205
(
`
in crores)
2013 - 2014
2012 - 2013
34. (i)
Movement of provision for warranty and product liability
Opening balance
6,719.10
5,299.73
Add: Provision for the year (net) (including additional provision for earlier years)
6,207.44
4,203.91
Less: Payments / debits (net of recoveries from suppliers)
(4,760.36)
(2,756.43)
Foreign currency translation
1,316.04
(28.11)
Closing balance
9,482.22
6,719.10
Current portion
3,976.69
3,145.50
Non-current portion
5,505.53
3,573.60
9,482.22
6,719.10
The provision is expected to be utilized for settlement of warranty claims within a period of 5 years.
(ii)
Movement of provision for redemption of FCCN / CARS
Opening balance
34.21
912.50
Foreign currency exchange loss
0.94
82.97
Premium on redemption of FCCN / CARS (including withholding tax)
(35.15)
(843.37)
Reversal of provision for premium due to conversion of FCCN / CARS
-
(19.92)
Provision / (reversal of provision) for withholding tax upon conversion /
redemption / foreign currency exchange of FCCN / CARS
-
(97.97)
Closing balance
-
34.21
Current portion
-
-
Non-current portion
-
34.21
-
34.21
(iii) Movement of provision for residual risk
Opening balance
119.67
130.98
Add: Provision / (reversal of provision) for the year
27.19
(6.02)
Less: Payments / debits
-
(7.74)
Foreign currency translation
2.08
2.45
Closing balance
148.94
119.67
Current portion
17.95
13.40
Non-current portion
130.99
106.27
148.94
119.67
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 towards environmental cost
Opening balance
179.32
164.86
Add: Provision for the year (net)
0.96
25.79
Less: Payments
(12.50)
(12.04)
Foreign currency translation
38.90
0.71
Closing balance
206.68
179.32
Current portion
-
-
Non-current portion
206.68
179.32
206.68
179.32
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.
NOTES FORMING PART OF CONSOLIDATED FINANCIAL STATEMENTS
Independent Auditors’Report
Balance Sheet
(176-206)
Statement of Profit and Loss
Cash Flow Statement
Notes to Accounts
