Page 238 - Tata_Chemicals_yearly-reports-2020-2021

Integrated Annual Report 2020-21

Useful lives and residual values of assets are between the net disposal proceeds and the
reviewed at the end of each reporting period. carrying amount of the asset and recognised as
income or expense in the Consolidated Statement
Losses arising from the retirement of, and gains or of Profit and Loss.
losses arising from disposal/adjustments of PPE
are recognised in the Consolidated Statement of 2.11 Capital work-in-progress (‘CWIP’) and
Profit and Loss. intangible assets under development
2.10 Intangible assets Projects under commissioning and other CWIP/
intangible assets under development are carried
Goodwill
at cost, comprising direct cost, related incidental
Goodwill represents the cost of the acquired expenses and attributable borrowing cost.
businesses in excess of the fair value of identifiable
tangible and intangible net assets purchased. Subsequent expenditures relating to property,
Goodwill is not amortised; however it is tested plant and equipment are capitalised only when it is
annually for impairment and carried at cost less probable that future economic benefit associated
accumulated impairment losses, if any. The gains with these will flow to the Group and the cost of
/ (losses) on the disposal of an entity include the the item can be measured reliably.
carrying amount of Goodwill relating to the entity Advances given to acquire property, plant and
disposed.
equipment are recorded as non-current assets and
Other Intangible assets subsequently transferred to CWIP on acquisition of
Computer software, technical knowhow, product related assets.
registration, contractual rights, rights to use railway 2.12 Investment property
wagons and mining rights of similar nature are
initially recognised at cost. The intangible assets Investment properties are land and buildings that
acquired in a business combination are measured are held for long term lease rental yields and/ or
at their fair value as at the date of acquisition. for capital appreciation. Investment properties are
Following initial recognition, intangible assets are initially recognised at cost including transaction
carried at cost less accumulated amortisation and costs. Subsequently investment properties
accumulated impairment losses, if any. comprising building are carried at cost less
accumulated depreciation and accumulated
The intangible assets with a finite useful life impairment losses, if any.
are amortised using straight line method over
their estimated useful lives. The management’s Depreciation on buildings is provided over the
estimates of the useful lives for various class of estimated useful lives as specified in note 2.9
intangibles are as given below: above. The residual values, estimated useful lives
and depreciation method of investment properties
Asset Useful life are reviewed, and adjusted on prospective basis as
Mining rights** 140 years
Computer software 3-8 years appropriate, at each reporting date. The effects
Product registration, contractual 4-20 years of any revision are included in the Consolidated
rights and rights to use railway Statement of Profit and Loss when the changes
wagons arise.
Technical knowhow 3 years An investment property is de-recognised when
**Mining rights which are in relation to the USA either the investment property has been disposed
subsidiaries mine are amortised using the units-of-
production method. Approximately 99% (previous of or does not meet the criteria of investment
year 99%) of mining rights are amortised using the property i.e. when the investment property is
units-of-production method. permanently withdrawn from use and no future
economic benefit is expected from its disposal.
The estimated useful life is reviewed annually by The difference between the net disposal proceeds
the management.
and the carrying amount of the asset is recognised
Losses arising from the retirement or disposal of an in the Consolidated Statement of Profit and Loss in
intangible asset are determined as the difference the period of de-recognition.

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