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Useful lives and residual values of assets are reviewed 2.11 Capital work-in-progress (‘CWIP’) and intangible
at the end of each reporting period. assets under development

Losses arising from the retirement of, and gains or Projects under commissioning and other CWIP/
losses arising from disposal/adjustments of PPE are intangible assets under development are carried
recognised in the Consolidated Statement of Profit at cost, comprising direct cost, related incidental
and Loss. expenses and attributable borrowing cost.
2.10 Intangible assets Subsequent expenditures relating to property, plant
and equipment are capitalised only when it is probable
Goodwill
that future economic benefit associated with these
Goodwill represents the cost of the acquired will flow to the Group and the cost of the item can be
businesses in excess of the fair value of identifiable measured reliably.
tangible and intangible net assets purchased. Goodwill
2.12 Investment property
is not amortised; however it is tested annually for
impairment and carried at cost less accumulated Investment properties are land and buildings that Integrated Report
impairment losses, if any. The gains / (losses) on the are held for long term lease rental yields and/ or
disposal of an entity include the carrying amount of for capital appreciation. Investment properties are
Goodwill relating to the entity disposed. initially recognised at cost including transaction costs.
Subsequently investment properties comprising
Other Intangible assets
building are carried at cost less accumulated
Computer software, technical knowhow, product depreciation and accumulated impairment losses, if
registration, contractual rights, rights to use railway any.
wagons and mining rights of similar nature are initially
Depreciation on buildings is provided over the
recognised at cost. The intangible assets acquired
estimated useful lives as specified in note 2.9 above.
in a business combination are measured at their fair
The residual values, estimated useful lives and
value as at the date of acquisition. Following initial
depreciation method of investment properties are
recognition, intangible assets are carried at cost
reviewed, and adjusted on prospective basis as
less accumulated amortisation and accumulated
appropriate, at each reporting date. The effects of any
impairment losses, if any.
revision are included in the Consolidated Statement of Statutory Reports
The intangible assets with a finite useful life are Profit and Loss when the changes arise.
amortised using straight line method over their
An investment property is de-recognised when either
estimated useful lives. The management’s estimates of
the investment property has been disposed of or does
the useful lives for various class of intangibles are as
not meet the criteria of investment property i.e. when
given below:
the investment property is permanently withdrawn
from use and no future economic benefit is expected
Asset Useful life
from its disposal. The difference between the net
Mining rights** 140 years disposal proceeds and the carrying amount of the
Computer software 3-8 years asset is recognised in the Consolidated Statement of
Profit and Loss in the period of de-recognition.
Product registration, contractual
rights and rights to use railway 2.13 Research and Development Expenses
wagons 4-20 years
Research expenses are charged to the Consolidated
Technical knowhow 3 years Statement of Profit and Loss as expenses in the year
in which they are incurred. Development costs are Financial Statements
**Mining rights which are in relation to the USA capitalised as an intangible asset under development
subsidiaries mine are amortised using the units-of- when the following criteria are met:
production method. Approximately 99% (previous
year 99%) of mining rights are amortised using the ʀ the project is clearly defined, and the costs are
units-of-production method. separately identified and reliably measured;
The estimated useful life is reviewed annually by the ʀ the technical feasibility of the project is
management. demonstrated;
Gains or losses arising from the retirement or disposal ʀ the ability to use or sell the products created during
of an intangible asset are determined as the difference the project is demonstrated;
between the net disposal proceeds and the carrying
amount of the asset and recognised as income or ʀ the intention to complete the project exists and
expense in the Consolidated Statement of Profit and use or sale of output manufactured during the
Loss. project;

Consolidated Financial Statements 203