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Atul Ltd | Annual Report 2012-13
NOTE 1 SIGNIFICANT ACCOUNTING POLICIES
(contd)
Depreciation on additions to the assets during the year is being provided on pro-rata basis at their
respective rate with reference to the month of acquisition | installation.
Depreciation on assets sold, scrapped or discarded during the year is being provided at their respective
rates up to the month in which such assets are sold, scrapped or discarded.
Depreciation is adjusted in subsequent periods to allocate the revised carrying amount of assets after the
recognition of an impairment loss on a systematic basis over its remaining useful life of assets.
Amortisation:
a) Premium on lease hold land is amortised over the period of lease.
b) Computer software is amortised over a period of three years.
4.5 Impairment of Assets:
The carrying amounts of assets are reviewed at each Balance Sheet date to assess if there is any indication
of impairment based on internal | external factors. An impairment loss on such assessment will be
recognised wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable
amount of the assets is net selling price or value in use whichever is higher. While assessing value in use,
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capital. A previously recognised impairment loss is further provided or reversed depending on changes in
the circumstances.
4.6 Borrowing Costs:
Borrowing costs in relation to acquisition and construction of qualifying assets are capitalised as part of
cost of such assets up to the date when such assets are ready for intended use. Other borrowing costs are
charged as expense in the year in which these are incurred.
4.7 Investments:
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as long-term investments and are carried at cost. However, provision for diminution in value of investments
is made to recognise a decline, other than temporary, in the value of the investments.
4.8 Inventories:
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whichever is lower. Cost is arrived at on moving weighted average basis.
b) Goods-in-transit and in bonded warehouse are stated at the cost to the date of Balance Sheet.
c) ‘Cost’ comprises all costs of purchase, costs of conversion and other costs incurred in bringing the
inventory to the present location and condition.
d) Due allowances are made for obsolete inventory based on technical estimates made by the Company.
4.9 Foreign Currency Transactions:
a) Initial recognition:
Transactions denominated in foreign currencies are recorded at the rate prevailing on the date of the
transaction.
b) Conversion:
At the year end, monetary items denominated in foreign currencies remaining unsettled are converted
into rupee equivalents at the year end exchange rates. Non-monetary items which are carried in terms
Notes
to Consolidated financial statements