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Consolidated Financials
203
CORPORATE OVERVIEW (1-31)
STATUTORY REPORTS (46-122)
FINANCIALS
35. (i) Movementofprovisionforwarrantyandproduct liability
Opening balance
4,126.19
3,743.37
Add: Provision for the year (net) (including additional provision for earlier years)
3,427.45
2,927.68
Less: Payments / debits (net of recoveries from suppliers)
(2,857.76)
(2,834.07)
Foreign currency translation
556.29
289.21
Closing balance
5,252.17
4,126.19
Current portion
2,731.40
2,196.06
Non-current portion
2,520.77
1,930.13
5,252.17
4,126.19
The provision is expected to be utilized for settlement of warranty claims within a period of 4 years.
(ii) Movement of provision for redemptionof FCCN / CARS
Opening balance
801.09
993.15
Foreign currency exchange loss / (gain)
100.99
(3.22)
Premium on redemption of FCCN (including withholding tax)
(0.97)
-
Reversal of provision for premium due to conversion of FCCN
-
(168.57)
Provision / (Reversal of provision) for withholding tax upon conversion /
redemption / foreign currency exchange of FCCN
11.39
(20.27)
Closing balance
912.50
801.09
Current portion
855.73
0.87
Non-current portion
56.77
800.22
912.50
801.09
(iii) Movement of provision for residual risk
Opening balance
50.23
106.91
Add: Provision for the year (net)
42.57
(221.83)
Less: Payments / debits
-
166.03
Foreign currency translation
38.18
(0.88)
Closing balance
130.98
50.23
Current portion
17.58
7.14
Non-current portion
113.40
43.09
130.98
50.23
In certain markets, some subsidiaries are responsible for the residual risk arising on vehicles
sold by dealers on a leasing arrangement. The provision is based on the latest available market
expectations of future residual value trends. The timing of the outflows will be at the end of
the lease arrangements – being typically up to three years.
(iv) Movement of provision towardsenvironmental cost
Opening balance
130.90
128.11
Add: Provision for the year (net)
19.47
-
Less: Payments
(4.96)
(3.54)
Foreign currency translation
19.45
6.33
Closing balance
164.86
130.90
Current portion
-
-
Non-current portion
164.86
130.90
164.86
130.90
This provision relates to various environmental remediation costs such as asbestos removal and
land clean up. The timing of when these costs will be incurred is not known with certainty.
NOTESFORMINGPARTOFCONSOLIDATEDFINANCIALSTATEMENTS
(
`
in crores)
2011-2012
2010-2011
FINANCIAL HIGHLIGHTS (32-45)