Page 274 - Tata_Chemicals_yearly-reports-2021-22

Integrated Annual Report 2021-22

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
related assets.
Computer software, technical knowhow, product
registration, contractual rights, rights to use railway 2.12 Investment property
wagons and mining rights of similar nature are Investment properties are land and buildings that
initially recognised at cost. The intangible assets are held for long term lease rental yields and/ or
acquired in a business combination are measured for capital appreciation. Investment properties are
at their fair value as at the date of acquisition. initially recognised at cost including transaction
Following initial recognition, intangible assets are costs. Subsequently investment properties
carried at cost less accumulated amortisation and comprising building are carried at cost less
accumulated impairment losses, if any.
accumulated depreciation and accumulated
The intangible assets with a finite useful life impairment losses, if any.
are amortised using straight line method over Depreciation on buildings is provided over the
their estimated useful lives. The management’s estimated useful lives as specified in note 2.9
estimates of the useful lives for various class of above. The residual values, estimated useful lives
intangibles are as given below: and depreciation method of investment properties
Asset Useful life are reviewed, and adjusted on prospective basis as
Mining rights** 140 years appropriate, at each reporting date. The effects
Computer software 3-8 years of any revision are included in the Consolidated
Product registration, contractual 4-20 years Statement of Profit and Loss when the changes
rights and rights to use railway arise.
wagons An investment property is de-recognised when
Technical knowhow 3 years either the investment property has been disposed
**Mining rights which are in relation to the USA of or does not meet the criteria of investment
subsidiaries mine are amortised using the units-of- property i.e. when the investment property is
production method. Approximately 99% (previous year permanently withdrawn from use and no future
99%) of mining rights are amortised using the units-of- economic benefit is expected from its disposal.
production method.
The difference between the net disposal proceeds
The estimated useful life is reviewed annually by and the carrying amount of the asset is recognised
the management. in the Consolidated Statement of Profit and Loss in
the period of de-recognition.
Gains or losses arising from the retirement or
disposal of an intangible asset are determined 2.13 Research and Development Expenses
as the difference between the net disposal Research expenses are charged to the Consolidated
proceeds and the carrying amount of the asset Statement of Profit and Loss as expenses in the
and recognised as income or expense in the year in which they are incurred. Development
Consolidated Statement of Profit and Loss.
costs are capitalised as an intangible asset under
2.11 Capital work-in-progress (‘CWIP’) and development when the following criteria are met:
intangible assets under development • the project is clearly defined, and the
Projects under commissioning and other CWIP/ costs are separately identified and reliably
intangible assets under development are carried measured;
at cost, comprising direct cost, related incidental • the technical feasibility of the project is
expenses and attributable borrowing cost. demonstrated;

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