Atul Ltd Annual Report 2016-17

Atul Ltd | Annual Report 2016-17

The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows by

reference to market yields at the end of the reporting period on Government bonds that have terms approximating to the

terms of the related obligation.

The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the

fair value of plan assets. This cost is included in employee benefit expense in the Statement of Profit and Loss.

Remeasurement gains and losses arising from experience adjustments and changes in actuarial assumptions are recognised

in the period in which they occur directly in Other Comprehensive Income. They are included in retained earnings in the

Statement of changes in equity and in the Balance Sheet.

Changes in the present value of the defined benefit obligation resulting from plan amendments or curtailments are

recognised immediately in profit or loss as past service cost.

w) Research and Development expenditure:

Research and Development expenditure is charged to revenue under the natural heads of account in the year in which

it is incurred. Research and Development expenditure on property, plant and equipment is treated in the same way as

expenditure on other property, plant and equipment.

x) Earnings per share:

Earnings per share (EPS) is calculated by dividing the net profit or loss for the period attributable to Equity Shareholders by

the weighted average number of Equity shares outstanding during the period. Earnings considered in ascertaining the EPS

is the net profit for the period and any attributable tax thereto for the period.

y) Contributed equity:

Equity shares are classified as equity.

Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax,

from the proceeds.

Critical estimates and judgements

Preparation of the Financial Statements requires use of accounting estimates which, by definition, will seldom equal the actual

results. This Note provides an overview of the areas that involved a higher degree of judgements or complexity, and of items

which are more likely to be materially adjusted due to estimates and assumptions turning out to be different than those

originally assessed. Detailed information about each of these estimates and judgements is included in relevant notes together

with information about the basis of calculation for each affected line item in the Financial Statements.

The areas involving critical estimates or judgements are:

Estimation of useful life of tangible assets: Note 1 (g)

ii) Estimation of defined benefit obligation: Note 27.6

Estimates and judgements are continually evaluated. They are based on historical experience and other factors, including

expectations of future events that may have a financial impact on the Company and that are believed to be reasonable under

the circumstances.

Note 1 Significant Accounting Policies

(continued)

Notes

to the Financial Statements