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Radaan Mediaworks (I) Ltd.

BSE: 590070 Sector: Media
NSE: RADAAN ISIN Code: INE874F01027
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VOLUME 2023
52-Week high 3.43
52-Week low 0.85
P/E
Mkt Cap.(Rs cr) 7
Buy Price 1.39
Buy Qty 2000.00
Sell Price 1.38
Sell Qty 108.00
OPEN 1.40
CLOSE 1.35
VOLUME 2023
52-Week high 3.43
52-Week low 0.85
P/E
Mkt Cap.(Rs cr) 7
Buy Price 1.39
Buy Qty 2000.00
Sell Price 1.38
Sell Qty 108.00

Radaan Mediaworks (I) Ltd. (RADAAN) - Auditors Report

Company auditors report

ON STANDALONE FINANCIAL STATEMENTS

To the Members of RADAAN MEDIAWORKS INDIA LIMITED

Opinion

We have audited the standalone financial statements of RADAAN MEDIAWORKS INDIA LIMITED("the Company") which comprise the Balance Sheet as at 31st March2019 the Statement of Profit and Loss Statement of Cash Flows and the Statement ofChanges in the Equity for the year then ended and notes to the financial statementsincluding a summary of 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 (‘‘the Act'') in the manner so required and give atrue and fair view in conformity with the accounting principles generally accepted inIndia of the state of affairs of the Company as at March 312019 the Loss othercomprehensive income and changes in equity and its cash flows for the year ended on thatdate.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Companies Act 2013. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities forthe Audit oftheFinancial Statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountantsof India together with the ethical requirements that are relevant to our audit of thefinancial statements under the provisions of the Companies Act 2013 and the Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

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.

a) Assessment of Provisions for taxation litigations and claims: The following audit procedures were performed in this area among others to obtain sufficient appropriate audit evidence:
As at 31st March 2019 the Company has contingent liability to the tune of Rs.573345963. These were estimated using a significant degree of management judgment in interpreting the various relevant rules regulations and practices and in considering precedents in various forums. Note 47 of the notes to accounts to the financials. • Based on the procedures performed it is concluded that the management's assessment of the outcome of pending litigations and claims is appropriate.
• Letters have been obtained from the company regarding the likely outcome and magnitude of and exposure to the relevant litigation based on the previous orders passed by appropriate authorities in similar matters.
• Previous judgments made by relevant tax Authorities and advice given by Company's advisors on these matters were reviewed.
b) Work In Progress Valuation: Audit areas include the following but not restricted to:
The closing balance of Work In Progress stands at Rs.24718284/- This was identified as a Key Audit Matter as it is a significant portion of the Financial Statements. • Evaluating the Design of Internal Controls relating to recording of costs incurred and estimation of further costs that are required for completion of the episodes.
• Understanding the context of the Work in Progress in terms of Number of episodes that have been shot and yet to be aired. These numbers were justified by the Internal Production team.
• Selected episodes to be aired on a sample basis and tested the same for evaluating the costs involved therein.
• Obtaining a closing statement of episodes in hand as at 31st March 2019. Reviewed the same for any old unaired episodes that require impairment.
• Understanding and validating the inclusion of costs like administration and specialized project costs in the valuation.
• Representations from the Management.
c) Investments in Subsidiary: The following audit procedures were performed in this area:
The Company has an investment in an Overseas Subsidiary named ‘Radaan Media Ventures Pte. Ltd' in Singapore amounting to Rs.935000 or SGD 20000. The subsidiary has not been in operation since financial year 2014-15. The carrying value of this investment was questioned by Audit. Further loans were given to the subsidiary carrying an interest rate of 10% which is overdue. • Calling for the Financials Statements of 31st March 2019. The same were audited by the Auditor of the respective Country.
• Audit questioned the existence and valuation of the investment in view of no operations in the subsidiary for the past five years.
• Annual Performance reports and filings in relation to the foreign subsidiary were verified.
• Furthermore the appropriateness of the disclosures made in note 35 to the financial statements was assessed.
d) Other Investments: Audit questioned the carrying value of these investments.
The Company has investments in Celebrity Cricket League Private Limited to the tune of Rs.7225231/- (750000 equity shares of Rs.10/- each). • Based on the business plan provided it is concluded that the management's estimation of carrying value of investment is appropriate.
• Furthermore the appropriateness of the disclosures made in note 36 to the financial statements was assessed.
e) Delays in Statutory Dues Payment:
Audit observed that there were delays in statutory payment dues. • Audit Procedure checked the subsequent evidences of payments.
f) Delay in Unsecured Loan Repayments:
Audit observed delays in Unsecured Loan Repayments. • Audit Procedure checked the revised repayment terms with party negotiated.

g) Revenue Recognition (IND AS 115)

Recognition of revenue is complex due to certain specific nature of customer contracts.

The application of the new standard on recognition of revenue involves significantjudgment and estimates made by the management which includes;

• Identification of performance obligations contained in contracts.

• Determination of the most appropriate method for recognition of revenue relatingto the identified performance obligations.

• Assessment of transaction price and

• Allocation of the assessed price to the individual performance obligations.

• Audit procedure involved review of the Company's INDAS115 implementationprocessandkeyjudgmentsmade by management evaluation of customer contracts in light of INDAS 115 on sample basis and comparison of the same with management's evaluation andassessment of design and operating effectiveness of internal controls relating to revenuerecognition.

• Based on the procedures performed it is concluded that management's judgmentswith respect to recognition and measurement of revenue in light of IND AS 115 isappropriate.

• Furthermore the appropriateness of the disclosures made in Note 3 (f) to thefinancial statements was assessed.

Information Other than the Standalone Financial Statements and Auditors' Report Thereon

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 standalone financial statements and our 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 the work we have performed we conclude that there is a materialmisstatement of this other information we are required to report that fact. We havenothing to report in this regard.

Management's Responsibility for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters stated in section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese standalone financial statements that give a true and fair view of the financialposition financial performance and cash flows of the Company in accordance with theaccounting principles generally accepted in India including the Accounting Standardsspecified under section 133 of the Act read with the rule 3 of the Companies (IndianAccounting Standards) Rules 2015 and Companies (Indian Accounting Standards AmendmentRules 2016). This responsibility also includes maintenance of adequate accounting recordsin accordance 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 implementation and maintenance of accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the financial statement that give a true and fair view andare free from material misstatement whether due to fraud or error.

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.

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 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.

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 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 Companies Act 2013 we are also responsible for expressing our opinion on whetherthe company has adequate internal financial controls system in place and the operatingeffectiveness 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.

We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant auditfindings including anysignificant deficiencies in internal control thatwe identify during ouraudit.

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 financial statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditor's report unless law or regulation precludes public disclosure about the matter orwhen 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

As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of subsection (11) of section 143 ofthe Companies Act 2013 we give in the "Annexure A" statement on the mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.

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 and the Cash Flow Statementand statement of changes in the equity dealt with by this Report are in agreement with thebooks of account;

(d) In our opinion the aforesaid standalone financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Indian Accounting Standards) Rules 2014.

(e) On the basis of the written representations received from the directors as on 31stMarch 2019 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2019 from being appointed as a director in termsof 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 matter to be included in the Auditors' Report under section197(16) of the Act as amended:

In our opinion and to the best of our information and according to the explanationsgiven to us the remuneration paid by the Company to its directors during the year is inaccordance with the provisions of section 197 of the Act.

(h) 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 47 to the financial statements.

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.

For SRSV & Associates
Chartered Accountants
F.R No.015041S
-sd-
V.RAJESWARAN
Place: Chennai Partner
Date: 29th May 2019 Membership No.020881

Annexure A to the auditor's report

Referred to in Paragraph 1 of Report on Other Legal and Regulatory Requirements of ourReport of even date

i. a) The company has maintained proper records showing full particulars includingquantitative details and situation offixed assets.

b) As explained to us all the fixed assets have been physically verified by themanagement in a phased periodical manner which in our opinion is reasonable havingregard to the size of the Company and nature of its assets. According to the informationand explanations given to us no material discrepancies were noticed on such physicalverification.

c) According to the information and explanation given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties of theCompany are held in the name of the Company.

ii. Physical verification of inventory has been conducted at reasonable intervals bythe management and no material discrepancies were noticed on such verification.

iii. In our opinion and according to the information and explanations given to us thecompany has not granted any loans secured or unsecured to companies firms or otherparties covered in the register maintained under section 189 of the Companies Act. (Basedon the above para matters referred in clause iii(a) iii(b) and iii(c) of paragraph 3 ofCompanies (Auditors Report) Order 2016 are not applicable).

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 loans investments guarantees and security.

v. In our opinion and according to the information and explanations given to us thecompany has not accepted any deposits during the year. Accordingly reporting under thisclause does not arise.

vi. The Central Government has not prescribed the maintenance of cost records undersection 148 (1) of the Companies Act 2013. Accordingly clause vi of paragraph 3 ofCompanies (Auditor's Report) Order 2016 is not applicable.

vii. a) According to the records of the Company and information and explanations givento us there were no delays in depositing undisputed statutory dues of provident fundemployees' state insurance income-tax sales-tax wealth tax service tax duty ofcustoms duty of excise value added tax cess Goods and Service Tax and other statutorydues with the appropriate authorities except GST and TDS which were paid subsequently.However there are no undisputed statutory dues outstanding for more than six months.

b) As at 31st March 2019 according to the records of the Company thefollowing are the particulars of the disputed dues on account of GST income tax customsduty wealth tax service tax which have not been deposited on account of dispute:

S.No Period Nature of Dues Not Paid (Amt in Rs.) Forum where pending
1 Oct 2010-Sep 2012 Service Tax 36084169 CESTAT Chennai
2 Oct 2012-Sep 2013 Service Tax 15882476 CESTAT Chennai
3 Oct 2013-Sep 2014 Service Tax 15945636 CESTAT Chennai
4 Oct 2014-Dec 2015 Service Tax 21415584 CESTAT Chennai
5 Apr 2001-Mar 2006 Sales Tax 484018098 Rs.22860665 before Appellate Deputy Commissioner (CT) the same has been remanded by the ADC and sent back to assistant commissioner. The hearing has been completed and order is awaited.
Rs.461157433 - interim stay granted earlier by Hon'ble High Court of Madras is made absolute vide order dated 19.11.2014.

viii. Based on our audit procedures and according to the information and explanationsgiven to us by the management we are of the opinion that the company has not defaulted inrepayment of loans or borrowings to a financial institution bank Government or debentureholders.

ix. The company has not raised money by way of initial public offer or further publicoffer during the Current year and the term loans were applied for the purposes for whichthose were raised.

x. In our opinion and according to the information and explanations given to us nofraud on or by the Company has been noticed or reported during thefinancial period.

xi. In our opinion and according to the information and explanations given to us theCompany has paid / provided managerial remuneration in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct 2013.

xii. In our opinion the Company is not a Nidhi Company. Accordingly clause xii ofPara 3 of Companies (Auditor's Report) Order 2016 is not applicable.

xiii. In our opinion and according to the information and explanations given to us alltransactions with the related parties are in compliance with sections 177 and 188 ofCompanies Act 2013 where applicable and the details have been disclosed in the FinancialStatements as required by the applicable accounting standards.

xiv. According to the information and explanations given to us the Company has notmade any preferential allotment or private placement of Equity share capital during theyear clause xiv of Para 3 of Companies (Auditor's Report) Order 2016 is not applicable.

xv. In our opinion and according to the information and explanations given to us theCompany has not entered into any non - cash transactions with directors or personsconnected with the Directors. Accordingly clause xv of Para 3 of Companies (Auditors'Report) Order 2016 is not applicable.

xvi. In our opinion and according to the information and explanations given to us theCompany is not required to be registered under Section 45-lA of the Reserve Bank of IndiaAct 1934. Accordingly clause xvi of Para 3 of Companies (Auditor's Report) Order 2016is not applicable.

For SRSV & Associates
Chartered Accountants
F.R No.015041S
-sd-
V.RAJESWARAN
Place: Chennai Partner
Date: 29th May 2019 Membership No.020881

Annexure B to the Independent Auditor's Report

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of RADAANMEDIAWORKS INDIA LIMITED ("the Company") as of March 312019 in conjunction withouraudit ofthe standalone financial statements ofthe Company forthe year ended on thatdate.

Management's Responsibility for Internal Financial Controls

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. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation ofreliablefinancial information as required under theCompanies Act 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance 168 Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing 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 financial statements whether due to fraud or error.

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 systemover financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability offinancial reporting and thepreparation offinancial statements forexternal purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets ofthe company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation offinancial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorizations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because ofthe inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at March 312019 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.

For SRSV & Associates
Chartered Accountants
F.R No.015041S
-sd-
V.RAJESWARAN
Place: Chennai Partner
Date: 29th May 2019 Membership No.020881