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Zee Entertainment Enterprises Ltd.

BSE: 505537 Sector: Media
NSE: ZEEL ISIN Code: INE256A01028
BSE 00:00 | 21 Sep 452.10 0.20
(0.04%)
OPEN

456.70

HIGH

458.25

LOW

434.85

NSE 00:00 | 21 Sep 450.85 0.05
(0.01%)
OPEN

455.00

HIGH

458.00

LOW

434.05

OPEN 456.70
PREVIOUS CLOSE 451.90
VOLUME 105410
52-Week high 619.35
52-Week low 434.85
P/E 25.19
Mkt Cap.(Rs cr) 43,424
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 456.70
CLOSE 451.90
VOLUME 105410
52-Week high 619.35
52-Week low 434.85
P/E 25.19
Mkt Cap.(Rs cr) 43,424
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Zee Entertainment Enterprises Ltd. (ZEEL) - Auditors Report

Company auditors report

TO

THE MEMBERS OF

ZEE ENTERTAINMENT ENTERPRISES LIMITED

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of ZeeEntertainment Enterprises Limited (the Company) which comprise the Balance Sheet as at 31March 2018 and the Statement of Profit and Loss (including Other Comprehensive Income)the Cash Flow Statement and the Statement of Changes in Equity for the year then endedand a summary of the significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Ind AS 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 of thesestandalone Ind AS financial statements that give a true and fair view of the financialposition financial performance including other comprehensive income cash flows andchanges in equity of the Company in accordance with the Indian Accounting Standards (IndAS) prescribed under Section 133 of the Act read with the Companies (Indian AccountingStandards) Rules 2015 as amended and other accounting principles generally accepted inIndia.

This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the standalone IndAS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these standalone Ind AS financialstatements based on our audit.

In conducting our audit we have taken into account the provisions of the Act theaccounting and auditing standards and matters which are required to be included in theaudit report under the provisions of the Act and the Rules made thereunder and the Orderissued under Section 143(11) of the Act.

We conducted our audit of the standalone Ind AS financial statements in accordance withthe Standards on Auditing specified under Section 143(10) of the Act. Those Standardsrequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the standalone Ind AS financial statements are freefrom material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the standalone Ind AS financial statements. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the standalone Ind AS financial statements whether due to fraud or error.In making those risk assessments the auditor considers internal financial controlrelevant to the Company's preparation of the standalone Ind AS financial statements thatgive a true and fair view in order to design audit procedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of the accountingpolicies used and the reasonableness of the accounting estimates made by the Company'sDirectors as well as evaluating the overall presentation of the standalone Ind ASfinancial statements.

We believe that the audit evidence obtained by us is sufficient and appropriate toprovide a basis for our audit opinion on the standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the Ind AS and other accounting principles generally accepted in India of the stateof affairs of the Company as at 31 March 2018 and its profit total comprehensive incomeits cash flows and the changes in equity for the year ended on that date.

Other Matters

a) The comparative financial information of the Company for the year ended 31 March2017 prepared in accordance with Ind AS included in these standalone Ind AS financialstatements have been audited by the predecessor auditor. The report of the predecessorauditor on these comparative financial information dated 10 May 2017 expressed anunmodified opinion.

b) These previously issued standalone Ind AS financial statements for the year ended 31March 2017 have been restated to give effect to the following:

• The composite scheme of arrangement among Reliance Big Magic from Reliance BigBroadcasting Private Limited Big Magic Limited and Azalia Broadcast Private Limited(together referred as transferor entities) and the Company as explained in note 43a tothe financial statements.

• The composite scheme of arrangement and amalgamation between the subsidiaries ofthe Company viz. Zee Digital Convergence Limited Zee Unimedia Limited SarthakEntertainment Private Limited and the Company and their respective shareholders asexplained in note 43b to the financial statements.

The financial statements of the said subsidiaries and transferor entities for the yearended 31 March 2017 prepared in accordance with Ind AS have been audited by the respectiveentity's statutory auditors.

The adjustments made to the previously issued financial statements/information of theCompany for the year ended 31 March 2017 giving effect to the above mentioned compositescheme of arrangement have been audited by us. Our report is not qualified for thesematters.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143(3) of the Act based on our audit we report to theextent applicable 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 Cash Flow Statement and Statement of Changes in Equity dealt with by thisReport are in agreement with the books of account.

d) In our opinion the aforesaid standalone Ind AS financial statements comply with theIndian Accounting Standards prescribed under Section 133 of the Act.

e) On the basis of the written representations received from the directors of theCompany as on 31 March 2018 taken on record by the Board of Directors none of thedirectors is disqualified as on 31 March 2018 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 A". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company's internal financial controls overfinancial reporting.

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 as amended inour opinion and to the best of our information and according to the explanations given tous:

i. The Company has disclosed the impact of pending litigations on its financialposition in its standalone Ind AS financial statements;

ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any 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.

2. As required by the Companies (Auditor's Report) Order 2016 (the Order) issued bythe Central Government in terms of Section 143(11) of the Act we give in "AnnexureB" a statement on the matters specified in paragraphs 3 and 4 of the Order.

For Deloitte Haskins & Sells LLP
Chartered Accountants
(Firm's Registration No. 117366W/W-100018)
A. B. Jani
Partner
Mumbai 10 May 2018 Membership No. 46488

ANNEXURE ‘A' TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 1(f) under ‘Report on Other Legal and RegulatoryRequirements' section of our report of even date)

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 (the Act)

We have audited the internal financial controls over financial reporting of ZeeEntertainment Enterprises Limited (the Company) as of 31 March 2018 in conjunction withour audit of the standalone Ind AS financial statements of the Company for the year endedon that date.

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 (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 respective company's policies the safeguarding of itsassets the prevention and detection of frauds and errors the accuracy and completenessof the accounting records and the timely preparation of reliable financial informationas required under the Act.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting of the Company based on our audit. We conducted ouraudit in accordance with the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting (the Guidance Note) issued by the ICAI and the Standards on Auditingprescribed under Section 143(10) of the Act to the extent applicable to an audit ofinternal financial controls. 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 over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects.

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 of financial reporting and thepreparation of financial statements for external 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 of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised 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 of the 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 to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at 31 March 2018 based on the criteria forinternal financial control over financial reporting 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 ICAI.

For Deloitte Haskins & Sells LLP
Chartered Accountants
(Firm's Registration No. 117366W/W-100018)
A.B. Jani
Partner
Mumbai 10 May 2018 Membership No. 46488

ANNEXURE ‘B' TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 2 under ‘Report on Other Legal and RegulatoryRequirements' section of our report of even date)

Report on Companies (Auditor's Report) Order 2016 (the Order) issued by the CentralGovernment in terms of Section 143(11) of the Companies Act 2013 (the Act) of ZeeEntertainment Enterprises Limited (the Company)

(i) In respect of its fixed assets:

a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.

b) Some of the fixed assets were physically verified except Integrated ReceiverDecoders (IRD) boxes lying with third parties during the year by the Management inaccordance with a programme of verification which in our opinion provides for physicalverification of all the fixed assets at reasonable intervals. According to the informationand explanations given to us no material discrepancies were noticed on such verification.

c) According to the information and explanations given to us and the records examinedby us and based on the examination of the registered sale deed/transfer deed/conveyancedeed provided to us we report that the title deeds comprising all the immovableproperties of land and buildings which are freehold are held in the name of the Companyas at the balance sheet date. The Company also does not have any immovable propertiestaken on lease and that are disclosed as fixed asset in the standalone Ind AS financialstatements.

(ii) As explained to us the nature of the inventories of the Company are such thatclause (ii) of paragraph 3 of the Order is not applicable to the Company.

(iii) The Company has not granted any loans secured or unsecured to companies firmsor other parties covered in the Register maintained under Section 189 of the Act.

(iv) In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Sections 185 and 186 of the Act in respect ofgrant of loans making investments and providing guarantees and securities as applicable.

(v) In our opinion and according to the information and explanations given to us theCompany has not accepted deposits from the public during the year. Therefore theprovisions of clause 3(v) of the Order are not applicable to the Company.

(vi) The maintenance of cost records has been specified by the Central Government underSection 148(1) of the Act. We have broadly reviewed the cost records maintained by theCompany pursuant to the Companies (Cost Records and Audit) Rules 2014 as amendedprescribed by the Central Government under sub-Section (1) of Section 148 of the Act andare of the opinion that prima facie the prescribed cost records have been made andmaintained. We have however not made a detailed examination of the cost records with aview to determine whether they are accurate or complete.

(vii) According to the information and explanations given to us in respect of statutorydues:

a) The Company has generally been regular in depositing undisputed statutory duesincluding Provident Fund Investor Education and Protection Fund Employee StateInsurance Income-tax Wealth- tax Sales tax Service tax/Goods and Service Tax Customsduty Excise duty Cess and any other material statutory dues applicable to it with theappropriate authorities.

b) There were no undisputed amounts payable in respect of Provident Fund InvestorEducation and Protection Fund Employee State Insurance Income-tax Wealth Tax SalesTax Service Tax/Goods and Service Tax Customs Duty Excise Duty Cess and other materialstatutory dues in arrears as at 31 March 2018 for a period of more than six months fromthe date they became payable.

c) Details of dues of Income-tax Sales Tax Service Tax/Goods and Service Tax CustomsDuty Excise Duty and Value Added Tax which have not been deposited as on 31 March 2018on account of disputes are given below:

Name of Statute Nature of Dues Forum where Dispute is Pending Period to which the Amount Relates Amount Unpaid (' in millions)
The Central Excise Act 1944 Service Tax Customs Central Excise and Service Tax Appellate Tribunal F.Y. 2006-07 314
F.Y. 2007-08 148
Additional Commissioner of Service Tax Mumbai FY 2011-12 5
FY 2012-13
FY 2012-13 39
FY 2013-14
FY 2014-15
The Income Tax Act 1961 Tax Deducted at Source (including interest) Commissioner of Income Tax (Appeals) FY 2012-13 10
FY 2013-14 14
Income Tax High Court FY 1995-96 (426630)
FY 2004-05 18
Income Tax Appellate Tribunal FY. 2009-10 4
FY. 2010-11 50
FY. 2011-12 83
FY. 2008-09 3*
FY. 2009-10 30*
Income Tax-Penalty Commissioner of Income Tax (Appeals) FY. 2007-08 173

" represents absolute amount

*pertains to erstwhile ETC Networks Limited merged with the Company.

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in the repayment of loans or borrowings to financialinstitutions or banks. The Company does not have any loans from the Government and has notissued any debentures.

(ix) The Company has not raised moneys by way of initial public offer or further publicoffer (including debt instruments) or term loans and hence reporting under clause 3 (ix)of the Order is not applicable.

(x) To the best of our knowledge and according to the information and explanationsgiven to us no fraud by the Company and no material fraud on the Company by its officersor employees has been noticed or reported during the year.

(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) The Company is not a Nidhi Company and hence reporting under clause 3(xii) of theOrder is not applicable.

(xiii) In our opinion and according to the information and explanations given to usthe Company is in compliance with Section 177 and 188 of the Act where applicable forall transactions with the related parties and the details of related party transactionshave been disclosed in the standalone Ind AS financial statements as required by theapplicable accounting standards.

(xiv) During the year the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures and hence reporting underclause 3(xiv) of the Order is not applicable to the Company.

(xv) In our opinion and according to the information and explanations given to usduring the year the Company has not entered into any non-cash transactions with itsDirectors or persons connected to its directors and hence provisions of Section 192 of theAct are not applicable.

(xvi) The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934.

For Deloitte Haskins & Sells LLP
Chartered Accountants
(Firm's Registration No. 117366W/W-100018)
A.B. Jani
Partner
Mumbai 10 May 2018 (Membership No. 46488)