(e) Provisions and Contingent Liabilities
The Company exercises significant judgement in identification of and estimation of the amounts of provisions and contingent liabilities. These provisions and contingent liabilities are reviewed at the end of each reporting period and are adjusted to reflect the current best estimates.
(f) Employee Benefits
Short Term Employee Benefits
The undiscounted amount of short term employee benefits expected to be paid in exchange for the services rendered by employees are recognised as an expense during the period when the employees render the services.
Long Term Employee Benefits
Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related service are recognised as a liability as at the Balance Sheet date on the basis of actuarial valuation as per Projected Unit Credit Method.
Post-Employment Benefits
Defined Contribution Plans
A defined contribution plan is a post-employment benefit plan under which the Company pays specified contributions towards Provident Fund, Employee State Insurance and Pension Scheme. The Company's contribution is recognised as an expense in the Statement of Profit and Loss during the period in which the employee renders the related service.
Defined Benefit Plans
The Company pays gratuity to the employees who have completed five years of service with the Company at the time of resignation/ superannuation. The gratuity is paid @ 15 days basic salary for every completed year of service as per the Payment of Gratuity Act, 1972.
The liability in respect of gratuity and other post-employment benefits is calculated using the Projected Unit Credit Method and spread over the period during which the benefit is expected to be derived from employees' services. Re-measurements of defined benefit plans in respect of post-employment benefits are charged to the Other Comprehensive Income.
(g) Current Tax and Deferred Tax
The tax expense for the period comprises of current and deferred tax. The Company exercises judgment in computation of current tax considering the relevant rulings and reassesses the carrying amount of deferred tax assets at the end of each reporting period.
(h) Foreign currencies transactions and translation
Transactions in foreign currencies are recorded at the exchange rate prevailing on the date of transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency's closing rates of exchange at the reporting date.
Exchange differences arising on settlement or translation of monetary items are recognised in Statement of Profit and Loss.
Non-monetary items that are measured in terms of historical cost in a foreign currency are recorded using the exchange rates at the date of the transaction. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was measured. The gain or loss arising on translation of nonmonetary items measured at fair value is treated in line with the recognition of the gain or loss on the change in fair value of the item.
(i) Revenue recognition
Revenue from contracts with customers is recognised when control of the goods or services are transferred to the customer at an amount that reflects the consideration entitled in exchange for those goods or services.
Revenue from contracts with customers includes sale of goods and services. Revenue from rendering of services includes advertisement revenue, subscription revenue, revenue from sale of contents, facility and equipment rental, program revenue, revenue from sponsorship of events and revenue from media related professional and consultancy services. Revenue from rendering of services is recognised over time where the Company satisfies the performance obligation over time or point in time where the Company satisfies the performance obligation at a point in time.
Generally, control is transferred upon shipment of goods to the customer or when the goods is made available to the customer, provided transfer of title to the customer occurs and the Company has not retained any significant risks of ownership or future obligations with respect to the goods shipped.
Revenue is measured at the amount of consideration which the Company expects to be entitled to in exchange for transferring distinct goods or services to a customer as specified in the contract, net of returns and allowances, trade discounts and volume rebates and excluding amounts collected on behalf of third parties (for example taxes and duties collected on behalf of the government). Consideration is generally due upon satisfaction of performance obligations and the receivable is recognised when it becomes unconditional.
Contract balances
Trade receivables represents the Company's right to an amount of consideration that is unconditional. Revenues in excess of invoicing are considered as contract assets and disclosed as accrued revenue.
I nvoicing in excess of revenues are considered as contract liabilities and disclosed as unearned revenues. When a customer pays consideration before the Company transfers goods or services to the customer, a contract liability is recognised and disclosed as advances from customers.
Contract liabilities are recognised as revenue when the Company performs under the contract.
Interest income
Interest Income from Financial Assets is recognised using effective interest rate method.
Dividend income
Dividend Income is recognised when the Company's right to receive the amount has been established.
(j) Financial instruments
A. Initial recognition and measurement
(i) Financial Assets and Financial Liabilities
All financial assets and liabilities are initially recognised and measured at fair value and in case of borrowings, net of directly attributable cost. Purchase and Sale of Financial Assets and Financial Liabilities are recognised using trade date accounting.
B. Subsequent measurement:
(i) Financial Assets
a) Measured at amortised cost
A financial asset is subsequently measured at amortised cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
The effective interest rate amortisation is included in other income in the Statement of Profit and Loss.
b) Financial assets measured at fair value through other comprehensive income (FVTOCI)
A financial asset is measured at fair value through other comprehensive income if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial assets give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
c) Financial assets measured at fair value through profit or loss (FVTPL)
A financial asset which is not classified in any of the above categories are measured at fair value through profit or loss.
C. Investment in subsidiaries, associates and joint ventures
The Company accounts for its investments in subsidiaries, associates and joint venture at cost less impairment loss (if any).
D. Other Equity investments:
All Other equity investments are measured at fair value, with value changes recognised in the Statement of Profit and Loss, except for those equity investments for which the Company has elected to present the value changes in 'Other Comprehensive Income' However, dividend on such equity investments are recognised in the Statement of Profit and loss when the Company's right to receive the amount is established.
E. Impairment of financial assets
The Company uses 'Expected Credit Loss' (ECL) model, for evaluating impairment of financial assets other than those measured at fair value through profit and loss (FVTPL).
Expected credit losses are measured through a loss allowance at an amount equal to:
a) The 12-months expected credit losses (expected credit losses that result from those default events on the financial instrument that are possible within 12 months after the reporting date); or
b) Full lifetime expected credit losses (expected credit losses that result from all possible default events over the life of the financial instrument)
For trade receivables, the Company applies 'simplified approach' which requires expected lifetime losses to be recognised from initial recognition of the receivables. Further, the Company uses historical default rates to determine impairment loss on the portfolio of the trade receivables. At every reporting date, these historical default rates are reviewed and changes in the forward looking estimates are analysed.
For other assets, the Company uses 12 months ECL to provide for impairment loss where there is no significant increase in credit risk. If there is significant increase in credit risk full lifetime.
(ii) Financial Liabilities
Financial liabilities are subsequently carried at amotised cost using the effective interest method other than those measured at Fair Value through Profit or Loss (FVTPL). For trade and other payables maturing within one year from the Balance Sheet date, the carrying amounts are determined to approximate fair value due to the short maturity of these instruments.
(iii) Derivative financial instruments
The Company uses derivative financial instruments such as forwards, currency swaps and options to mitigate the risk of changes in exchange rates. Any gains or losses arising from changes in the fair value of derivatives are taken to the Statement of Profit and Loss.
(k) Cash and cash equivalents
Cash and cash equivalents comprise of cash on hand, cash at banks, short-term deposits and short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.
J CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY
The preparation of the Company's standalone financial statements requires management to make judgements, estimates and assumptions that affect the reported amount of revenue, expenses, assets and liabilities and the accompanying disclosures. Uncertainty about these judgements, estimates and assumptions could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.
(a) Depreciation/ Amortisation and useful lives of Property, Plant and Equipment and Other Intangible Assets
Estimates are involved in determining the cost attributable to bringing the assets to the location and condition necessary for it to be capable of operating in the manner intended by the management.Property, Plant and Equipment/ Other Intangible
assets are depreciated/ amortised over their estimated useful lives, after taking into account their estimated residual value. Management reviews the estimated useful lives and residual values of the assets annually in order to determine the amount of depreciation/ amortisation to be recorded during any reporting period. The useful lives and residual values are based on the Company's historical experience with similar assets and take into account anticipated technological changes. The depreciation/ amortisation for future periods is adjusted if there are significant changes from previous estimates.
(b) Determining the lease term
The Company determines the lease term as the non-cancellable term of the lease, together with any periods covered by an option to extend the lease if it is reasonably certain to be exercised, or any periods covered by an option to terminate the lease, if it is reasonably certain not to be exercised. It considers all relevant factors that create an economic incentive for it to exercise either the renewal or termination.
(c) Recoverability of trade receivables
Judgements are required in assessing the recoverability of overdue trade receivables and determining whether a provision against those receivables is required. Factors considered include the credit rating of the counterparty, the amount and timing of anticipated future payments and any possible actions that can be taken to mitigate the risk of non-payment.
(d) Provisions
The timing of recognition and quantification of the liability require the application of judgement to existing facts and circumstances, which can be subject to change. The carrying amounts of provisions and liabilities are reviewed regularly and adjusted to take account of changing facts and circumstances.
(e) Impairment of non-financial assets
The Company assesses at each reporting date whether there is an indication that an asset may be impaired. Goodwill is allocated to cash -generating units ('CGU') for the purposes of impairment testing. A CGU to which goodwill has been allocated is tested for impairment annually, or more frequently when there is an indication that the unit may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset's recoverable amount. An asset's recoverable amount is the higher of an asset's or CGU's fair value less costs of disposal and its value in use; considering recent transaction or independent valuer's report. It is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or a groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.
I n determining fair value less costs of disposal, recent market transaction are taken into account, if no such transactions can be identified, an appropriate valuation model is used. The recoverable amount of CGU has been determined based on revenue multiples.
(f) Impairment of financial assets
The impairment provisions for financial assets depending on their classification are based on assumptions about risk of default, expected cash loss rates, discounting rates applied to these forecasted future cash flows, revenue multiples and EBITDA multiples. The Company uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based on Company's past history, existing market conditions as well as forward looking estimates at the end of each reporting period.
(g) Defined benefit plans
The employment benefit obligations depends on a number of factors that are determined on an actuarial basis using a number of assumptions. The assumptions used in determining the net cost/ income include the discount rate, salary escalation and mortality assumptions. Any changes in these assumptions will impact upon the carrying amount of employment benefit obligations.
(h) Deferred tax
Deferred income tax assets are reassessed at each reporting period and are recognised to the extent that it is probable that taxable profits will be available against which the deductible temporary differences and the carry forward of unused tax credits and unused tax losses can be utilised. The Company uses judgement to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable profits and business developments.
(i) Fair value measurement
For estimates relating to fair value of financial instruments refer Note 41.
41.2 FINANCIAL RISK MANAGEMENT
The Company's activities exposes it mainly to credit risk, liquidity risk and market risk. The treasury team identifies and evaluates financial risk in close coordination with the Company's business teams.
(a) CREDIT RISK
Credit risk is the risk that customers or counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities which is primarily trade receivables.
Customers credit risk is managed by each business team subject to the Company's established policy, procedures and control relating to customers credit risk management. Outstanding customers receivables are regularly monitored.
An impairment analysis is performed at each reporting date for major customers. Receivables are grouped into homogenous groups and assessed for impairment collectively. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets. The Company evaluates the concentration of risk with respect to receivables as low.
(b) LIQUIDITY RISK
Liquidity risk arises from the Company's inability to meet its cash flow commitments on the due date. The Company maintains sufficient stock of cash, marketable securities and committed credit facilities. The Company accesses local financial markets to meet its liquidity requirements. It uses a range of products to ensure efficient funding from across well-diversified markets and investor pools. Treasury monitors rolling forecasts of the Company's cash flow position and ensures that the Company is able to meet its financial obligation at all times including contingencies.
The Company's liquidity is managed by forecasting the cash and liquidity requirements. Treasury arranges to either fund the net deficit or invest the net surplus in the market.
42.2 The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair value that are either observable or unobservable and consist of the following three levels:
Level 1: Inputs are Quoted prices (unadjusted) in active markets or Net Assets Value (NAV) for identical assets or liabilities. Level 2: Inputs are other than the quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
Level 3: Inputs are not based on observable market data (unobservable inputs). Fair values are determined in whole or in part using a valuation model based on assumption that are neither supported by prices from observable current market transactions in the same instrument nor are they based on available market data.
42.3 Valuation Methodology
All financial instruments are initially recognised and subsequently re-measured at fair value as described below: a) The fair value of investment in quoted Equity Shares and Mutual Funds is measured at quoted price or Net Assets Value (NAV).
45 IMPAIRMENT TESTING OF GOODWILL
Goodwill acquired through business combinations with indefinite useful lives has been allocated to cash generating units ('ecu') related to "Media Operations" which is also an operating and reportable segment for impairment testing. The carrying amount of Goodwill as at 31st March, 2024 is ? 1,16,834 lakh (Previous year ? 29,100 lakh), the increase therein being pursuant to the Composite Scheme of Arrangement of the Company's subsidiaries, namely, TV18 Broadcast Limited and e-Eighteen.Com Limited ("transferor Companies") into the Company with appointed date being 1st April, 2023 (Refer note 46).
The Company performed its annual impairment test for year ended 31st March, 2024. The recoverable amount of CGU has been determined based on revenue multiples. The Level of the fair value hierarchy is Level 3. The management believes that any reasonably possible change in the key assumptions on which recoverable amount is based would not cause the aggregate carrying amount to exceed the aggregate recoverable amount of the CGU.
46 The National Company Law Tribunal, Mumbai Bench, has approved the Composite Scheme of Arrangement ("the Scheme") for the amalgamation of the Company's subsidiaries, namely, TV18 Broadcast Limited ("TV18") and e-Eighteen.Com Limited ("E18") (together referred to as "amalgamating Companies") into the Company with appointed date being 1st April, 2023. The Scheme has become effective on 3rd October, 2024. The stipulations contained in the Scheme have been given effect to as under:
The amalgamation has been accounted in accordance with Appendix C of Ind AS 103 'Business Combinations' and the above said Scheme. The assets aggregating ? 442,456 lakh, liabilities aggregating ? 116,777 lakh, reserves aggregating ? 83,023 lakh, rights and obligations of the amalgamating Companies have been transferred to and vested with the Company with effect from 1st April 2023 and have been recorded at their respective book value, under the 'pooling of interests' method.
49,50,51,499 equity shares of face value ? 5 each fully paid up are to be issued to the equity shareholders of the amalgamating Companies whose names are registered in the register of members on the record date, without payment being received in cash. Pending allotment, the face value of such shares has been shown as "Equity Share Suspense".
8,77,198,625 Equity shares of TV18 Broadcast Limited and 49,65,596 Equity shares of e-Eighteen.Com Limited, have been cancelled pursuant to the Scheme (Refer note 5).
Excess of net assets taken over by the Company over the paid up value of Equity Shares to be issued as stated above and after writing off investment in, loan including interest accrued thereon given to Greycells18 Media Limited (Refer note 5 and 37), as approved by the board of directors of the Company, aggregating ?43,774 lakh has been debited to Capital Reserves on Amalgamation. Entire negative balance of retained earnings of the Company as on 31st March 2024 has been adjusted against the balance in the securities premium account as on the said date.
From the effective date the authorised share capital will stand increased to ? 4,17,352 lakh consisting of 700,00,00,000 Equity Shares of ? 5 each and 67,35,20,000 Preference Shares of ? 10 each.
47 OTHER STATUTORY INFORMATION
(a) There are no balances outstanding as on 31st March, 2024 and 31st March, 2023 on account of any transaction with companies struck off under section 248 of the Companies Act, 2013 or section 560 of Companies Act, 1956.
(b) The Company does not have any Capital Work-In-Progress, whose completion is overdue or has exceeded its cost compared to its original plan.
(c) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:
(i) Directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or
(ii) Provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.
(d) The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:
(i) Directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or
(ii) Provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(e) The Company does not have any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961.
48 Previous year's figures have been not been restated for giving effect to the Scheme as the appointed date is 1st April 2023 and accordingly Previous year's figures are not comparable to the current year's figures. However, Opening balances of amalgamating companies have been considered, while calculating current year's Cash flows and Ratios.
49 The financial statements were approved for issue by the Board of Directors on 12th October, 2024.
As per our Report of even date
For Deloitte Haskins & Sells LLP For and on behalf of the Board of Directors
Chartered Accountants Network18 Media & Investments Limited
Pallavi A. Gorakshakar Adil Zainulbhai Dhruv Subodh Kaji Renuka Ramnath
Partner Chairman Director Director
DIN 06646490 DIN 00192559 DIN 00147182
P.M.S. Prasad Jyoti Deshpande Rahul Joshi
Director Director Managing Director
DIN 00012144 DIN 02303283 DIN 07389787
Ramesh Kumar Damani
Date: 12th October, 2024 Group Chief Financial Officer
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