Untitled - Domain-b

Auditors’ Report
To the Board of Directors of Zee Telefilms Limited
1. We have audited the attached Consolidated Balance
Sheet of Zee Telefilms Limited (“the Company”) and
its subsidiaries and associate Companies (“the
Group”) as at 31st March, 2004, the Consolidated
Profit and Loss Account for the year then ended on
that date annexed thereto and the Consolidated Cash
low statement for the year then ended on that date.
These financial statements are the responsibility of
the Company’s management. Our responsibility is
to express an opinion on these financial statements
based on our audit.
2. We conducted our audit in accordance with
generally accepted auditing standards in India. Those
standards require that we plan and perform the audit
to obtain reasonable assurance about whether the
financial statements are prepared, in all the material
respects, in accordance with an identified financial
reporting framework and are free of material
misstatements. An audit includes examining on a
test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also
includes assessing the accounting principles used and
significant estimates made by the management, as
well as evaluating the overall financial statement
presentation. We believe that our audit provide a
reasonable basis for our opinion.
3. (a) The financial statements of subsidiaries
with total assets (net) of Rs./Thousand
7,860,181 (8,876,363) as at 31st March,
2004 and total revenues (net) of Rs./
Thousand 8,907,475 (8,508,637) for the
year ended on that date have not been
audited by us. These financial statements
have been audited by other auditors
whose report has been furnished to us
and our opinion, in so far it relates to
the amounts included in respect of those
subsidiaries, is based solely on the report
of the other auditors.
(b) The financial statements of subsidiaries
with total assets of Rs./Thousand 755,688
as at 31st March, 2004 and total revenues
of Rs./Thousand 445,663 for the year
ended on that date have been
consolidated on the basis of reviewed /
unaudited financial statements, which
have been relied upon by us.
ZEE TELEILMS LIMITED
(c) The financial statement of an associate for
the year ended 31st March, 2004 has been
audited by another auditor whose report
has been furnished to us. The profit of such
associate considered for consolidation is
Rs./Thousand 4,352 (1,851). Our opinion,
in so far it relates to the amounts included
in respect of that associate, is based solely
on the report of the other auditors
including non compliance of AS – 15 as
referred in Note 2(e).
4. We draw reference to
(a) Note 16(b) of Schedule 18 regarding permanent
diminution in the value of investments of
subsidiaries of Rs./Thousand 19,205,303 written
off and adjusted against Securities Premium as
per High Court order. The goodwill arising on
consolidation has accordingly been adjusted.
(b) Note 18(a) of Schedule 20 regarding amount
of Rs./Thousand 807,001 due from Buddha
ilms Limited, considered recoverable, as the
promoter of the Company continue to provide
comfort for this balance after repayment of
Rs./Thousand 1,130,000.
5. (a) Investments in preference shares of
distribution companies (Network
Management Companies) amounting to
Rs./Thousand 156,441 are carried at cost
[Note 17 (c)] and advances to these
companies amounting to Rs./Thousand
133,215 [Note 18(b)] considered
recoverable by the management on
account of strategic business relation
inspite of negative networth of these
companies, we are unable to comment
on carrying value of these preference
shares and recoverability of advances.
(b) The Hybrid ibre Cable (HC) Project
have been put on hold /deferred due to
uncertain market conditions in Cable TV
business hence realisability and
capitalization of capital work in progress
Rs./Thousand 463,681 of the said project
depends upon revival of the project as
referred in Note 5(b).
(c) Provision for Taxation in the case of
amalgamating company is made
considering the brought forward losses