By Himanshu V. Kishnadwala
Chartered Accountant
Assumption
of ‘Going Concern’ basis for preparation of financial statements for the year
ended 31st March
2018 and reporting thereon in independent auditor’s report for SEBI LODR
regulations
Jet Airways (India)
Ltd.
From Notes to financial results
The
Company has incurred a loss during the year and has negative net worth as at 31st
March, 2018 that may create uncertainties. However, various initiatives
undertaken by the Company in relation to saving cost, optimise revenue
management opportunities and enhance ancillary revenues is expected to result
in improved operating performance. Further, our continued thrust to improve
operational efficiency and initiatives to raise funds are expected to result in
sustainable cash flows addressing any uncertainties, accordingly, the statement
of financial results continues to be prepared on a going concern basis, which
contemplates realisation of assets and settlement of liabilities in the normal
course of business including financial support to its subsidiaries.
From auditor’s report
Emphasis of Matter
We
draw attention to Note 13 of the annual standalone financial results regarding
preparation of the annual standalone financial results on going concern basis
for the reasons stated therein. The appropriateness of assumption of going
concern is dependent upon realisation of the various initiatives undertaken by
the Company and/or the Company’s ability to raise requisite finance/generate
cash flows in future to meet its obligations, including financial support to
its subsidiary companies. Our opinion is not modified in respect of this
matter.
Reliance
Communications Ltd.
From Notes to financial results
The
Company was engaged with Joint Lenders’ Forum (JLF), constituted on June 2,
2017 and under standstill period till December 2017 pursuant to the Strategic
Debt Restructuring Scheme (SDR Scheme) of Reserve Bank of India (RBI).
Consequent to circular of 1 February, 2018 of RBI, the Company continued to
work closely with the Lenders to finalise an overall debt resolution plan.
Pursuant to strategic transformation programme, as a part of debt resolution
plan of the Company under consideration, inter alia of the Lenders, the
Company and its subsidiaries; Reliance Telecom Limited (RTL) and Reliance
lnfratel Limited (RITL), with the permission of and on the basis of suggestions
of the Lenders, had for monetisation of some specified Assets, entered into
definitive binding agreements with Reliance Jio lnfocomm Limited (RJio) on
December 28, 2017 for sale of Wireless Spectrum, Towers, Fiber and Media
Convergence Nodes (MCNs). Further, the Company has also entered into a
definitive binding agreement with Pantel Technologies Private Limited and
Veecon Media and Television Limited for sale of its subsidiary company having
DTH Business. The Company and its said subsidiaries expected to close these
transactions in a phased manner. In the meanwhile, Hon’ble National Company Law
Tribunal (NCLT), Mumbai has, overruling the objections of the Company as also
its lenders represented by State Bank of India, the lead member, vide its order
dated May 15, 2018 admitted applications filed by an operational creditor for
its claims against the Company and its subsidiaries; RTL and RITL and thereby
admitted the companies to debt resolution process under the Insolvency and
Bankruptcy Code, 2016 (IBC). As a consequence, Interim Resolution Professionals
(IRPs) were appointed vide NCLT’s order dated May 18, 2018. The Company along
with the support of the lenders filed an appeal with Hon’ble National Company
Law Appellate Tribunal (NCLAT) challenging the order of NCLT admitting the Company
to IBC proceedings. The Hon’ble NCLAT, vide its order dated May 30, 2018,
stayed the order passed by NCLT and consequently, the Board stands reinstated.
Further, Minority Shareholders holding 4.26% stake in RITL had accused the
management of RITL of “Oppression of minority shareholders and
mismanagement” and filed a petition in NCLT. Based on an amendment to the
Petition, the NCLT stayed RITL’s proposed asset sale (Tower and Fibre). The
parties have subsequently settled the dispute and the restriction on sale
stands vacated pursuant to order admitting RITL to the IBC proceeding is
vacated. The Company is confident that a suitable debt resolution plan would be
formulated along with its lenders as per the strategic transformation
programme. Considering these developments, the financial results continue to be
prepared on going concern basis. This matter has been referred to by the
Auditors in their Audit Report.
From auditor’s report
We
draw attention to Note 7 of the standalone Ind AS financial results, regarding
the Definitive Binding Agreement for monetisation of assets of the company
& its two subsidiaries and National Company Law Appellate Tribunal (NCLAT)
order dated 30th May 2018 staying the NCLT order dated 15th
May 2018 admitting the Company under Insolvency and Bankruptcy Code (IBC),
2016. The Company is confident that a suitable resolution plan would be
formulated by lenders in view of order admitting the Company under IBC
proceedings is vacated/stayed, accordingly financial results of the Company have
been prepared on going concern basis. Our opinion is not modified in respect of
the above matters.
Tata Teleservices
(Maharashtra) Ltd
From Notes to financial results
The
accumulated losses of the company as of March 31, 2018 have exceeded its
paid-up capital and reserves. The company has incurred net loss during the year
ended March 31, 2018 and the company’s current liabilities exceeded its current
assets as on that date. The company is in discussion for monetisation of
certain assets, proceeds of which will be used to meet its financial
obligations as and when they fall due. Further, the company has obtained a
support letter from its promoter indicating that the promoter will take
necessary actions to organise for any shortfall in liquidity in the company
that may arise to meet its financial obligations and
timely repayment of
debt during the 12 months from balance sheet date.
From auditor’s report
No
remarks
Sri Adhikari
Brothers Television Network Ltd.
From Notes to financial results
During
the year ended 31st March 2018, the company’s loan facilities from
banks has turned Non performing. Management of the company has submitted its
resolution plan, which is under consideration with the banks. The management of
the company is focussing on growth in cash flow and is quite confident to reach
some workable solution to resolve the financial position of the company.
From auditor’s report
We
draw attention to Note 6 regarding preparation of results on going concern
basis notwithstanding the fact that loans have been recalled back by secured
lenders, current liabilities are substantially higher than the current assets
and substantial losses incurred by the company during the financial year ending
31st March 2018. The appropriateness of assumption of going concern
is mainly dependent on approval of company’s resolution plan with the secured
lenders, company’s ability to generate growth in cash flows in future, to meet
its obligations.
Our
opinion is not modified in respect of the matter stated in the above paragraph.
Spice Jet Ltd.
From Notes to financial results
The
Company has been consistently profitable for the last three financial years, as
a result of which the negative net worth of Rs. 14,852 million as on March 31,
2015 has substantially improved, and is only Rs. 429.7 million as on March 31,
2018. The Company’s net current liabilities have also reduced by similar
amounts. The earlier position of negative net worth and net current liabilities
was the result of historical market factors.
As a
result of various operational, commercial and financial measures implemented
over the last three years, the Company has significantly improved its liquidity
position, and generated operating cash flows during that period.
In
view of the foregoing and having regard to industry outlook in the markets in
which the Company operates, management is of the view that the Company will be
able to maintain profitable operations and raise funds as necessary, in order
to meet its liabilities as they fall due. Accordingly, these financial results
have been prepared on the basis that the Company will continue as a going
concern for the foreseeable future.
From auditor’s report
No remarks
