JBIMS

FINANCIAL ACCOUNTING ASSIGNMENT

ANIL GAWADE

MMS I ROLL NO 74

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INTRODUCTION

Prime Focus Group is one of the largest film, advertising and television post-production and visual effects companies in the world. It is the result of a number of acquisitions and mergers by Prime Focus Ltd. Prime Focus provides a complete spectrum of innovative creative and technical services to the Film, Broadcast, Advertising and Media industries. Our end-to-end offering ranges from pre-production to final delivery, including visual effects, creative 3D conversion, animation, video and audio post-production, digital content management and distribution, Digital Intermediate, versioning and adaptation, and equipment rental. Prime Focus Limited has a highly skilled workforce of 4,200 personnel in India. Worldwide, the group works across 3 continents at 19 facilities. Prime Focus offers three specialised business divisions catering to its key markets: Prime Focus World Prime Focus Group Prime Focus Technologies

Prime Focus has a presence across three continents: India, UK and North America. Prime Focus Ltd is India's largest visual effects and post-production company, offering a full range of services to the feature film, ad film and broadcast markets. Prime Focus Ltd is listed on the Mumbai and National Stock Exchanges in India (Symbol PRIF IN). With its proprietary View-D technology, global scale and presence, short time-to-market, global delivery capabilities and artist-driven conversions, Prime Focus offers competitive advantages and execution capabilities that no other company in the industry can match. The company was born in India, and has grown by acquiring businesses in the major media centres around the world. Its creative and technical services are rounded-out and bound together by its unique and pioneering financial model. Mr. Naresh Malhotra is chairman and whole-time director while Mr. Ramakrishnan Sankaranarayanan is the managing director.

Entertainment Network India Limited (ENIL), a subsidiary of Times Infotainment Media Limited (TIML), the holding company promoted by Bennett, Coleman & Company Limited (BCCL)- the flagship company of the Times of India Group, was incorporated in 1999. It is listed on the Bombay Stock Exchange of India Limited and the National Stock Exchange of India Limited. Enil operates in the radio broadcasting segment and experimental marketing segment. The company was formed in June 1999 post the first phase of licensing. The Information Broadcasting Ministry offered 108 frequency across 40 cities and ENIL got the maximum of them. It started its operations with the launch of its services in Indore on 4 October 2001. The company simultaneously started operations in seven more cities. In the second phase the company got 25 more frequencies. That took the count of total number of stations to 32. Enil Operates in the radio broadcasting segment, out-of-home

media segment and experiential marketing segment. The tag line of the brand is "Its Hot !". Mirchi is a Hindi word for chilly. While all other Radio brands were in English, ENIL came up with a Hindi brand name. The brand name Mirchi was coined by Mr. Vineet Jain(Chairman, Times Group). The brand name has been wonderful as it has a very high recall and connects well with listeners. The tag line "its Hot !" convey that the brand is young, exciting and is enticing. ENIL cater to Radio Broadcasting Segment, Out of Home and Experiential Marketing Segment. The radio broadcasting segment This segment operates with the brand name of 'Radio Mirchi'. Before Radio Mirchi, the Times of India Group provided private FM service along with Government of India(GOI) under the brand name of Times FM.GOI did not renew the contract with private player post that. They operated in Delhi, Calcutta, Chennai and Goa from 1993-1998.[9] It has been consistently rated as the No. 1 FM radio channel. It has a large pan India presence with 32 stations across 14 states. This extensive coverage increases loyalty of listens and provides a national media platform for advertisers. The channel reaches to more than 41 Million listeners(as per IRS Q4, 2010, last week recall) across stations. Mr. Vineet Jain is the Chairman and non-executive Director while Mr. Prashant Panday is the Executive Director & CEO. The Network18 Group is a media and entertainment company with interests in television, internet, films, e-commerce, magazines, mobile content and allied businesses. Through its subsidiary TV18 Broadcast Ltd. [BSE: 532800, NSE: TV18BRDCST], the group operates news channels - CNBC-TV18, CNBC Awaaz, CNBC-TV18 Prime HD, CNN-IBN, IBN7 and IBN-Lokmat (a Marathi regional news channel in partnership with the Lokmat group). TV18 also operates a joint venture with Viacom, called Viacom18, which houses a portfolio of popular entertainment channels Colors, Colors HD, MTV, SONIC, Comedy Central, VH1 and Nick - and Viacom18 Motion Pictures, the groups filmed entertainment business. TV18 and Viacom18 have also recently launched a strategic joint venture called IndiaCast, a multiplatform content asset monetization entity mandated to drive domestic and international channel distribution, placement services and content syndication for the bouquet of channels from TV18,Viacom18 and other broadcasters. TV18 has also forayed into the Indian factual entertainment space through A+E Networks | TV18 (Joint venture between A+E Networks and TV18 Broadcast), which has recently launched a new channel HistoryTV18. TV18 is a listed company which runs business news channels CNBC-TV18 in English and CNBC Awaaz in Hindi and owns most of Web 18. In 2006 it acquired CRISIL Market Wire which was renamed Newswire. TV18 is a subsidiary of Network18 Media & Investments Limited which is an Indian mass media company with interests in television, print, internet, film, mobile content and allied businesses. Network 18 FinCap is the holding company for several media entities in India such as Television Eighteen India Ltd (TV18), IBN 18 Broadcast Ltd, Web 18, Studio 18, Shop 18, Infomedia 18, and Viacom 18. TV18, a joint venture of Network18 and NBCUniversal. Mr. Hari S Bhatia and Mr.Raghav Bahl are the director while Mr.Manoj Mohanka is the CEO.

ACCOUNTING POLICIES

Accounting Policy

Company #1
Indiabulls Power Ltd.

Company #2
NTPC Ltd.

Company #3
CESC Ltd.

1) Revenue Recognition

Revenue from Power Consultancy / Advisory Services is recognized on an accrual basis. Interest income from deposits and others is recognized on an accrual basis. Dividend income is recognized when the right to receive the dividend is unconditionally established. Profit/loss on sale of investments is recognized on the date of the transaction of sale and is computed with reference to the original cost of the Investment sold.

Sale of energy is accounted for based on tariff rates approved by the Central Electricity Regulatory Commission (CERC) as modified by the orders of Appellate Tribunal for Electricity to the extent applicable. In case of power stations where the tariff rates are yet to be approved, provisional rates are adopted. Advance against depreciation considered as deferred revenue in earlier years is included in sales, to the extent depreciation recovered in tariff during the year is lower than the corresponding depreciation charged. Exchange differences on account of translation of foreign currency borrowings recoverable from or payable to the beneficiaries in subsequent periods as per CERC Tariff Regulations are accounted as Deferred foreign currency fluctuations asset/ liability. The increase or decrease in depreciation or interest and finance charges for the year due to the accounting of such exchange differences as

Revenue from sale of electricity are net of discount for prompt payment of bills and do not include electricity duty payable to the State Government. They also include, as per established practice, consistently followed by the Company in the past, estimated sums recoverable from / adjustable on consumers'' account, calculated on the basis of rates approved / specified by the appropriate authorities which are reflected in the subsequent bills. In terms of the applicable regulations and tariff determination process followed by the Commission, advance against depreciation forms part of tariff. Such advance against depreciation of a year is adjusted against earnings from sale of electricity for inclusion of the same in subsequent years, based on due consideration by the authorities in the tariff determination process.

per accounting policy no. Income from hire of H is adjusted in meters is accounted for depreciation or sales, as as per the approved the case may be. rates. Delayed payment surcharge, as a general practice, is determined and recognized on receipt of overdue payment from consumers.

2) Inventory Valuation

Inventories are valued at Inventories are valued at the lower of, cost the lower of, cost determined on weighted determined on weighted Average basis and net Average basis and net realizable value. realizable value. The diminution in the value of obsolete, unserviceable and surplus Stores and spares is ascertained on review and provided for.

Inventories of stores and spare parts and fuel are valued at lower of Cost and net realizable value. Cost is calculated on weighted average basis and comprises of expenditure incurred in the normal course of Business in bringing such inventories to their location and condition. Obsolete, slow moving and defective inventories are identified at the Time of physical verification of inventories and where necessary, adjustment is made for such items. In terms of applicable Regulations under the Electricity Act, 2003, depreciation on tangible assets other than freehold land is provided on straight line method on a prorate basis at the rates specified therein, the basis of which is considered by the West Bengal Electricity Regulatory Commission (Commission) in determining the tariff for the year of the Company. Additional charge of depreciation for the year on increase in value

3) Depreciation

Depreciation on fixed assets is provided on the Straight-Line Method at the rates and in the manner prescribed under Schedule XIV of the Companies Act, 1956.

Depreciation on the assets of the generation of electricity business is charged on straight line method following the rates and methodology notified by the CERC Tariff Regulations, 2009 Depreciation on in accordance with additions / deletions to Section 616 (c) of the fixed assets is provided Companies Act, 1956. on a pro-rata basis from / Depreciation on the upto the date the asset is assets of the coal mining, put to use/discarded. oil & gas Individual assets exploration and costing less than Rs. consultancy business, is 5,000 are fully charged on straight line depreciated in method following the the year of purchase. rates specified in The acquisition value of Schedule XIV of the Leasehold Land is Companies

amortized over the period of the Lease. The right-to-use leased asset (land) is amortized on a Straight-Line basis over the lease term. Intangible assets consisting of Software are amortized on a Straight Line basis over a period of four years from the date when the assets are available for use.

Act, 1956. Depreciation on the following assets is provided based on their estimated useful life: Depreciation on additions to/deductions from fixed assets during the year is charged on pro-rata basis from/up to the month in which the asset is available for use/disposal. Assets costing up to Rs. 5000/are fully depreciated in the year of acquisition.

arising from revaluation is recouped from Revaluation Reserve. Leasehold land is amortized over the unexpired period of the lease. Cost of intangible assets, comprising software related expenditure, are amortized in three years and those relating to brands/trademarks in twenty years, based on useful life assessed by an independent value.

COMMON FACTORS IN ACCOUNTING POLICIES

Accounting Policy

Common Factors

Revenue Recognition

Revenue from Power Consultancy / Advisory Services is recognized on an accrual basis. Interest income is recognized on time proportionate basis, taking into account the amount outstanding and the rate applicable.

Inventory Evaluation Depreciation

Inventories are valued at the lower of, cost determined on weighted Average basis and net realizable value. Depreciation on tangible fixed assets is provided on the Straight-Line Method The cost of leasehold improvements are amortised over the primary period of lease of the property. Assets costing up to Rs. 5000/- are fully depreciated in the year of acquisition.

DIFFERENCES (PECULIARITIES) IN ACCOUNTING POLICIES

Accounting Policy

Company #1
Indiabulls Power Ltd.

Company #2
NTPC Ltd.

Company #3
CESC Ltd.

differences 1) Revenue Dividend income is Exchange recognized when the arising from Recognition right to receive the settlement/translation of dividend is monetary items unconditionally denominated in foreign established. currency (other than long term) Profit/loss on to the extent recoverable sale of investments is from or payable to the recognized on the date beneficiaries in of the transaction of subsequent periods as sale and is computed per CERC Tariff with reference to the Regulations are original cost of the accounted as investment sold. Deferred foreign currency fluctuation asset/liability during construction period and adjusted from the year in which the same becomes recoverable/ payable. Advance against depreciation considered as deferred revenue in earlier years is included in sales, to the extent depreciation recovered in tariff during the year is lower than the corresponding depreciation charged. The surcharge on late payment/overdue sundry debtors for sale of energy is recognized when no significant uncertainty as to measurability or collectability exists.

Earnings from sale of electricity are net of discount for prompt payment of bills and do not include electricity duty payable to the State Government. They also include, as per established practice, consistently followed by the Company in the past, estimated sums recoverable from / adjustable on consumers'' account, calculated on the basis of rates approved / specified by the appropriate authorities which are reflected in the subsequent bills.

2) Inventory Inventories of stores and spare parts and fuel are Valuation valued at lower of cost and net realizable value

The diminution in the value of obsolete, unserviceable and surplus stores and spares is ascertained on review and provided for.

Obsolete, slow moving and defective inventories are identified at the time of physical verification of inventories and where necessary , adjustment is made for such items. In terms of applicable Regulations under the Electricity Act, 2003, depreciation on tangible assets other than freehold land is provided on straight line method on a proata basis at the rates specified therein, the basis of which is considered by the West Bengal Electricity Regulatory Commission (Commission) in determining the tariff for the year of the Company.

3) Depreciation

Intangible assets consisting of Software are amortized on a Straight Line basis over a period of four years from the date when the assets are available for use

Where the cost of depreciable assets has undergone a change during the year due to increase/decrease in long term liabilities on account of exchange fluctuation, price adjustment, change in duties or similar factors, the unamortized balance of such asset is charged off prospectively at the rates and methodology notified by CERC Tariff Regulations, 2009/ revised useful life determined based on rates specified in Schedule XIV of the Companies Act, 1956.