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					AnnuAl RepoRt
    2009-10
Cinema Capital Venture Fund
1st Annual Report and Statements for Financial Year 2009-10

Trustees	                                         Auditors	                          Office
Mrs urmila Gupta                                  Deloitte Haskins & Sells           102-103, 1st Floor,
Maj. Gen. A.l. Suri, AVSM (Retd.)                 Chartered Accountants              Building A-4,
                                                  Mumbai                             lok nirman towers,
Investment Managers                                                                  Dr. Ambedkar Road,
Cinema Capital Advisory pvt. ltd.                                                    Khar(W), Mumbai

telephone +91 22 42461717             www.cinemacapitalindia.com     email: info@cinemacapitalindia.com




Investment Managers’ Report
to the contributories.

Your Investment Managers have pleasure in presenting the First Annual Report on the business and operations
of fund together with the Statement of Accounts for the year ended March 31, 2010



Financial Review
Sources                                                                                        Rs. in Lacs
total Commitment                                                                                 18500.80
Commitments Received from Contributories                                                         16044.70
Applications
Investments Committed                                                                             9068.83
liquidity pending Investment                                                                      5189.59
net Fixed Assets                                                                                     19.96
net Current Assets                                                                                 - 38.53
excess of expenditure over Income                                                                 1804.95
Operations (for the period 14/11/2008-31/03/2010)                                              Rs. in Lacs
Income
Income from liquidity pending Investment                                                           251.51
Advisory Income                                                                                       8.00
total                                                                                              259.51
Expenditure
Set up expenses                                                                                    994.80
Management expenses                                                                                496.95
Administration expenses                                                                            519.97
Distribution to Contributories                                                                       38.90
trustee Fees                                                                                         11.75
Direct tax                                                                                            2.51
total                                                                                             2064.88
excess of expenditure over Income                                                                 1804.95



2 | Cinema Capital Venture Fund Annual Report
Industry Outlook
The Indian Film and entertainment industry has gone through a very tough year in 2009-10 fiscal and the trend
has continued in the first quarter of 2010-2011 fiscal. Indian filmed entertainment industry is currently estimated
to be at Rs. 95 billion in 2009 slipping from Rs. 107 billion in 2008 showing a de-growth of 11.3% from 2008
to 2009*. The film production sector has an estimated loss in excess of Rs 200 Crore in the first six months of
calendar year 2010.

2009-10 the year gone by has been a turbulent one for the Indian Film and entertainment industry. there was
the multiplex strike that almost threatened to cripple the industry but the outcome has been positive for film
producers and distributors wherein they will be rewarded. The benefits of this strike will benefit producers in the
long run if their content appeals to the consumer.

The first quarter of this year i.e. April to June 2010 has been disappointing for the industry. Except for films like
Rajneeti and Housefull there have been major disappointments in the April –– June 2010 period with big films
like Kites and Raavan failing to excite audiences and being commercially negative for the industry. on the other
side some of the smaller films have done well with films like Ishqiya and Love Sex & Dhokha. We feel that the
number of smaller films that are likely to be successful will rise in the year 2010-11.


Future Outlook
Failing box office results coupled with high valuations for key projects has resulted in a breakdown of the pre-
sales model. owing to the change in the dynamics of the business, CCVF had put on hold all investment and
deployment plans from november 2009 to March 2010 till a clear business trend emerged. the fund has held
back investing the entire fourth drawdown and part of the third drawdown.

Currently the fund is closely looking at opportunities in animation, digital film exhibition, music publishing,
distribution and mobile VAS and live event entertainment sectors. one of the key areas we are looking at is live
entertainment and music publishing and to see if there are captive revenue realization options in the proposed
companies. owing to the change in business dynamics we are looking at certain opportunities which combine
entertainment with retail revenue options .

Currently the industry presents a tremendous opportunity for value investments and we believe that our patience
in deployment will pay off in very attractive investment valuations in 2010-11. the fund expects to be fully
invested by 31st March 2011.

*Source : PwC Indian Media and Entertainment Outlook 2010


Corporate Governance
the fund adopts and follows the best principles of Corporate Governance. Corporate Governance is not just
restricted to ensuring compliance with regulatory requirements but also meeting the highest standards of
transparency, accountability and integrity in respect all its transactions. the fund has in place clear processes
and well-defined roles and responsibilities for people at various levels. This, along with robust internal information
systems, ensures appropriate information flow to facilitate monitoring as well as adherence to processes in a
timely manner


Auditors
M/s. Deloitte Haskins & Sells, Chartered Accountants, Mumbai are proposed to be reappointed as Auditors for
the Financial Year ending March 31, 2011. their appointment is considered and approved.


Investment Managers Responsibility Statement
The Investment Manager confirm:

1.    that in the preparation of the annual accounts, the applicable accounting standards had been followed
      along with proper explanation relating to material departures.




                                                                            Cinema Capital Venture Fund Annual Report | 3
2.    that the Investment Manager had selected such accounting policies and applied them consistently and
      made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the
      state of affairs of the Fund for that period.

3.    That the Investment Managers had taken proper and sufficient care of the maintenance of adequate
      accounting records in accordance with the provisions of the Indian trust Act, 1882 for safeguarding the
      assets of the Fund and for preventing and detecting fraud and other irregularities and;

4.    that the Investment Managers had prepared the annual accounts on a going concern basis.


Acknowledgements
Your Investment Managers wish to place on record their appreciation for the dedication and hard work put in
by the employees of the Fund. Relationship with the Investors, Government, Regulatory Authorities and Clients
remained excellent

Your Investment Managers are grateful for the support extended by them and look forward to receiving their
continued support and commitment.

Your Investment Managers also wish to thank the Investors in the Funds for their continued support to the
Fund.



                                                                    For and on behalf of Investment Manager




Mumbai                                                                                                 -Sd-
Dated: September 03, 2010                                                                       Samir Gupta




4 | Cinema Capital Venture Fund Annual Report
Auditors Report
to the trustees and members of Cinema Capital venture Fund.

1.   We have audited the attached Balance Sheet of Cinema Capital Venture Fund as at March 31, 2010 and
     the Income and Expenditure Account for the year ended on that date, annexed thereto. These financial
     statements are the responsibility of the trustees. our responsibility is to express an opinion on these
     financial statements based on our audit.

2.   We conducted our audit in accordance with the auditing standards generally accepted in India. those
     Standards require that we plan and perform the audit to obtain reasonable assurance about whether the
     financial statements are free of material misstatements. An audit includes examining, on a test basis,
     evidence supporting the amounts and the disclosures in the financial statements. An audit also includes
     assessing the accounting principles used and the significant estimates made by the Trustees, as well as
     evaluating the overall financial statement presentation. We believe that our audit provides a reasonable
     basis for our opinion.

3.   We have obtained all the information and explanations which to the best of our knowledge and belief were
     necessary for the purposes of our audit;

4.   the Balance Sheet and Income and expenditure Account dealt with by this report are in agreement with
     the books of account;

5.   In our opinion and to the best of our information and according to the explanations given to us, the said
     accounts, read with the significant accounting policies and notes thereon, give a true and fair view in
     conformity with the accounting principles generally accepted in India:

     (i)    in the case of the Balance Sheet, of the state of affairs of ‘Cinema Capital Venture Fund’ as at 31st
            March, 2010; and

     (ii)   in the case of the Income and expenditure Account, of the excess of expenditure over income of
            ‘Cinema Capital Venture Fund’ for the year ended on that date.



                                                                                     For Deloitte Haskins & Sells

                                                                                           Chartered Accountants




                                                                                                                 -Sd-

                                                                                                            A B Jani

                                                                                                             partner

Mumbai,                                                                                    Membership no. 46488
Dated: September 03, 2010




                                                                         Cinema Capital Venture Fund Annual Report | 5
Balance Sheet

                                                                          as at March 31, 2010
                                                        Schedule
                                                                                   Rs. in Lacs

I. Sources of funds:
   1. trust Fund                                           1                        16,044.80
   total                                                                            16,044.80
II. Application of funds:
Fixed Assets                                               2
   Gross Block                                                                          28.64
   less : Accumulated Depreciation                                                      (8.68)
   net Block                                                                            19.96
Investments                                                3                        11,657.88
Current assets, loans and advances :
   (a) Sundry Debtors                                      4                             7.94
   (b) Cash and Bank balances                              5                           259.09
   (c) loans and Advances                                  6                         2,401.53
                                                                                     2,668.56
less: Current liabilities and provisions :                 7
        Current liabilities                                                            106.56
                                                                                     2,562.01
excess of expenditure over income                                                    1,804.95
total                                                                               16,044.80
Significant Accounting Policies and Notes on Accounts      8
In terms of our report attached




For Deloitte Haskins & Sells,                                  For Cinema Capital Venture Fund
Chartered Accountants



-Sd-                                                                                      -Sd-
A. B. Jani                                                                             Trustee
partner



Mumbai
Dated: September 03, 2010




6 | Cinema Capital Venture Fund Annual Report
Profit and Loss Account
                                                                                       March 31, 2010
                                                                  Schedule
                                                                                        Rs. in Lacs
Income:
  Dividend Income on current Investments                                                              171.60
  excess provision for earlier year written back                                                         0.41
  Consultancy fees                                                                                       8.00
  total                                                                                               180.01
Expenditure :
  payments to and provision for employees                                                              27.48
  Depreciation                                                                                           8.55
  Investment management fees (Refer note C (1) of schedule 8)                                         383.93
  legal and professional fees                                                                         347.81
  Audit fees                                                                                             6.22
  travelling expenses and hotel expenses                                                               12.70
  Communication expenses                                                                                 7.37
  Business development expenses                                                                        23.75
  Rent                                                                                                 35.03
  postage and courier expenses                                                                           6.78
  printing and stationery expenses                                                                       6.42
  Repair and Maintenance                                                                                 1.72
  Office Expenses                                                                                        2.00
  Miscellaneous expenses (include electricity,
                                                                                                       10.00
  books and periodical, membership etc.)
  total                                                                                               879.77
  excess of expenditure over Income before taxation                                                 (699.76)
  Distribution to contributors (Refer note C (2) of schedule 8)                                          4.00
  Balance carried to Balance Sheet                                                                  (703.75)


  Significant Accounting Policies                                      8
  and notes on Accounts
  In terms of our report attached


For Deloitte Haskins & Sells,                                         For Cinema Capital Venture Fund
Chartered Accountants


-Sd-                                                                                                     -Sd-
A. B. Jani                                                                                            Trustee
partner



Mumbai
Dated: September 03, 2010



                                                                  Cinema Capital Venture Fund Annual Report | 7
Schedules
                                                                                                        Rs. in Lacs
SCHEDULE 1: TRUST FUND                                                                         as at March 31, 2010
   1. Initial contribution from settler                                                                       0.10
   2. Contribution towards trust Fund                                                                    16,044.70
   total                                                                                                 16,044.80
Note: In terms of the contribution agreement, the contributors have agreed to contribute, in
aggregate Rs 1,850,080,000/-(Previous year Rs 1,64,02,80,000) comprising of 185,00,800 units
of Rs 100/- each (Previous year 1,64,02,800 units of Rs 100/- each).
SCHEDULE 3 : INVESTMENTS                                                                       as at March 31, 2010
   Current-term investments (unquoted) - At lower of cost or fair value
   A) Investments in Mutual Funds                                                                         7,580.49
   (of above ` 2650 lacs is pending payment to Sunshine pictures pvt. ltd and
   Kinesis Films pvt. ltd.)
   B) Investments in Equity shares
   In Subsidiary:
   43,000 (previous year nil)equity Shares of Rs.10/- each fully paid-up in
   Kinesis Films private limited (Subsidiary)                                                                 4.30
   In Others:
   18,750 (previous year nil) equity shares of Rs.10/- each fully paid-up in
   Sunshine pictures private limited                                                                      4,073.09
                                                                                                         11,657.88
SCHEDULE 4: SUNDRY DEBTORS                                                                     as at March 31, 2010
   Debts outstanding for a period exceeding six months                                                        0.00
   other debts                                                                                                7.94
   total                                                                                                      7.94
SCHEDULE 5: CASH AND BANK BALANCES                                                             as at March 31, 2010
   Cash on Hand                                                                                               0.00
   Bank balances with scheduled banks:
   -In Current Accounts                                                                                     259.09
   total                                                                                                    259.09
SCHEDULE 6: LOANS AND ADVANCES                                                                 as at March 31, 2010
 Advances recoverable in cash or in kind or for value to be received (Refer
 note C (6) of schedule 8)                                                                                   58.72
 Advance payment of Income tax (tax Deducted at Source) (net of
 provision)                                                                                                   1.37
   loans to subsidiary company                                                                            2,341.44
   total                                                                                                  2,401.53
SCHEDULE 7: CURRENT LIABILITIES AND PROVISIONS                                                 as at March 31, 2010
   Sundry creditors: (Refer note C (8) of schedule 8)
   (i) total outstanding dues of micro enterprises and small enterprises                                      0.00
   (ii) total outstanding dues of Creditors other than micro and small
   enterprises                                                                                              106.56
   total                                                                                                    106.56




8 | Cinema Capital Venture Fund Annual Report
SCHEDULE 2: FIXED ASSETS
                                                                                                       (Rs. in Lacs)
                             Gross Block                         Depreciation                   Net Block
                   As at                    As at      Up-to       For the    Up-to          As at     As at
                   31.3.09    Additions    31.3.10     31.3.09        year    31.3.10        31.3.10   31.3.09
Computers             1.09         4.73       5.82        0.01        1.86       1.86           3.96      1.09
Office                5.01         1.05       6.06        0.12        1.98       2.10           3.96      4.89
equipments
Furniture and       0.00        16.76      16.76      0.00             4.71        4.71        12.04          0.00
fixtures
total               6.10        22.54      28.64      0.12             8.55        8.68        19.96          5.97
total
previous Year       0.00         6.10        6.10     0.00             0.12        0.12
Capital Work In progress (including Capital Advances)                                           0.00         11.40
                                                                                               19.96         17.37


SCHEDULE 8:
Significant	Accounting	Policies	and	Notes	on	Accounts:

A.   About the Fund:
the Fund has been established with the objective of formulating schemes to collect capital from proposed
investors in trust for the purpose of investing in entertainment industry in India, including investments in
production houses, ventures, etc. and also to carry out various activities allowed by the prevailing regulations
and governing Deed of trust. the life of the Fund is 5 years, which can be further extended up to a maximum
period of two years.

unit contributions from investors are accounted for when actually received. Surplus funds pending purchase of
investments in entertainment industry are placed in short term / demand deposits / open-ended Mutual Funds
with Banks / Companies and in other investments, in terms of the relevant clauses of the Indenture of trust, to
maximize return on such funds.

B.	 Significant	Accounting	Policies:
1.   Basis for preparation of accounts

     the accounts have been prepared to comply in all material aspects with applicable accounting principles
     in India, including the applicable Accounting Standards issued by the Institute of Chartered Accountants
     of India (ICAI).

2.   Use of estimates

     The preparation of financial statements, in conformity with the generally accepted accounting principles,
     requires estimates and assumptions to be made that affect the reported amounts of assets and liabilities on
     the date of financial statements and the reported amounts of revenues and expenses during the reported
     period. Differences between the actual results and estimates are recognized in the period in which the
     results are known / materialized.

3.   Income Recognition

     i.     In appropriate circumstances, income is recognized when no significant uncertainty as to determination
            or realization exists.

     ii.    Interest income on deposits with banks is recognized on a time proportion basis taking into account
            the amount outstanding and the rate applicable.

     iii.   Dividend Income is recognized when a right to receive payment/ additional units is established.


                                                                         Cinema Capital Venture Fund Annual Report | 9
4.    Fixed assets:

      Fixed assets are recorded at cost of acquisition or construction. they are stated at historical cost.

5.    Depreciation:

      Depreciation on fixed assets is provided on a straight line method on the basis of Management’s estimate
      of useful lives as under:

      a. Computers – three years

      b. Office equipments - three years

      c.   Furniture and Fixtures : three years

      d. leasehold improvements are written off over the primary period of lease.

      Assets costing less than Rs. 5, 000/- are fully depreciated in the year of purchase.

6.    Investments

      Investments classified as long term investments and are stated at cost of acquisition including other
      related expenses. provision is made to recognize diminution, other than temporary, in the value of such
      investments.

      Current investments are carried at lower of cost and fair value.

7.    Income taxes

      tax expense comprises of current tax and deferred tax.

      Current tax is measured at the amount expected to be paid to/ recovered from the tax authorities, using
      the applicable tax rates.

      Deferred income tax reflect the current period timing differences between taxable income and accounting
      income for the period and reversal of timing differences of earlier years/ period. Deferred tax assets are
      recognised only to the extent that there is reasonable certainty that sufficient future income will be available
      except that deferred tax assets, in case there are unabsorbed depreciation and losses, are recognised if
      there is virtual certainty that sufficient future taxable income will be available to realise the same.

8.    Contingent liabilities

      these, if any, are disclosed in the notes on accounts. provision is made in the accounts if it becomes
      probable that an outflow of resources embodying economic benefits will be required to settle the
      obligation.

C. Notes on accounts
      1.    the Investment management fees paid by the Fund to the investment advisor are calculated in
            accordance with the terms and conditions of the Contribution Agreements entered into with each
            contributor and Advisory services agreement entered into with the investment advisor.

      2.    Distribution to contributors have been made in accordance with the terms and conditions of the
            contribution agreements entered into with each contributor

      3.    In the opinion of the management of the Fund, the Fund is liable to tax as under:

            „„ entire dividend income earned by the Fund is exempt as per the provisions of the Income-tax
                 Act, 1961.

            „„ the Fund is liable to current income-tax on the consultancy fees/ interest income after claiming
                 a proportionate deduction for investment management fee.

      4.    the principal object of the Fund is of making investing in entertainment industry in India. All other
            activities of the Fund revolve around / are connected with its main object. Considering this, the Fund
            has only one reportable segment.


10 | Cinema Capital Venture Fund Annual Report
5.   As required under Accounting Standard 18 on “Related party disclosures” (AS 18), following are details of
     transaction during the period with the related parties of the Fund as defined in AS 18:-

a)   List of Related Parties and Relationships:

      Related Parties                      Relation
      Ms urmila Gupta                      Key Management personnel (trustee)
      Mr. Gopi Arora                       Key Management personnel (trustee) (upto December 05, 2009)
      Kinesis Films private limited        Subsidiary (W.e.f August 20, 2009)

b)   The Related Party Transactions:

       name of Related party                   nature of transaction                  Amount (Rs)
       Mrs urmila Gupta                        professional Fees                      500,000(187,500)
       Mr. Gopi Arora                          professional Fees                      300,000(187,500)
       Kinesis Films private limited           loans given                            234,144,094(-)
       Kinesis Films private limited           Investment in equity shares            430,000(-)

     Note: Figures in brackets pertain to the previous period.

6.   Advance recoverable in cash or in kind or for value to be received include amounts aggregating to Rs
     3,883,276/- (previous period Rs. 2,079,198) as at the year end, being service tax credits which in the
     opinion of the Fund, are available for set-off against the Fund’s future service tax liability on a proportionate
     basis and accordingly the same are carried forward.

7.   Advance to Venture Capital undertaking in the previous period aggregating to Rs. 75,000,000/- comprise
     of amount paid to a third party, to fund the production of a film, through a proposed subsidiary of the
     Fund.

8.   As per information available with the Fund, none of the creditors have confirmed that they are registered
     under the Micro, Small and Medium enterprises Development Act, 2006. Hence the disclosure in Schedule
     7 is given accordingly.

9.   Previous period’s figures have been regrouped/ reclassified where necessary to conform to current year’s
     classification. Previous period’s figures in respect of the Income and Expenditure Account pertain to the
     period from May 22, 2008 to March 31, 2009 and hence are not comparable to those of the the current
     year.



Signatures to schedules 1 to 8

In terms of our report attached




For Deloitte Haskins & Sells,                                                  For Cinema Capital Venture Fund
Chartered Accountants




-Sd-                                                                                                              -Sd-
A. B. Jani                                                                                                     Trustee
partner



Mumbai
Dated: September 03, 2010


                                                                          Cinema Capital Venture Fund Annual Report | 11
            102-103, 1st Floor, Building A-4,
lok nirman towers, Dr. Ambedkar Road, Khar(W), Mumbai

				
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