PRIVI SPECIALITY CHEMICALS LIMITED Annual Report 2020-21

149 Annual Report 2020-21 CORPORATE OVERVIEW STATUTORY REPORTS FINANCIAL STATEMENTS v. Property, Plant and Equipment (“PPE”) and depreciation I Recognition and Measurement Items of Property, Plant and Equipment are measured at cost, which includes capitalized borrowing costs, less accumulated depreciation, and any accumulated impairment losses. The cost of the certain items of the property, plant and equipment as of January 1, 2005. The group’s date of transition to the standards was determined with the reference to its fair value at the date. If significant parts of an item of Property, Plant and Equipment have different useful lives, then they are accounted for as separate items (major components) of Property, Plant and Equipment. Any Gain or loss on disposal of an item of Property, Plant and Equipment is recognized in profit or loss. II Subsequent Expenditure Subsequent Expenditure is capitalized only if it is probable that the economic benefits flow to the associated with the Expenditure will flow to the entity. Depreciation and Amortisation Depreciation is calculated using the straight-line method to allocate cost of Property Plant and Equipment, net of residual values, over their estimated useful lives as per the useful life prescribed in schedule II of the Companies Act, 2013 except in case of the following class of assets where the useful life is based on technical evaluation of the management: ASSET CLASS Years Plant and Machinery 10 Furniture & Fixtures 16 Office Equipment 10 Vehicle 11 Computer 6 Fixtures in leasehold premises are amortized over the primary period of the lease or useful life of the fixtures, whichever is lower. Depreciation on additions / deletions during the year is provided from the month in which the asset is ready to use to the month in which the asset is disposed of. The estimated useful lives, residual values and depreciation method are reviewed at the end of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis. Assets required under finance leases are depreciated over the shorter of the lease term and their useful lives (not being greater than the useful life envisaged in Schedule II of Companies Act, 2013) unless it is reasonably certain that group will obtain ownership by the end of lease term, in which case the depreciation rates applicable for similar assets owned by the group are applied. An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount. Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in profit or loss within other gains/(losses). vi. Intangible assets and amortisation Intangible assets with finite useful life are stated at cost of acquisition, less accumulated depreciation/ amortisation and impairment loss, if any. Cost includes taxes, duties and other incidental expenses related to acquisition and other incidental expenses. Amortisation is recognised in profit or loss on a straight-line basis over the estimated useful lives of respective intangible assets. ASSET CLASS Years Computers and Soft wares 3 to 6 Years Rights of Sale of Products 5 Years Development Rights 5 Years NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2021 (Currency: Indian Rupees in lakhs)