1. Employee stock option plans

During the year ended 31 March 2019, the Company's equity settled ESOP Schemes viz., ESOP Scheme 2014 was in existence.

(a) Employee Stock Option Scheme 2014 (ESOP 2014) :

The Compensation Committee recommended the new ESOP Scheme 2014 and the Board approved the new ESOP Scheme 2014 at its meeting held on 11 November 2014 and Shareholders approved this ESOP Scheme 2014 at its meeting held on 20 November 2014.

As per the ESOP Scheme 2014, 25% of the options shall vest equally at the end of each year from the date of grant.

The exercise period of these options is as follows :

i) For the employees while in employment of the Company : Within a period of two years from the date of vesting of the respective Employee Stock Options.

ii) For the retired employees, termination due to permanent disability, death: Within six months from the date of retirement, termination due to physical disability or death, respectively.

*On 3 April 2018, the Board of Directors of the Company and on 15 May 2018 the Shareholders of the Company have approved the amendment in the employee stock option scheme 2014, whereby exercise price of existing granted options (419,002 vested options and 209,501 unvested options) got revised from Rs, 600/- per option to Rs, 400/- per option and its exercise period got extended upto 11 December 2020.

*On 3 April 2018, the Board of Directors approved the grant of 208,578 options under employee stock option Scheme 2014 at an exercise price of Rs, 400/- per option to the employee of the Company and its Subsidiaries.

2. Related party disclosure

1. Names of related parties where control exists irrespective of whether transactions have occurred or not.

Subsidiaries Scrabble Entertainment Limited

Valuable Digital Screens Private Limited United Film Organisers Nepal Private Limited, Nepal PJSA Technosoft Private Limited UFO Lanka Private Limited, Sri Lanka*

UFO Software Technologies Private Limited

United Film Organisers(Mauritius) Private Limited, Mauritius (upto 08 June 2018)

Step-down subsidiaries Scrabble Entertainment DMCC, Dubai

Scrabble Entertainment (Lebanon) Sarl, Lebanon Scrabble Digital Inc.,USA.

Scrabble Entertainment Mauritius Limited, Mauritius Scrabble Entertainment Israel Ltd, Israel*

Scrabble Digital Limited (w.e.f. 15 December 2018)

* Under voluntary liquidation

Names of other related parties with whom transactions have taken place during the year.

Key management personnel Mr. Sanjay Gaikwad - Managing Director

Mr. Kapil Agarwal - Joint Managing Director

Mr. Ashish Malushte - Chief Financial Officer

Mr. Rajesh Mishra - CEO- Indian Operations

Mr. Sameer Chavan - Company Secretary

Mr. Sanjeev Aga - Independent and Non executive director

Mr. S. Madhavan - Independent and Non executive director

Ms. Lynn de Souza - Independent and Non executive director

Mr. Ameya Hete - Non executive director

Relatives of Key management personnel Mr. Narendra Hete

Enterprises owned or significantly influenced by key management personnel or their relatives

Media Infotek Park Shree Enterprises Valuable Media Limited Valuable Technologies Limited Valuable Edutainment Private Limited Valuable Infotainment Private Limited Qwik Entertainment India Limited Impact Media Exchange Limited Nifty Portfolio Services Private Limited Advent Fiscal Private Limited

S.Madhavan (HUF)

Associate of Subsidiary Scrabble Digital Limited (upto 14 December 2018)

Mukta VN Films Limited

Scrabble Digital DMCC, Dubai

Scrabble Ventures LLC, USA

Scrabble Ventures, S.de R.L. de C.V., Mexico

*Key managerial personnel and relatives of promoters who are under the employment of the Company are entitled to post employment benefits and other long term employee benefits recognized as per Ind AS -19 Employee Benefits in the financial statements. As these employee benefits are lump sum amounts provided on the basis of actuarial valuation, the same is not included above as they are determined on an actuarial basis for the Company as a whole.

Notes:

a) As at 31 March 2018, the Company has provided corporate guarantee to bank for overdraft facility of Rs, 300 lacs taken by Mukta VN Films Limited, associate of subsidiary assuring that it will take all necessary steps so that the repayment of the loan is honored as and when due and payable. The corporate guarantee has been reduced to Rs, 200 lacs as at 31 March 2019.

b) The Company has provided corporate guarantee to bank for term loan and cash credit facility of Rs, 2,384 lacs taken by Valuable Digital Screens Private Limited (subsidiary) assuring that it will take all necessary steps so that the repayment of the loan is honored as and when due and payable. The outstanding term loan of the subsidiary Company as on 31 March 2019 is Rs, 466.72 lacs (31 March 2018 : Rs, 730.13 lacs)

c) The transactions with related parties are made on terms equivalent to those that prevail in arm's length transactions and ordinary course of business. The assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates. Outstanding balances at the year-end are unsecured and settlement occurs in cash.

Notes:

a) As at 31 March 2018, the Company has provided bank guarantee of Rs, 100 lacs to Chief Secretary, Revenue Department, Government of Maharashtra on behalf of Impact Exchange Media Private Limited, for declaring it as approved satellite based computer ticketing system provider in Maharashtra in connection with the business of operating satellite based ticketing system managed by the Company.

b) The Company is contesting the demand/matter relating to pending litigations listed above and the management, including its tax advisors, believe that its position will likely be upheld in the appellate process. No tax expense has been accrued in the financial statements for the tax demand raised. The management believes that the ultimate outcome of these proceedings will not have a material adverse effect on the Company's financial position and results of operations.

c) i) West Bengal Case : The Company has received an Order dated 4 July 2011 from the Senior Jt. Commissioner, Sales Tax Behala Circle (West Bengal) for the year 2007-2008 demanding sales tax payment of Rs, 41.90 lacs. The Company has filed an appeal on 26 August 2011 at Honorable Appellate Tribunal of Sales tax Kolkata. The Company has received favorable order from Assessing officer in same issues for subsequent years.

ii) Cochin Case : The Company has received an Order dated 30 January 2017 from Asst. Commissioner, Commercial Tax Special Circle Ernakulum for the period 2012 to 2013 demanding tax on the difference in closing stock & difference in material movement value as per VAT return & VAT Audit report. The dispute is that Sales Tax Department has passed an order without considering the fact that Company has already applied for the application for revision of return and it is pending for approval from commercial tax department. The Sales Tax Department has issued the notification allowing the revision of return of earlier period. The Company is in process of revising the VAT Returns. Post revision of return the outstanding liability will be nullified.

On 24 August 2017, the Company received an order from Customs Excise and Service Tax Appellate Tribunal ('CESTAT') dated 18 August 2017 ('the Order'), where in the demand raised by the Commissioner of Service Tax Mumbai of Rs, 2,201 lacs, excluding interest and penalty on account of disallowance of CENVAT credit claimed on Capital Goods (Digital Cinema Equipments) by the Company for the period April 2008 to March 2014 and demand of Rs, 937 Lacs , excluding interest and penalty on account of service tax on equipment rental income of the Company for the period April 2008 to September 2011 has been dropped.

Further, CESTAT remanded the matter relating to demand of Rs, 1,526 lacs, excluding interest and penalty on account of service tax on equipment rental income of the Company for the period October 2011 to March 2014 for reconsideration to the adjudicating authority viz, the Commissioner of Service Tax Mumbai. The department has appealed with honorable High Court against the Order on 22 March 2018.

The Company received show cause cum demand notice dated 16 April 2018 for April 2014 to June 2017 in respect of

i. disallowance of cenvat credit claimed on capital goods - Rs, 391.46 lacs

ii. double taxation issue i.e. service tax on rental from leasing of Digital Cinema Equipment - Rs, 3,245.86 lacs

Since the demand is in relation to similar matter as stated above for the period, the same has been set aside by the department and the case will be heard post finalization of earlier matter at High Court.

The Company believes its position will likely to be upheld in the appellate process and liability will not arise to the Company on this matter.

The above does not include all other obligations resulting from customer claims, legal pronouncements having financial impact in respect of which the Company generally performs the assessment based on the external legal opinion and the amount of which cannot be reliably estimated.

3. Details of dues to micro and small enterprises as defined under the MSMED Act, 2006

Under the Micro, Small and Medium Enterprises Development Act, 2006 ('MSMED') which came in to force from 02 October 2006, certain disclosures are required to be made relating to dues to Micro and Small enterprises. On the basis of information and records available with the Management, the following disclosures are made for the amounts due to micro and small enterprises:

4. Business combinations and acquisition of non controlling interest

a) On 1 November 2017, the Board of Directors of the Company had approved the composite scheme of arrangement and amalgamation amongst the Company and Qube Cinema Technologies Private Limited (“QCTPL”); Qube Digital Cinema Private Limited (“QDCPL”); Moviebuff Private Limited (“MPL”) and PJSA Technosoft Private Limited (“PJSA”) and their respective shareholders and creditors (“the Qube Scheme”) under Sections 230 to 232 and other relevant provisions of the Act.

The Company had filed the Qube Scheme with the National Company Law Tribunal (NCLT), Mumbai Bench on 13 March 2018. Further, the shareholders of the Company had approved the Qube Scheme at the NCLT Mumbai convened meeting held on 21 May 2018. NCLT at a hearing held on 21 January 2019, has dismissed the petition filed jointly by the Company and PJSA before the NCLT for the approval of the Qube Scheme. The Company and PJSA have filed an appeal on 25 February 2019 before the National Company Law Appellate Tribunal challenging the aforementioned order of the NCLT

b) During the year ended 31 March 2018, the Company acquired additional 15.82% stake in Scrabble Entertainment Limited (SEL) from the minority shareholders for Rs, 1453.41 lacs. Post this investment, the Company holds 100 % of equity share capital of SEL.

c) During the year ended 31 March 2019, the Company acquired additional 20% stake 2,895 equity shares in Valuable Digital Screens Private Limited (VDSPL) from the minority shareholders for Rs, 60.00 lacs. Post this investment, the Company holds 100 % of equity share capital of VDSPL.

d) Common control transactions

a) On 22 June 2018, the National Company Law Tribunal (NCLT) has approved the Scheme of arrangement for the amalgamation of Company's wholly owned subsidiaries including its step down subsidiaries namely, V N Films Private Limited (“VNFPL”), Edridge Limited (“EL”), UFO International Limited (“UIL”) and Southern Digital Screenz India Private Limited (“SDS”) (together referred to as the “merging companies”) with the Company (“the Scheme”)

b) UFO is principally engaged in the delivery of content via satellite directly to theatres. The Company is largest digital cinema distribution network and in-cinema advertising platform. VNFPL, EL, UIL and SDS are in the business of providing digital cinema services.

c) Consequent to fulfillment of all the conditions relating to the Scheme including filing of certified copy of the Order with the Registrar of Companies, the Scheme is effective on 29 June 2018 with effect from the appointed date of 01 April 2016 for the amalgamation of VNFPL, EL and UIL with the Company and the appointed date of 01 July 2016 for SDS.

d) The amalgamation has been accounted using pooling of interest method as prescribed under Indian Accounting Standard (“Ind AS”) 103- “Business Combination” notified under Section 133 of the Act read with relevant rules issued there under and/ or such other applicable accounting standard prescribed under the Act. The previous year figures have been restated to give the effect of amalgamation in accordance with the scheme.

e) In accordance with the Scheme :

(i) All assets and liabilities, including reserves of the Amalgamating Companies have been recorded at their respective book values as appearing in their respective books on the date immediately preceding the Appointed Date.

(ii) The difference in books of accounts of the Transferee Company on account of:

(a) Net assets taken over;

(b) Reserves acquired and cancellation of investments in Transferor Companies is recorded in Amalgamation Reserve account of the Transferee Company.

(iii) The debit balance in profit and loss account of Transferor Companies and the Amalgamation Reserve account has been adjusted against Securities Premium of the Transferee Company.

* The Company considers that the carrying amounts of these financial instruments recognized in the financial statements approximates its fair values.

There have been no transfers between Level 1 and Level 2 during the year ended 31 March 2019 and 31 March 2018.

5. Financial risk management / Objectives and policies

The Company's financial liabilities comprise mainly of borrowings, trade payables, other payables and corporate guarantees. The Company's financial assets comprise mainly of investments, cash and cash equivalents, other balances with banks, loans, trade receivables and other receivables.

The Company is exposed to market risk, credit risk and liquidity risk. The Company's Senior Management oversees the management of these risks. The Company's Senior Management determines the financial risks and the appropriate financial risk governance framework through relevant policies and procedures for the Company. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarized below:

1. Market risk

Market Risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises two types of risks: interest rate risk and currency risk. Financial instruments affected by market risk include borrowings, investments and deposits, loans and derivative financial instruments.

a) Interest rate risk :

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company's exposure to the risk of changes in market interest rates relates primarily to the long-term debt obligations with floating interest rates.

The Company manages its interest rate risk by having a portfolio of fixed and variable rate loans and borrowings wherever feasible.

The following table demonstrates the sensitivity to a reasonably possible change in interest rates on that portion of borrowings affected. With all other variables held constant, the Company's profit before tax is affected through the impact on floating rate borrowings, as follows:

b) Currency risk :

Currency risk is the risk that the fair value or future cash flows of financial instruments will fluctuate because of the change in foreign currency exchange rates. The majority of the Company's revenue and expense are in Indian Rupees, with the remainder denominated in US Dollars. Management considers currency risk to be low and does not hedge its own currency risks except foreign currency borrowing for which it uses forward contract to hedge exposure to foreign currency risk.

The Company regularly evaluates exchange rates exposure arising from foreign currency transactions for taking appropriate actions.

6. Credit Risk :

Credit risk is the risk of financial loss arising from counterparty failure to repay or service debt according to the contractual terms or obligations Credit risk encompasses of both, the direct risk of default and the risk of deterioration of creditworthiness as well as concentration of risks. Credit risk is controlled by analysing credit limits and creditworthiness as well as concentration of risks. Credit risk is controlled by analysing credit limit and creditworthiness of customers on a continuous basis to whom the credit has been granted after obtaining necessary approval for credit. The Company majorly operates locally and hence Company's exposure on credit risk from receivable's in different geographies is not significant.

Financial instruments that are subject to concentration of credit risk principally consist of trade receivables, unbilled revenue, investments, derivative financial instruments, cash and cash equivalents, bank deposits and other financial assets .

Exposure to credit risk:

The carrying amount of financial assets represents the maximum credit exposure. The maximum credit risk exposure to credit risk was ' 28,362.82 lacs and ' 26,415.01 lacs as at 31 March 2019 and 31 March 2018 respectively as per the table below.

Trade receivables and unbilled revenue are typically unsecured and are derived from revenue earned from customers. Credit risk has always been managed by the Company by continuously monitoring the credit worthiness of customers to which the Company grants credit terms in the normal course of business.

Credit risk on cash and cash equivalents is limited as the Company generally invest in deposits with banks with high credit ratings assigned by international credit rating agencies.

7. Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in raising funds to meet commitment associated with financial instruments that are settled by delivering cash or another financial assets. Liquidity risk may result from an inability to sell a financial asset quickly at close to its fair value.

The Company has an established liquidity risk management framework for managing its short term, medium term and long term funding and liquidity management requirements. The Company's exposure to liquidity risk arises primarily from mismatches of the maturities of financial assets and liabilities. The Company manages the liquidity risk by having adequate amount of credit facilities agreed with banks to ensure that there is sufficient cash to meet all its normal operating commitments in a timely and cost effective manner.

The Company receives payments from customers based upon contractual billing schedules.

Accounts receivable are recorded when the right to consideration becomes unconditional.

Contract assets includes amounts related to Company's contractual right to consideration for completed performance objectives not yet invoiced and deferred contract acquisition costs, which are amortized along with the associated revenue.

Contract liabilities include payments received in advance of performance under the contract, and are realized with the associated revenue recognized under the contract.

Practical expedients used

In accordance with the practical expedient in Para 63 of Ind AS 115, the Company has not adjusted the promised amount of consideration for the effects of a significant financing component if the Company expects, at contract inception, that the period between when the Company transfers a promised good or service to a customer and when the customer pays for that good or service will be one year or less.

8. Capital Management

For the purpose of the Company's capital management, capital includes issued equity capital, share premium, money received against share warrants and all other equity reserves attributable to the equity holders. The primary objective of the Company's capital management is to maximize the shareholder value. The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Company monitors capital using a gearing ratio, which is long term debts including current maturities divided by equity attributable to owners of Company.

Free campaigns screened as per the communication received from films division of Ministry of Information and Broadcasting and Information and Public Relation Department, Kerala has been considered as Company's contribution towards CSR.

9. Details of loans given, investment made and guarantee given covered u/s 186(4) of the Companies Act, 2013.

Investment made are given under the respective head (refer note 4)

Corporate guarantees given by the Company in respect of guarantee (refer note 32)

*The loan given to the above mentioned subsidiaries is repayable on demand for purpose of working capital requirement and capital expenditure for the busi