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Next Mediaworks Ltd.

BSE: 532416 Sector: Media
NSE: NEXTMEDIA ISIN Code: INE747B01016
BSE 00:00 | 21 Oct 5.61 -0.30
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NSE 00:00 | 21 Oct 5.70 -0.20
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5.85

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OPEN 5.84
PREVIOUS CLOSE 5.91
VOLUME 5218
52-Week high 7.19
52-Week low 3.38
P/E
Mkt Cap.(Rs cr) 38
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 5.84
CLOSE 5.91
VOLUME 5218
52-Week high 7.19
52-Week low 3.38
P/E
Mkt Cap.(Rs cr) 38
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Next Mediaworks Ltd. (NEXTMEDIA) - Auditors Report

Company auditors report

To the Members of Next Mediaworks Limited

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the standalone financial statements of Next Mediaworks Limited("the Company") which comprise the standalone balance sheet as at 31 March2020 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 2020 and loss 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 with theCode of Ethics issued by the Institute of Chartered Accountants of India together with theethical requirements that are relevant to our audit of the standalone financial statementsunder the provisions of the Act and the Rules thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the Code of Ethics. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our opinion on the Standalone financial statements.

Key Audit Matter

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 Matter

Impairment of investment in subsidiary

See note 2 to the standalone financial statements

The key audit matter How the matter was addressed in our audit
The Company has identified investment in its subsidiary company ('NRL') having gross carrying value of Rs 4192.07 lakhs as a separate cash generating unit (‘CGU'). The Company has performed an impairment assessment on its investment in subsidiary as at 31 March 2020. Our audit procedures included:
- Tested design implementation and operating effectiveness of key controls over the impairment assessment process
- As value in use (VIU) was higher than fair value less cost of disposal (FVLCD) we assessed the VIU as determined by the Company as under:
The impairment testing of the above investment is considered as a key audit matter as it involves significant judgements and estimates in assessing the recoverable value. The recoverable value is considered to be the higher of the Company's assessment of the value in use (VIU) and fair value less cost of disposal (FVLCD). The economic slowdown owing to the Covid-19 pandemic and other economic factors may impact the future cash flows of NRL and the key assumptions taken while computing VIU. - Assessed the method of determining VIU and key assumptions used therein through historical information budgets / projections externally derived data and other relevant information. Challenged the key assumptions and judgements within the build up and methodologies used by the Company.
- Tested the mathematical accuracy of the impairment models
- Assessed the sensitivity of the outcome of impairment assessment to changes in key assumptions.
- Compared the implied multiple arising from the VIU to the market multiples.
- Involved our internal specialists to assist us in performing above mentioned procedures.

Other Information

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 auditor's 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 companyhas adequate internal financial controls with reference to financial statements in placeand the 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 auditor's 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.

Other Matter

We draw your attention to the fact that corresponding figures for the year ended 31March 2019 are based on previously issued standalone financial statements of the Companythat were audited by the predecessor auditor who expressed an unmodified opinion on thosestandalone financial statements dated 27 May 2019.

Our opinion is not modified in respect of this matter.

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 2020 taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2020 from being appointed as a director in terms of Section164(2) of the Act.

f) With respect to the adequacy of the internal financial controls with reference tofinancial statements of the Company and the operating effectiveness of such controlsrefer to our separate Report in "Annexure B".

(B) 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 standalone financial statements- Refer Note 28 to the standalone financialstatements

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 standalone financial statements since they do not pertainto the financial year ended 31 March 2020.

(C) With respect to the matter to be included in the Auditor's 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 bythe Company is not in excess of the limit laid down under Section 197 of the Act. TheMinistry of Corporate Affairs has not prescribed other details under Section 197(16) whichare required to be commented upon by us.

For B S R and Associates
Chartered Accountants
Firm's Registration No.: 128901W
Rajesh Arora
Partner
Place: Gurugram Membership No. : 076124
Date: 23 June 2020 UDIN: 20076124AAAABI3665

ANNEXURE A referred to in our Independent Auditor's Report to the members of NextMediaworks Limited on the standalone financial statements for the year ended 31 March 2020

(i) The Company did not have any fixed asset (i.e. property plant and equipment)during the year ended 31 March 2020. Therefore provisions of paragraph 3(i) of the Orderis not applicable.

(ii) The Company does not hold inventories. Accordingly paragraph 3(ii) of the Orderis not applicable to the Company.

(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 guarantees given or investmentsmade by the Company which are not in compliance with Section 185 and 186 of the CompaniesAct 2013. Further there are no loans given or securities provided by the Company asspecified under Section 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 by the Company. Accordinglyparagraph 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 duty of customs goods and services tax professional tax cess andother statutory dues have been regularly deposited during the year by the Company with theappropriate authorities. As explained to us the Company did not have any dues on accountof duty of excise sales tax service tax and value added taxes.

According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees' state insurance income tax duty ofcustoms goods and services tax professional tax cess and other statutory dues were inarrears as at 31 March 2020 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 service tax goods and services tax sales tax value added tax and duty ofcustoms which have not been deposited by the Company with the appropriate authorities onaccount of any dispute as at 31 March 2020 other than those mentioned as follows

Statement of Disputed Tax Dues

Particulars Nature of the dues Amount Amount paid under protest Period to which amount relates Forum where dispute is pending
(Rs in Lakhs) (Rs in Lakhs)
Income Tax Act 1961 Disallowance of certain expenses / adjustments 193.11 98.41 A.Y. 2009-10 Bombay High Court

(viii) According to the information and explanations given to us and on the basis ofour examination of the records of the Company the Company has not taken any loan orborrowing from financial institutions banks and government and has not issued anydebentures. Accordingly paragraph 3 (viii) of the Order is not applicable to the Company.

(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 duringthe course of our audit.

(xi) According to information and explanations given to us the remuneration paidduring the current year by the Company to its director is in accordance with theprovisions of Section 197 read with Schedule V to the Companies Act 2013.

(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.

(xv) According to information and explanations given to us the Company has not enteredinto any non-cash transactions with directors or persons connected with them. Accordinglyparagraph 3(xv) of the Order is not applicable.

(xvi) According to the information and explanations 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.

For B S R and Associates
Chartered Accountants
Firm's Registration No.: 128901W
Rajesh Arora
Partner
Place: Gurugram Membership No. : 076124
Date: 23 June 2020 UDIN: 20076124AAAABI3665

ANNEXURE B

to the Independent Auditor's report on the standalone financial statements of NextMediaworks Limited for the year ended 31 March 2020.

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)

Opinion

We have audited the internal financial controls with reference to standalone financialstatements of Next Mediaworks Limited ("the Company") as of 31 March 2020 inconjunction with our audit of the standalone financial statements of the Company for theyear 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 2020 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").

Auditor's Responsibility

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 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

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

Chartered Accountants

Firm's Registration No.: 128901W

Rajesh Arora

Partner

Place: Gurugram

Membership No. : 076124

Date: 23 June 2020

UDIN: 20076124AAAABI3665

.