2 Summary of Significant Accounting Policies
(a) Basis of Preparation & Presentation
The financial statements are prepared on the accrual basis of accounting and in accordance with the
Indian Accounting Standards (hereinafter referred to as the Ind AS) as prescribed under Section 133 of
the Companies Act, 2013 (the Act) (as amended) and other relevant provisions of the Act.
The Financial statements have been prepared as a going concern under the historical cost convention.
The Financial statements are presented in Indian Rupees (“INR”) and all values are rounded to the
nearest Thousand, except otherwise stated as per the requirement of Schedule III.
(b) Classification of Current and Non-Current
The Company presents assets and liabilities in the Balance Sheet based on Current/ Non-Current
classification.
An asset is treated as current when it is:
i) Expected to be realized or intended to be sold or consumed in normal operating cycle,
ii) Held primarily for the purpose of trading,
iii) Expected to be realized within twelve months after the reporting period, or
iv) Cash or Cash equivalent unless restricted from being exchanged or used to settle a liability for at least
twelve months after the reporting period.
All other assets are classified as non-current.
A liability is current when:
i) It is expected to be settled in normal operating cycle,
ii) It is held primarily for the purpose of trading,
iii) It is due to be settled within twelve months after the reporting period, or
iv) There is no unconditional right to determine the settlement of the liability for at least twelve months
after the reporting period.
The Company classifies all other liabilities as non - current.
(c) Cash and cash equivalents
Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and short-term
deposits with an original maturity of three months or less, which are subject to an insignificant risk of
changes in value.
For the purpose of the statement of cash flows, cash and cash equivalents consist of cash and short-term
deposits.
(d) Taxes on Income
Current Tax
Income tax expense represents the sum of current tax and deferred tax and includes any adjustments
related to past periods in current and /or deferred tax adjustments that may become necessary due to
certain developments or reviews during the relevant year. Current income tax is based on the taxable
income and calculated using the applicable tax rates.
Deferred Tax
Deferred tax is provided using the Balance sheet method on temporary differences between the tax bases
of assets and liabilities and their carrying amounts for the financial reporting purposes at the reporting
date. The carrying amount of deferred tax assets is reviewed at the end of reporting date and reduced to
the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of
the deferred tax asset to be utilised.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year
when the asset is realized or the liability is settled, based on tax rates and tax laws that have been
enacted or substantively enacted at the reporting date. Deferred tax relating to items recognised outside
profit or loss is recognised outside profit or loss in correlation to the underlying transaction either in OCI
or directly in equity.
Deferred tax liabilities are offset if a legally enforceable right exists to set off current tax assets against
current tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation
authority.
Deferred tax assets and liabilities are offset if a legally enforceable right exists to set off current tax
assets against current tax liabilities and the deferred taxes relate to the same taxable entity and the same
taxation authority.
(e) Revenue Recognition.
In Case of Sale of rights, the company recongnizes the income When all the following criteria are met:
1) A license agreement is signed by both the parties.
2) The Licensee is able to freely exploit the rights granted.
3) Effective date of grant of rights to the licensee has commenced as per the agreement or complete
payment with respect to the rights has been recieved,whichever is earlier.
4) The Enterprise has no remaining performance obligations.
5) The arrangement is fixed and determinable.
6) Collection of fee is reasonably assured.”
Other Stream of income
In all other cases, revenue is recognized when the company has the undisputable right to receive the
income.
(f) Purchase of Movie rights
The Enterprise recognizes purchase of movie rights when all the below mentioned criteria are met:
• A license agreement is signed by both the parties.
• The Enterprise is able to freely exploit the rights granted.
• Effective date of grant of rights to the Enterprise has commenced as per the agreement or complete
payment for the same has been made, whichever is earlier.
• The Seller has no remaining performance obligations.
• The arrangement is fixed and determinable.
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