Home  »  Company  »  Dredging Corpora  »  Quotes  »  Accounting Policy
Enter the first few characters of Company and click 'Go'

Accounting Policies of Dredging Corporation Of India Ltd. Company

Mar 31, 2015

1. BASIS OF PREPARATION OF FINANCIAL STATEMENTS.

a) The Financial Statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles (IGAAP) under the historical cost convention on accrual basis. IGAAP comprises Accounting standards notified by the central Government of India, and the relevant provisions of Companies Act, 2013.The financial statements are presented in Indian Rupees rounded off to the nearest lakh with two decimals.

2. OPERATIONAL INCOME:

a ) Operational income is recognized as income depending upon nature of the contract as per respective applicable accounting standards.

b) Claims preferred on customers for works/items not contemplated are considered as in come on their acceptance.

3. OTHER INCOME:

a ) Sale proceeds of condemned and unserviceable Spares, Stores, Empties, Waste Oil, etc are accounted for in the year of disposal. b) Liquidated damages recovered from suppliers are accounted on settlement of bills. c ) Interests on Tax refunds are accounted on receipt basis. d) In respect of hull and machinery insurance claims, the claim is accounted as claims recoverable from underwriters as and when the repair bill is submitted by yard/firm. Necessary adjustments are made as and when the claim is accepted by Underwriters. In respect of other insurance claims, the same are accounted for on realization / settlement of the same by the underwriters".

4. OPERATIONAL EXPENSES:

a ) All operational expenses are charged to revenue under accrual basis.

b) Insurance:

Final adjustments to insurance premium paid are considered in accounts on the basis of demands received.

5. DEPRECIATION:

Depreciation is provided considering the useful lives as prescribed under Schedule II of the Companies Act, 2013, other than the following class of assets, whose useful lives are different from that of the lives prescribed in the Schedule, which are determined based on the technical evaluation. i. Dredgers- ii. The useful life dredgers will be 25 years. iii. Expenditure incurred on dry-docking of dredgers which have completed the useful life of 25 years already is capitalized to the said dredger and depreciated over the extended useful life determined by technical evaluation.

Note:

Residual value of the dredgers will be considered at 2% of the original cost of the dredger including capitalization of exchange variance in accordance with AS-11.

In respect of the following assets depreciation is provided on straight line method based on technical estimation of useful lives of such assets: iv. Pipeline Equipment: 25% for Mild Steel pipe line equipment and 12.5% for high density polyethylene pipe line equipment.

v. Second hand assets: As per estimate of balance service life.

vi. Building on lease: Cost of building constructed on lease hold land is amortized over the lease period. vii. Items of Fixed Assets whose cost does not exceed Rs.5,000/- (Rupees five thousand) are capitalized and depreciated 100% during the year.

viii. Cost of Library: Cost of library is considered as Other establishment expenditure. ix. The exchange differences on long term foreign currency monetary liabilities used for acquisition of specific fixed assets adjusted to the cost of fixed assets, are amortized over the remaining useful life of the said asset.

6. FIXED ASSETS:

a ) Fixed Assets are stated at historical cost less depreciation (historical cost includes financing cost and other related overheads).

b) Grants in Aid relating to specific Fixed Assets are shown as deduction from the gross value of the assets concerned in arriving at book value.

c ) Items of the nature of Capital/ Equipments are capitalized and depreciated over the remaining useful life of the asset.

d) The exchange differences on long term foreign currency liabilities used for acquisition of fixed assets are adjusted to the cost of the specific fixed assets.

7. BORROWING COSTS:

a ) As per the transitional provisions given in the notification issued by the Ministry of Corporate Affairs, Government of India dated 31st Mar, 2009 read with the notification dated 9th August,2012, the Company has opted for adjusting the exchange difference on the long term foreign currency monetary items to the cost of the assets acquired out of these foreign currency items. b) Borrowing costs attributable to acquisition, construction or production of qualifying assets are capitalized as part of the cost of that asset, till the time the asset is put to use. Other borrowing costs are recognized as an expense in the period in which they are incurred.

8. FOREIGN CURRENCY TRANSACTIONS:

Transactions in foreign currency are recorded at exchange rates prevailing at the dates of the transactions. As per the notification issued by the Ministry of Corporate Affairs dated 31st Mar, 2009, the Company has opted for adjusting the exchange difference on the long term foreign currency monetary items to the cost of the assets acquired out of these foreign currency items. The Company has accordingly aligned its accounting policy based on the above notification.

Exchange differences arising out of fluctuation in exchange rates on settlement/restatement at the period end are accounted based on the nature of transaction as under:

i) Short term foreign currency monetary assets and liabilities: recognized in the profit and loss account. ii) Long term foreign currency monetary liabilities used for acquisition of fixed assets: adjusted to the cost of the fixed assets and amortized over the remaining useful life of the asset.

9. INVENTORIES:

a ) Stock of spares and stores is valued at weighted average cost and is inclusive of :

(i) Customs duty, if any as applicable to the whole consignment and

(ii) Overheads at predetermined rate.

b) Reconditioned spares are valued at the respective cost of reconditioning. c ) Spares /stores are accounted for as per respective delivery/ shipment terms as material-in transit/ stock accounts,

valued as per (a) above and are charged to revenue as and when consumed. d) Stores and lubricants delivered to crafts during the year are charged to revenue.

10. INVESTMENTS:

a ) Long Term Investments are stated at cost. Provision for diminution is made to recognize a decline, other than temporary, in the value of such investments. b) Current Investments are stated at lower of cost and fair value.

11. EMPLOYEE BENEFITS:

Provisions for Gratuity Liability and leave encashment liability are made on the basis of actuarial Valuation using the projected unit credit method. In the case of crew and MPW of floating employees who are entitled to settlement of leave in full on signing off, provision is made for the leave at credit of such employees as on 31st March. Actuarial liability in excess of respective plan assets is recognized during the year. Provision for Gratuity as per the Actuarial valuation is funded with a separate Trust.

12. PROVISIONS, CONTINGENT LIABILITIES & CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Assets are neither recognized nor disclosed in the financial statements. Contingent liabilities, if material, are disclosed by way of notes.


Mar 31, 2014

1. BASIS OF PREPARATION OF FINANCIAL STATEMENTS.

a) The Financial Statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles.

b) The Company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis.

2. OPERATIONAL INCOME:

a) Unbilled values of works executed up to 31st March are considered as income although bills are raised subsequently. The Corresponding debit balances are shown under "Current Assets-unbilled operational income receivable".

b) Claims preferred on Customers for works/items not contemplated are considered as income on their acceptance.

c) Income in respect of incomplete dredging jobs undertaken on insitu basis are accounted for on the basis of estimated realizable value of the work done up to 31st March.

3. OTHER INCOME:

a) Sale proceeds of condemned and unserviceable Spares, Stores, Empties, Waste Oil, etc are accounted for in the year of disposal.

b) Liquidated damages recovered from suppliers are accounted on settlement of bills.

c) Interests on Tax refunds are accounted on receipt basis.

4. OPERATIONAL EXPENSES:

a) Spares issued to Dredgers, of the nature of inventory, are charged to revenue as and when consumed.

b) Stores:

Stores and Lubricants delivered to the crafts during the year and acknowledged by the Master/CEO are charged to revenue. Provision is made towards consumption for the material delivered to crafts up to 31st March in respect of which acknowledgements are not received.

c) Insurance:

Final adjustments to Insurance Premium paid are considered in accounts on the basis of demands received.

d) In respect of hull and machinery insurance claims, the claim is accounted as claims recoverable from underwriters as and when the repair bill is submitted by yard/firm. Necessary adjustments are made as and when the claim is accepted by Underwriters. In respect of other insurance claims, the same are accounted for on realisation / settlement of the same by the underwriters"

5. DEPRECIATION:

Depreciation is provided under straight-line method in accordance with Schedule XIV of the Companies Act. In respect of the following Assets, depreciation is provided on straight-line method at the following rates based on the technical estimation of the useful lives of such assets:-

a) Pipeline Equipment: 25% for Mild Steel Pipeline equipment and 12.5% for High Density polyethylene pipeline equipment.

b) Second hand assets/ retrofit of vessels: as per the estimated balance service life.

c) Building on lease: Cost of Buildings constructed on lease hold land is amortized over the lease period.

d) Items of Fixed Assets whose cost does not exceed Rs. 5000/- (Rupees Five thousand) each are capitalized and depreciated 100% during the year.

e) Cost of Library: Cost of Library is considered as Other Establishment expenditure.

f) The exchange differences on long term foreign currency monetary liabilities used for acquisition of specific fixed assets, adjusted to the cost of the fixed assets, are amortised over the remaining useful life of the said asset.

6. FIXED ASSETS:

a) Fixed Assets are stated at historical cost less depreciation (historical cost includes financing cost and other related overheads).

b) Grants in Aid relating to specific Fixed Assets are shown as deduction from the gross value of the assets concerned in arriving at book value.

c) Items of the nature of Capital/ Equipments are capitalized and depreciated over the remaining useful life of the asset.

d) The exchange differences on long term foreign currency liabilities used for acquisition of fixed assets are adjusted to the cost of the specific fixed assets.

7. BORROWING COSTS:

a) As per the transitional provisions given in the notification issued by the Ministry of Corporate Affairs, Government of India dated 31st Mar, 2009 read with the notification dated 9th August,2012, the Company has opted for adjusting the exchange difference on the long term foreign currency monetary items to the cost of the assets acquired out of these foreign currency items.

b) Borrowing costs attributable to acquisition, construction or production of qualifying assets are capitalised as part of the cost of that asset, till the time the asset is put to use. Other borrowing costs are recognised as an expense in the period in which they are incurred.

8. FOREIGN CURRENCY TRANSACTIONS:

Transactions in foreign currency are recorded at exchange rates prevailing at the dates of the transactions. As per the notification issued by the Ministry of Corporate Affairs dated 31st Mar, 2009, the Company has opted for adjusting the exchange difference on the long term foreign currency monetary items to the cost of the assets acquired out of these foreign currency items. The Company has accordingly aligned its accounting policy based on the above notification. Exchange differences arising out of fluctuation in exchange rates on settlement/restatement at the period end are accounted based on the nature of transaction as under:

i) Short term foreign currency monetary assets and liabilities: recognized in the profit and loss account.

ii) Long term foreign currency monetary liabilities used for acquisition of fixed assets: adjusted to the cost of the fixed assets and amortized over the remaining useful life of the asset.

9. STOCK OF SPARES AND STORES:

a) Stock of spares and stores is valued at weighted average cost and is inclusive of:

i) Customs Duty, if any, as applicable to the whole consignment and

ii) Overheads at pre-determined rate.

b) Reconditioned spares are valued at the respective cost of reconditioning.

c) Value of Materials dispatched on F.O.B. basis by Foreign Suppliers on or before 31st March of a year is considered in the accounts of that year, provided dispatch documents are retired or accepted within 15 days of the end of the accounting year.

10. INVESTMENTS:

(a) Long Term Investments are stated at cost. Provision for diminution is made to recognize a decline, other than temporary, in the value of such investments.

(b) Current Investments are stated at lower of cost and fair value.

11. EMPLOYEE BENEFITS:

Provisions for Gratuity Liability and leave encashment liability are made on the basis of actuarial Valuation using the projected unit credit method. In the case of crew and MPW of floating employees who are entitled to settlement of leave in full on signing off, provision is made for the leave at credit of such employees as on 31st March. Actuarial liability in excess of respective plan assets is recognized during the year.

Provision for Gratuity as per the Actuarial valuation is funded with a separate Trust.

12. PROVISIONS, CONTINGENT LIABILITIES & CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Assets are neither recognized nor disclosed in the financial statements. Contingent liabilities, if material, are disclosed by way of notes.


Mar 31, 2013

1 1. BASIS OF PREPARATION OF FINANCIAL STATEMENTS.

a) The Financial Statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles.

b) The Company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis.

2. OPERATIONAL INCOME:

a) Unbilled values of works executed up to 31st March are considered as income although bills are raised subsequently. The Corresponding debit balances are shown under "Current Assets-unbilled operational income receivable”.

b) Claims preferred on Customers for works/items not contemplated are considered as income on their acceptance.

c) Income in respect of incomplete dredging jobs undertaken on insitu basis are accounted for on the basis of estimated realizable value of the work done up to 31st March.

3. OTHER INCOME:

a) Sale proceeds of condemned and unserviceable Spares'' Stores'' Empties'' Waste Oil'' etc are accounted for in the year of disposal.

b) Liquidated damages recovered from suppliers are accounted on settlement of bills.

c) Interests on Tax refunds are accounted on receipt basis.

4. OPERATIONAL EXPENSES:

a) Spares issued to Dredgers'' of the nature of inventory'' are charged to revenue as and when consumed.

b) Stores:

Stores and Lubricants delivered to the crafts during the year and acknowledged by the Master/CEO are charged to revenue. Provision is made towards consumption for the material delivered to crafts up to 31st March in respect of which acknowledgements are not received.

c) Insurance:

Final adjustments to Insurance Premium paid are considered in accounts on the basis of demands received.

d) In respect of hull and machinery insurance claims'' the claim is accounted as claims recoverable from underwriters as and when the repair bill is submitted by yard/firm. Necessary adjustments are made as and when the claim is accepted by Underwriters. In respect of other insurance claims'' the same are accounted for on realisation / settlement of the same by the underwriters”

5. DEPRECIATION:

Depreciation is provided under straight-line method in accordance with Schedule XIV of the Companies Act. In respect of the following Assets'' depreciation is provided on straight-line method at the following rates based on the technical estimation of the useful lives of such assets:- a) Pipeline Equipment: 25% for Mild Steel Pipeline equipment and 12.5% for High Density polyethylene pipeline equipment.

b) Second hand assets/ retrofit of vessels: as per the estimated balance service life.

c) Building on lease: Cost of Buildings constructed on lease hold land is amortized over the lease period.

d) Items of Fixed Assets whose cost does not exceed Rs.5000/- (Rupees Five thousand) each are capitalized and depreciated 100% during the year.

e) Cost of Library: Cost of Library is considered as Other Establishment expenditure.

f) The exchange differences on long term foreign currency monetary liabilities used for acquisition of specific fixed assets'' adjusted to the cost of the fixed assets'' are amortised over the remaining useful life of the said asset.

6. FIXED ASSETS:

a) Fixed Assets are stated at historical cost less depreciation (historical cost includes financing cost and other related overheads).

b) Grants in Aid relating to specific Fixed Assets are shown as deduction from the gross value of the assets concerned in arriving at book value.

c) Items of the nature of Capital/ Equipments are capitalized and depreciated over the remaining useful life of the asset.

d) The exchange differences on long term foreign currency liabilities used for acquisition of fixed assets are adjusted to the cost of the specific fixed assets.

7. BORROWING COSTS:

a) As per the transitional provisions given in the notification issued by the Ministry of Corporate Affairs'' Government of India dated 31st Mar'' 2009 read with the notification dated 9th August''2012'' the Company has opted for adjusting the exchange difference on the long term foreign currency monetary items to the cost of the assets acquired out of these foreign currency items.

b) Borrowing costs attributable to acquisition'' construction or production of qualifying assets are capitalised as part of the cost of that asset'' till the time the asset is put to use. Other borrowing costs are recognised as an expense in the period in which they are incurred.

8. FOREIGN CURRENCY TRANSACTIONS:

Transactions in foreign currency are recorded at exchange rates prevailing at the dates of the transactions. As per the notification issued by the Ministry of Corporate Affairs dated 31st Mar'' 2009'' the Company has opted for adjusting the exchange difference on the long term foreign currency monetary items to the cost of the assets acquired out of these foreign currency items. The Company has accordingly aligned its accounting policy based on the above notification. Exchange differences arising out of fluctuation in exchange rates on settlement/restatement at the period end are accounted based on the nature of transaction as under:

i) Short term foreign currency monetary assets and liabilities: recognized in the profit and loss account.

ii) Long term foreign currency monetary liabilities used for acquisition of fixed assets: adjusted to the cost of the fixed assets and amortized over the remaining useful life of the asset.

9. STOCK OF SPARES AND STORES:

a) Stock of spares and stores is valued at weighted average cost and is inclusive of:

i) Customs Duty'' if any'' as applicable to the whole consignment and

ii) Overheads at pre-determined rate.

b) Reconditioned spares are valued at the respective cost of reconditioning.

c) Value of Materials dispatched on F.O.B. basis by Foreign Suppliers on or before 31st March of a year is considered in the accounts of that year'' provided dispatch documents are retired or accepted within 15 days of the end of the accounting year.

10. INVESTMENTS:

(a) Long Term Investments are stated at cost. Provision for diminution is made to recognize a decline'' other than temporary'' in the value of such investments.

(b) Current Investments are stated at lower of cost and fair value.

11. EMPLOYEE BENEFITS:

Provisions for Gratuity Liability and leave encashment liability are made on the basis of actuarial Valuation using the projected unit credit method. In the case of crew and MPW of floating employees who are entitled to settlement of leave in full on signing off'' provision is made for the leave at credit of such employees as on 31st March. Actuarial liability in excess of respective plan assets is recognized during the year. Provision for Gratuity as per the Actuarial valuation is funded with a separate Trust.

12. PROVISIONS'' CONTINGENT LIABILITIES & CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Assets are neither recognized nor disclosed in the financial statements. Contingent liabilities'' if material'' are disclosed by way of notes.


Mar 31, 2012

1. BASIS OF PREPARATION OF FINANCIAL STATEMENTS:

a) The Financial Statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles.

b) The Company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis.

2. OPERATIONAL INCOME:

a) Unbilled values of works executed up to 31st march are considered as income although bills are raised subsequently. The Corresponding debit balances are shown under "Current Assets-unbilled operational income receivable".

b) Claims preferred on Customers for works/items not contemplated are considered as income on their acceptance.

c) Income in respect of incomplete dredging jobs undertaken on insitu basis are accounted for on the basis of estimated realizable value of the work done up to 31st March.

3. OTHER INCOME:

a) Sale proceeds of condemned and unserviceable Spares, Stores, Empties, Waste Oil, etc are accounted for in the year of disposal.

b) Liquidated damages recovered from suppliers are accounted on settlement of bills.

c) Interests on Tax refunds are accounted on receipt basis.

4. OPERATIONAL EXPENSES:

a) Spares issued to Dredgers, of the nature of inventory, are charged to revenue as and when consumed.

b) Stores:

Stores and Lubricants delivered to the crafts during the year and acknowledged by the Master/CEO are charged to revenue. Provision is made towards consumption for the material delivered to crafts up to 31st March in respect of which acknowledgements are not received.

c) Insurance:

Final adjustments to Insurance Premium paid are considered in accounts on the basis of demands received.

d) In respect of hull and machinery insurance claims, the claim is accounted as claims recoverable from underwriters as and when the repair bill is submitted by yard/firm. Necessary adjustments are made as and when the claim is accepted by Underwriters. In respect of other insurance claims, the same are accounted for on realisation / settlement of the same by the underwriters

5. DEPRECIATION:

Depreciation is provided under straight-line method in accordance with Schedule XIV of the Companies Act. In respect of the following Assets, depreciation is provided on straight-line method at the following rates based on the technical estimation of the useful lives of such assets:-

a) Pipeline Equipment: 25% for Mild Steel Pipeline equipment and 12.5% for High Density polyethylene pipeline equipment.

b) Second hand assets/retrofit of the vessels: as per the estimated balance service life.

c) Building on lease: Cost of Buildings constructed on lease hold land is amortised over the lease period.

d) Items of Fixed Assets whose cost does not exceed Rs.5000/-(Rupees Five thousand) each are capitalized and depreciated 100% during the year.

e) Cost of Library: Cost of Library is considered as Other Establishment expenditure.

6. FIXED ASSETS:

a) Fixed Assets are stated at historical cost less depreciation (historical cost includes financing cost and other related overheads).

b) Grants in Aid relating to specific Fixed Assets are shown as deduction from the gross value of the assets concerned in arriving at book value.

c) Items of the nature of Capital/ Equipments are capitalized and depreciated over the remaining useful life of the asset.

7. BORROWING COSTS:

Borrowing costs attributable to acquisition, construction or production of qualifying assets are capitalised as part of the cost of that asset, till the time the asset is put to use. Other borrowing costs are recognised as an expense in the period in which they are incurred.

8. STOCK OF SPARES AND STORES:

a) Stock of spares and stores is valued at weighted average cost and is inclusive of:

i) Customs Duty, if any, as applicable to the whole consignment and

ii) Overheads at pre-determined rate.

b) Reconditioned spares are valued at the respective cost of reconditioning.

c) Value of Materials dispatched on F.O.B. basis by Foreign Suppliers on or before 31st March of a year is considered in the accounts of that year, provided dispatch documents are retired or accepted within 15 days of the end of the accounting year.

9. INVESTMENTS:

a) Long Term Investments are stated at cost. Provision for diminution is made to recognize a decline, other than temporary, in the value of such investments.

b) Current Investments are stated at lower of cost and fair value.

10. EMPLOYEE BENEFITS:

Provisions for Gratuity Liability and leave encashment liability are made on the basis of actuarial Valuation using the projected unit credit method. In the case of crew and MPW of floating employees who are entitled to settlement of leave in full on signing off, provision is made for the leave at credit of such employees as on 31st March. Actuarial liability in excess of respective plan assets is recognized during the year.

Provision for Gratuity as per the Actuarial valuation is funded with a separate Trust.

11. PROVISIONS, CONTINGENT LIABILITIES & CONTINGENT ASSETS:

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Assets are neither recognized nor disclosed in the financial statements. Contingent liabilities, if material, are disclosed by way of notes.


Mar 31, 2010

1. BASIS OF PREPARATION OF FINANCIAL STATEMENTS.

a) The Financial Statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles.

b) The Company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis.

2. OPERATIONAL INCOME:

a) Unbilled values of works executed up to 31st march are considered as income although bills are raised subsequently. The Corresponding debit balances are shown under "Current Assets-unbilled operational income receivable".

b) Claims preferred on Customers for works/items not contemplated are considered as income on their acceptance.

c) Income in respect of incomplete dredging jobs undertaken on insitu basis are accounted for on the basis of estimated realizable value of the work done up to 31s March.

3. OTHER INCOME:

a) Sale proceeds of condemned and unserviceable Spares, Stores, Empties, Waste Oil, etc are accounted for in the year of disposal.

b) Liquidated damages recovered from suppliers are accounted on settlement of bills.

c) Interests on Tax refunds are accounted on receipt basis.

d) In respect of hull and machinery insurance claims, until final settlement, 80% of the claimable amount based on estimate of technical department, after deductible excess, or the actual amount received, whichever is higher, is treated as income from insurance claims. Provision for repair expenditure is simultaneously made as per the estimate of technical department where actual repairs have not been completed and/or bills not settled with the repairers. In respect of other claims, the same are accounted for on realization/settlement by the underwriters.

4. OPERATIONAL EXPENSES:

a) Spares issued to Dredgers, of the nature of inventory, are charged to revenue as and when consumed.

b) Stores:

Stores and Lubricants delivered to the crafts during the year and acknowledged by the Master/CEO are charged to revenue. Provision is made towards consumption for the material delivered to crafts up to 31st March in respect of which acknowledgements are not received.

c) Insurance:

Final adjustments to Insurance Premium paid are considered in accounts on the basis of demands received.

5. DEPRECIATION:

Depreciation is provided under straight-line method in accordance with Schedule XIV of the Companies Act. In respect of the following Assets, depreciation is provided on straight-line method at the following rates based on the technical estimation of the useful lives of such assets:-

a) Pipeline Equipment: 25% for Mild Steel Pipeline equipment and 12.5% for High Density polyethylene pipeline equipment.

b) Second hand assets/retrofit of the vessels: as per the estimated balance service life.

c) Building on lease: Cost of Buildings constructed on lease hold land is amortised over the lease period.

d) Items of Fixed Assets whose cost does not exceed Rs.5000/-(Rupees Five thousand) each are capitalized and depreciated 100% during the year.

e) Cost of Library: Cost of Library is considered as Other Establishment expenditure.

6. FIXED ASSETS:

a) Fixed Assets are stated at historical cost less depreciation (historical cost includes financing cost and other related overheads).

b) Grants in Aid relating to specific Fixed Assets are shown as deduction from the gross value of the assets concerned in arriving at book value.

c) Items of the nature of Capital/ Equipments are capitalized and depreciated over the remaining useful life of the asset.

7. BORROWING COSTS:

Borrowing costs attributable to acquisition, construction or production of qualifying assets are capitalised as part of the cost of that asset, till the time the asset is put to use. Other borrowing costs are recognised as an expense in the period in which they are incurred.

8. STOCK OF SPARES AND STORES:

a) Stock of spares and stores is valued at weighted average cost and is inclusive of: i) Customs Duty, if any, as applicable to the whole consignment and

ii) Overheads at pre-determined rate.

b) Reconditioned spares are valued at the respective cost of reconditioning.

c) Value of Materials dispatched on F.O.B. basis by Foreign Suppliers on or before 31s" March of a year is considered in the accounts of that year, provided dispatch documents are retired or accepted within 15 days of the end of the accounting year.

9. INVESTMENTS:

Investments are classified as long term and are carried at cost.

10. EMPLOYEE BENEFITS:

Provisions for Gratuity Liability and leave encashment liability are made on the basis of actuarial Valuation using the projected unit credit method. In the case of crew and MPW of floating employees who are entitled to settlement of leave in full on signing off, provision is made for the leave at credit of such employees as on 31st March. Actuarial liability in excess of respective plan assets is recognized during the year.

Provision for Gratuity as per the Actuarial valuation is funded with a separate Trust.

11. PROVISIONS, CONTINGENT LAIBILITIES & CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Assets are neither recognized nor disclosed in the financial statements. Contingent liabilities, if material, are disclosed by way of notes.



 
Subscribe now to get personal finance updates in your inbox!