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Integrated Report Statutory Reports Financial Statements
1-59 60-146 Consolidated

recognised, to reflect new information obtained value of the replaced part is de-recognised.
about facts and circumstances that existed at Where an item of property, plant and equipment
the acquisition date that, if known, would have comprises major components having different
affected the amount recognised at that date. useful lives, these components are accounted for
as separate items.
2.8 Changes in the proportion held by NCI
Changes in the proportion of the equity held by PPE acquired and put to use for projects are
NCI are accounted for as equity transactions. The capitalised and depreciation thereon is included
carrying amount of the controlling interests and in the project cost till the project is ready for
NCI are adjusted to reflect the changes in their commissioning.
relative interests in the subsidiaries. Any difference Depreciation methods, estimated useful lives
between the amount by which the NCI are and residual value
adjusted and the fair value of the consideration Depreciation on PPE (except leasehold
paid or received is recognised directly in equity improvements) is calculated using the straight-line
and attributed to owners of the Group.
method to allocate their cost, net of their residual
2.9 Property, plant and equipment values, over their estimated useful lives. However,
An item of property, plant and equipment (‘PPE’) leasehold improvements are depreciated on a
is recognised as an asset if it is probable that the straight-line method over the shorter of their
future economic benefits associated with the respective useful lives or the tenure of the lease
item will flow to the Group and its cost can be arrangement. Freehold land is not depreciated.
measured reliably. These recognition principles Schedule II to the Act prescribes the useful lives for
are applied to the costs incurred initially to acquire various class of assets. For certain class of assets,
an item of PPE, to the pre-operative and trial run based on technical evaluation and assessment,
costs incurred (net of sales), if any and also to the Management believes that, the useful lives
costs incurred subsequently to add to, replace part adopted by it reflect the periods over which these
of, or service it and subsequently carried at cost assets are expected to be used. Accordingly for
less accumulated depreciation and accumulated those assets, the useful lives estimated by the
impairment losses, if any. management are different from those prescribed
The cost of PPE includes interest on borrowings in the Schedule. Management’s estimates of the
directly attributable to the acquisition, useful lives for various class of PPE are as given
construction or production of a qualifying asset. A below:
qualifying asset is an asset that necessarily takes Asset Useful life
a substantial period of time to be made ready for Salt Works, Reservoirs and Pans 1-30 years
its intended use or sale. Borrowing costs and other Plant and Machinery** 1-60 years
directly attributable cost are added to the cost Traction Lines and Railway Sidings 15 years
of those assets until such time as the assets are Factory Buildings 5-60 years
substantially ready for their intended use, which Other Buildings 5-60 years
generally coincides with the commissioning date Water Works 15 years
of those assets. Furniture and Fittings and Office 1-10 years
The present value of the expected cost for the Equipment (including Computers
decommissioning of an asset after its use is and Data Processing Equipment)
included in the cost of the respective asset if the Vehicles 4-10 years
recognition criteria for a provision is met. Mines and Quarries** 140 years
Machinery spares that meet the definition of PPE **Mines and quarries and certain plant and
are capitalised and depreciated over the useful life machinery which are in relation to the USA
of the principal item of an asset. subsidiaries mine are depreciated using the
units-of-production method. Approximately 1%
All other repair and maintenance costs, (previous year 2%) of plant and machinery and
including regular servicing, are recognised in 100% (previous year 100%) of mines and quarries
the Consolidated Statement of Profit and Loss as are depreciated using the units-of-production
incurred. When a replacement occurs, the carrying method.

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