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Statutory Reports
Corporate Overview
Financial Statements
F-84
(Consolidated)
72nd Annual Report 2016-17
Estimated useful lives of the assets are as follows:
Type of Asset
Estimateduseful life
Buildings, Roads, Bridge and culverts
4 to 60 years
Plant, machinery and equipment
3 to 30 years
Computers and other IT assets
3 to 6 years
Vehicles
3 to 11 years
Furniture, fixtures and office appliances 3 to 21 years
The useful lives is reviewed at least at each year-end. Changes in expected useful lives are treated as change in accounting estimates.
Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or, where shorter, the term
of the relevant lease.
Depreciation is not recorded on capital work-in-progress until construction and installation are complete and the asset is ready for its intended
use.
n. Other intangible assets
Intangible assets purchased, including those acquired in business combinations, are measured at cost or fair value as of the date of acquisition
where applicable less accumulated amortization and accumulated impairment, if any. Intangible assets with indefinite lives are reviewed annually
to determine whether indefinite-life assessment continues to be supportable. If not, the change in the useful-life assessment from indefinite to
finite is made on a prospective basis.
Estimated useful lives of assets are as follows:
Type of Asset
Estimated useful life
Patents and technical know-how
2 to 12 years
Computer software
1 to 8 years
Dealer network
20 years
Intellectual property rights
3 to 10 years
The amortization period for intangible assets with finite useful lives is reviewed at least at each year-end. Changes in expected useful lives are
treated as changes in accounting estimates.
Customer related intangible assets consists of the Company’s dealer network.
Internally generated intangible asset
Research costs are charged to the Statement of Profit and Loss in the year in which they are incurred.
Product development costs incurred on new vehicle platform, engines, transmission and new products are recognized as intangible assets, when
feasibility has been established, the Company has committed technical, financial and other resources to complete the development and it is
probable that asset will generate probable future economic benefits.
The costs capitalized include the cost of materials, direct labour and directly attributable overhead expenditure incurred up to the date the asset
is available for use.
Interest cost incurred is capitalized up to the date the asset is ready for its intended use, based on borrowings incurred specifically for financing
the asset or the weighted average rate of all other borrowings if no specific borrowings have been incurred for the asset.
Product development cost is amortized over a period of 24 months to 120 months or on the basis of actual production or planned production
volume over such period.
Capitalized development expenditure is measured at cost less accumulated amortization and accumulated impairment, if any.
NOTES FORMING PART OF CONSOLIDATED FINANCIAL STATEMENTS