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INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF TATA INTERNET SERVICES LIMITED Report on the Financial Statements
We have audited the accompanying Financial Statements of TATA INTERNET SERVICES LIMITED (“the Company”), which comprise the Balance Sheet as at March 31, 2015, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information. Management’s Responsibility for the Financial Statements The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these standalone Financial Statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Financial Statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express an opinion on these Financial Statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the Audit Report under the provisions of the Act and the Rules made thereunder. We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the Financial Statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the Financial Statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the Financial Statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company’s preparation of the Financial Statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company’s Directors, as well as evaluating the overall presentation of the Financial Statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Financial Statements. Opinion In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Financial Statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2015, and its profit and its cash flows for the year ended on that date. Emphasis of Matters We draw attention to the following matters in the Notes to Financial Statements: 1. Note 19 in the Financial Statements where it has been explained that the Financial Statements have
been prepared on the Going Concern Assumption, notwithstanding that the Company is proposed to be merged with Tata Teleservices Limited (TTL), the holding company. The Company’s business is intended to be taken over by the holding company. Consequently no adjustments have been made in the Financial Statements relating to recoverability and classification of recorded amounts of assets or to amounts and classification of liabilities
Our opinion is not modified in respect of these matters. Report on Other Legal and Regulatory Requirements 1. As required by the Companies (Auditor’s Report) Order, 2015 (“the Order”) issued by the Central
Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order.
2. As required by Section 143 (3) of the Act, we report that:
a. We have sought and obtained all the information and explanations which to the best of 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 the Company so far
as it appears from our examination of those books.
c. The Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.
d. In our opinion, the aforesaid standalone Financial Statements comply with the Accounting
Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
e. On the basis of the written representations received from the directors as on March 31, 2015 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2015 from being appointed as a director in terms of Section 164 (2) of the Act.
f. With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us: i) The Company has disclosed the impact of pending litigations on its financial position in its
Financial Statements – Refer Note 24 to the Financial Statements ii) The Company did not have any long-term contracts including derivative contracts for which
there were any material foreseeable losses. iii) There were no amounts which were required to be transferred to the Investor Education and
Protection Fund by the Company.
For Sahni Natarajan and Bahl Chartered Accountants Firm Registration No. : 002816N Sudhir Chhabra Partner Membership No. 083762 Place: New Delhi Date: May 27,2015
ANNEXURE TO THE AUDITOR’S REPORT (This is the annexure referred to in Para 1 of ‘Report on Other Legal and Regulatory requirements’ of our Report of even date)
1. In respect of the Fixed Assets: a. The Company has maintained proper records showing the full particulars including
quantitative details and situation of fixed assets. b. Some of the fixed assets were physically verified during the year by the management in
accordance with a program of verification, which provides for physical verification of all the fixed assets at reasonable intervals. In our opinion and according to the information and explanations given to us, discrepancies noticed on such verification have been properly dealt with in the books of account.
2. In our opinion and according to the information and explanations given to us, the Company does
not have any inventory. Accordingly the provisions of clause 3(ii) of the Order are not applicable to the Company.
3. In our opinion and according to the information and explanations given to us, the Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 189 of the Companies Act, 2013.
4. In our opinion and according to the information and explanations given to us, there exists an
adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of fixed assets. The Companies’ activities did not involve purchase of inventory and sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system of the Company.
5. In our opinion and according to the information and explanations given to us, the Company has
not accepted any deposits as defined under the provisions of section 73 o 76 or any other relevant provisions of the Companies Act and the rules framed thereunder.
6. As explained to us, maintenance of the cost records has not been prescribed by the Central
Government under section 148(1) of the Companies Act, 2013. Accordingly, the provisions of clause 3(vi) of the Order are not applicable to the Company.
7. In respect of the statutory and other dues:
a. According to the information and explanations given to us, the Company has generally been regular in depositing undisputed statutory dues, including Income Tax, Sales Tax, Service Tax, Value Added Tax, Cess and any other material statutory dues as applicable with the appropriate authorities. As explained to us, the Company did not have any dues on account of Provident Fund, Employees’ State Insurance, Wealth Tax, Duty of Customs and Duty of Excise. According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were in arrears, as at March 31, 2015 for a period of more than six months from the date they became payable.
b. According to the information and explanations given to us, disputed demand for Income Tax, Sales Tax, Wealth Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax and Cess which have not been deposited with relevant authorities given as under:-
S.No. Name of Statute
Nature of Dues
Amount due (Rs. In Lacs)
Year to which
amount relates
Forum where dispute is pending
1 Finance Act,
1994 Service
Tax 536.29 2008-09
Commissioner of Service Tax
c. Investor Education and Protection Fund:
According to the information and explanations given to us, there were no amount required to be transferred to Investor Education and Protection Fund in accordance with the relevant provisions of the Companies Act, 1956 and rules made thereunder.
8. In our opinion, the Company’s accumulated losses at the end of the financial year are more than
50% of its net worth. The Company has not incurred any cash losses either during the current financial year or in the immediately preceding financial year.
9. In our opinion and according to the information and explanations given to us, the Company has
not borrowed from financial institutions/banks or by way of debentures. Therefore provisions of clause 3(ix) of the Order are not applicable to the Company.
10. In our opinion and according to the information and explanations given to us, the Company has
not given any guarantee for loans taken by others from Banks or Financial Institutions. Accordingly, the provisions of clause 3(x) of the Order are not applicable to the Company.
11. In our opinion and according to the information and explanations given to us, no term loans were
availed by the Company. Accordingly, the provisions of clause 3(xi) of the Order are not applicable to the Company.
12. According to the information and explanations given to us and to the best of our knowledge and
belief, no fraud on or by the Company, has been noticed or reported by the Company during the year.
For Sahni Natarajan and Bahl Chartered Accountants Firm Registration No. : 002816N Sudhir Chhabra Partner Membership No. 083762 Place: New Delhi Date: May 27,2015
TATA INTERNET SERVICES LIMITED
BALANCE SHEET AS AT March 31, 2015
(Rs. in Lacs) (Rs. in Lacs)
EQUITY AND LIABILITIES
Shareholders' Funds
(a) Share Capital 2 15,000.00 15,000.00
(b) Reserves And Surplus 3 (10,861.60) (11,493.51)
4,138.40 3,506.49
Current Liabilities
(a) Other Current Liabilities 4 1,048.00 993.37
1,048.00 993.37
Total 5,186.40 4,499.86
ASSETS
Non-Current Assets
(a) Fixed Assets
Tangible Assets 5 2,330.24 2,380.60
(b) Non Current Investments 6 1,000.00 -
(c) Long Term Loans and Advances 7 - 1.39
(d) Other Non-Current Assets 8 9.25 13.91
3,339.49 2,395.90
Current Assets
(a) Current Investments 9 1,211.12 1,529.45
(b) Cash and Bank Balances 10 68.02 16.73
(c) Short Term Loans and Advances 11 509.32 421.73
(d) Other Current Assets 12 58.45 136.05
1,846.91 2,103.96
Total 5,186.40 4,499.86
Summary of Significant Accounting Policies 1 (0.00) (0.00)
0 (3)
The accompanying 'Notes forming part of the Financial Statements' form an integral part of the Financial Statements
As per our report of even date
For Sahni Natarajan And Bahl
Chartered Accountants
Firm Registration No. 002816N
Sudhir Chhabra Madhav Joshi Suresh Mahadevan Manoj Jain Krishna Kant Chaturvedi
Partner Director Director Chief Financial Officer & Company SecretaryManager
M. No. 083762 DIN: 00030754 DIN: 06423250
Place: New Delhi Place : Mumbai
Date : May 27, 2015 Date : May 25,2015
Corporate Identification Number: U72900DL1999PLC100313
For and on behalf of the Board of Directors
Particulars As at March 31, 2014 As at March 31, 2015
Note No.
TATA INTERNET SERVICES LIMITED
STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED March 31, 2015
For The Year Ended
March 31, 2015
For The Year Ended
March 31, 2014
(Rs. In Lacs) (Rs. In Lacs)
REVENUE
Revenue from Operations - 875.00
Other Income 13 798.00 833.91
TOTAL REVENUE 798.00 1,708.91
EXPENSES
Employee Benefit Expenses 14 38.01 2.25
Other Expenses 15 199.36 238.05
CSR Expenses 32 30.63 -
TOTAL EXPENSES 268.00 240.30
Earnings before Interest, Tax and Depreciation 530.00 1,468.61
Finance Income 16 (152.35) (103.39)
Finance Cost 17 0.12 1.66
Depreciation 5 50.32 50.37
Profit before tax 631.91 1,519.97
Tax Expense
Current tax - -
Profit After Tax 631.91 1,519.97
Earnings Per Share -(On the Face Value of Rs. 10/-)
Basic and Diluted 33 0.42 1.01
Summary of Significant Accounting Policies 1
The accompanying 'Notes forming part of the Financial Statements' form an integral part of the Financial Statements
As per our report of even date
For Sahni Natarajan And Bahl
Chartered Accountants
Firm Registration No. 002816N
Sudhir Chhabra Madhav Joshi Suresh Mahadevan Manoj Jain Krishna Kant Chaturvedi
Partner Director Director Chief Financial Officer & Company Secretary
Manager
M. No. 083762 DIN: 00030754 DIN: 06423250
Place: New Delhi Place : Mumbai
Date : May 27, 2015 Date : May 25,2015
Corporate Identification Number: U72900DL1999PLC100313
Particulars Note No.
For and on behalf of the Board of Directors
TATA INTERNET SERVICES LIMITED
CASH FLOW STATEMENT FOR THE YEAR ENDED March 31, 2015
For The Year Ended
March 31, 2015
For The Year Ended
March 31, 2014
(Rs. In Lacs) (Rs. In Lacs)
A. CASH FLOW FROM OPERATING ACTIVITIES
Profit for the year, after tax 631.91 1,519.97
Adjustments for:
Liabilities and Provision written back (10.94) (69.12)
Depreciation 50.32 50.37
Provision for Doubtful debts 4.25 -
Finance Charges 0.12 1.66
Profit on Sale of Fixed Assets (25.89) (3.62)
Interest Income (0.75) (6.15)
Profit on Sale of Investment (151.60) (97.24)
Cash generated from operations 497.42 1,395.87
Income Tax Paid (19.89) (19.07)
Operating Profit before Working Capital changes 477.53 1,376.80
Adjustments for:
Increase/ (Decrease) in Other Current Liabilities and Provisions 65.57 (706.10)
(Increase)/ Decrease in Loans and Advances (71.15) (240.81)
(Increase)/ Decrease in Other Current Assets 78.10 445.95
Net Cash from Operating Activities* 550.05 875.84
B. CASH FLOW FROM INVESTING ACTIVITIES
Purchase of Fixed Assets - (0.09)
Sale of Fixed Assets 25.89 3.62
Investments in Associates (1,000.00) -
Purchase of Current Investments (2,494.69) (2,996.84)
Sale of Current Investments 2,964.65 2,108.33
Investments made in Fixed Deposits (0.21) (0.58)
Interest Income 0.24 7.75
ICD Redeemed with MMP Mobiwallet Payment Systems Limited - 15.00
Net Cash Flows From Investing Activities (504.12) (862.81)
C. CASH FLOW FROM FINANCING ACTIVITIES
Finance Charges (0.12) (0.45)
Net Cash Flows from Financing Activities (0.12) (0.45)
Net increase/ (decrease) in Cash and Cash equivalents (A+B+C) 45.81 12.58
Cash and cash equivalents (opening) 14.59 2.01
Cash and cash equivalents (closing) (Refer Note No. 10) 60.40 14.59
60.41 14.59
Notes:
Previous years figures have been regrouped and rearranged wherever considered necessary
*During the year the Company spent Rs 30.63 Lacs on CSR Expenditure in accordance with the provisions of the Companies Act 2013.
As per our report of even date
For Sahni Natarajan And Bahl
Chartered Accountants
Firm Registration No. 002816N
Sudhir Chhabra Madhav Joshi Suresh Mahadevan Manoj Jain Krishna Kant Chaturvedi
Partner Director Director Chief Financial Officer & Company Secretary
Manager
M. No. 083762 DIN: 00030754 DIN: 06423250
Place: New Delhi Place : Mumbai
Date : May 27, 2015 Date : May 25, 2015
Corporate Identification Number: U72900DL1999PLC100313
The above cash flow statement has been prepared in accordance with the "Indirect method" as set out in the AS 3 - Cash Flow Statement.
Particulars
For and on behalf of the Board of Directors
TATA INTERNET SERVICES LIMITED 100000 ###
Notes forming part of the Financial Statements for the Year ended March 31, 2015
(Rs. In Lacs) (Rs. In Lacs)
2. SHARE CAPITAL
Authorised:
15,000.00 15,000.00
15,000.00 15,000.00
Issued, Subscribed And Fully Paid Up:
15,000.00 15,000.00
15,000.00 15,000.00
Terms / Rights attached to Equity Shares
As at March 31, 2015 As at March 31, 2014
In Nos. % In Nos. %
149,999,800 99.99% 149,999,800 99.99%
Particulars As at March 31, 2015 As at March 31, 2014
In Nos. Rs. In Lacs In Nos. Rs. In Lacs
No. of Equity Shares at the beginning of the year 150,000,000 15,000 150,000,000 15,000
No. of Equity Shares at the end of the year 150,000,000 15,000 150,000,000 15,000
Name of the Shareholder Relationship As at March 31, 2015 As at March 31, 2014
Tata Teleservices Limited Holding Company 149,999,800 149,999,800
3. RESERVES AND SURPLUS
(a) Surplus :
Balance in Statement of Profit and Loss:-
Balance as per last balance sheet (11,493.51) (13,013.48)
Add: Profit for the year 631.91 1,519.97
Closing balance (10,861.60) (11,493.51)
TOTAL (10,861.60) (11,493.51)
4. OTHER CURRENT LIABILITIES
Other Payables :
- Statutory Liabilities 2.41 3.12
- Provision for Expenses 1,042.96 989.78
- Refundable Deposit - 0.01
- Outstanding Dues 2.63 0.46
TOTAL 1,048.00 993.37
Reconciliation of Number of Shares Outstanding
150,000,000 (Previous year 150,000,000) Equity Shares of Rs.10/- each
Details of Shares held by Holding Company
Particulars
Details of Shareholders holding more than 5% shares
Tata Teleservices Limited
150,000,000 (Previous year 150,000,000) Equity Shares of Rs.10/- each fully paid-up
Name of the Shareholders
The Company has one class of Equity Shares having a face value of Rs.10 per Share. Each Shareholder is eligible for one vote per Share held. In the event of
Liquidation , the Equity Shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amount, in proportion to their
Shareholding.
As at March 31, 2015 As at March 31, 2014
100000
TATA INTERNET SERVICES LIMITED
Notes forming part of the Financial Statements for the Year ended March 31, 2015
Note 5 :
FIXED ASSETS
(Rs. In Lacs)
As at April 1,
2014Additions Deletions
As at March 31,
2015
As at April 1,
2014
Additions during
the year
Disposals/
Adjustments
As at March 31,
2015
As at March 31,
2015
As at March 31,
2014
Tangible Assets
(Under Operating Lease)
-
Building 3,219.33 - - 3,219.33 838.80 50.29 - 889.09 2,330.24 2,380.53
Lease Hold Improvments 365.86 - - 365.86 365.86 - - 365.86 - -
-
Plant and Machinery 7,939.45 - 7,939.45 - 7,939.45 - 7,939.45 - - -
-
Furniture and Fixtures 246.33 - 246.33 - 246.33 - 246.33 - - -
Office Equipment 752.29 - 752.29 - 752.22 0.03 752.25 - - 0.07
Total 12,523.26 - 8,938.07 3,585.19 10,142.66 50.32 8,938.03 1,254.95 2,330.24 2,380.60
Previous Year 12,895.18 0.09 372.01 12,523.26 10,464.31 50.37 372.01 10,142.66 2,380.60 2,430.87
Asset Group
GROSS BLOCK DEPRECIATION NET BLOCK
100000
TATA INTERNET SERVICES LIMITED
Notes forming part of the Financial Statements for the Year ended March 31, 2015
( Rs. In Lacs ) ( Rs. In Lacs )
6. NON-CURRENT INVESTMENTS
Non Trade Investments- (At Cost)
Investments in Equity Shares (Unquoted)
In Associates: 1,000.00 -
MMP Mobi Wallet Payment System Limited
(C.Y: 10,000,000 (P.Y: NIL) Equity Shares of Rs.10 each, Fully Paid up)
TOTAL 1,000.00 -
Aggregate Amount of Unquoted Investments 1,000.00 -
7. LONG TERM LOANS AND ADVANCES
Others (Unsecured and Considered Doubtful)
Premises and Other Deposits 40.75 40.75
Less: Provision for Doubtful Deposits (40.75) (39.36)
TOTAL - 1.39
8. OTHER NON CURRENT ASSETS
Others
Advance Gratuity 8.66 8.05
Deposit with Banks 0.59 5.86
- Fixed Deposits (Original maturity of more than 12 months)
TOTAL 9.25 13.91
Balances with banks held as Margin Money Deposits 0.59 5.86
9. CURRENT INVESTMENTS
Non -Trade Investments (At Cost or Fair Value whichever is lower)
Investments in Mutual Funds (Quoted)
- JP Morgan India - Liquid Fund Direct Plan Growth 774.12 320.45
{C Y 4,412,145.78 units (P.Y.units 1,983,034.55) of Rs 18.1594 (P.Y. Rs 16.15916) each}
- Pramerica Mutual Fund - Liquid Fund - Direct Plan Growth 437.00 1,209.00
{C Y 29,984.43 units (P.Y. 91561.17 units) of Rs.1,493.8861 (P.Y. Rs 1,320.429) each}
TOTAL 1,211.12 1,529.45
Aggregate Amount of Quoted Investments 1,211.12 1,529.45
Aggregate Market Value of Quoted Investments 1,249.15 1,583.83
As at March 31, 2014Particulars
As at March 31, 2015
100000
TATA INTERNET SERVICES LIMITED
Notes forming part of the Financial Statements for the Year ended March 31, 2015
( Rs. In Lacs ) ( Rs. In Lacs )
As at March 31, 2014Particulars
As at March 31, 2015
10. CASH AND BANK BALANCES
Cash and Cash Equivalents
Balance with Banks
- Current Accounts 60.40 14.59
60.40 14.59
Other Bank Balances
Fixed Deposit Accounts
Fixed Deposits (Original maturity of more than 3 months but less than 12 months) 2.35 2.14
Fixed Deposit (Original maturity more than 12 months) 5.27
7.62 2.14
TOTAL 68.02 16.73
Balances with banks held as Margin Money Deposits 7.62 2.14
11. SHORT-TERM LOANS AND ADVANCES
Others (Unsecured and Considered Good)
TDS Receivables 197.47 177.55
197.47 177.55
Advances recoverable in cash or in kind or for value to be received 311.85 241.32
311.85 241.32
Others (Unsecured and Considered Doubtful)
Advances recoverable in cash or in kind or for value to be received 2.86 2.86
Less: Provision for Doubtful Receivable (2.86) -
- 2.86
TOTAL 509.32 421.73
12. OTHER CURRENT ASSETS
Interest Accrued 0.64 0.13
Lease Rent Receivable 57.57 135.92
Other Receivables 0.24 -
TOTAL 58.45 136.05
100000
TATA INTERNET SERVICES LIMITED
Notes forming part of the Financial Statements for the Year ended March 31, 2015
For The Year Ended
March 31, 2015
For The Year Ended
March 31, 2014
(Rs. In Lacs) (Rs. In Lacs)
Note 13
Other Income
Lease Rent 761.17 761.17
Profit on Sale of Fixed Assets 25.89 3.62
Liabilities No Longer Required Written Back 0.29 42.70
Provisions No Longer Required Written Back 10.65 26.42
798.00 833.91
Note 14
Employee Benefit Expenses
Salaries and Bonus (0.60) 2.08
Contribution to Provident and other Funds 0.00 0.12
Other Manpower Cost 38.61 -
Staff Welfare - 0.05
38.01 2.25
Note 15
Other Expenses
License Fee to DoT 34.80 144.98
Rent 0.48 0.48
Property Taxes 36.08 40.20
Rates and Taxes 0.08 0.03
Repairs and Maintenance - Building 80.19 19.20
Maintenance Charges - Building 21.01 18.48
Insurance Expenses 1.00 2.08
Legal & Professional Charges 18.72 11.57
Bad Debts Written off - 491.63
Provision for Bad and Doubtful Debts - (491.63)
Miscellaneous Expenses 7.00 1.02
199.36 238.04
Note 16
Finance Income
Interest Income
-On Term Deposits with Banks 0.75 4.59
-On Inter-Corporate Deposit - 1.56
Profit on Sale of Current Investments 151.60 97.24
152.35 103.39
Note 17
Finance Cost
Interest Cost - 1.21
Other Borrowing Costs 0.12 0.45
0.12 1.66
Particulars
TATA INTERNET SERVICES LIMITED Notes forming part of the Financial Statements for the year ended March 31, 2015
1. Significant Accounting Policies
a) Basis of preparation of Financial Statements
The Financial Statements of the Company have been prepared in accordance with Generally Accepted Accounting Principles in India (Indian GAAP), the accounting standards specified under Section 133 of the Companies Act, 2013 (the ‘Act’) read with Rule 7 of the Companies (Accounts) Rules, 2014, and the relevant provisions of the Act. The Financial Statements have been prepared on an accrual basis and under the historical cost convention.
The accounting policies adopted in the preparation of Financial Statements are consistent with those of previous year.
b) Revenues
Revenue is recognized to the extent that it is probable that the economic benefit will flow to the Company and the revenue can be reliably measured. The following specific revenue recognition criteria must also be met before revenue is recognized.
(i) Service Revenues Service revenues include revenue from internet access services and corporate network/data services and are net of trade discounts and service tax. Revenue from services is recognized based on usage by subscribers/customers. Revenue from corporate network/data services is recognized as and when services are rendered.
(ii) Sale of Equipment Revenues from sale of equipment primarily consist of sale of network equipments. Revenue from sale of goods is recognized when all the significant risks and rewards of ownership of the goods have been passed to the buyer, usually on the delivery of goods.
(iii) Revenue Share The Company had entered into an arrangement with Tata Communications Limited (TCL), wherein TCL was granted the rights to run and operate the assets and facilities of the Company to service TCL’s clients. In terms of this arrangement, TCL has given a fixed contribution amount of Rs. 52.50 Crores for 6 years, which had been recognized as revenue on time proportion basis. The said arrangement expired on March 31, 2014 and therefore there is no such revenue in financial year 2014-15. (iv) Interest Income The Company recognizes Interest income on a time proportion basis taking into account the amount outstanding and the rate applicable.
c) Leases
Operating Lease – As Lessor
Assets subject to operating leases are included in fixed assets. Lease income is recognized in the Statement of Profit and Loss on a straight-line basis over the lease term. Costs, including depreciation are recognized as an expense in the Statement of Profit and Loss. Initial direct costs such as legal costs, brokerage costs, etc. are recognized immediately in the Statement of Profit and Loss.
d) Expenditure
Expenses are recognized on an accrual basis. Provision for all known liabilities accruing for the period is made at the Balance Sheet date.
TATA INTERNET SERVICES LIMITED Notes forming part of the Financial Statements for the year ended March 31, 2015
e) Employee Benefits i. Short term employee benefits are recognized as an expense at the undiscounted amount in the
Statement of Profit and Loss of the year in which related service is rendered.
ii. The Company makes contributions towards provident fund to a defined contribution retirement benefit plan for qualifying employees. The provident fund plan is operated by the Regional Provident Fund Commissioner. Under the scheme, the Company is required to contribute a fixed percentage of payroll cost to the retirement benefit schemes to fund the benefits.
iii. Gratuity is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. Gratuity benefit obligations recognized in the Balance Sheet represent the present value of the obligation as reduced by the fair value of plan assets.
iv. The Company provides for leave encashment for its employees on full cost basis.
v. Termination benefits are recognized as an expense immediately.
vi. Gains or Losses arising out of Actuarial Valuation are recognized immediately in the Statement of Profit
and Loss as income or expense.
f) Borrowing Cost
Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to revenue.
g) Income Tax
Tax expense comprises of current and deferred tax. Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961. Deferred income taxes reflects the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier year.
Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the Balance Sheet date. Deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. In situations where the Company has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that they can be realized against future taxable profits. At each Balance Sheet date the Company re-assesses unrecognized deferred tax assets. It recognizes the unrecognized deferred tax assets to the extent that it has become reasonably certain or virtually certain, as the case may be that sufficient future taxable income will be available against which such deferred tax assets can be realized.
h) Earnings per Share
Basic earnings per share is calculated by dividing profit after tax for the year attributable to equity shareholders by the weighted average number of shares outstanding during the year.
Diluted earnings per share is calculated by dividing profit after tax for the year attributable to equity shareholders by the weighted average number of shares outstanding during the year after taking into effects of all dilutive potential equity shares.
TATA INTERNET SERVICES LIMITED Notes forming part of the Financial Statements for the year ended March 31, 2015
i) Fixed Assets Fixed Assets are stated at cost less accumulated depreciation and impairment losses, if any. The Company capitalizes all costs including non-refundable taxes, freight and incidental expenses attributable to bringing the asset to its working condition for its intended use.
Subsequent expenditure related to an item of fixed asset is added to its book value only if increases the future benefits from the existing asset beyond its previously assessed standard of performance. All other expenses on existing fixed assets, including day- to-day repair and maintenance expenditure and cost of replacing parts, are charged to the Statement of Profit and Loss for the year during which such expenses are incurred.
Advance paid towards acquisition of fixed assets are disclosed under “Long Term Loans and Advances” and cost of assets not ready for intended use before the year end, are disclosed under “Capital Work In Progress”.
j) Depreciation
Fixed assets are depreciated pro-rata from the date on which the asset is ready for its intended use, on a straight-line method, based on the following estimated economic useful lives of assets:
Type of Assets Useful Life (in years)
Building 60
Leasehold Improvements 9 years or over the term of the lease, whichever is lower
Plant Machinery Network Equipment 13 Air Conditioning Equipment 15 Generators 15 Electrical Equipment 10 Information System/Technology 3 Vehicle 8 Software 3 Furniture & Fixture 10
Fixed Assets individually costing less than Rs. 5,000 are fully depreciated in the year of acquisition.
k) Impairment of Assets
The carrying amounts of assets are reviewed at each Balance Sheet date if there is any indication of impairment based on internal / external factors. An impairment loss is recognized for the amount by which the assets’ carrying amount exceeds its recoverable amount. The recoverable amount is the higher of the assets’ fair value less cost to sell and value in use.
l) Investments
Investments that are readily realizable and intended to be held for not more than a year from the date of their acquisition are classified as current investments; all other investments are classified as long term investments. Current investments are carried at lower of cost and fair market value determined on an individual investment basis. Long term investments are carried at cost. Provision for diminution in value of long term investments is made to recognize only a decline, other than temporary, in the value of the investments.
TATA INTERNET SERVICES LIMITED Notes forming part of the Financial Statements for the year ended March 31, 2015
m) Inventories
Inventories comprise of network equipment. Inventories are valued at the lower of cost and net realizable value. Cost is determined on a weighted average basis and includes all applicable overheads in bringing the inventories to their present location and condition.
. n) Foreign Currency Translation
Foreign currency transactions are translated into rupees at the exchange rates prevailing on the date of the transaction. Monetary foreign currency assets and liabilities are translated into rupees at exchange rates prevailing on the date of the Balance Sheet. Non monetary items denominated in foreign currency are valued at the exchange rate prevailing at the date of transaction.
Exchange difference arising from the settlement of such transaction and from the translation of such monetary assets and liabilities are recognized in the Statement of Profit and Loss.
o) Provisions and Contingencies
A provision is recognized for a present obligation as a result of past event; it is probable that an outflow of resources will be required to settle the obligation and in respect of which a reliable estimate can be made. Provisions are not discounted to its present value and are determined based on best management estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.
A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. Contingent liabilities are not recognized but are disclosed in notes.
Contingent assets are neither recognized nor disclosed in the Financial Statements.
p) Segmental Reporting
i. The Company’s operations relate to providing Internet & Data service. There are no reportable business segments taking into account the nature of products, the differing risks & returns, the organizational structure and internal reporting system.
ii. The Company caters to the needs of the domestic market. There is no export turnover. As such there
are no reportable geographical segments.
TATA INTERNET SERVICES LIMITED Notes forming part of the Financial Statements for the year ended March 31, 2015
18. Background Tata Internet Services Limited was incorporated on June 21, 1999 as a private limited Company to provide Internet service on all India basis. The Company has been promoted by Tata Industries Ltd. On April 17, 2000, the Company acquired the status of a deemed public limited Company. The Company changed its name from ISP India Ltd. to Tata Internet Services Limited with effect from May 1, 2000.
The Company has been granted an “A” category license from Department of Telecommunications (DoT) to operate Internet Services in the whole of India. The license is granted initially for a period of 15 years unless terminated for default or for insolvency or for convenience or for transfer of the license under the provisions of the agreement. The Company started its operations during the financial year 2000-2001 and 2001-2002 in a phased manner. The DoT had decided to waive the license fee up to October 31, 2003 and with effect from November 1, 2003, DoT has levied a nominal license fee of Re. 1.00 per annum. However, with effect from January 1, 2006, the amendments introduced for the first time the concept of revenue share @ 6% of the Adjusted Gross Revenue of the Licensee. It is also understood that the directives are meant for ISP’s who offered Internet Telephony only and not to other pure play ISP’s. The Company has also approached to DoT whether on surrendering of internet telephony licenses, the newly introduced provision of revenue share will not be applicable. However, on the ground of prudence, the Company has provided revenue share in the books of accounts according to the letter dated March 3, 2006 from DoT. The Company had initially started providing Internet Services through Consumer Dial up Access, Public Internet Centers and Corporate Network/Data Access. The license was due to expire during the current year on October 10, 2014. The Company in its board meeting held on September 19, 2014 had decided not to renew the license and had therefore informed the DoT that it did not intend to seek renewal of license vide a letter dated October 10, 2014. The Company has entered into an arrangement with Tata Communications Limited (TCL) [previously known as Videsh Sanchar Nigam Limited] on November 7, 2005, providing right to manage the business of VPN, IDC and related business with full administrative control over the assets and customer ownership even though asset ownership will remain with TISL. In consideration TCL will pay to TISL Revenue share subject to minimum guaranteed amount. The Company has renewed the agreement w.e.f. April 1, 2008 modifying the conditions from Revenue share to a fixed consideration for 6 years w.e.f. April 1, 2008 to March 31, 2014. There has been no further renewal and the agreement stands terminated effective April 1, 2014. The Company has also given its building and other assets on cancellable lease, the revenue for which is recognized in the Statement of Profit and Loss on a straight line basis over the lease term. Details of Gross Carrying Amount, Accumulated Depreciation and Depreciation recognized in the Statement of Profit and Loss is as per Note-5.
19. Amalgamation with Holding Company The Company in its board meeting held on November 14, 2014 has considered and approved the proposed Scheme of Amalgamation (Scheme) of Tata Internet Services Limited (TISL) with its holding company, Tata Teleservices Limited (TTL) under the relevant provisions of the Companies Act 1956.The Scheme has been filed before the Honorable High Court and waiting approval. The Appointed Date under the scheme is January 1, 2015. The Company’s business is intended to be taken over by the holding company. Consequently no adjustment has been made in the Financial Statements relating to recoverability and classification of recorded amounts of assets and liabilities.
TATA INTERNET SERVICES LIMITED Notes forming part of the Financial Statements for the year ended March 31, 2015
20. Short term loans and advances
Property Tax Payment: The Company had received a demand note from Bombay Municipal Corporation towards Property Tax dues at enhanced rates with retrospective effect from April 1, 2010. The company is of the view that being a holder of Information Technology Enabled Services (ITES) certificate and as per the IT & ITES policy of Government of Maharashtra, property tax in relation to a property of ITES units should be levied at the residential rates. However the company has paid an amount of Rs 85.17 Lacs till date (PY Rs 51.09 Lacs) under protest against an equivalent provision being kept. License Fee Payment: The Department of Telecommunications (DoT) had notified certain changes in Internet Service Provider (ISP) Licenses and introduced License Fees by way of revenue share of 6% on the Adjusted Gross Revenue (AGR). It has been reliably learnt that this notification was not applicable to ISPs that did not have a license to offer Internet Telephony. Since the Company did not offer Internet Telephony Services, the Board of Directors had decided to surrender the Company’s License for offering Internet Telephony with effect from January 1, 2006 or such other date as decided by DoT, and decided to retain the plain ISP Category “A” License which has been communicated to DoT. Further DoT vide its letter dated June 29, 2012, the amendment of License Fees rates to 7% of adjusted gross revenue in case of ISP license (with Internet Telephony) and 4% of adjusted gross revenue in case of ISP license (without Internet Telephony), with effect from July 1, 2012 to March 31, 2013 and 8% for both Licenses for year 2013-14 and onwards. The Company has therefore made a payment of Rs 224.90 Lacs till date (PY Rs 190.01 Lacs) under protest towards the alleged License Fees levied with effect from July 1, 2012 till date and has maintained a equivalent provision against the same.
21. Funds Requirement As of March 31, 2015, the Company has incurred revenue and capital expenditure of Rs.16,048 Lacs (P.Y: Rs. 15,993 Lacs), funded by equity contribution of Rs 15,000 Lacs (P.Y: 15,000 Lacs), and balance Rs. 1,048 Lacs (P.Y: Rs. 993 Lacs) has been financed by Vendors/Creditors. The Profit earned by the Company for the year ending March 31, 2015 was Rs 632 Lacs (P.Y: Rs. 1,520 Lacs) and accumulated losses as on March 31, 2015 were Rs. 10,861 Lacs (P.Y: Rs. 11,494 Lacs).
22. Contingent Liability
(a) The Company has furnished total Performance Bank Guarantee for Rs 68.34 Lacs (P.Y: Rs Nil) , Rs. 100.00 Lacs (P.Y: Rs 100.00 Lacs) and Rs. 20.00 Lacs (P.Y:Rs. 20.00 Lacs) respectively to the Ministry of Communications as required under the License agreement for fulfilling certain obligations under the agreement.
(b) On April 9, 2012, Office of the Commissioner of Service Tax had issued a Show cause cum demand notice for Rs 536.29 Lacs (P.Y: Rs. 536.29 Lacs) on the Company alleging to invoke service tax on the consideration received from Tata Communications Limited for facilitating access to render services to customer and intends to cover the same under Business support services. Subsequently the Company has filed an appeal against the same, the hearing of the same is awaited.
(c) On November 19, 2012, Department of Telecommunications (DoT) had issued a demand notice on the
Company for alleged short payment of License Fee of Rs 483.95 Lacs including interest of Rs 247.45 Lacs for the financial years 2006-07 and 2007-08. Subsequently the Company has filed an appeal against the same with Telecom Disputes Settlement Appellate Tribunal (TDSAT). Hearing is awaited for the same. The Company is carrying a provision of Rs 236.5 Lacs in the books of account against the said demand notice.
TATA INTERNET SERVICES LIMITED Notes forming part of the Financial Statements for the year ended March 31, 2015
23. Micro, Small & Medium Enterprises
As per the information available with the Company there are no enterprises, which are registered under the Micro, Small & Medium Enterprises Development Act 2006.Hence the outstanding to these enterprises as required to be disclosed is not given.
24. Capital Commitments
Estimated amount of contracts remaining to be executed on Capital Account and not provided for is Nil (P.Y. Nil).
25. Income Tax In accordance with the Accounting Standard on Accounting for Taxes on Income ('AS 22') and the guidance provided by the ICAI, the Company has not recognized any deferred tax assets resulting from the carry forward tax losses. Further, no deferred tax liabilities or assets on account of timing differences have been recognized since they are expected to reverse in the tax holiday period.
26. Provision against Doubtful Deposits
The Company had given Deposits / Earnest Money Deposits to various parties towards Electricity/Telephone Connections for Office Premises, Insurance Premium Deposits / Government Projects etc. As the recoverability of the same is remote the Company has maintained a provision for the said deposits of Rs.40.75 Lacs (PY Rs 39.36 Lacs). The Company has an un utilized VAT credit input balance of Rs 2.86 Lacs which cannot be adjusted and hence has decided to create a provision towards the same during the financial year 2014-15.
27. Pursuant to the Companies Act, 2013 (The Act) being effective from April 1, 2014 the Company has revised useful lives on certain fixed assets as per the useful life specified in Schedule II of the Act. There is no material impact on the depreciation charged during the year.
28. Write off of Fixed Assets
The Company had some fully depreciated fixed assets which had served beyond the useful life. The physical availability of these assets could not be confirmed and hence the Company has decided to write off these assets during the financial year 2014-15. The original cost and accumulated depreciation of such assets was Rs 8767.23 Lacs.
29, Auditors’ Remuneration (Excluding Service Tax)
(Figures in Lacs) Particulars 2014-15 2013-14
Statutory Audit 1.35 1.35
Tax Audit 0.40 0.40
Other Services - 0.45
Out of Pocket Expenses 0.18 0.21
Total 1.93 2.41 30, Defined Contribution Plan as per AS-15 Contribution to Defined Contribution Plan, as recognized as expense for the year is as under:
(Figures in Lacs) Particulars 2014-15 2013-14
Employer's Contribution to Provident Fund* - 0.11 Employer’s Contribution to Pension Scheme* - 0.01
* Included in Contribution to Provident and other funds under Employee Benefit Expenses
TATA INTERNET SERVICES LIMITED Notes forming part of the Financial Statements for the year ended March 31, 2015
Defined Benefit Plans as per AS-15
Gratuity The Company has defined benefit plan for gratuity of employees. Summary of the gratuity plan is as follows: Fund Balance (Figures in Lacs)
Particulars 2014-15 2013-14Defined benefit obligation - - Fair value of plan assets 8.66 8.05 Funded Status asset / (liability) 8.66 8.05 Unrecognized past service cost - non vested benefits - - Asset recognized in Balance Sheet 8.66 8.05
The change in benefit obligation and funded status of the gratuity plan for the year ended March 31, 2015 is as follows:
Change in Benefit Obligation (Figures in Lacs)
Particulars 2014-15 2013-14Benefit obligation at the beginning of the year - 1.29Service cost - 0.14Interest Cost - 0.10Benefits Paid - (1.36)Actuarial Loss/(Gain) - (0.18)Past Service Cost - - Benefit obligation at the end of the year - -
Change in Fair Value of Plan Assets (Figures in Lacs)
Particulars 2014-15 2013-14Fair value of plan assets at beginning of year 8.05 7.49Return on Plan Assets 0.70 0.65Actual Contribution - - Benefits Paid - - Asset Gain / (Loss) (0.10) (0.09)Fair value of plan assets at end of year 8.66 8.05
Net gratuity cost for the year ended March 31, 2015 is as follows:
Components of Net Benefit Cost# (Figures in Lacs)
Particulars 2014-15 2013-14Service cost - 0.14Interest Cost - 0.10Return on Plan Assets (0.70) (0.65)Net actuarial (gain) / loss recognized during the year 0.10 (0.09)Past Service cost –non-vested benefit - - Past Service cost-vested benefit - - Net gratuity cost (0.60) (0.50)
- The assumptions used in accounting for the gratuity plan for the year are as below: Particulars 2014-15 2013-14Discount Rate 0.00% 0.00%Return on plan assets 8.70% 8.70%Rate of compensation increase 0.00% 0.00%
TATA INTERNET SERVICES LIMITED Notes forming part of the Financial Statements for the year ended March 31, 2015
Major categories of plan assets as a percentage to total assets: Particulars 2014-15 2013-14Government of India Securities (funded with Tata AIG Life Insurance)
100% 100%
# Included in Employee Benefit Expenses (Refer Note- 14) The estimate of future salary increase, considered in actuarial valuation, takes into account inflation, seniority, promotion and other relevant factors.
31. Related Party Disclosures List of Related Parties and their Relationships
Relationship Party
Holding Company Tata Teleservices Limited
Associate MMP Mobi Wallet Payment Systems Limited (W.e.f November 28, 2014)
Fellow – Subsidiary MMP Mobi Wallet Payment Systems Limited
Key Management Personnel Mr. Manoj Jain ( Chief Financial Officer & Manager)
Related Party Transactions (Figures in Lacs)
Description
For the year ended March 31, 2015 For the year ended March 31, 2014
Holding Company
Associate Fellow Subsidiary Company
Total as on Mar 31,
2015
Holding Company
Associate Fellow Subsidiary Company
Total as on Mar 31,
2015
Interest Income
MMP Mobi Wallet Payment Systems Limited
1.56 1.56
Finance Cost
Tata Teleservices Limited 0.12 0.12 0.45 0.45
Manpower Cost
Tata Teleservices Limited 38.61 38.61
Insurance Cost
Tata Teleservices Limited 0.96 0.96
Investments
MMP Mobi Wallet Payment Systems Limited
1,000.00 1,000.00
Loans Received Back
MMP Mobi Wallet Payment Systems Limited
15.00 15.00
Performance Bank Guarantee
Tata Teleservices Limited 188.34 188.34 120.00 120.00
Balance Recoverable/ (Payable)
Tata Teleservices Limited (3.93) (3.93) (0.45) (0.45)
TATA INTERNET SERVICES LIMITED Notes forming part of the Financial Statements for the year ended March 31, 2015
32. CSR Expenditure (Figures in Lacs) a) Gross Amount required to be spent by the Company; 30.63 b) Amount Spent by the Company during the year on:
S.No Breakup of CSR Expense In Cash Yet to be paid in Cash
Total
(i) Construction/Acquisition of any asset
- - -
(ii) Other Purposes- Payment made to “Tata Community Initiatives Trust”
30.63 - 30.63
33. Earnings Per Share Basic and Diluted Earnings Per Share 2014-15 2013-14
Number of Ordinary Shares at the beginning of the year (In Lacs) 1500 1500
Number of Ordinary Shares at the closing of the year (in Lacs) 1500 1500 Weighted Average no. of Equity Shares outstanding during the year (in Lacs) (A) 1500 150
0 Nominal Value of Equity Shares (Rs.) 10 10
Profit attributable to Equity Shareholders (Rs. in Lacs) (B) 631.91 1519.97
Basic and Diluted Earnings Per Share (Rs.) (B/A) 0.42 1.01
34. Previous year figures have been regrouped / rearranged wherever considered necessary.
For SAHNI NATARAJAN AND BAHL For and on behalf of the Board of Directors Chartered Accountants Firm Registration No. 002816N
Sudhir Chhabra Madhav Joshi Suresh Mahadevan Manoj JainPartner Director Director Chief Financial Officer
& Manager M.No.083762 DIN: 00030754 DIN:06423250
Krishna Kant Chaturvedi Company Secretary
Place: New Delhi Place: Mumbai
Date: May 25, 2015 Date: May 25, 2015 Corporate Identification Number: U72900DL1999PLC100313
INDEPENDENT AUDITOR’S REPORT To the Members of MMP Mobi Wallet Payments Systems Limited Report on the Financial Statements We have audited the accompanying financial statements of MMP Mobi Wallet Payments Systems Limited (the ‘Company’), which comprise the balance sheet as at March 31, 2015, the statement of profit and loss and cash flow statement for the year then ended, and a summary of significant accounting policies and other explanatory information Management’s Responsibility for the Financial Statements The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (‘the Act’) with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial control that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder. We conducted our audit in accordance with the Standards on Auditing, issued by the Institute of Chartered Accountants of India, as specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company’s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Company’s Directors, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.
Opinion In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India of the state of affairs of the Company as at March 31, 2015, its loss and its cash flows for the year ended on that date. Report on Other Legal and Regulatory Requirements 1. As required by the Companies (Auditor’s Report) Order, 2015 (“the Order”) issued by the Central
Government of India in terms of section 143 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order.
2. As required by section 143 (3) of the Act, we report that: (a) We have sought and obtained all the information and explanations which to the best of our
knowledge and belief were necessary for the purpose of our audit; (b) In our opinion proper books of account as required by law have been kept by the Company so far
as it appears from our examination of those books;
(c) The balance sheet, statement of profit and loss and cash flow statement dealt with by this Report are in agreement with the books of account;
(d) In our opinion, the aforesaid financial statements comply with the Accounting Standards specified
under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014; (e) On the basis of written representations received from the directors as on March 31, 2015, and
taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2015, from being appointed as a director in terms of section 164 (2) of the Act;
(f) With respect to the other matters to be included in the Auditor’s Report in accordance with Rule
11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company does not have any pending litigations which would impact its financial
position; ii. The Company did not have any long-term contracts including derivative contracts for which
there were any material foreseeable losses;
iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.
For S.R. Batliboi & Associates LLP Chartered Accountants ICAI Firm Registration Number: 101049W per Prashant Singhal Partner Membership Number: 93283 Place: Mumbai Date: May 25, 2015
Annexure referred to in paragraph 1 under the heading Report on other legal and regulatory requirements of our Report of even date Re: MMP Mobi Wallet Payments Systems Limited (‘the Company’) (i) (a) The Company has maintained proper records showing full particulars, including quantitative
details and situation of fixed assets.
(b) Fixed assets have been physically verified by the management during the year and no material discrepancies were identified on such verification.
(ii) (a) The procedures of physical verification of inventory followed by the management are
reasonable and adequate in relation to the size of the Company and the nature of its business.
(b) The Company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification
(iii) According to the information and explanations given to us, the Company has not granted any
loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 189 of the Act. Accordingly, the provisions of clause 3(iii) (a) to (b) of the Order are not applicable to the Company and hence not commented upon.
(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness or continuing failure to correct any major weakness in the internal control system of the company in respect of these areas.
(v) The Company has not accepted any deposits from the public.
(vi) To the best of our knowledge and as explained, the Central Government has not prescribed maintenance of cost records under sub-section (1) of section 148 of the Act for the services of the Company.
(vii) (a) Undisputed statutory dues including provident fund, income-tax, service tax, cess and other material statutory dues have generally been regularly deposited with the appropriate authorities though there has been a slight delay in a few cases. According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, income-tax, service tax, cess and other material statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable, except given under table below.
Name of the statute
Nature of the dues
Amount (Rs)
Period to which the amount relates
Due Date Date of Payment
Professional Tax Act
Professional Tax
69,465 April 2013 to August 31, 2014
May 30, 2013 to September 30, 2014
Not deposited due to delay in obtaining registration
The provisions relating to employees’ state insurance, sales tax, wealth tax, duty of customs, duty of excise and value added tax are not applicable to the Company.
(b) According to the information and explanations given to us, there are no dues of income tax, service tax and cess which have not been deposited on account of any dispute. The provisions relating to employees’ state insurance, sales tax, wealth tax, duty of customs, duty of excise and value added tax are not applicable to the Company.
(c) There were no amounts which were required to be transferred to the Investor Education and
Protection Fund by the Company in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made thereunder.
(viii) The Company has been registered for a period of less than five years and hence we are not
required to comment on whether or not the accumulated losses at the end of the financial year is fifty per cent or more of its net worth and whether it has incurred cash losses in the current financial year and in the immediately preceding financial year.
(ix) Based on our audit procedures and according to the information and explanations given to us, we
are of the opinion that the Company has not defaulted in the repayment of dues to banks.
(x) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions.
(xi) The Company did not have any term loans outstanding during the year.
(xii) Based upon the audit procedures performed for the purpose of reporting the true and fair view of
the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of audit.
For S.R. Batliboi & Associates LLP ICAI Firm registration number: 101049W Chartered Accountants per Prashant Singhal Partner Membership No.: 93283 Place: Mumbai Date: May 25, 2015
MMP Mobi Wallet Payment Systems Limited
Balance Sheet as at March 31, 2015
(All amount in Rupees Lakhs, unless otherwise stated)
Notes March 31, 2015 March 31, 2014
Equity and liabilities
Shareholders’ funds
Share capital 3 5,000.00 2,700.00
Reserves and surplus 4 (4,007.10) (2,354.66)
992.90 345.34
Non Current liabilities
Deposit from distributors 22.40 20.80
Long-term provisions 6 23.09 19.14
45.49 39.94
Current liabilities
Trade payable 22.32 388.70
Other current liabilities 5 763.64 892.97
Short-term provisions 6 211.97 172.83
997.93 1,454.50
2,036.32 1,839.78
Assets
Non- Current assets
Fixed Assets
Tangible assets 7 10.09 6.86
Intangible assets 8 49.26 185.91
59.35 192.77
Current assets
Current investments 9 525.00 1,000.00
Inventories 10 20.79 2.97
Cash and bank balances 11 1,145.28 528.05
Loans and advances 12 285.90 115.99
1,976.97 1,647.01
2,036.32 1,839.78
Summary of significant accounting policies 2
The accompanying notes are an integral part of the financial statements
As per our report of even date
For S.R. Batliboi & Associates LLP For and on behalf of the Board of Directors of
ICAI Firm Registration Number : 101049W MMP Mobi Wallet Payment Systems Limited
Chartered Accountants
per Prashant Singhal Sunil Tandon Madhav Joshi
Partner Director Director
Membership no. 93283
Pradeep Kumar Sampath Ranjan Talwar
Chief Operating Officer Chief Financial
Officer
Place: Mumbai Place: Mumbai
Date: May 25, 2015 Date: May 25, 2015
TOTAL
TOTAL
MMP Mobi Wallet Payment Systems Limited
Statement of Profit and Loss for the Year ended March 31, 2015(All amount in Rupees Lakhs, unless otherwise stated)
Notes March 31, 2015 March 31, 2014
REVENUE
Revenue from operations 915.82 605.93
Other Income 13 37.83 28.02
TOTAL REVENUE 953.65 633.95
EXPENSES
Employee benefit expenses 14 835.64 739.00
Platform support expenses 685.13 553.40 Professional and legal fees (Refer note 18) 62.80 66.78
Commission expenses 631.36 436.70
Other administrative and selling expenses 15 245.79 231.63
TOTAL EXPENSES 2,460.72 2,027.51
Loss before interest expense, depreciation and amortisation (LBITDA) (1,507.07) (1,393.56)
Interest expense 0.17 1.57
Depreciation and amortisation 7 & 8 145.20 141.30
Loss before Tax (1,652.44) (1,536.43)
Tax expenses - current tax - -
Loss for the year (1,652.44) (1,536.43)
Earning per equity share [nominal value of share Rs. 10 each]
Basic & Diluted (4.35) (8.55)
Summary of significant accounting policies 2
The accompanying notes are an integral part of the financial statements
As per our report of even date
For S.R. Batliboi & Associates LLP For and on behalf of the Board of Directors of
ICAI Firm Registration Number : 101049W MMP Mobi Wallet Payment Systems Limited
Chartered Accountants
per Prashant Singhal Sunil Tandon Madhav Joshi
Partner Director Director
Membership no. 93283
Pradeep Kumar Sampath Ranjan Talwar
Chief Operating Officer Chief Financial
OfficerPlace: Mumbai Place: Mumbai
Date: May 25, 2015 Date: May 25, 2015
MMP Mobi Wallet Payment Systems Limited
Cash flow statement for the year ended March 31, 2015(All amount in Rupees Lakhs, unless otherwise stated)
Notes March 31, 2015 March 31, 2014
Cash Flow from Operation Activities
Loss before tax from continuing operations (1,652.44) (1,536.43)
Adjustment to reconcile loss before tax to net cash flows:
Depreciation and amortisation 145.20 141.30
Interest expense - 1.57
Interest income (13.72) (27.41)
Profit on sale of fixed assets (0.32) -
Profit on sale of current investments (22.41) -
Operating loss before working capital changes (1,543.69) (1,420.97)
Movements in working capital :
(Increase) in loans and advances (156.60) (62.62)
(Increase)/Decrease in Inventories (17.82) 2.19
Increase/(Decrease) in Trade Payable (366.39) 15.80
Increase/(Decrease) in short term and long term provisions 43.09 191.97
Increase/(Decrease) in other current liabilities (127.73) 416.33
Cash generated / (used) in operations (2,169.14) (857.30)
Direct taxes paid (net of refunds) (2.22) (2.71)
Net cash flow from/ (used in) operating activities (A) (2,171.36) (860.01)
Cash flows from investing activities
Purchase of fixed assets (12.07) (380.12)
Proceeds from sale of fixed assets 0.61 0.47
Proceeds from sale of current investments 497.41 -
Purchase of current investments - (1,000.00)
Interest received 2.64 27.41
Net cash flow from/ (used in) investing activities (B) 488.59 (1,352.24)
Cash flows from financing activities
Proceeds from issuance of equity share capital 2,300.00 1,700.00
Repayment of short term borrowing - (15.00)
Interest expense - (3.06)
Net cash flow from/ (used in) in financing activities ('C) 2,300.00 1,681.94
Net increase/(decrease) in cash and cash equivalents (A + B + C) 617.23 (530.31)
Cash and cash equivalents at the beginning of the year 528.05 1,058.36
Cash and cash equivalents at the end of the year 1,145.28 528.05
Components of cash and cash equivalents 11
Cash on hand - -
Balances with scheduled banks:
Current accounts 457.37 488.24
Escrow accounts* 387.91 39.81
Deposit accounts 300.00 -
* balance in escrow account of the Company can be used only for settlement of customer
balance as per RBI guidelines on Pre-paid payment instruments. CASH AND CASH EQUIVALENTS 1,145.28 528.05
Summary of significant accounting policies 2
The accompanying notes are an integral part of the financial statements
As per our report of even date
For S.R. Batliboi & Associates LLP For and on behalf of the Board of Directors of
ICAI Firm Registration Number : 101049W MMP Mobi Wallet Payment Systems Limited
Chartered Accountants
per Prashant Singhal Sunil Tandon Madhav Joshi
Partner Director Director
Membership no. 93283
Pradeep Kumar Sampath Ranjan Talwar
Chief Operating Officer Chief Financial
OfficerPlace: Mumbai Place : Mumbai
Date: May 25, 2015 Date: May 25, 2015
MMP MOBI WALLET PAYMENTS SYSTEMS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2015 (All amounts in Rupees Lakhs, unless otherwise stated)
1. Background
MMP Mobi Wallet Payment Systems Limited (the ‘Company’) was incorporated on July 13, 2010 as a limited company to provide Mobile Commerce and related services on pan India basis. The Company has been promoted by Tata Teleservices Limited. The Company has received approval from Reserve Bank of India on December 2011 to operate payment system in India and started its operations from June 29, 2012.
2. Basis of preparation of financial statements
The Financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules 2014. The financial statements have been prepared on an accrual basis and under the historical cost convention.
The accounting policies adopted in the preparation of financial statements are consistent with those of previous year.
Summary of significant accounting policies 2.1 Presentation and disclosure of financial statements
The financial statements are prepared and presented in the revised Schedule III notified under Companies Act, 2013. The financial statements have been prepared under the historical cost convention, on the accrual basis of accounting. The accounting policies have been consistently applied by the Company and are consistent with those used in the previous period. The significant accounting polies are as follows:
2.2 Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting year end. Although these estimates are based upon management’s best knowledge of current events and actions, uncertainty about this assumptions and estimates could result in the outcome requiring a material adjustment to the carrying amounts of assets or liabilities in future periods.
2.3 Tangible assets
Fixed assets are stated at cost less accumulated depreciation and impairment losses, if any. Cost of acquisition comprises the purchase price and is inclusive of any directly attributable costs such as freight, duties, taxes and all attributable expenditure required to bring the assets to its working condition for its intended use. Subsequent expenditure related to an item of fixed asset is added to its book value only if increases the future benefits from the existing asset beyond its previously assessed standard of performance. All other expenses on existing fixed assets, including day- to-day repair and maintenance expenditure and cost of replacing parts, are charged to the Statement of profit and loss account for the period during which such expenses are incurred
2.4 Depreciation
Till the year ended March 31, 2014, depreciation rates prescribed under Schedule XIV were treated as minimum rates and the company was not allowed to charge depreciation at lower rates even if such lower rates were justified by the estimated useful life of the asset. Schedule II to the Companies Act 2013 prescribes useful lives for fixed assets which, in many cases, are different from lives prescribed under the erstwhile Schedule XIV. However, Schedule II allows companies to use higher/ lower useful lives and residual values if such useful lives and residual values can be technically supported and justification for difference is disclosed in the financial statements.
Fixed assets are depreciated pro-rata form the date on which the assets is ready to use, on straight-line method as given below, at lives estimated by management, which are higher than lives determined using the rates specified in Schedule II of the Companies Act, 2013:
MMP MOBI WALLET PAYMENTS SYSTEMS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2015 (All amounts in Rupees Lakhs, unless otherwise stated)
Particulars Useful lives (In years)
Computers 3 years Office equipment 3 years
Considering the applicability of Schedule II, the management has re-estimated useful lives and residual values of all its fixed assets. The management believes that depreciation rates currently used fairly reflect its estimate of the useful lives and residual values of fixed assets, though these rates in certain cases are different from lives prescribed under Schedule II. Hence, this change in accounting policy did not have any material impact on financial statements of the company.
2.5 Intangible assets Intangible asset comprise of following:
Software: Software i.e. Platform software purchased are amortised over an estimated useful life of three years.
2.6 Impairment of tangible and intangible assets
The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the asset’s net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value at the weighted average cost of capital. After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life. A previously recognized impairment loss is increased or reversed depending on changes in circumstances. However, the carrying value after reversal is not increased beyond the carrying value that would have prevailed by charging usual depreciation if there was no impairment.
2.7 Revenue Recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured. The following specific revenue recognition criteria must also be met before revenue is recognized.
Revenue from sale of services:
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognized: Service Revenue is recognized on completion of transactions and net of discount and service tax. The Company collects service tax on behalf of the government and therefore, it is not an economic benefit flowing to the Company. Hence, it is excluded from revenue.
Interest: Revenue is recognised on a time proportion basis taking into account the amount outstanding and rate applicable. Interest income is included under the head “Other income” in the statement of profit and loss.
MMP MOBI WALLET PAYMENTS SYSTEMS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2015 (All amounts in Rupees Lakhs, unless otherwise stated)
2.8 Retirement and other employee benefits
Retirement benefits in the form of Provident Fund are a defined contribution scheme and the contributions are charged to the Statement of profit & loss of the year when the contributions to the government funds are due. There are no other obligations other than the contribution payable to the government fund.
Gratuity liability is defined benefit obligation, covering all employees as per the Gratuity Act, 1972 and is provided for on the basis of an actuarial valuation made at the end of each year as per the Projected Unit Credit Method.
Liability for leave encashment is in accordance with the rules of the Company. Compensated absences are provided based on actuarial valuation obtained at the end of each year as per the Projected Unit Credit Method. Actuarial gains/ losses are immediately taken to Statement of profit and loss account and are not deferred.
2.9 Cash and cash equivalents
Cash and cash equivalents comprises of cash at bank and in hand and short-term investments with an original maturity of more than three months but less than 12 months.
2.10 Income taxes
Tax expense comprises of current and deferred tax. Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act, 1961. Deferred income taxes reflect the impact of timing differences between taxable income and accounting income for the relevant year.
Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. In situations where the Company has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognised only if there is virtual certainty supported by convincing evidence that they can be realised against future taxable profits. At each balance sheet date the Company will re-assess unrecognised deferred tax assets. It recognizes the unrecognised deferred tax assets to the extent that it has become reasonably certain or virtually certain, as the case may be that sufficient future taxable income will be available against which such deferred tax assets can be realised.
In accordance with the Accounting Standard on Accounting for Taxes on Income ('AS 22') and the guidance provided by the ICAI, the Company has not recognized any deferred tax assets.
2.11 Loss per share
Loss per share is calculated by dividing the net loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. The number of shares used in computing diluted earnings per share comprises the weighted average shares considered for deriving basic earnings per share, and also the weighted average number of shares, if any, which would have been issued on the conversion of all dilutive potential equity shares.
2.12 Provisions
A provision is recognized when an enterprise has a present obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to its present value and are determined based on management estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current management estimates. Provision for warranty is determined based on management estimate of the anticipated cost based on past experience and industry trends.
MMP MOBI WALLET PAYMENTS SYSTEMS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2015 (All amounts in Rupees Lakhs, unless otherwise stated)
2.13 Inventories Inventories are valued at the lower of cost and net realisable value. Cost is determined on a weighted average basis and includes all applicable overheads in bringing the inventories to their present location and condition. Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs to make the sale.
2.14 Contingent Liabilities
A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the company or a present obligation that is not recognised because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The Company does not recognize a contingent liability but discloses its existence in the financial statements.
[This space has been intentionally left blank]
1000 100,000
MMP Mobi Wallet Payment Systems Limited
Notes to the financial statements for the year ended March 31, 2015(All amount in Rupees Lakhs, unless otherwise stated)
3. SHARE CAPITAL March 31, 2015 March 31, 2014
Authorised Share Capital (Nos in lakhs)
500 (March 31, 2014 - 500) equity shares of Rs. 10 each 5,000.00 5000.00
Issued, Subscribed and Fully Paid (Nos in lakhs)
500 (March 31, 2014 - 270) equity shares of Rs. 10 each fully paid 5,000.00 2,700.00
a. Reconciliation of Shares Outstanding at the beginning and at the end of the reporting period
Equity Shares No. Lakhs (Rs. in Lakh) No. Lakhs (Rs. in Lakh)
At the beginning of the year 270.00 2,700.00 100.00 1,000.00
Issued during the year 230.00 2,300.00 170.00 1,700.00
Outstanding at the end of the year 500.00 5,000.00 270.00 2,700.00
b. Terms/rights attached to equity shares
c. Shares held by holding company and details of shareholders
holding more than 5% shares in the Company
(Rs. in Lakh) % (Rs. in Lakh) %
Tata Teleservices Limited (Nos in Lakhs)
400 (March 31, 2014 - 270 ) equity shares of Rs. 10 each 4,000.00 80% 2,700.00 100%
fully paid
Tata Internet Services Limited (Nos in lakhs)
100 (March 31, 2014 - Nil ) equity shares of Rs. 10 each 1,000.00 20% - -
fully paid
5,000.00 100% 2,700.00 100%
4. RESERVES AND SURPLUS March 31, 2015 March 31, 2014
(Deficit) in the statement of profit and loss
Balance as per last financial statements (2,354.66) (818.23)
Loss for the year (1,652.44) (1,536.43)
Net (deficit) in the statement of profit and loss (4,007.10) (2,354.66)
5. OTHER CURRENT LIABILITIES March 31, 2015 March 31, 2014
Provision for expenses 259.57 560.14
Taxes payable 39.04 67.86
Income received in advance - 0.01
Other Liabilities * 440.03 250.46
Deposit from distributor 25.00 14.50
(* includes amount lying with distributor, retailer and customer)
763.64 892.97
6. Provisions for Employee Benefits
March 31, 2015 March 31, 2014 March 31, 2015 March 31, 2014
Provision for Gratuity 23.09 19.14 7.17 3.85
Provision for Leave Encashment - - 40.22 31.30
Provision for Performance Bonus - - 164.58 137.68
23.09 19.14 211.97 172.83
Long Term Short Term
March 31, 2015 March 31, 2014
The Company has only one class of equity shares having a par Value of Rs. 10 per share. Each holder of equity shares is entitled to vote one per share.
March 31, 2015 March 31, 2014
MMP Mobi Wallet Payment Systems Limited
Notes to the financial statements for the year ended March 31, 2015
(All amount in Rupees Lakhs, unless otherwise stated)
7. TANGIBLE ASSET
As at April 1,
2014Addition
Disposal /
Adjustment
As at March, 31
2015
As at April 1,
2014Addition
Disposal /
Adjustment
As at March, 31
2015
As at March, 31
2015
As at March
31, 2014
Computer equipments 8.45 10.15 0.73 17.87 1.59 6.63 0.44 7.78 10.09 6.86
Office equipments 0.20 1.92 0.48 1.64 0.20 1.92 0.48 1.64 - -
Total 8.65 12.07 1.21 19.51 1.79 8.55 0.92 9.42 10.09 6.86
As at April 1,
2013Addition
Disposal /
Adjustment
As at March, 31
2014
As at April 1,
2013Addition
Disposal /
Adjustment
As at March, 31
2014
As at March, 31
2014
As at March
31, 2013
Computer equipments - 8.92 0.47 8.45 - 1.68 0.09 1.59 6.86 -
Office equipments - 0.20 - 0.20 - 0.20 - 0.20 - -
Total - 9.12 0.47 8.65 - 1.88 0.09 1.79 6.86 -
8. INTANGIBLE ASSET (Rs. in Lakh)
As at April 1,
2014Addition
Disposal /
Adjustment
As at Mar 31
2015
As at April 1,
2014Addition
Disposal /
Adjustment
As at March, 31
2015
As at March, 31
2015
As at March
31, 2014
Licensed software (Base platform) 410.00 - - 410.00 224.09 136.65 - 360.74 49.26 185.91
Total 410.00 - - 410.00 224.09 136.65 - 360.74 49.26 185.91
As at April 1,
2013Addition
Disposal /
Adjustment
As at March, 31
2014
As at April 1,
2013Addition
Disposal /
Adjustment
As at March, 31
2014
As at March, 31
2014
As at March
31, 2013
Licensed software (Base platform) 399.00 11.00 - 410.00 84.67 139.42 - 224.09 185.91 314.33
Total 399.00 11.00 - 410.00 84.67 139.42 - 224.09 185.91 314.33
Gross Block Accumulated Amortisation Net Block
Particulars
Particulars
Gross Block Accumulated Amortisation Net Block
Particulars
Gross Block Accumulated Amortisation Net Block
Particulars
Gross Block Accumulated Amortisation Net Block
MMP Mobi Wallet Payment Systems Limited
Notes to the financial statements for the year ended March 31, 2015(All amount in Rupees Lakhs, unless otherwise stated)
9. Current Investments (At lower of cost and market value), Unquoted March 31, 2015 March 31, 2014
Investment in Mutual Funds255,157.200 ( March 31, 2014 - 73,299.579 ) units at Rs. 207.0990 (March 31, 2014: Rs.
1364.264) in ICICI Prudential Mutual Funds in Liquid Direct Plan
(March 31, 2014: Pramerica Mutual Funds)
525.00 1,000.00
10. INVENTORIES [at cost or marketvalue, whichever is less] March 31, 2015 March 31, 2014
Inventories 20.79 2.97
20.79 2.97
11. CASH AND BANK BALANCES March 31, 2015 March 31, 2014
Cash in hands - -
Balance with banks:
i) in current accounts 457.37 488.24
ii) in escrow accounts* 387.91 39.81
Other bank balances:
Deposit with original maturity more than three months but less than 12 months 300.00 -
* balance in escrow account of the Company can be used only for settlement of customer balance as
per RBI guidelines on Pre-paid payment instruments.
1,145.28 528.05
12. LOAN AND ADVANCES March 31, 2015 March 31, 2014
Unsecured, consider good
Interest accured but not due 11.08 -
Advance income tax 5.57 3.34
Balance with government authorities 170.68 107.48
Prepaid expenses 9.84 1.08
Advance to employees 8.71 4.09
Loan and advances to related party 41.72 -
Advance to suppliers and others 38.30 -
285.90 115.99
13. Other Income March 31, 2015 March 31, 2014
Interest income on bank deposits 13.72 27.41
Profit from sale of current investment 22.41 -
Profit on sale of assets 0.32 -
Others 1.38 0.61
37.83 28.02
14. Employee Benefit Expenses March 31, 2015 March 31, 2014
Salaries, wages and bonus 765.52 685.41
Contribution to provident and other funds 37.32 29.88
Gratuity and leave encashment expenses 32.80 23.71
835.64 739.00
15. OTHER ADMINISTRATIVE AND SELLING EXPENSES March 31, 2015 March 31, 2014
Advertisement expenses 57.52 63.16
Call centre charges 17.46 16.64
Rates and taxes 2.82 28.60
Rent expense 62.68 47.93
Travel & conveyance 57.31 50.05
Communication expenses 12.77 11.28
Miscelleneous expenses 35.23 13.97
245.79 231.63
MMP MOBI WALLET PAYMENTS SYSTEMS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2015 (All amounts in Rupees Lakhs, unless otherwise stated)
16. Related Party Disclosures (i) Names of related parties
Holding company Tata Teleservices Limited
Fellow subsidiaries
Tata Internet Services Limited (upto November 27, 2014)
Enterprise having significant influence Tata Internet Services Limited (from November 28, 2014)
(ii) During the period, the Company has entered into transactions with related parties. The value of such
transactions, along with related balances as at March 31, 2015, are presented in the following table
Particulars March 31, 2015 March 31, 2014Tata Teleservices Limited
Share capital received during the year 1,300.00 1,700.00
Advertisement expenses - 14.36
Rent expenses 62.68 47.93
Miscellaneous expenses 2.65 0.74
Communication expense 11.79 11.15
Purchase of inventory 56.85 -
Purchase of laptop 3.08 0.95
Sale of laptop 0.31 -
Revenue from operations 7.71
Reimbursement for employee related cost (15.99) (62.09)
Tata Internet Services LimitedShare capital received during the year 1,000 -
Inter corporate deposits repaid during the year - 15.00
Interest expense - 1.56
Outstanding balances at the end of the year
Trade payables and other current liabilities
Tata Teleservices Limited - 338.86
Advance to suppliers and othersTata Teleservices Limited 41.72 -
The above information has been determined to the extent such parties have been identified on the basis of information provided by the Company, which has been relied upon by the auditors.
17. Loss per share
March 31, 2015 March 31, 2014
Loss for the year (1,652.44) (1,536.43)
Net amount attributable to equity shareholders (1,652.44) (1,536.43) 380.30 179.64
(4.35) (8.55)
Particulars
Basic and diluted EPS [nominal value of share Rs 10 (March 31, 2014: Rs10]
Weighted average no of shares outstanding during the year - in lakhs
MMP MOBI WALLET PAYMENTS SYSTEMS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2015 (All amounts in Rupees Lakhs, unless otherwise stated)
18. Payment to auditor (excluding service tax):
Particulars March 31, 2015 March 31, 2014As auditor:
Audit fees 8.00 5.00 Tax audit fees 1.00 0.50 Other fees - 4.00 Out of pocket expenses 0.80 1.01
Total 9.80 10.51
19. Gratuity and other post-employment benefit plans:
Gratuity:
In accordance with Accounting Standard 15 (Revised 2005), actuarial valuation was done in respect of the of the aforesaid defined benefit plan of gratuity based on the following assumptions:-
Particulars March 31, 2015 March 31, 2014Discount Rate (per annum) 7.80% 9.00%Rate of increase in Compensation levels 6.00% 8.00%Attrition rate 29.00% 26.00%Retirement age 60 years 60 yearsMortality Tables Indian Assured Lives (2006-08)
Ultimate Mortality Table Indian Assured Lives (2006-08)
Ultimate Mortality Table The Company has Non-Funded Gratuity Plan; accordingly changes in present value of plan assets, percentage of each category of plan assets to total fair value of plan assets and reconciliation of present value of defined benefit obligation and fair value of assets for funded scheme have not been disclosed. Leave encashment:
Particulars March 31, 2015 March 31, 2014
Discount Rate (per annum) 7.80% 9.00%Rate of increase in Compensation levels 6.00% 8.00%Attrition rate 29.00% 26.00%Retirement age 60 years 60 yearsMortality Tables Indian Assured Lives (2006-08)
Ultimate Mortality Table Indian Assured Lives (2006-08)
Ultimate Mortality Table 20. Based on the information available with the Company, none of the suppliers have confirmed that they are
registered under The Micro, Small and Medium Enterprise Development Act, 2006 (‘MSMED’), as at March 31, 2015. Hence, the Company is not required to give disclosures specified under the Act.
MMP MOBI WALLET PAYMENTS SYSTEMS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2015 (All amounts in Rupees Lakhs, unless otherwise stated)
21. Previous year figures
Previous year figures have been regrouped where necessary to conform to this year’s classification
As per our report of even date For S.R. Batliboi & Associates LLP ICAI Firm Registration Number : 101049W Chartered Accountants
For and on behalf of the Board of Directors
per Prashant Singhal Partner Membership No. 93283 Place: Mumbai Date: May 25, 2015
Sunil Tandon Director
Madhav Joshi Director
Pradeep Kumar Sampath Chief Operating Officer & Manager Place : Date : May 25, 2015
Ranjan Talwar Chief Financial Officer
DRAFT OF INDEPENDENT AUDITOR’S REPORT To the members of NVS Technologies Limited. Report on the Financial Statements We have audited the accompanying standalone financial statements of NVS Technologies Limited, which comprise the Balance Sheet as at 31st March, 2015, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information. Management’s Responsibility for the Standalone Financial Statements The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express an opinion on these standalone financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters, which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder. We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company’s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company’s Directors, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our audit opinion on the standalone financial statements. Opinion In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2015, and its profit/loss and its cash flows for the year ended on that date. Report on Other Legal and Regulatory Requirements 1. As required by the Companies (Auditor’s Report) Order, 2015 (“the Order”)
issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure A, a statement on the matters specified in paragraphs 3 and 4 of the Order.
2. As required by Section 143 (3) of the Act, we report that: (a) We have sought and obtained all the information and explanations, which to the
best of 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
the Company so far as it appears from our examination of those books (c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow
Statement dealt with by this Report are in agreement with the books of account (d) in our opinion, the aforesaid standalone financial statements comply with the
Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
(e) on the basis of the written representations received from the directors as on 31st March, 2015 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2015 from being appointed as a director in terms of Section 164 (2) of the Act.
(f) With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us: i. The Company does not have any pending litigations which would impact its
financial position ii. The Company did not have any long-term contracts including derivative
contracts for which there were any material foreseeable losses. Iii. There has been no delay in transferring amounts, required to be transferred,
to the Investor Education and Protection Fund by the Company For PKF Sridhar & Santhanam LLP Chartered Accountants Firm’s Registration No.003990S/S200018 R.Suriyanarayanan Partner Membership No.201402 Place of Signature: Mumbai. Date:
Annexure A Referred to in paragraph 1 on ‘Report on Other Legal and Regulatory Requirements’ of our report of even date (i) The Company does not have any fixed assets and consequently matters specified in Clause (i) of the Order, are not applicable.
(ii) The Company does not have inventories and consequently matters specified
in clause (ii) of the Order, are not applicable.
(iii) The company has not granted loans to parties covered under Sec 189 register and consequently clause (iii) (b) of the Order is not applicable
(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to the purchase of inventory, fixed assets and sale of goods and services. On the basis of our examination and according to the information and explanations given to us, there is no continuing failure to correct major weaknesses in the aforesaid internal control system.
(v) The Company has not accepted any deposits from the public within the meaning of the Act and the rules made there under.
(vi) The Company is not required to maintain cost records prescribed by the Central Government under sub-section (1) of section 148 of the Act.
(vii)
(a) According to the information and explanations given to us and the records of the Company examined by us, the Company has generally been regular in depositing undisputed statutory dues including provident fund, employees’ state insurance, income-tax, sales tax, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and any other statutory dues applicable to it with the appropriate authorities. According to the information and explanation given to us and the records of the Company examined by us, no undisputed amounts payable in respect of provident fund, employees’ state insurance, income-tax, sales tax, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and any other statutory dues were in arrears, as at 31st March 2015 for a period of more than six months from the date they became payable.
(b) There are no dues relating to income tax / sales tax / wealth tax / service tax / duty of customs / duty of excise / value added tax / cess, which have not been deposited on account of disputes with the related authorities.
(c) There are no amounts which require to be transferred to Investor Education and Protection Fund in accordance with the provisions of the Companies Act 1956 and the rules made thereunder.
(viii) The Company has been in existence for a period less than five years and consequently reporting under clause (viii) of the Order is not applicable.
(ix) The Company does not have any dues to financial institutions. Banks or debenture holders and consequently reporting under clause (ix) of the Order is not applicable.
(x) According to the information and explanations given to us, the company has not given any guarantee during the year for loans taken by others from banks or financial institutions.
(xi) The Company has not availed any term loans and consequently reporting under clause (xi) of the Order is not applicable.
(xii) Based upon the audit procedures performed and information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the year ended 31st March 2015.
For PKF Sridhar & Santhanam LLP Chartered Accountants Firm’s Registration No.003990S/S200018 R.Suriyanarayanan. Partner Membership No.201402 Place of Signature: Mumbai Date:
INDEPENDENT AUDITOR’S REPORT
To the Members of Viom Networks Limited
Report on the Financial Statements
We have audited the accompanying financial statements of Viom Networks Limited (“the Company”), which comprise the
Balance Sheet as at March 31, 2015, the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and
a summary of significant accounting policies and other explanatory information.
Management’s Responsibility for the Financial Statements
The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the
Act”) with respect to the preparation of these financial statements that give a true and fair view of the financial position,
financial performance and cash flows of the Company in accordance with accounting principles generally accepted in India,
including the Accounting Standards specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts)
Rules, 2014. This responsibility includes maintenance of adequate accounting records in accordance with the provisions of
the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities;
selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and
prudent; and the design, implementation and maintenance of adequate internal financial control that were operating
effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation
of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or
error.
Auditor’s Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in
accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India, as specified under
Section 143(10) of the Act. We have taken into account the provisions of the Act, the accounting and auditing standards and
matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.
Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material
misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor
considers internal financial control relevant to the Company’s preparation of the financial statements that give a true and fair
view in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an
opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the
effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the
reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the
financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinion on the standalone financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the financial statements give
the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting
principles generally accepted in India, of the state of affairs of the Company as at March 31, 2015, its profit and its cash flows
for the year ended on that date.
Emphasis of Matter
We draw attention to Note 34 to the financial statement which describes the uncertainty related to the outcome of the
lawsuit involving one of the customers of the Company. Our opinion is not qualified in respect of this matter
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor’s report) Order, 2015 (“the Order”) issued by the Central Government of India in
terms of sub-section (11) of section 143 of the Act, we give in the Annexure 1 a statement on the matters specified in
paragraphs 3 and 4 of the Order.
2. As required by section 143 (3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were
necessary for the purpose of our audit;
(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our
examination of those books;
(c) The Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement
with the books of account;
(d) In our opinion, the aforesaid financial statements comply with the Accounting Standards specified under section 133 of
the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;
(e) On the basis of written representations received from the directors as on March 31, 2015, and taken on record by the
Board of Directors, none of the directors is disqualified as on March 31, 2015, from being appointed as a director in
terms of section 164 (2) of the Act;
(f) With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies
(Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations
given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements
– Refer Note 33 (b) and Note 34 to the financial statements;
ii. The Company did not have any long-term contracts including derivative contracts for which there were any
material foreseeable losses;
iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by
the Company.
For S.R. Batliboi & Co. LLP
Chartered Accountants
ICAI Firm Registration Number: 301003E
----Sd-----
______________________________
per Vikas Mehra
Partner
Membership Number: 94421
Place of Signature: Gurgaon
Date: May 6, 2015
Annexure referred to in paragraph 1 under the heading “Report on other legal and regulatory requirements” of our report of
even date
Re: Viom Networks Limited (‘the Company’)
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation
of fixed assets.
(b) Fixed assets have been physically verified by the management during the year in accordance with a programme of
verification in a phased manner which, in our opinion, is reasonable having regard to the size of the Company and
the nature of its assets. Discrepancies identified during the year were not material and have been properly dealt
with in the books of accounts.
(ii) The Company’s business does not involve inventories and, accordingly, the requirements under paragraph 4(ii) of the
Order are not applicable to the Company.
(iii) As informed, there are no parties that require to be listed in the register maintained under 189 of the Companies Act,
2013. Therefore, the provision of clause 4 (iii) (a) and (b) of the Order are not applicable to the Company and hence not
commented upon.
(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control
system commensurate with the size of the Company and the nature of its business, for the purchase of fixed assets and
for the sale of services. The activities of the Company do not involve purchase of inventory and the sale of goods. During
the course of our audit, we have not observed any major weakness or continuing failure to correct any major weakness
in the internal control system of the company in respect of these areas.
(v) The Company has not accepted any deposits from the public.
(vi) To the best of our knowledge and as explained, the Central Government has not specified the maintenance of cost
records under clause 148(1) of the Companies Act, 2013, for the products/services of the Company.
(vi) (a) The Company is regular in depositing with appropriate authorities undisputed statutory dues including provident
fund, employees’ state insurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, value added
tax, cess and other material statutory dues applicable to it.
(b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident
fund, employees’ state insurance, income-tax, wealth-tax, service tax, sales-tax, customs duty, excise duty, value added
tax, cess and other material statutory dues were outstanding, at the year end, for a period of more than six months from
the date they became payable.
(c) According to the information and explanations given to us, there are no dues of income tax, sales-tax, wealth tax,
service tax, customs duty, excise duty, value added tax and cess which have not been deposited on account of any
dispute, except as follows:
Name of the statute Nature of dues Amount (Rs.
Cr)
Period to which the
amount relates
Forum where dispute is
pending
Income Tax Act , 1961 MAT liability on
income
54.75 2011-12 The Office of the
Commissioner of Income
tax
Name of the statute Nature of dues Amount (Rs.
Cr)
Period to which the
amount relates
Forum where dispute is
pending
CENVAT Credit Rules, 2004 Service Tax 855.20 2006-07 to 2013-14 The Office of the
Commissioner of Service
tax
Uttar Pradesh Entry Tax Act, Orissa
Entry Tax Act, Rajasthan Entry Tax,
Jharkhand Entry Tax Act, Madhya
Pradesh Entry Tax Act and
Chhattisgarh Entry Tax Act
Entry Tax 19.65 2007-08 to
2014-15
Hon’ble Supreme Court
and High Courts of
respective states,
Commissioner of
Commercial taxes
The West Bengal VAT Act, 2003 Value Added Tax 5.12 2007-08 to 2010-11 Sr. Joint Commissioner
The Madhya Pradesh VAT Act,
2002
Value Added Tax 2.17 2007-08 to 2009-10 Appellate Commissioner
Kerala VAT Act, 2003 Value Added Tax
3.56 2009-10 High Court of Kerala
Uttar Pradesh Value Added Tax Act,
2008
Value Added Tax 21.14 2007-08 to 2009-10 Appellate Commissioner
& Tribunal
Gujrat Value Added Tax, 2003 Value Added Tax 188.89 2007-08 to 2008-09 Deputy Commissioner of
Commercial Taxes,
Appeals – 1, Ahmedabad
Tamilnadu Value Added Tax Act
2006
Value Added Tax 25.84 2007-08 to 2010-11 Appellate Commissioner
The Gujrat Value added Tax Act,
2003
Value Added Tax 0.85 2007-08 & 2008-09 Deputy commissioner of
Commercial Tax, Appeal
1, Ahmedabad
Orissa Value Added Tax Act 2004 Value Added Tax 0.10 2007-08 to 2010-11 Joint Commissioner of
Commercial Taxes
Maharashtra Value Added Tax Act Value Added Tax 0.75 2009-10 to 2011-12 Appellate Commissioner
Delhi Value Added Tax Act Value Added Tax 3.04 2009-10 Appellate Commissioner
Rajasthan Value Added Tax Act Value Added Tax 0.34 2011-12 Appellate Commissioner
Andhra Pradesh Value Added Tax
Act
Value Added Tax 0.14 2010-11 Appellate Commissioner
Punjab Value Added Tax Act Value Added Tax 0.02 2007-08 & 2009-10 Appellate Commissioner
Kerala VAT Act, 2003 Value Added Tax 0.04 2009-10 & 2013-14 Appellate Commissioner
(d) There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the
Company in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made
thereunder.
(vii) The Company’s accumulated losses at the end of the financial year are less than fifty per cent of its net worth and it has
not incurred cash losses in the current and immediately preceding financial year.
(viii) Based on our audit procedures and as per the information and explanations given by the management, we are of the
opinion that the Company has not defaulted in repayment of dues to a financial institutions or banks. The Company did
not have any debentures during the year.
(ix) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by
others from bank or financial institutions.
(x) Based on the information and explanations given to us by the management, term loans were applied for the purpose for
which the loans were obtained.
(xi) We have been informed by the management that certain employee have colluded with vendors and committed
fraudulent acts relating to purchase of fixed assets and the same have been identified during the year. Appropriate
action has been taken against the same. As a result, the Company has written off Rs.6.68 crores in the statement of
profit and loss during the year under audit.
For S.R. Batliboi & Co. LLP
Chartered Accountants
Firm Registration No. 301003E
----Sd----
per Vikas Mehra
Partner
Membership No.: 94421
Place : Gurgaon
Date ; May 6, 2015
Viom Networks Limited
Balance Sheet as at March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
Notes March 31, 2015 March 31, 2014
Equity and liabilities
Shareholders' funds
Share capital 3 907.71 907.71
Reserves and surplus 4 678.13 630.95
1,585.84 1,538.66
Non-current liabilities
Long-term borrowings 5 5,680.90 4,741.84
Other long-term liabilities 6 718.51 608.08
Long-term provisions 7 185.65 172.78
6,585.06 5,522.70
Current liabilities
Short-term borrowings 8 - 353.54
Trade payables 9 522.41 479.98
Other current liabilities 9 644.16 1,307.09
Short-term provisions 7 44.75 11.00
1,211.32 2,151.61
9,382.22 9,212.97
Assets
Non-current assets
Fixed assets
Tangible assets 10 5,539.32 5,795.42
Intangible assets 11 851.16 5.58
Capital work-in-progress 12 86.80 72.34
Non-current investments 13 - 956.96
Trade receivables 15 145.89 51.62
Long-term loans and advances 18 552.85 423.86
Other non-current assets 16 1,025.60 910.98
8,201.62 8,216.76
Current assets
Current investments 14 100.00 -
Trade receivables 15 347.35 416.57
Cash and bank balances 17 108.93 58.05
Short-term loans and advances 18 378.66 302.08
Other current assets 16 245.66 219.51
1,180.60 996.21
9,382.22 9,212.97
Summary of significant accounting policies 2
The accompanying notes are an integral part of the financial statements.
As per our report of even date
For S.R. Batliboi & Co. LLP For and on behalf of the Board of Directors of
Firm registration number: 301003E Viom Networks Limited
Chartered Accountants
-sd- -sd-
-sd- Sunil Kanoria Eruch N Kapadia
per Vikas Mehra Vice-Chairman and Director
Partner Managing Director
Membership no. 94421
-sd- -sd-
Syed Safawi Shirish J Maniar
Chief Executive Officer Chief Financial Officer
-sd- -sd-
Place : Gurgaon Geeta Puri Seth Naveen Maheshwari
Date: May 06,2015 Company Secretary Finance Controller
Place : Mumbai
Date: May 06,2015
Viom Networks Limited
Statement of profit and loss for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
Notes March 31, 2015 March 31, 2014
INCOME
Service income 19 4,839.29 4,362.55
Other income 20 86.76 81.90
Exceptional items (net) 29 - 159.00
Total income (I) 4,926.05 4,603.45
EXPENSES
Energy charges 21 1,723.56 1,648.59
Lease/license expenses 22 643.01 562.12
Repairs and maintenance 23 399.48 371.47
Employee benefits expenses 24 154.05 141.85
Other expenses 25 108.36 83.53
Provision/ write off for fixed assets/debtors/ advances 26 70.80 111.25
Total expenses (II) 3,099.26 2,918.81
1,826.79 1,684.64
Depreciation and amortisation expenses 27 878.68 757.32
Interest and finance charges 28 777.26 842.34
Profit before taxes 170.85 84.98
Tax expense
Current tax expense MAT 26.50 2.60
Less: Mat credit entitlement (26.50) (2.60)
Total tax expense - -
Profit for the year 170.85 84.98
30
Basic 1.98 0.69
Diluted 1.98 0.69
Weighted average number of shares used in computing earning per share
Basic 65,77,14,012 65,77,14,012
Diluted 66,23,34,090 66,38,73,099
Summary of significant accounting policies 2
The accompanying notes are an integral part of the financial statements.
As per our report of even date
For S.R. Batliboi & Co. LLP For and on behalf of the Board of Directors of
Firm registration number: 301003E Viom Networks Limited
Chartered Accountants
-sd- -sd-
Sunil Kanoria Eruch N Kapadia
per Vikas Mehra Vice-Chairman and Director
Partner Managing Director
Membership no. 94421
-sd- -sd-
Syed Safawi Shirish J Maniar
Chief Executive Officer Chief Financial Officer
-sd- -sd-
Place : Gurgaon Geeta Puri Seth Naveen Maheshwari
Date: May 06,2015 Company Secretary Finance Controller
Place : Mumbai
Date: May 06,2015
Earnings before interest, tax, depreciation and amortisation
(EBITDA) (I) – (II)
Earning per share (equity shares, par value of Rs 10 each)
Viom Networks Limited
Cash flow statement for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
Notes March 31, 2015 March 31, 2014
Cash flow from operating activities
Profit for the year, before tax 170.85 84.98
Adjustment for:
Depreciation and amortisation 27 878.68 757.32
Interest and finance charges 28 777.26 842.34
Loss on sale/write off of fixed assets 25 59.26 57.48
Provision for slow moving and damaged assets 26 (36.28) (7.39)
Bad debts/advance written off 26 96.45 93.84
Provision/(reversal) for bad and doubtful debt/advances 26 (48.63) 26.14
Lease/license equalization reserve 40 9.28 28.83
Revenue equalization reserve 40 (74.59) 22.00
Profit on redemption of current investments 20 (4.65) -
Loss on sale of non-current investments 25 0.57 -
Interest Income 20 (11.65) (33.92)
Liabilities no longer required written back 20 (70.05) (11.70)
Operating profit before working capital changes 1,746.50 1,859.92
Movement in working capital
Increase/(decrease) in other long term liabilities 82.55 29.86
Increase/(decrease) in trade payables (11.04) 38.31
Increase/(decrease) in other current liabilities 23.35 19.38
Increase/(decrease) in provisions 29.14 7.67
Increase/(decrease) in provision for employee benefits 3.52 1.68
Decrease/(increase) in trade receivables (13.45) (54.06)
Decrease/(increase) in other non-current assets 0.92 4.15
Decrease/(increase) in other current assets 6.45 114.81
Decrease/(increase) in short term loans and advances (41.13) 51.85
Decrease/(increase) in long-term loans and advances (9.26) (50.15)
Cash from operations 1,817.55 2,023.42
Tax deducted at source (120.06) (46.27)
Income tax refund received (including interest thereon) - 281.53
Net cash flow from operating actives (A) 1,697.49 2,258.68
Cash flow from investing activities
Purchase of fixed assets (389.18) (370.79)
Proceeds from sale/insurance claims on fixed assets 42.82 9.62
Purchase of non-current investment - (0.62)
Proceeds from sale of non-current investment 0.05 -
Proceeds from redemption of current investments 4.65 -
Redemption/(purchase) of deposits with maturity of more than
three months (Net)
9.61 (53.16)
Interest received 11.83 9.75
Net cash (used in) investing activities (B) (320.22) (405.20)
Cash flow from financing activities
Proceeds from long term borrowings 2,200.00 300.00
Repayment of long term borrowings (2,183.69) (1,288.20)
Proceeds from/(repayment of) short term borrowings (Net) (370.07) 43.52
Proceeds of issuance of preference share capital 0.05 0.05
Redemption of preference share capital and premium thereon 3(c) (108.38) (75.16)
Interest paid (776.71) (881.67)
Net cash (used in) financing activities (C) (1,238.80) (1,901.46)
Viom Networks Limited
Cash flow statement for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
Notes March 31, 2015 March 31, 2014
Net increase/(decrease) in cash and cash equivalents (A+B+C) 138.47 (47.98)
Cash and cash equivalents at the beginning of the year 58.05 106.03
Cash and cash equivalent acquired under scheme of 12.41 -
amalgamation (refer note 35)
Cash and cash equivalents at the end of the year 208.93 58.05
Components of cash and cash equivalents as at year end
Short term investments 14 100.00 -
Balances with scheduled banks:
Current accounts 17 108.93 58.05
Deposit account: As margin money for bank guarantee 17 56.01 64.44
264.94 122.49
Less: Fixed deposits not considered as cash equivalents (56.01) (64.44)
Total cash and cash equivalents 208.93 58.05
Summary of significant accounting policies 2
The accompanying notes are an integral part of the financial statements.
As per our report of even date
For S.R. Batliboi & Co. LLP For and on behalf of the Board of Directors of
Firm registration number: 301003E Viom Networks Limited
Chartered Accountants -sd- -sd-
Sunil Kanoria Eruch N Kapadia
Vice-Chairman and Director
per Vikas Mehra Managing Director
Partner -sd- -sd-
Membership no. 94421Syed Safawi Shirish J Maniar
Chief Executive Officer Chief Financial Officer
-sd- -sd-
Place : Gurgaon Geeta Puri Seth Naveen Maheshwari
Date: May 06,2015 Company Secretary Finance Controller
Place : Mumbai
Date: May 06,2015
Viom Networks Limited
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
Statement of significant accounting policies and notes to financial statements
1. Corporate Information
2. Significant Accounting Policies
2.1 Basis of preparation of financial statements
2.2 Use of estimates
2.3 Tangible fixed assets and depreciation
Viom Networks Limited ('the Company' or 'VIOM') is in the business primarily to build, develop, maintain, supply operate, manage
and deal in services, facilities and infrastructure in connection with or ancillary to telecommunication systems. The Company is a
subsidiary of Tata Teleservices Limited (‘TTSL’).
The financial statements have been prepared to comply in all material respects with the mandatory accounting standards issued by
the Institute of Chartered Accountants of India and as notified under section 133 of the Companies Act, 2013, read together with
paragraph 7 of the Companies (Accounts) Rules 2014. The financial statements have been prepared under the historical cost
convention, on the accrual basis except in case of assets for which provision for impairment is made, revaluation carried out and
provision for site restoration cost obligations. The accounting policies have been consistently applied by the Company and are
consistent with those used in the previous year.
The preparation of financial statements in conformity with generally accepted accounting principles (Indian GAAP) and requires
management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent liabilities at the date of the financial statements and the results of operations during the reporting year end. Although
these estimates are based upon management’s best knowledge of current events and actions, actual results could differ from these
estimates.
Fixed assets are stated at cost of acquisition and subsequent improvements thereto including taxes and duties (net of refundable
excise and service tax), freight and other incidental expenses related to the acquisition and installation of fixed assets less
accumulated depreciation. Capital work-in-progress is stated at cost. Provision for slow moving, obsolescence and damaged assets
is made based upon physical verification and a yearly technical evaluation undertaken by the Company.
Site restoration cost obligations are capitalized when it is probable that an outflow of resources will be required to settle the
obligation and a reliable estimate of the amount can be made.
-- This space is intentionally left blank --
Viom Networks Limited
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
Asset Life considered by the
Company
Indicative useful life as
given in Schedule II of
the Companies Act,
2013
(in Years) (in Years)
Plant and machinery :
Towers# 35 18
Shelter 15 15
Air-conditioning equipment 8 15
Generators 8 15
Civil and electricals Lease/license period Lease/license period
Electrical equipment 8 – 10 15
Battery bank (included in electrical equipment) 4 (Prev yr 6) 15
Computers and IT Hardware/ Software 3 3 – 6
Office equipments 2 – 5 5
Furniture and fittings 3 – 6 10
Vehicles 5 6
2.4 Intangible Assets
In respect of all other assets where the useful life of assets is lower than indicative life as per Schedule II of the Companies Act,
2013, the Company has estimated the same based on past trend of useful life and technical evaluation.
In respect of battery bank and diesel generators the Company has considered realisable value of 20% and 15% respectively at the
end of useful life, based on past trends as well as from the recent sale of such assets. For all other assets it has considered 5% as
realisable value.
The Company has made necessary changes to be in compliance with Schedule II of the Companies Act, 2013 and accordingly as
per the transitional provision given as per Note 7 (b) of Schedule II of Companies Act 2013, an amount of Rs 15.34 has been
adjusted with opening accumulated losses. The impact of the same for current year is not material. The reasons for considering
different life and realisable value with regard to items under schedule II of Companies Act, 2013 are as below:
Intangible Assets are stated at cost of acquisition less accumulated amortization. All expenditure on intangible items are expensed
as incurred unless it qualifies as an intangible assets as defined in Accounting Standard – 26 notified under section 133 of the
Companies Act, 2013, read together with the paragraph 7 of the Companies (Accounts) Rules 2014. The carrying value of
intangible assets is assessed for recoverability by reference to the estimated future discounted cash flows that are expected to be
generated by the asset. Wherever this assessment indicates a deficit, the assets are written down to the market value or fair value.
Intangible Assets are amortised over the period of estimated future cash flows, not exceeding 10 years.
#The Company had obtained technical evaluation from Government approved independent certified engineers estimating useful
life of towers between 35 to 50 years. Based on which the Company had obtained an approval from Ministry of Corporate
Affairs, Government of India vide Order no.45/1/2012-CL-III dated May 6, 2013 issued under Section 205(2)(d) of the
Companies Act, 1956 effective from April 1, 2011 to depreciate tower on straight line method at the rate of 2.72% per annum
(equivalent to 35 years). The Company continues with the same policy for such assets.
Goodwill arising on amalgamation is amortised over a period of 10 years, based on management's estimates of useful life. (refer
note 35)
Depreciation on fixed assets is provided on the straight-line method (‘SLM’), at the rates prescribed in Schedule II of the
Companies Act, 2013 (‘Act’) or rates determined based on the estimated useful lives upto the estimated residual value of the
depreciable assets, whichever is higher, as follows:
Leasehold improvements and site restoration obligation cost are amortised over the period of lease.
Fixed assets individually costing less than Rs 5,000/- are fully depreciated in the year of acquisition.
Where an individual asset forms an integral part of another asset, it is added to the gross book value of the main asset and
depreciated accordingly.
Viom Networks Limited
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
2.5 Borrowing Costs
2.6 Impairment
2.7 Investments
2.8 Revenue recognition
(i) Service income
(ii) Interest income
(iii) Others
2.9 Cash and cash equivalents
(b) One time fee received from operators in relation of services provided to them are amortised over a period of five years or
agreement period whichever is less.
Cash and cash equivalents comprise of cash at bank and in hand and short term investments with an original maturity of three
months or less.
(a) Income by way of compensation on shortfall in commitment and other claims on service level arrangements with customers is
recognised as and when such income is claimable as per agreement and on reasonable certainty of realisation thereof.
The Company amortizes the cost of arranging long-term loans over the period of the loan or five years, whichever is lower,
commencing from the date of the first draw down of the related loan, on a straight-line basis. The costs incurred for the acquisition
or construction of a qualifying asset is capitalized as part of the cost of the underlying class of assets. The unamortized portion of
finance set up costs has been reflected in the balance sheet under the head ‘Other current assets" as 'Unamortised borrowing
expenses’. All other borrowing costs are expensed in the period they occur.
The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on
internal/external factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable
amount. The recoverable amount is the higher of the assets net selling price and value in use. In assessing value in use, the
estimated future cash flows are discounted to their present value at the weighted average cost of capital.
After impairment, depreciation is provided on the revised carrying amount of the respective asset over its remaining useful life.
Investments that are readily realisable and intended to be held for not more than a year are classified as current investments. All
other investments are classified as long-term investments. Current investments are carried at lower of cost and fair value determined
on an individual investment basis. Long-term investments are carried at cost. However, provision for diminution in value is made to
recognise a decline other than temporary in the value of the long term investments.
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be
reliably measured. The following specific recognition criteria must also be met before revenue is recognized:
Service income includes income from use of sites, energy and other reimbursement charges from operators, net of discounts and
service tax. Income from use of sites is recognized as and when services are rendered. If the payment terms in the service
arrangements include fixed escalations, the effect of such increases is recognized on straight line basis over the lease term. Unbilled
revenues at the end of year represent accrued service income and reimbursements pending to be billed, which are estimated and
recorded. The Company collects service tax on behalf of the government and therefore, it is not an economic benefit flowing to the
Company, hence it is excluded from revenue.
Interest income is recognised on a time proportion basis taking into account the amount outstanding and the rate applicable and on
reasonable certainty of realisation thereof.
Viom Networks Limited
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
2.10 Provisions
2.11 Retirement and other employee benefits
2.12 Income taxes
In accordance with the Accounting Standard on Accounting for Taxes on Income ('AS 22') and the guidance provided by the ICAI,
the Company has not recognized any deferred tax assets resulting from the unabsorbed depreciation or carry forward tax losses.
A provision is recognized for a present obligation as a result of past event; it is probable that an outflow of resources may be
required to settle the obligation and in respect of which a reliable estimate can be made. Provisions are not discounted to its present
value and are determined based on best management estimates required to settle the obligation at the balance sheet date. These are
reviewed at each balance sheet date and adjusted to reflect the current best estimates.
The Company has schemes of retirement benefits in form of provident fund, gratuity and leave encashment.
(i) Retirement benefits in the form of Provident Fund is defined contribution scheme and the contribution to government
administered funds are charged to the statement of profit and loss for the year when the contribution to the respective funds are due.
The Company has no further obligations under these plans beyond its monthly contribution.
(ii) Gratuity liability is a defined benefit obligation and is provided for on the basis of an actuarial valuation on Projected Unit
Credit Method made at the end of each year.
(iii) Short term compensated absences are provided based on estimates. Long term compensated absences are provided based on
actuarial valuation at the each Balance Sheet date as per Projected Unit Credit Method.
(iv) Actuarial gains/losses are immediately taken to the statement of profit and loss and are not deferred.
Tax expense comprises of current and deferred tax. Current income tax is measured at the amount expected to be paid to the tax
authorities in accordance with the Indian Income Tax Act. Deferred income taxes reflects the impact of current year timing
differences between taxable income and accounting income for the year and reversal of timing differences of earlier years.
MAT credit is recognised as an asset only when and to the extent there is convincing evidence that the Company will pay normal
income tax during the specified year. In the year in which the Minimum Alternative tax (MAT) credit becomes eligible to be
recognized as an asset in accordance with the recommendations contained in Guidance Note issued by the Institute of Chartered
Accountants of India, the said asset is created by way of a credit to the statement of profit and loss and shown as MAT Credit
Entitlement. The Company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit
Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax during the
specified year.
Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date.
Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be
available against which such deferred tax assets can be realised. In situations where the Company has unabsorbed depreciation or
carry forward tax losses, all deferred tax assets are recognised only if there is virtual certainty supported by convincing evidence
that they can be realised against future taxable profits. At each balance sheet date the Company re-assesses unrecognised deferred
tax assets. It recognises the unrecognised deferred tax assets to the extent that it has become reasonably certain or virtually certain,
as the case may be that sufficient future taxable income will be available against which such deferred tax assets can be realised.
Viom Networks Limited
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
2.13 Earnings/ (Loss) per share
2.14 Leases / Licenses
Where the Company is the lessee
Where the Company is the service provider
2.15 Foreign currency transactions and balances
(i) Initial Recognition
(ii) Conversion
(iii) Exchange Differences
2.16 Segment Reporting
2.17 Measurement of EBITDA
Exchange differences arising on the settlement of monetary items or on reporting such monetary items of company at rates different
from those at which they were initially recorded during the year, or reported in previous financial statements, are recognized as
income or as expenses in the period in which they arise.
The primary reporting of the Company has been performed on the basis of business segments. The Company has only one
reportable business segment, which is provision of Passive Infrastructure services. Further, the Company provides services only in
the domestic markets in India and, accordingly, no disclosures are required under secondary segment reporting.
As permitted by the Guidance Note on the Revised Schedule VI to the Companies Act, 2013, the Company has elected to present
earnings before interest, tax, depreciation and amortization (EBITDA) as a separate line item on the face of the statement of profit
and loss. The Company measures EBITDA on the basis of profit/loss from continuing operations. In its measurement, the Company
does not include depreciation and amortization expenses, interest and finance charges and tax expenses charged to the statement of
profit and loss.
Basic earnings/ (loss) per share is calculated by dividing the net profit after tax for the year attributable to equity shareholders (after
deducting preference dividends and attributable taxes), by the weighted average number of equity shares outstanding during the
year.
The number of shares used in computing diluted earnings per share comprise of the weighted average shares considered for deriving
basic earnings per share including issue of right shares and also the weighted average number of shares, if any, which would have
been issued on the conversion of all dilutive potential equity shares unless the impact is anti-dilutive. For the purpose of calculating
diluted earnings per share, the net profit or loss for the year attributable to equity shareholders and the weighted average number of
shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.
Leases/licenses where the lessor effectively retains substantially all the risks and benefits of ownership of the leased/licensed item,
are classified as operating leases/licenses. Operating lease/license expense on roof top sites and ground based sites are recognized as
an expense in the statement of profit and loss on a straight-line basis over the lease/license term.
Assets subject to infrastructure service provisioning are included in fixed assets and depreciated on a basis consistent with the
depreciation policy of the Company. Infrastructure provisioning fees is recognised in the statement of profit and loss on a straight-
line basis over the lease term. Costs, including depreciation are recognised as an expense in the statement of profit and loss. Initial
direct costs such as legal costs, brokerage costs, etc. are recognised immediately in the statement of profit and loss.
Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate
between the reporting currency and the foreign currency at the date of the transaction.
Foreign currency monetary items are retranslated using the exchange rate prevailing at the reporting date. Non-monetary items
which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the
transaction; and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are
reported using the exchange rates that existed when the values were determined.
VIOM NETWORKS LIMITED
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
3 Share Capital
March 31, 2015 March 31, 2014
Authorized :
100,00,00,000 (March 31, 2014 - 100,00,00,000) equity shares of Rs 10/- each. 1,000.00 1,000.00
25,00,00,000 (March 31, 2014 - 25,00,00,000) cumulative redeemable optionally convertible 250.00 250.00
preference shares of Rs.10/- each.
50,00,00,000 (March 31, 2014 - 50,00,00,000) cumulative convertible preference shares of 500.00 500.00
Rs.10/- each.
1,750.00 1,750.00
Issued, subscribed and paid-up :
65,77,14,012 (March 31, 2014 - 65,77,14,012) Equity Share of Rs.10/- each fully paid up 657.71 657.71
25,00,00,000 (March 31, 2014 - 25,00,00,000) 13.5% cumulative redeemable optionally partially 250.00 250.00
convertible preference shares of Rs.10/- each fully paid up.
907.71 907.71
a. Reconciliation of the shares outstanding at the beginning and at the end of the reporting year:
Nos Rs. in Crores Nos Rs. in Crores
Equity shares
At the beginning of the year 65,77,14,012 657.71 65,77,14,012 657.71
At the end of the year 65,77,14,012 657.71 65,77,14,012 657.71
Preference shares
At the beginning of the year 25,00,00,000 250.00 25,00,00,000 250.00
Issued during the year 50,000 0.05 50,000 0.05
Redeemed during the year (refer note 4 under (50,000) (0.05) (50,000) (0.05)
Reserve and Surplus')
At the end of the year 25,00,00,000 250.00 25,00,00,000 250.00
b. Terms/rights attached to equity shares
The Company has only one class of equity shares having a par value of Rs. 10/- per share. Each holder of equity shares is entitled to one
vote per share. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the
Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the
shareholders.
c. Terms of conversion/redemption of cumulative redeemable optionally partially convertible preference shares (CROPCPS)
The Company had issued 25,00,00,000 13.5% CROPCPS on March 23, 2010. CROPCPS carry cumulative dividend @ 13.5% p.a. Each
holder of CROPCPS is entitled to one vote per share only on resolutions placed before the Company which directly affect the rights attached
to CROPCPS.
Conversion option
(i) One third of 24,99,00,000 CROPCPS are convertible at an agreed price, any day after March 23, 2013 at the option of the preference
shareholder. The preference shareholder has not opted for conversion as on the balance sheet date.
(ii) Shareholders of remaining 1,00,000 CROPCPS does not have the right of conversion.
Redemption option
The earliest date of redemption was March 23, 2015. In accordance with the terms of the agreement, redemption premium is payable by the
Company to the preference share holders. Since the amount is subject to the outcome of various alternatives available to the Company/
holders (like conversion, early payment etc) and is payable only upon redemption, it is included under contingent liabilities (refer note 33(c)).
The preference shareholder has not requested for redemption as on the balance sheet date.
d. Shares held by holding/ultimate holding company and/or their subsidiaries/associates
Out of equity and preference shares issued by the company, shares held by its holding company, ultimate holding company and their
subsidiaries/ associates are as below:
March 31, 2015 March 31, 2014
-34,76,36,193 Equity shares of Rs. 10/- each held by Tata Teleservices 347.64 347.64
Limited the holding Company.
-1,20,76,875 Equity shares of Rs. 10/- each held by Tata Sons Limited the 12.08 12.08
ultimate holding Company.
March 31, 2015 March 31, 2014
VIOM NETWORKS LIMITED
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
e. Aggregate number of share issued for consideration other than cash and shares bought back during the period of five
years immediately preceding the reporting date:
The Company together with Quippo Telecom Infrastructure Limited (‘QTIL’), entered into Scheme of Arrangement (‘the Scheme’) under
sections 391 to 394 of the Companies Act, 1956, for transfer of passive telecom infrastructure undertaking from QTIL to the Company,
which was approved by the Hon’ble High Court of Delhi vide its order dated May 29, 2010 and the Hon’ble High Court of Andhra Pradesh
vide its Order dated July 19, 2010 and was filed with the Registrar of Companies, Andhra Pradesh on August 11, 2010 which is the Effective
Date of the Scheme. The Scheme was, accordingly, given effect to in the financial statements for the year ended March 31, 2010 with effect
from April 1, 2009, the Appointed Date.
The Company further issued 1,00,00,000 10% Compulsorily Convertible Debentures for aggregate value of Rs 100. As on March 17, 2011.
These were converted in equity shares and the Company issued 58,25,453 Equity shares of a face value of Rs.10/- each.
f. Details of shareholders holding more than 5% shares in the Company
Nos % Nos %
Equity shares of Rs. 10/- each fully paid
Tata Teleservices Limited 34,76,36,193 52.86% 34,76,36,193 52.86%
SREI Infrastructure Finance Limited 7,33,44,044 11.15% 6,10,75,688 9.29%
Macquarie SBI Infrastructure Investments Pte. Limited 6,14,44,554 9.34% 6,14,44,554 9.34%
Funderburk Mauritius Ltd. 4,23,37,331 6.44% 4,23,37,331 6.44%
IDFC Trustee Co. Ltd. 3,66,37,387 5.57% 3,66,37,387 5.57%
13.5% CROPCP shares of Rs.10/- each fully paid
IDFC Trustee Company Limited-India
Infrastructure Fund
24,99,00,000 99.96% 24,99,50,000 99.98%
As per records of the Company, including its register of shareholder/members and other declarations received from shareholders
regarding beneficial interest, the above shareholding represents both legal and beneficial ownerships of shares.
4 Reserves and Surplus
March 31, 2015 March 31, 2014
a) Capital Reserve A 421.20 421.20
b) Securities Premium
Beginning of the year 764.34 839.45
Less: Utilised for premium on redemption of 50,000 CROPCPS (108.33) (75.11)
(March 31, 2014: 50,000 CROPCPS) (see note below)
B 656.01 764.34
c) Surplus/(deficit) in the statement of profit and loss
Beginning of the year (554.59) (639.57)
Less: Depreciation impact due to life change (refer note 2.3) (15.34) -
Profit for the year 170.85 84.98
Net surplus/(deficit) in the statement of profit and loss C (399.08) (554.59)
Total reserves and surplus A+B+C 678.13 630.95
Due to inadequacy of profit for the declaration of dividend, the Company on September 26, 2014 redeemed 50,000 CROPCPS (Previous
year: 50,000 CROPCPS on September 27, 2013) of Rs.10/- each issued to preference shareholders at a redemption premium of Rs 108.33
(Previous year: Rs 75.11), in accordance with the terms of Investment Agreement dated March 23, 2010 (IA) governing the said CROPCPS.
The redemption premium has been paid utilizing Securities Premium by obtaining necessary approval of shareholders at the respective Annual
General Meetings.
5 Long-term borrowings
March 31, 2015 March 31, 2014 March 31, 2015 March 31, 2014
Secured term loans
from banks 5,088.40 4,278.51 358.09 940.89
from financial institution 592.50 463.33 30.00 132.46
5,680.90 4,741.84 388.09 1,073.35
Less: Amount disclosed under the head "other current liabilities
(refer note 9)(388.09) (1,073.35)
5,680.90 4,741.84 - -
Current maturitiesNon-current
March 31, 2015 March 31, 2014
VIOM NETWORKS LIMITED
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
A. Particulars of security for loans from banks and financial institution other than covered in (B) below:
All loans including interest accrued and due are secured on pari passu basis by the following :
i) First charge of all the Company's immovable properties, both present and future.
ii) First charge by way of hypothecation of all the Company's movables assets both present and future.
iii) First charge over all book debts, operating cash flows, revenues, commissions and receivables (excluding receivables from one particular
customer) of the Company, both present and future.
iv) First Charge by way of assignment of Insurance Contracts / Insurance Proceeds, all the rights, titles, interest benefits, claims and demands,
Intangible assets (including goodwill) O & M contracts and Master Service Agreements with the customers, excluding one particular
customer referred in A(iii) above.
v) First charges on escrow accounts (excluding escrow account for one particular customer as referred in (iii) above) and any other bank
account of the borrower.
vi) Second charge on receivables from one particular customer referred to in A(iii) above.
vii) Terms of repayment for loans from banks are set out as below:
Terms and conditions Moratorium period
(in months)
Date of maturity No of installments
remaining
Outstanding
Balance
a. Repayable in 18 unequal quarterly installments 30 September-15 2 14.76
b. Repayable in 18 unequal quarterly installments 30 December-15 3 7.49
c. Repayable in 18 unequal quarterly installments 30 September-16 2 20.00
d. Repayable in 32 unequal quarterly installments 21-24 March-17 4 26.24
e. Repayable in 16 equal quarterly installments 12 March-17 4 112.50
f. Repayable in 32 unequal quarterly installments 12-24 September-18 10 270.00
g. Repayable in 28 unequal quarterly installments 12-36 March-20 16 150.00
h. Repayable in 28 unequal quarterly installments 12-36 March-20 20 217.50
i. Repayable in 32 unequal quarterly installments 24 June-20 17 158.38
j. Repayable in 28 unequal quarterly installments 35 June-20 17 390.00
k. Repayable in 28 unequal quarterly installments 36 September-20 22 364.00
l. Repayable in 28 unequal quarterly installments 36 March-21 24 380.02
n. Repayable in 28 unequal quarterly installments 36 March-22 24 474.99
o. Repayable in 28 unequal quarterly installments 36 March-22 28 500.00
p. Repayable in 28 unequal quarterly installments 36 December-22 27 197.48
q. Repayable in 12 equal quarterly installments 24 December-19 12 200.00
3,483.36
Interest on above loan is payable monthly at floating rate from 11.25% to 12.25%.
vi) Terms of repayment for loans from financial institution are set out as below:
Terms and conditions Moratorium period
(in months)
Date of maturity No of installments
remaining
Outstanding
Balance
a. Repayable in 28 unequal quarterly installments 36 September-20 18 405.00
b. Repayable in 32 unequal quarterly installments 24 March-20 20 217.50
622.50
Interest on above loan from financial institution is payable on monthly basis at fixed/floating rate ranging from 11.48% to 11.70%.
B. Particulars of security for loans from banks other than covered in A above.
All loans including interest accrued and due are secured on pari passu basis by the following :
i. First charge on receivables from one particular customer (as referred in A(iii) above), both present and future.
ii. First charge on escrow account for deposit of remittance by one particular customer (as referred in A(iii) above)
iii. Second charge of all the Company's immovable properties, both present and future.
iv. Second charge by way of hypothecation of all the Company's movables assets both present and future.
v. Second charge by way of assignment of insurance contract/insurance proceeds, all the rights, titles, interest benefits, claims and demands,
intangible assets (including goodwill), O&M contracts and master service agreements with the customers, excluding with one particular
customer (as referred to in A(iii) above) of the company, both present and future.
vi) Terms of repayment are set out as below:
Terms and conditions Moratorium
period
(in months)
Date of maturity No of installments
remaining
Outstanding
Balance
a. Repayable in 114 equal monthly installments 6 June-24 111 973.67
b. Repayable in 114 equal monthly installments 6 July-24 111 389.47
c. Repayable in 114 equal monthly installments 6 September-24 114 500.00
d. Repayable in 114 equal monthly installments 6 November-15 114 100.00
1,963.14
Interest on above loan is payable monthly at floating rate from 11.50% to 11.75%.
VIOM NETWORKS LIMITED
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
6 Other long-term liabilities
March 31, 2015 March 31, 2014
Liabilities towards purchases of fixed assets - 0.39
Unearned Revenue 11.57 -
Lease/license equalization reserve 346.71 322.71
Security deposits from customers (unsecured) 360.23 284.98
718.51 608.08
7 Provisions
March 31, 2015 March 31, 2014 March 31, 2015 March 31, 2014
Provision for employee benefits
Provision for gratuity (see note 38) 6.26 5.92 0.54 0.32
Provision for leaves 5.15 1.61 0.94 1.33
A 11.41 7.53 1.48 1.65
Others
Provision for site restoration 174.24 165.25 - -
Provision for contingencies - - 43.27 9.35
B 174.24 165.25 43.27 9.35
A+B 185.65 172.78 44.75 11.00
a) Provision for site restoration
The Company uses various premises on lease/license to install the passive telecom infrastructure facilities. A provision is recognized for
the costs to be incurred for the restoration of these premises at the end of the lease/license period. It is expected that this provision will
be utilized at the end of the lease/license period of the respective sites as per the respective lease/license agreements. The following
table sets forth the movement in provisions:
March 31, 2015 March 31, 2014
Balance at the beginning of the year 165.25 160.66
Acquired pursuant to scheme of amalgamation(refer note 35) 9.08 -
Additions during the year 0.05 5.43
Utilised during the year (0.14) (0.84)
Balance at the end of the year 174.24 165.25
b) Provision for contingencies
Provision for contingencies represents probable outflow of resources for matters under litigation
March 31, 2015 March 31, 2014
Balance at the beginning of the year 9.35 6.27
Acquired pursuant to scheme of amalgamation(refer note 35) 4.69 -
Additions during the year 29.94 4.31
Utilised during the year (0.71) (1.23)
Balance at the end of the year 43.27 9.35
Long-term Short-term
VIOM NETWORKS LIMITED
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
8 Short-term borrowings
March 31, 2015 March 31, 2014
Secured borrowings
From Banks
Cash credit - 3.87
Other - 284.98
- 288.85
From others - 64.69
- 353.54
a) Particulars of security for borrowing from banks:
Borrowings including interest accrued and due are secured on pari passu basis by the following :
i) First charge of all the Company's immovable properties, both present and future.
ii) First charge by way of hypothecation of all the Company's movables assets both present and future.
iii) First charge over all book debts, operating cash flows, revenues, commissions and receivables (excluding receivables from one particular customer
(referred to in note 5A(iii)above) of the Company, both present and future.
iv) First Charge by way of assignment of Insurance Contracts / Insurance Proceeds, all the rights, titles, interest benefits, claims and demands,
Intangible assets (including goodwill) O & M contracts and Master Service Agreements with the customers, excluding one particular
customer referred in note 5A(iii) above.
v) First charges on escrow accounts (excluding escrow account for one particular customer as referred in 5A(iii) above) and any other bank
account of the borrower.
vi) Second charge on receivables from one particular customer referred to in note 5A(iii) above.
The assets so hypothecated are charged on a parri passu basis in favour of lenders for secured long term loans (as covered in note 5(A) above).
b) Terms of repayment of borrowings from banks are set out as below:
The cash credit is repayable on demand and interest is payable monthly at floating rate of interest at 11.75% to 12.30%.
c) Particulars of security and terms of repayment for borrowing from others:
Secured on sub-servient charge on all fixed and current assets of the Company. The facility is for 90 days and interest is linked to Short
Term Reference Rate payable on monthly basis @ 11.75%.
9 Other Current Liabilities
March 31, 2015 March 31, 2014
Trade payables (Refer note 37 for detail of due to micro and small enterprises) A 522.41 479.98
Other liabilities
Liabilities towards purchases of fixed assets 155.35 115.41
Current maturities of long-term borrowings (refer note 5) 388.09 1,073.35
Provision for expenses 61.42 57.88
Advances from customers 2.23 40.55
Interest accrued but not due on loans 1.74 1.19
Lease/license equalization reserve 10.70 7.13
Taxes payable 12.56 6.26
Other liabilities 12.07 5.32
B 644.16 1,307.09
A+B 1,166.57 1,787.07
VIOM NETWORKS LIMITED
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
10 Tangible Assets:
Gross Block Accumulated Depreciation Net Block
March 31, 2015 March 31, 2014
Acquired under
scheme of
amalgamation
(refer note 35)
Additions for
the year
Disposal/
Adjustments March 31, 2015 March 31, 2014 for the year
Disposal/
Adjustments March 31, 2015 March 31, 2015 March 31, 2014
Leasehold Improvements 16.18 - 0.08 - 16.26 11.33 3.07 - 14.40 1.86 4.85
Plant and machinery* 9,447.02 202.27 404.00 (315.95) 9,737.34 3,562.26 787.21 (217.32) 4,132.15 5,605.19 5,884.76
Computers & other IT hardware 45.86 0.02 5.63 (2.40) 49.11 38.30 5.90 (2.40) 41.80 7.31 7.56
Office equipments 6.49 - 1.30 (0.02) 7.77 3.13 1.39 (0.01) 4.51 3.26 3.36
Furniture and fittings 5.85 - 0.01 - 5.86 3.21 0.80 - 4.01 1.85 2.64
Vehicles 3.37 - - - 3.37 1.18 0.05 - 1.23 2.14 2.19
Less: Provision for damaged
assets- Plant and machinery - - - - - - - (82.29) (109.94)
Total 9,524.77 202.29 411.02 (318.37) 9,819.71 3,619.41 798.42 (219.73) 4,198.10 5,539.32 5,795.42
Gross Block Accumulated Depreciation Net Block
March 31, 2014 March 31, 2013 -- Additions for
the year
Disposal/
Adjustments March 31, 2014 March 31, 2013 For the year
Disposal/
Adjustments March 31, 2014 March 31, 2014 March 31, 2013
Leasehold Improvements 12.09 - 0.08 4.01 16.18 6.14 5.19 - 11.33 4.85 5.95
Plant and machinery* 9,331.82 - 307.43 (192.23) 9,447.02 2,926.33 740.08 (104.15) 3,562.26 5,884.76 6,405.49
Computers & other IT hardware 40.29 - 6.81 (1.24) 45.86 31.78 7.76 (1.24) 38.30 7.56 8.51
Office equipments 5.94 - 1.16 (0.61) 6.49 2.81 1.12 (0.80) 3.13 3.36 3.13
Furniture and fittings 4.99 - 0.18 0.68 5.85 1.66 1.55 - 3.21 2.64 3.33
Vehicles 3.11 - 0.26 - 3.37 1.04 0.14 - 1.18 2.19 2.07
Less: Provision for damaged
assets- Plant and machinery - - - - - - - - - (109.94) (106.47)
Total 9,398.24 - 315.92 (189.39) 9,524.77 2,969.76 755.84 (106.19) 3,619.41 5,795.42 6,322.01
*Include: 1. Plant and machinery comprises assets given on operating lease/licenses.
2. Includes site restoration obligation cost : Gross Block of Rs 164.87 (March 31, 2014 Rs.165.25) Net Block of Rs 96.63 (March 31, 2014 Rs 108.78)(refer Note 2.3).
11 Intangible Assets:
Gross Block Accumulated amortisation Net Block
March 31, 2015 March 31, 2014
Acquired under
scheme of
amalgamation
(refer note 35)
Additions for
the year
Disposal/
Adjustments March 31, 2015 March 31, 2014
Additions
for the year
Disposal/
Adjustments March 31, 2015 March 31, 2015 March 31, 2014
Additional tenancy rights 38.19 - - - 38.19 32.61 1.48 - 34.09 4.10 5.58
Goodwill (refer note 35) - 941.18 - 941.18 - 94.12 - 94.12 847.06 -
Total 38.19 941.18 - - 979.37 32.61 95.60 - 128.21 851.16 5.58
Gross Block Accumulated amortisation Net Block
March 31, 2014 March 31, 2013 -- Additions for
the year
Disposal/
Adjustments March 31, 2014 March 31, 2013
Additions
for the year
Disposal/
Adjustments March 31, 2014 March 31, 2014 March 31, 2013
Additional tenancy rights 38.19 - - - 38.19 31.13 1.48 - 32.61 5.58 7.06
Total 38.19 - - - 38.19 31.13 1.48 - 32.61 5.58 7.06
VIOM NETWORKS LIMITED
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
12 Capital work in progress:
March 31, 2015 March 31, 2014
Capital work in progress: 106.03 100.19
Less: Provision for obsolete, slow moving and damaged assets (19.23) (27.85)
86.80 72.34
13 Non current-investments (at cost)(Unquoted)
March 31, 2015 March 31, 2014
Investment in wholly owned subsidiaries:
(i) Nil (March 31, 2014 - 12,00,00,000) equity shares of Rs.10/- each fully - 956.34
paid-up of Viom Infra Networks (Maharashtra) Limited (refer note 35)
(ii) Nil (March 31, 2014 - 1,00,000) Ordinary shares of US$ 1/- each fully paid-up - 0.62
of Viom International Singapore Pte. Limited sold during the year
- 956.96
14 Current investments (at lower of cost or market value)
March 31, 2015 March 31, 2014
Investments in mutual funds - quoted
Reliance Liquid Fund-TP-Dir-Growth 20.00 -
58660.5 units at `3409.45 (March 31, 2014 : 'NIL')
ICICI Prudential Liquid Plan- Growth Option 20.00 -
966172.84 units at `207 (March 31, 2014 : 'NIL')
Birla Sunlife - cash Plus Growth Direct 20.00 -
891072.21 units at `224.45 (March 31, 2014 : 'NIL')
HDFC Liquid Fund - Direct Plan - Growth Plan 20.00 -
7246429.32 units at `27.6 (March 31, 2014 : 'NIL')
SBI Premier Liquid Fund - Dir - Growth 20.00 -
90999.05 units at `2197.83 (March 31, 2014 : 'NIL')
100.00 -
Aggregate net asset value 100.05 -
15 Trade receivables
March 31, 2015 March 31, 2014 March 31, 2015 March 31, 2014
Debts outstanding for a period exceeding six months
Unsecured and considered good* 142.86 51.62 87.01 164.48
Unsecured and considered doubtful 30.67 2.51 70.45 138.06
A 173.53 -
54.13 157.46 302.54
Debts outstanding for a period less than six months
Unsecured and considered good 3.03 - 260.34 252.09
B 3.03 - 260.34 252.09
Total trade receivables A+B 176.56 54.13 417.80 554.63
Less: Provisions for doubtful debts (30.67) (2.51) (70.45) (138.06)
145.89 51.62 347.35 416.57
"Trade receivables" include receivables from related parties amounting to Rs 183.50 (March 31, 2014 Rs 51.79 respectively. (For details
refer note 39)
* Also refer note 34
CurrentNon-Current
VIOM NETWORKS LIMITED
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
16 Other assets
March 31, 2015 March 31, 2014 March 31, 2015 March 31, 2014
Unsecured, considered good unless stated otherwise
Non-current bank balances (refer note 17) 56.01 64.44 - -
Revenue equalisation reserve 963.25 839.53 41.54 23.78
Accrued revenue - - 28.89 15.37
Accrued reimbursement of energy charges - - 143.04 148.20
Unamortised borrowing expenses 6.34 7.01 3.60 6.03
A 1,025.60 910.98 217.07 193.38
Others
Interest accrued on margin money deposit - - 0.40 0.58
Assets held for sale - - 28.19 25.55
B - - 28.59 26.13
A+B 1,025.60 910.98 245.66 219.51
"Accrued revenue and Accrued reimbursement of energy charges" include from related parties amounting to Rs 44.81
(March 31, 2014 Rs 9.19)
17 Cash and bank balances
March 31, 2015 March 31, 2014 March 31, 2015 March 31, 2014
Cash and cash equivalents
Balances with banks on current accounts 108.93 58.05
Deposits with original maturity of less than 90 days - -
108.93 58.05
Other bank balances
Margin money deposit 56.01 64.44 - -
Amount disclosed under other non-current
asset (refer note 16)(56.01) (64.44)
- -
- - 108.93 58.05
18 Loans and advances
March 31, 2015 March 31, 2014 March 31, 2015 March 31, 2014
Unsecured and considered good
Security deposits 230.68 217.53 - -
Advances to suppliers and others - - 28.88 8.75
Capital advances 12.31 16.64 - -
Loan to wholly owned subsidiary companies - 12.95 - -
Advances to related parties 8.21 8.20 3.02 33.97
Others
Prepaid expenses - - 53.33 19.39
Tax deducted at source receivable (net of provision for tax) 193.30 106.62 198.00 172.04
Balances with custom, excise and other authorities 75.11 58.80 95.43 67.93
MAT credit entitlement 33.24 3.12 - -
Unsecured, considered doubtful
Security deposits 3.56 3.56 - -
Advances to suppliers & others 11.80 10.14 - -
Capital advances 2.09 2.09 - -
Less: Provisions for doubtful advances (17.45) (15.79) - -
552.85 423.86 378.66 302.08
"Security deposits" and "Loan and advances to related parties" include deposits and advances to related parties amounting to Rs 7.74
(March 31, 2014 Rs 14.06) and Rs 11.14 (March 31. 2014 Rs 42.17) respectively. (For details refer note 39).
Non-current Current
Non-current Current
Non-current Current
VIOM Networks Limited
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
19 Service income
March 31, 2015 March 31, 2014
Infrastructure provisioning fees* 3,153.69 2,762.30
Energy and other reimbursements 1,685.60 1,600.25
4,839.29 4,362.55
*Includes Rs 29.91 (March 31, 2014 :Nil) received from one of the customer as one time settlement and earlieryear Rs. 15.92 (March 31, 2014 : Nil)
20 Other income
March 31, 2015 March 31, 2014
Interest received from subsidiary 0.47 7.82
Interest income on bank deposits 7.10 1.51
Interest others 4.08 24.59
Liabilities no longer required written back 70.05 11.70
Profit on redemption of current investments 4.65 -
Others 0.41 36.28
86.76 81.90
21 Energy charges
March 31, 2015 March 31, 2014
Networks 1,720.30 1,646.10
Others 3.26 2.49
1,723.56 1,648.59
22 Lease/license expenses
March 31, 2015 March 31, 2014
Networks 628.94 549.41
Others 14.32 16.88
643.26 566.29
Less : Project expenditure capitalised (0.25) (4.17)
643.01 562.12
23 Repairs and maintenance
March 31, 2015 March 31, 2014
Plant and machinery 393.13 366.83
Others 6.35 5.24
399.48 372.07
Less : Project expenditure capitalised - (0.60)
399.48 371.47
24 Employee benefit expenses
March 31, 2015 March 31, 2014
Salaries, allowances and bonus 143.87 135.57
Contribution to provident and other funds 5.33 5.11
Gratuity (see note 38) 1.14 2.01
Staff welfare expenses 3.62 2.54
Others 1.96 1.42
155.92 146.65
Less : Project expenditure capitalised (1.87) (4.80)
154.05 141.85
VIOM Networks Limited
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
25 Other expenses
March 31, 2015 March 31, 2014
Professional and legal fees 29.96 33.38
Travel and conveyance 19.64 17.93
Rates and taxes (net of utilisation of contingency provision) 4.13 6.12
Information technology expenses 11.94 10.95
Communication expenses 4.27 4.64
Loss on sale of non-current investment 0.57 -
Insurance 5.90 5.23
Printing and stationery 1.00 0.68
Provision for contingencies (refer note 7) 29.94 4.31
Miscellaneous expenses 1.55 1.63
108.90 84.87
Less : Project expenditure capitalised (0.54) (1.34)
108.36 83.53
* Professional & legal fees include payment to auditor :-
As auditor :
Statutory Audit fees 1.05 0.77
Reimbursement of expenses 0.02 0.03
1.07 0.80
26 Provision/ write off for fixed assets/debtors/advances
March 31, 2015 March 31, 2014
Loss on sale/write off of fixed assets 59.26 57.48
Provision for slow moving and damaged assets 22.98 48.91
Less: Provision utilised during the year (59.26) 22.98 (56.30) 50.09
Bad debts/advances written off 96.45 80.78
Provision for bad and doubtful debt/advances 47.82 61.16
Less: Provision utilised during the year (96.45) 47.82 (80.78) 61.16
70.80 111.25
27 Depreciation and amortisation expenses (refer note 10 & 11)
March 31, 2015 March 31, 2014
Depreciation 798.42 755.84
Less: Transfer to reserve and surplus (15.34) 783.08 - 755.84
(Refer note no 2.3)
Amortisation of intangible assets 95.60 1.48
878.68 757.32
28 Interest and finance charges
March 31, 2015 March 31, 2014
Interest on loans from banks and financial institutions 754.70 816.23
Interest others 10.86 13.21
Bank and other finance charges 11.70 12.90
777.26 842.34
VIOM Networks Limited
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
29 Exceptional items
March 31, 2015 March 31, 2014
Income:
(i) Compensation for periodic shortfall in committed tenancy (refer (a) below) - 260.00
(ii) Amount received towards exit fees/lock-in charges (refer b(i) below) - 30.00
A - 290.00
Expenses
(i) Amount paid/provision for exit fees (refer b(ii) below) - (6.23)
(ii) Bad Debts write off of certain customers (refer (b) (iii) below) - (13.06)
(iii) Discontinuance of Revenue equalisation reserve based on - (111.71)
reassessment/exit of sites by customer
B - (131.00)
A+B - 159.00
(a)
(b)
30 Earning Per Share (‘EPS’)
March 31, 2015 March 31, 2014
Net profit as per statement of profit and loss 170.85 84.98
Less: Preference shares dividend 33.75 33.75
Less: Dividend distribution tax thereon 6.91 5.74
Net profit attributable to equity shareholders 130.19 45.49
Weighted average number of equity shares in calculating basic EPS 65,77,14,012 65,77,14,012
Weighted average number of equity shares in calculating diluted EPS 66,23,34,090 66,38,73,099
Basic earning per share (Rs) 1.98 0.69
Diluted earning per share (Rs) 1.98 0.69
Nominal value per equity share (Rs.) 10.00 10.00
31 Foreign currency transactions
March 31, 2015 March 31, 2014
(a) Expenditure in foreign currency (accrual basis)
Professional fees 1.03 0.11
Travelling expenditure 0.62 1.06
Others 0.18 -
1.83 1.17
(b) Income in foreign currency (accrual basis)
Interest on loan to a subsidiary 0.47 -
(c) Particulars of unhedged foreign currency exposure
Loans and advances Nil (March 31, 2014 USD 0.19) - 11.12
32 Commitments
March 31, 2015 March 31, 2014
Estimated amount of contracts remaining to be executed on capital accounts and not 76.02 246.87
provided for (net of capital advances)
As a result of actions taken by various telecom operators and customers of the Company in the form of either not participating or
deciding to bid for lower number of licenses in respect of Hon’ble Supreme Court of India’s cancellation of UASL 2G licenses and its
subsequent directions thereupon, the Company during the previous year:
(i) Claimed and received as exit fee from one of its customers amounting to Rs Nil (March 31, 2014 Rs 30)
(ii) Paid and made provision for exit fees for sites of other service providers Rs Nil (March 31, 2014 Rs (-) 6.23)
(iii) Bad Debts write off Rs Nil (March 31, 2014 Rs 58.82) net of provision for doubtful debts Rs Nil (March 31, 2014 Rs 45.76).
Compensation claims receivable from customers against periodic shortfall in committed tenancy based on settlement reached with the
customer during previous year received during the year.
VIOM Networks Limited
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
33 Contingent Liabilities
March 31, 2015 March 31, 2014
a) Bank guarantees 9.13 9.05
b) Contingent liabilities in respect of :
I Income Tax (refer (i) below) 91.63 36.88
II Indirect Tax :
-Sales Tax / VAT / Entry Tax (refer (ii) below) 312.95 299.03 -Service Tax (refer (iii) below) 855.20 782.97
III Other legal matters (Civil, criminal and writ petition) 18.27 15.07
IV Property Taxes and Municipal Charges (refer (iv) below)
V Stamp Duty (refer (v) below) 14.60 14.60
(i)
(ii)
(iii)
(iv)
(v) The Company has preferred an appeal with the Hon'ble Supreme Court and obtained stay order against the order of Hon'ble
High Court of Allahabad in respect of demand from State of U.P. for stamp duty on certain leave and license agreements.
c)
34
35
i)
ii)
iii)
iv)
36 During the year, the Company disinvested its entire share holding in its overseas wholly owned subsidiary, viz Viom International
Singapore Pte Ltd.(Viom Singapore). Viom Singapore had created its subsidiary in Myanmar, namely Viom International
(Myanmar) Co Ltd. Hence these two companies have ceased to be subsidiaries of the Company with effect from March 30, 2015.
Goodwill arising on account of amalgamation as referred to in clause (iii) above is amortised over a period of ten years, being useful life
estimated by the management, effective from April 01, 2014.
Sales tax/VAT/Entry tax demand mainly represents dispute with tax authorities on applicability of sales tax/VAT/ entry tax, where stay
orders have been received at various levels in several states.
Income Tax cases represent amount demanded against the assessment year 2006-07, 2008-09 and 2012-13. The amount relates to
various matters relating to deductions of tax at source, depreciation claim and minimum alternate tax(MAT).
Investment amount for shares of Viom Infra standing in the books of the Company has been cancelled. Differential of Rs. 941.18 being
difference of the investment amount for the shares of Viom Infra held by the Company, in the books of the Company as at the April 01,
2014 less fair value of net assets has been debited to Goodwill account.
The amalgamation has been accounted for under the “Purchase Method” as prescribed by the Accounting Standard 14 “Accounting for
Amalgamation”
Service Tax represents show cause notices received in relation to input credit taken , where Company has appropriately replied to these
matters.
In respect of municipal charges and property taxes which, in view of the management is an industry vide phenomenon, the Company
has been representing to the authorities wherever required and have been challenging or being challenged in various courts including
Hon’ble Supreme Court. As on balance sheet date, to the best of the knowledge of the management, the Company has demands for
property taxes outstanding amounting to Rs. 45.46. On the basis of best estimates, the Company has made a contingency provision of
Rs. 38.02 in this regard. In view of the uncertainties about applicability and determination of amount of overall exposure involved, the
Company considers the exposure of these amounts on the financial statements not quantifiable.
During the year one of the customers has raised disputes over invoices for reimbursement of energy and other charges and also made
counter claims involving arbitration before Hon’ble High Court of Delhi. The Hon’ble High Court has passed interim order and
appointed an Arbitrator for settling the claims and counter claims. In view of pending arbitration process, it is not possible to predict
outcome of arbitration and financial impact thereof.
Pursuant to the scheme of amalgamation (‘the Scheme’) of erstwhile Viom Infra Networks (Maharashtra) Limited (‘Viom Infra’), wholly
owned subsidiary of the Company, with the Company under sections 391 to 394 of the Companies Act, 1956, sanctioned by Hon’ble
High Court of Delhi on December 04, 2014, entire business and all assets and liabilities of Viom Infra have been transferred and vested
in the Company effective from April 01, 2014 (‘Appointed Date’). Accordingly the Scheme has been given effect to in these financial
statements as below:
An estimated amount of dividend/redemption premium, accruing in terms of Investment Agreement (IA) (which may be paid as dividend
or redemption premium in terms of said agreement) is accumulated as on balance sheet date, on pro-rata basis, aggregates to Rs 33.75
(March 31, 2014 Rs 84.79). In view of this, no adjustments are carried in books and thus the impact of same on net-worth is not
disclosed in financial statement.
All assets and liabilities of Viom Infra have been recorded at their respective fair value under respective accounting heads and
intercompany balances stand cancelled.
Viom Networks Limited
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
37 Details of dues to micro and small enterprises as defined under the Micro, Small and Medium Enterprises
Development Act, 2006 (MSMED)
March 31, 2015 March 31, 2014
Amounts due to micro, and small enterprises under MSMED based on the
information available with the
Company and the confirmation received from the creditors till the year end:
a) The principal amount and the interest due thereon Principal amount due 9.17 4.91
remaining unpaid to any supplier as at the end of each Interest due thereon 5.88 3.04
accounting year:
b) The amount of interest paid by the buyer in terms of Principal amount 42.15 45.28
section 16 of the MSMED along with the amounts of the Adjusted during 4.87 -
payment made to the supplier beyond the appointed day the year
during each accounting year :
c) The amount of interest due and payable for the year of delay in making - -
payment (which have been paid but beyond the appointed day during the year) but
without adding the interest specified under MSMED
d) The amount of interest accrued and remaining unpaid at the end of each 3.32 4.20
accounting year;
e) The amount of further interest remaining due and payable even in the 10.52 6.82
succeeding years, until such date when the interest dues as above are actually
paid to the small enterprise for the purpose of disallowance as a deductible
expenditure under section 23 of the MSMED (includes Rs 1.34 acquired pursuant to scheme of amalgamation(refer note 35)).
38 Employee benefit plans
i. Reconciliation of opening and closing balances of benefit obligations and plan assets:
Change in benefit obligation March 31, 2015 March 31, 2014Benefit obligation at the beginning of the year 6.24 4.87
Acquired pursuant to scheme of amalgamation (refer note 35) 0.17 -
Service cost 2.19 0.48
Interest cost 0.48 0.43
Benefits paid (0.75) (0.64)
Actuarial loss (1.53) 1.10
Benefit obligation at the end of the year 6.80 6.24
ii. Amount charged to the statement of profit and loss:
Components of net benefit cost
Service cost 2.19 0.48
Interest cost 0.48 0.43
Net actuarial (gain) / loss recognized during the year (1.53) 1.10
1.14 2.01
iii. The assumptions used in accounting for the gratuity plan for the year are as below:
Salary Rise 8% 10%
Discount Rate 7.80% 8.00%
Attrition Rate 10% 5%
Gratuity March 31, 2015 March 31, 2014
Defined benefit obligation 6.80 6.24
Fair value of plan assets - -
Funded Status (asset) / liability 6.80 6.24
Unrecognised past service cost-non vested benefit - -
Liability recognised in Balance Sheet 6.80 6.24
Gratuity March 31, 2013 March 31, 2012 March 31, 2011
Defined benefit obligation 4.87 4.25 3.29
Fair value of plan assets - - -
Funded Status (asset) / liability 4.87 4.25 3.29
Unrecognised past service cost-non vested benefit - - -
4.87 4.25 3.29
The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a
gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The following tables summarise the
components of net benefit expense recognised in the profit and loss account and the amounts recognised in the balance sheet for
the plan.
The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and
other relevant factors, such as supply and demand in the employment market.
Amounts for the current and previous years are as follows:
VIOM Networks Limited
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
39 Related party disclosures
Disclosure as required by Accounting Standard 18 (AS 18) ‘Related Party Disclosures’ issued by Institute of Chartered Accountants of India is as follows:
A. Names of Related parties and descriptions of relationship:
(i) Holding Company : Tata Teleservices Limited
(ii) Subsidiary Company : Viom Infra Networks (Maharashtra) Limited (amalgamated with the company effective from April 01,2014, refer note 35)
: Viom International Singapore Pte. Limited (Ceased from March 30, 2015) (refer note 36)
: Viom International (Myanmar) Co. Limited (Ceased from March 30, 2015) (refer note 36)
(iii) Key Management Personnel (KMP) : Mr Sunil Kanoria, Vice Chairman and Managing Director
(iv)
B. Additional related parties as per Company Act 2013 section 2(76) with whom transactions have taken place during the year
(i) Holding Company : Tata Sons Limited
(ii) Fellow Subsidiaries : Tata AIG General Insurance Company Limited
: Tata International Limited
: Tata Capital financial services Limited
: Tata Consultancy Services Limited
: Tata Capital Forex Limited (formerly TT Holdings & Services Limited)
: Infiniti Retail Limited
: Drive India Enterprises Solutions Limited
: Tata Teleservices (Maharashtra) Limited
(iii) Key Management Personnel (KMP) : Mr. Syed Safawi, Chief Executive Officer
: Mr. Shirish Maniar, Chief Financial Officer
: Mr. Sudhir Prasad, Chief Operating Officer
: Mrs.Geeta Puri Seth, Company Secretary
(iv) Relative of Key Management Personnel : Mrs. Lubna Safawi
: Mrs. Rita Maniar
: Mrs. Kamla Verma
(iv) : Spice Tours & Travel Pvt. Ltd.
Enterprise having Significant Influence of KMP and their relatives
KMP's having significant influence on enterprise through their
relative
: SREI Equipment Finance Private Limited
: SREI Infrastructure Finance Limited
: Quippo Valuers and Auctioneers Private Limited (ceased to be related party with effect from October 25,2013)
: Quippo Oil & Gas Infrastructure Limited
: Quippo Telecom Infrastructure Private Limited
VIOM Networks Limited
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
C. Details of transactions during the year with the above parties:
Nature of transaction
31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14
I. Transactions during the year ended
a. Infrastructure provisioning fees (refer note (i) below
Tata Teleservices Limited 992.91 1,058.44 - - - - - - - - - - - -
Tata Teleservices (Maharashtra) Limited - - - - - - - - - - 178.39 25.72
Viom Infra Networks (Maharashtra) Limited* - - - 18.60 - - - - - - - - - -
b. Energy and other reimbursements
Tata Teleservices Limited 641.42 683.94 - - - - - - - - - - - -
Tata Teleservices (Maharashtra) Limited - - - - - - - - - - - - 73.58 9.61
Viom Infra Networks (Maharashtra) Limited* - - - 5.77 - - - - - - - - - -
c. Site lease/license,office/other lease and repair &
maintenance expenses
- - - - - - - -
Viom Infra Networks (Maharashtra) Limited* - - - 45.99 - - - - - - - - - -
Tata Teleservices Limited 1.66 2.35 - - - - - - - - - - - -
SREI Infrastructure Finance Limited - - - - 10.22 8.08 - - - - - - - -
SREI Equipment Finance Limited - - - - 0.07 0.01 - - - - - - - -
Tata Consultancy Services Limited - - - - - - - - - - - - 0.06 -
Drive India Enterprises Solutions Limited - - - - - - - - - - - - 8.80 -
Tata Capital Financial Services Limited - - - - - - - - - - - - 0.35 -
Lubna Safawi - - - - - - - - 0.08 - - - - -
Rita Maniar - - - - - - - - 0.04 - - - - -
Spice Travel private Ltd. - - - - - - - - - - 0.03 - - -
Kamla Verma - - - - - - - - 0.10 - - - - -
d. Communication expenses - - - - - - - -
Tata Teleservices Limited 2.73 3.68 - - - - - - - - - - - -
Tata Teleservices (Maharashtra) Limited - - - - - - - - - - - - 0.09 0.16
e. Information technology solutions
Tata Consultancy Services Limited - - - - - - - - - - - - 3.65 -
f. Insurance expense
Tata AIG General Insurance Company Limited - - - - - - - - - - - - 0.14 -
KMP's having
significant
influence on enterprise
through their relative
Fellow SubsidiariesHolding Company Subsidiary Company
Enterprise having
Significant Influence
of KMP and their
relatives
Key Management
Personnel
Relative of Key
Management Personnel
VIOM Networks Limited
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
Nature of transaction
I. Transactions during the year ended 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14
g. Remuneration to key managerial personnel
Mr. Syed Safawi, Chief Executive Officer
Salary, bonus and contribution to PF - - - - - - 5.84 - - - - - - -
Mr. Shirish Maniar, Chief Financial Officer
Salary, bonus and contribution to PF - - - - - - 2.13 - - - - - - -
Mr. Sudhir Prasad, Chief Operating Officer
Salary, bonus and contribution to PF - - - - - - 2.74 - - - - - - -
Mrs.Geeta Puri Seth, Company Secretary
Salary, bonus and contribution to PF - - - - - - 0.57 - - - - - - -
Holding Company Subsidiary Company
Enterprise having
Significant Influence
of KMP and their
relatives
Key Management
Personnel
Relative of Key
Management Personnel
KMP's having
significant influence on
enterprise through their
relative
Fellow Subsidiaries
VIOM Networks Limited
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
Nature of transaction
I. Transactions during the year ended 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14
h. Interest Received from Related Party
Viom Infra Networks (Maharashtra) Limited* - - - 7.82 - - - - - - - - - -
Viom International Singapore Pte. Limited - - 0.47 - - - - - - - - - - -
i. Finance charge (Interest)
SREI Equipment Finance (P) Limited - - - - - 14.70 - - - - - - - -
j. Reimbursement of expenses paid by related party (net of
revenues/ recoveries from other operators)
Viom Infra Networks (Maharashtra) Limited* - - - 14.49 - - - - - - - - - -
Tata International Limited - - - - - - - - - - - - 0.06 -
Tata Capital Forex Limited - - - - - - - - - - - - 0.29 -
SREI Equipment Finance Limited - - - - 0.02 0.07 - - - - - - - -
SREI Infrastructure Finance Limited - - - - 0.26 1.31 - - - - - - - -
k. Reimbursement of expenses incurred by the Company
on behalf of related party
Viom Infra Networks (Maharashtra) Limited* - - - 0.92 - - - - - - - - - -
l. Common sharing expenses (refer (ii) below
Viom Infra Networks (Maharashtra) Limited* - - - 29.78 - - - - - - - - - -
m. Consultancy expenses
Quippo Valuers and Auctioneers Private Limited - - - - - 0.09 - - - - - - - -
n. Loan repaid by the Company
SREI Equipment Finance Private Limited - - - - - 121.88 - - - - - - - -
o. Inter Corporate Deposits (ICD) given by the Company
Viom International Singapore Pte. Limited - - - 11.12 - - - - - - - - - -
p. Inter Corporate Deposits (ICD) re-paid by the related party
Viom Infra Networks (Maharashtra) Limited* - - - 100.00 - - - - - - - - - -
Viom International Singapore Pte. Limited (including
exchange fluctuation)
- - 11.37 - - - - - - - - - - -
q. Security deposits received
Tata Teleservices Limited 8.07 1.58 - - - - - - - - - - - -
Tata Teleservices (Maharashtra) Limited - - - - - - - - - - - - 0.26 1.10
r. Security deposits paid
Tata Teleservices Limited 0.27 - - - - - - - - - - - - -
SREI Infrastructure Finance Limited - - - - 0.01 0.03 - - - - - - - -
s. Sale of equity of subsidiary co.
Quippo Telecom Infrastructure Private Limited - - - - 0.05 - - - - - - - - -
t. Equity contribution made
Viom International Singapore Pte. Limited - - - 0.62 - - - - - - - - - -
Holding Company Subsidiary Company
Enterprise having
Significant Influence
of KMP and their
relatives
Key Management
Personnel
Relative of Key
Management Personnel
KMP's having
significant influence on
enterprise through their
relative
Fellow Subsidiaries
VIOM Networks Limited
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
II. Balances at the end of the year
Nature of transaction
Assets As at 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14 31-Mar-15 31-Mar-14
Trade receivables (refer (iii) below
Tata Teleservices Limited 110.04 41.08 - - - - - - - - - - - -
Tata Teleservices (Maharashtra) Limited - - - - - - - - - - - - 73.46 18.95
Viom Infra Networks (Maharashtra) Limited* - - - 9.84 - - - - - - - - - -
Loans and advances (Security Deposit given)
Tata Teleservices Limited 1.10 0.83 - - - - - - - - - - - -
Viom Infra Networks (Maharashtra) Limited* - - - 6.60 - - - - - - - - - -
SREI Infrastructure Finance Limited - - - - 6.64 6.63 - - - - - - - -
Loan to Subsidiary
Viom Infra Networks (Maharashtra) Limited* - - - 1.83 - - - - - - - - - -
Viom International Singapore Pte. Ltd - - - 11.12 - - - - - - - - - -
Reimbursement of expenses receivable
Tata Teleservices Limited 2.77 1.79 - - - - - - - - - - - -
Infiniti Retail Limited - - - - - - - - - - - - 0.01 -
Viom Infra Networks (Maharashtra) Limited* - - - 32.16 - - - - - - - - - -
Others - - - - - -
Quippo Telecom Infrastructure Private Limited - - - - 8.21 8.20 - - - - - - - -
Drive India Enterprises Solutions Limited - - - - - - - - - - - - 0.22 -
Quippo Oil & Gas Infrastructure Limited - - - - 0.02 0.02 - - - - - - -
Liabilities
Security Deposit received
Tata Teleservices Limited 137.29 129.22 - - - - - - - - - - - -
Tata Teleservices (Maharashtra) Limited - - - - - - - - - - - - 17.29 2.24
Payable Balance
Quippo Valuers and Auctioneers Private Limited - - - - - 0.07
Tata Consultancy Services Limited - - - - - - - - - - - - 0.72 -
SREI Infrastructure Finance Limited - - - - - - - - - - - - - -
Note: -
(ii) Common sharing expenses allocated during previous year as per agreement entered between the Company and subsidiary company (including allocation of previous year expenses of Rs. 13.82)
(iii) Trade receivables are excluding provisions.
* Viom Infra Networks (Maharashtra) Limited merged with the Company effective from April 01, 2014 and hence figure for current year are "Nil") (refer note 35)
Fellow Subsidiaries
(i) The infrastructure provisioning fees from Tata Teleservices Limited (‘the Holding Company’) and Tata Teleservices (Maharashtra) Limited (‘the Fellow Subsidiary) does not include the revenue equalization adjustment aggregating
Rs 39.90 (March 31, 2014 Rs 73.63) and Rs 23.96 (March 31, 2014 Rs 5.46) respectively.
Holding Company Subsidiary Company
Enterprise having
Significant Influence
of KMP and their
relatives
Key Management
Personnel
Relative of Key
Management Personnel
KMP's having
significant influence on
enterprise through their
relative
Viom Networks Limited
Notes forming part of the financial statements for the year ended March 31, 2015
(All amounts in Rupees crores, unless stated otherwise)
40 Operating leases/ Service revenue
Future minimum lease/license commitments under operating leases/licenses are as follows:
March 31, 2015 March 31, 2014(i) not later than one year 617.39 497.08
(ii) later than one year and not later than five years 2,313.54 1,932.92
(iii) later than five years 2,734.83 2,752.65
5,665.76 5,182.65
b) Where the Company is a infrastructure service provider
Service revenue
Future minimum infrastructure provisioning fees receivables under infrastructure service agreement are as follows:
March 31, 2015 March 31, 2014
(i) not later than one year 2,889.84 2,522.42
(ii) later than one year and not later than five years 10,063.19 9,362.50
(iii) later than five years 9,512.83 8,146.59
22,465.86 20,031.51
41 Previous year comparatives
As per our report of even date
For S.R. Batliboi & Co. LLP For and on behalf of the Board of Directors of Viom Networks Limited
Firm registration number: 301003E
Chartered Accountants
-sd- -sd- -sd-
per Vikas Mehra Sunil Kanoria Eruch N Kapadia
Partner Vice-Chairman and Director
Membership no. 94421 Managing Director
-sd- -sd-
Syed Safawi Shirish J Maniar
Chief Executive Officer Chief Financial Officer
-sd- -sd-
Place : Gurgaon Geeta Puri Seth Naveen Maheshwari
Date: May 06,2015 Company Secretary Finance Controller
Place : Mumbai
Date: May 06,2015
a) Where the Company is a lessee/licensee
The Company has entered into various lease/license agreements for leased/licensed premises, which expire at various dates over the next
twenty 'years. There are no contingent lease/license fees payments. Gross lease/license fee for the ended March 31, 2015 is Rs 643.26
(March 31, 2014 – Rs 566.29) includes lease/license equalization of Rs 9.28 (March 31, 2014 – Rs 28.83) for considering fixed
escalation on a straight line basis over the lease/license term.
The service revenue recognized during the year includes income from infrastructure provisioning fees over the year relating to passive
infrastructure sites. Gross revenue from infrastructure services for the year ended March 31, 2015 is Rs 3,153.69 (March 31, 2014 ‑ Rs
2,762.30) includes revenue equalization of Rs 74.59 (March 31, 2014 – Rs 89.71) considering fixed escalation on a straight line basis
over the lease term.
In view of note 35 and 36 the figures for the year are strictly not comparable with figures for the previous year. Previous year figures to
the extent disclosed in the financial statement, have been regrouped where necessary to conform to the current year classification.