure ||215 || ||AY 2016-17 ||Commissioner of Income Tax (Appeals) |
|Income tax act 1961 ||Disallowance of certain expenditure ||91 ||19 ||AY 2015-16 ||Commissioner of Income Tax (Appeals) |
|Income tax act 1961 ||Disallowance of certain expenditure ||97 ||92 ||AY 2012-13 ||Commissioner of Income Tax (Appeals) |
|Income tax act 1961 ||Disallowance of certain expenditure ||1 ||1 ||AY 2013-14 and AY 2014-15 ||Commissioner of Income Tax (Appeals) |
(viii) In our opinion and according to the information and explanations given to us andon the basis of our examination of the records of the Company the Company has notdefaulted in repayment of loans or borrowings to banks. Further no loans or borrowingswere taken from financial institutions and government and there were no debentures issuedduring the year or outstanding as at 31 March 2021.
(ix) In our opinion and according to the information and explanations given to us andon the basis of our examination of the records of the Company the Company has applied themoney raised by way of term loans for the purpose for which they were obtained. Furtherthe Company has not raised any money by way of initial public offer or further publicoffer (including debt instruments).
(x) According to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported duringour audit.
(xi) According to the information and explanations given to us the remuneration paidduring the year by the Company to its directors is in accordance with the provisions ofSection 197 read with Schedule V to the Act.
(xii) According to the information and explanations given to us the Company is not aNidhi Company. Accordingly paragraph 3(xii) of the Order is not applicable.
(xiii) In our opinion and according to the information and explanations given to us andon the basis of our examination of the records of the Company the transactions with therelated parties are in compliance with Sections 177 and 188 of the Companies Act 2013where applicable and the details have been disclosed in the standalone financialstatements as required by the applicable accounting standards.
(xiv) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe current year. Accordingly paragraph 3(xiv) of the Order is not applicable to theCompany.
(xv) According to the information and explanations given to us the Company has notentered into non-cash transactions with directors or persons connected with him.Accordingly paragraph 3(xv) of the Order is not applicable.
(xvi) According to the information and explanation given to us the Company is notrequired to be registered under Section 45-IA of the Reserve Bank of India Act 1934.Accordingly paragraph 3(xvi) of the Order is not applicable.
to the Independent Auditor's report on the standalone financial statements of HindustanMedia Ventures Limited for the year ended 31 March 2021.
Report on the internal financial controls with reference to the aforesaid standalonefinancial statements under Clause (i) of Sub-section 3 of Section 143 of the CompaniesAct 2013
(Referred to in paragraph 1(A)(f) under Report on Other Legal and RegulatoryRequirements' section of our report of even date)
We have audited the internal financial controls with reference to standalone financialstatements of Hindustan Media Ventures Limited ("the Company") as of 31 March2021 in conjunction with our audit of the standalone financial statements of the Companyfor the year ended on that date.
In our opinion the Company has in all material respects adequate internal financialcontrols with reference to standalone financial statements and such internal financialcontrols were operating effectively as at 31 March 2021 based on the internal financialcontrols with reference to standalone financial statements criteria established by theCompany considering the essential components of internal control stated in the GuidanceNote on Audit of Internal Financial Controls Over Financial Reporting issued by theInstitute of Chartered Accountants of India (the "Guidance Note").
Management's Responsibility for Internal Financial Controls
The Company's management and the Board of Directors are responsible for establishingand maintaining internal financial controls based on the internal financial controls withreference to financial statements criteria established by the Company considering theessential components of internal control stated in the Guidance Note. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Companies Act 2013 (hereinafter referred to as"the Act").
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 and the Standards on Auditing prescribed undersection 143(10) of the Act to the extent applicable to an audit of internal financialcontrols with reference to financial statements. Those Standards and the Guidance Noterequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls with reference tofinancial statements were established and maintained and whether such controls operatedeffectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls with reference to financial statements and their operatingeffectiveness. Our audit of internal financial controls with reference to financialstatements included obtaining an understanding of such internal financial controlsassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgement including the assessment of the risks ofmaterial misstatement of the standalone financial statements whether due to fraud orerror.
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 withreference to standalone financial statements.
Meaning of Internal Financial controls with Reference to Financial Statements
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 include 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 withauthorizations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorized 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
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 controls with reference to financial statements may become inadequatebecause of changes in conditions or that the degree of compliance with the policies orprocedures may deteriorate.
| ||For B S R and Associates |
| || |
| ||Firm's Registration No.:128901W |
| ||Rajesh Arora |
| || |
|Place:Gurugram ||Membership No. 076124 |
|Date: 17 June 2021 ||UDIN: 21076124AAAACE7109 |