213 / 327
Shaping the future of software driven business
Consolidated Financials •
213
vi. Provisions
Provisions are determined based on the best estimate required to settle the obligation at the reporting date. If the
effect of time value of money is material, provisions are discounted using a current pre-tax rate that reflects the risks
specific to the liability. These estimates are reviewed at each balance sheet date and adjusted to reflect the current
best estimates.
vii. Internally generated Intangible assets
During the year, the management continued to assess the recoverability of the Group’s internally generated intangible
assets including those under development. Based on the current revenue generated from these lines of business,
expected future revenue and the basis of amortization followed, the management considers the carrying value of the
these intangible assets as recoverable.
(b) Property, Plant and Equipment
Property, Plant and Equipment are stated at cost, less accumulated depreciation and accumulated impairment losses, if
any. The cost comprises the purchase price and directly attributable costs of bringing the asset to its working condition for
its intended use. Any trade discounts and rebates are deducted in arriving at the purchase price. Capital work-in-progress
includes cost of Property, Plant and Equipment that are not ready to be put to use.
Subsequent expenditure related to an item of Property, Plant and Equipment is added to its original cost only if it is
probable that future economic benefits associated with the item will flow to the Group. All other expenses on existing
Property, Plant and Equipment, including day-to-day repair and maintenance expenditure and cost of replacing parts, are
charged to the statement of profit and loss for the period during which such expenses are incurred.
Gains or losses arising from disposal of Property, Plant and Equipment are measured as the difference between the net
disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the
asset is disposed.
(c) Intangible assets
Intangible assets including software licenses of enduring nature and contractual rights acquired separately are measured
on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less accumulated
amortization and accumulated impairment losses, if any. Cost comprises the purchase price and any directly attributable
cost of bringing the asset to its working condition for its intended use.
Gains or losses arising from disposal of an intangible asset are measured as the difference between the net disposal
proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is
disposed.
Research and development cost
Research costs are expensed as incurred. Development expenditure incurred on an individual project is recognized as an
intangible asset when the Group can demonstrate:
-
technical feasibility of completing the intangible asset so that it will be available for use or sale;
-
its intention to complete the asset;
-
its ability to use or sell the asset;
-
how the asset will generate probable future economic benefits;
-
the availability of adequate resources to complete the development and to use or sell the asset; and
-
the ability to measure reliably the expenditure attributable to the intangible asset during development.
Such development expenditure, until capitalization, is reflected as intangible assets under development.
Following the initial recognition, internally generated intangible assets are carried at cost less accumulated amortization
and accumulated impairment losses, if any. Amortization of internally generated intangible asset begins when the
development is complete and the asset is available for use.
(d) Business combinations
Business combinations are accounted for using the acquisition method under the provisions of Ind AS 103 - Business
Combinations.
Notes forming part of consolidated financial statements (Contd.)