3. Material accounting policy
This note provides a list of the material accounting
policies adopted in the preparation of this standalone
financial statements. These policies have been
consistently applied to all the years presented, unless
otherwise stated.
a) Foreign Currency Transactions
Transaction and balance
Transactions in foreign currencies are initially recorded
in the functional currency at the spot rate of exchange
ruling at the date of the transaction. Monetary assets
and liabilities denominated in foreign currencies are
retranslated into the functional currency at the spot
rate of exchange at the reporting date. All exchange
differences arising from foreign currency borrowings
to the extent not capitalized
are regarded as a cost of borrowing and presented
under Finance cost.
b) Revenue from contracts with customers
The Company recognizes revenue from contracts with
customers (other than financial assets to which I nd
AS 109 'Financial Instruments' is applicable) based
on a comprehensive assessment model as set out in
Ind AS 115 'Revenue from Contracts with Customers'.
The Company identifies contract(s) with a customer
and its performance obligations under the contract,
determines the transaction price and its allocation
to the performance obligations in the contract and
recognizes revenue only on satisfactory completion of
performance obligations. Revenue is measured at fair
value of the consideration received or receivable.
Revenue from advertisement activity is recognized
upon satisfaction of performance obligation (over the
time) by rendering of services underlying the contract
with third party customers.
c) Employee benefits
Short-term employee benefits
Short-term employee benefits are measured on an
undiscounted basis and expensed as the related service
is provided. A liability is recognised for the amount
expected to be paid under short-term cash bonus, if the
Company has a present legal or constructive obligation
to pay this amount as a result of past service provided by
the employee and the obligation can be estimated reliably
Defined contribution plan - gratuity
Retirement benefit in the form of provident fund is a
defined contribution scheme. The Company has no
obligation other than the contribution payable to the
provident fund. The Company recognizes contribution
payable to the provident fund scheme as expenditure
when an employee renders the related service.
Share based payments
Employees (including senior executives) of the
Company receive remuneration in the form of share-
based payments in form of employee stock options,
whereby employees render services as consideration
for equity instruments (equity-settled transactions).
The cost of equity-settled transactions is determined
by the fair value at the date when the grant is made
using the Black Scholes valuation model. That cost is
recognized in employee benefits expense, together with
a corresponding increase in share options outstanding
account in Other equity, over the period in which the
performance and/or service conditions are fulfilled.
The cumulative expense recognized for equity-settled
transactions at each reporting date until the vesting
date reflects the extent to which the vesting period has
expired and the Company's best estimate of the number
of equity instruments that will ultimately vest. The
expense or credit for a period represents the movement
in cumulative expense recognized as at the beginning
and end of that period and is recognized in employee
benefits expense. Service and non-market performance
conditions are not taken into account when determining
the grant date fair value of awards, but the likelihood
of the conditions being met is assessed as part of
the Company's best estimate of the number of equity
instruments that will ultimately vest. The dilutive effect
of outstanding options is reflected as additional share
dilution in the computation of diluted earnings per
share.
Defined benefit plans
The Company has defined benefit gratuity plan. The
Company's net obligation in respect of defined benefit
plans is calculated separately by estimating the amount
of future benefit that employees have earned in the
current and prior periods, discounting that amount and
deducting the fair value of any plan assets.
The calculation of defined benefit obligations is
performed annually by a qualified actuary using the
projected unit credit method. When the calculation
results in a potential asset for the Company, the
recognised asset is limited to the present value
of economic benefits available in the form of any
future refunds from the plan or reductions in future
contributions to the plan ('the asset ceiling'). To calculate
the present value of economic benefits, consideration is
given to any applicable minimum funding requirements.
Remeasurements of the net defined benefit liability
/ (asset), which comprise actuarial gains and losses,
the return on plan assets (excluding interest) and the
effect of the asset ceiling (if any, excluding interest),
are recognised immediately in OCI. The Company
determines the net interest expense (income) on the
net defined benefit liability (asset) by applying the
discount rate, used to measure the net defined liability
/ (asset) as determined at the start of the financial year
after taking into account any changes in the net defined
benefit liability (asset) during the year as a result of
contributions and benefit payments. Net interest
expense and other expenses related to defined benefit
plans are recognised in the statement of profit and loss.
Remeasurements are not reclassified to profit and loss
in subsequent periods.
When the benefits of a plan are changed or when a plan
is curtailed, the resulting change in benefit that relates
to past service ('past service cost' or 'past service
gain') or the gain or loss on curtailment is recognised
immediately in the statement of profit and loss. The
Company recognises gains and losses on the settlement
of a defined benefit plan when the settlement occurs.
Other long-term employee benefits - compensated
absences
Compensated absences are a long-term employee
benefit and are accrued based on an actuarial valuation
done as per projected unit credit method as at the
Balance Sheet date, carried out by an independent
actuary.
Actuarial gains and losses arising during the year are
immediately recognized in the statement of profit and
loss.
d) Recognition of income and expense
The Company earns revenue primarily from giving loans.
Revenue is recognized to the extent that it is probable
that the economic benefits will flow to the Company
and the revenue can be reliably measured. The following
specific recognition criteria must also be met before
revenue is recognized:
(i) Interest income and expense
Interest revenue and expense is recognized using
the effective interest method (EIR). The effective
interest rate is the rate that discounts estimated
future cash payments or receipts through the
expected life of the financial instrument or, when
appropriate, a shorter period, to the gross carrying
amount of the financial asset or financial liability.
The calculation takes into account all contractual
terms of the financial instrument (for example,
prepayment options) and includes any fees or
incremental costs that are directly attributable to
the instrument and are an integral part of the EIR,
but not future credit losses.
The company calculates interest income by
applying the EIR to the gross carrying amount of
financial assets (other than credit-impaired assets).
When a financial asset becomes credit-impaired
and is, therefore, regarded as 'Stage IN', the
company calculates interest income by applying
the effective interest rate to the net amortized cost
of the financial asset. If the financial assets cures
and is no longer credit-impaired, the Company
reverts to calculating interest income on a gross
basis.
Interest expense includes issue costs that are
initially recognized as part of the carrying value
of the financial liability and amortized over the
expected life using the effective interest method.
These include fees payable to arrangers and other
expenses such as external legal costs, provided
these are incremental costs that are directly
related to the issue of financial liability.
(ii) Other income and expense
All Other income and expense are recognized in the
period they occur.
The Company recognises gains on fair value
change of financial assets measured at FVTPL
and realised gains on derecognition of financial
asset measured at FVTPL and FVOCI on net basis.
e) Income taxes
Current Taxes
Current income tax assets and liabilities are measured
at the amount expected to be recovered from or paid to
the taxation authorities in accordance with the Income
Tax Act, 1961. It is computed using tax rates and tax laws
enacted or substantively enacted at the reporting date.
Current income tax relating to items recognized outside
statement of profit and loss are recognized either in
other comprehensive income or in other equity.
Current tax assets and liabilities are offset only if there
is a legally enforceable right to set off the recognised
amounts, and it is intended to realise the asset and
settle the liability on a net basis or simultaneously.
Deferred Taxes
Deferred tax is provided on temporary differences at
the reporting date between the tax bases of assets
and liabilities and their carrying amounts for financial
reporting purposes.
Deferred tax liabilities are recognized for all taxable
temporary differences, except:
• Where the deferred tax liability arises from the initial
recognition of goodwill or of an asset or liability in a
transaction that is not a business combination and, at the
time of the transaction, affects neither the accounting
profit nor taxable profit or loss.
• In respect of taxable temporary differences associated
with investments in subsidiaries, where the timing of the
reversal of the temporary differences can be controlled
and it is probable that the temporary differences will not
reverse in the foreseeable future.
Deferred tax assets are recognized only to the extent
that it is probable that future taxable profits will be
available against which the asset can be utilized. The
carrying amount of deferred tax assets are reviewed at
each reporting date and reduced to the extent that it is
no longer probable that sufficient taxable profit will be
available to allow all or part of the deferred tax asset
to be utilized. Unrecognized deferred tax assets are
reassessed at each reporting date and are recognized to
the extent that it becomes probable that future taxable
profit will allow the deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured at the
tax rates that are expected to apply in the year when
the asset is realized or the liability is settled, based
on tax rates (and tax laws) that have been enacted or
substantively enacted at the reporting date.
Deferred tax relating to items recognized outside profit
or loss are recognized either in other comprehensive
income or in other equity. Deferred tax items are
recognized in correlation to the underlying transaction
either in OCI or directly in equity.
Deferred tax assets and liabilities are offset if there is a
legally enforceable right to offset current tax liabilities
and assets, and they relate to income taxes levied by
the same tax authority on the same taxable entity, or on
different tax entities, but they intend to settle current tax
liabilities and assets on a net basis or their tax assets
and liabilities will be realised simultaneously.
Current and deferred taxes are recognized as income
tax benefits or expenses in the statement of profit and
loss except for tax related to the FVOCI instruments.
The Company also recognizes the tax consequences
of payments and issuing costs, related to financial
instruments that are classified as equity, directly in
equity.
f) Property, plant and equipment (PPE)
The cost of an item of property, plant and equipment is
recognised as an asset if, and only if:
(a) it is probable that future economic benefits
associated with the item will flow to the entity; and
(b) the cost of the item can be measured reliably.
PPE are stated at cost (including incidental expenses
directly attributable to bringing the asset to its working
condition for its intended use) less accumulated
depreciation and accumulated impairment losses,
if any. Cost comprises the purchase price and any
attributable cost of bringing the asset to its working
condition for its intended use. Subsequent expenditure
related to PPE is capitalized only when it is probable
that future economic benefits associated with these
will flow to the Company and the cost of item can be
measured reliably. Other repairs and maintenance costs
are expensed off as and when incurred.
Leasehold improvements are amortized on straight line
basis over the lease term or the estimated useful life of
the assets, whichever is lower.
The residual values, useful lives and methods of
depreciation of property, plant and equipment are
reviewed at each financial year end and adjusted
prospectively, if appropriate.
An item of property, plant and equipment and any
significant part initially recognized is derecognized
upon disposal or when no future economic benefits
are expected from its use or disposal. Any gain or loss
arising on de-recognition of the asset (calculated as
the difference between the net disposal proceeds
and the carrying amount of the asset) is included
in the statement of profit and loss when the asset is
derecognized.
Depreciation
Depreciation on property, plant and equipment provided
on a written down value method at the rates arrived
based on useful life of the assets, prescribed under
Schedule 11 of the Act, which also represents the estimate
of the useful life of the assets by the management.
Depreciation on assets sold during the year is charged
to the statement of profit and loss to the date of sale.
Property, plant and equipment costing up to ' 5,000
(amount in full) individually are fully depreciated in the
year of purchase.
The Company has used the following useful lives
to provide depreciation on its Property, plant and
equipment:
g) Intangible assets
Intangible assets that are acquired by the Company
are measured initially at cost and are stated at cost
less accumulated depreciation as adjusted for
impairment, if any. Any gain on disposal of intangible
asset is recognised in the statement of profit and
loss. Subsequent expenditure is capitalised only if it is
probable that the future economic benefits associated
with the expenditure will flow to the Company.
Amortization
Amortisation is calculated to write-off the cost of
intangible asset using the written down value method
at the rates arrived based on useful life of the assets,
prescribed under Schedule II of the Act, which also
represents the estimate of the useful life of the assets
by the management. The estimated useful life used for
computation of depreciation is five years
h) Leases
At inception of a contract, the Company assesses
whether a contract is, or contains, a lease. A contract
is, or contains, a lease if the contract conveys the right
to control the use of an identified asset for a period of
time in exchange for consideration.
The Company recognises a right-of-use asset and a
lease liability at the lease commencement date. The
right-of-use asset is initially measured at cost, which
comprises the initial amount of the lease liability
adjusted for any lease payments made at or before
the commencement date, plus any initial direct
costs incurred and an estimate of costs to dismantle
and remove the underlying asset or to restore the
underlying asset or the site on which it is located, less
any lease incentives received. The right-of-use asset
is subsequently depreciated using the straight-line
method from the commencement date to the earlier of
the end of the useful life of the right-of-use asset or the
end of the lease term.
If ownership of the leased asset transfers to the
Company at the end of the lease term or the cost
reflects the exercise of a purchase option, depreciation
is calculated using the estimated useful life of the asset.
At the commencement date of the lease, the Company
recognizes lease liabilities measured at the present
value of lease payments to be made over the lease term.
The lease payments include fixed payments (including
in substance fixed payments) less any lease incentives
receivable, variable lease payments that depend on
an index or a rate, and amounts expected to be paid
under residual value guarantees. The lease payments
also include the exercise price of a purchase option
reasonably certain to be exercised by the Company
and payments of penalties for terminating the lease,
if the lease term reflects the Company exercising the
option to terminate.
In calculating the present value of lease payments,
the Company uses its incremental borrowing rate at
the lease commencement date because the interest
rate implicit in the lease is not readily determinable.
After the commencement date, the amount of lease
liabilities is increased to reflect the accretion of interest
and reduced for the lease payments made. In addition,
the carrying amount of lease liabilities is remeasured
if there is a modification, a change in the lease term, a
change in the lease payments (e.g.,changes to future
payments resulting from a change in rate used to
determine such lease payments) or a change in the
assessment of an option to purchase the underlying
asset.
Short term lease
The Company applies the short-term lease recognition
exemption to its short-term leases (i.e., those leases
that have a lease term of 12 months or less from the
commencement date and do not contain a purchase
option). Lease payments on short term leases are
recognized as and when due.
i) Financial instruments
A financial instrument is any contract that gives rise to
a financial asset of one entity and a financial liability or
equity instrument of another entity. Financial assets
and financial liabilities are recognized when the entity
becomes a party to the contractual provisions of the
instruments.
Financial Assets - All financial assets are recognized
initially at fair value plus, in the case of financial
assets not recorded at fair value through profit or loss,
transaction costs that are attributable to the acquisition
of the financial asset, except trade receivables which
is recorded at transaction price. Purchases or sales of
financial assets that require delivery of assets within a
time frame established by regulation or convention in
the marketplace (regular way trades) are recognized on
the trade date, i.e., the date that the Company commits
to purchase or sell the asset.
Subsequent measurement
For the purpose of subsequent measurement, financial
assets are classified in four categories:
• Loan Portfolio at amortized cost
• Loan Portfolio at fair value through other comprehensive
income (FVOCI)
• Investment in equity instruments and mutual funds at
fair value through profit or loss
• Other financial assets at amortized cost
Loan Portfolio at amortized cost:
Loan Portfolio is measured at amortized cost where:
• contractual terms that give rise to cash flows on specified
dates, that represent solely payments of principal and
interest (SPPI)on the principal amount outstanding; and
• are held within a business model whose objective is
achieved by Company to collect contractual cash flows.
Loan Portfolio at FVOCI:
Loan Portfolio is measured at FVOCI where:
• contractual terms that give rise to cash flows on specified
dates, that represent solely payments of principal and
interest (SPPI) on the principal amount outstanding; and
• the financial asset is held within a business model where
objective is achieved by both collecting contractual cash
flows and selling financial assets.
Business model: The business model reflects how the
Company manages the assets in order to generate cash
flows. That is, where the Company's objective is solely
to collect the contractual cash flows from the assets,
the same is measured at amortized cost or where the
Company's objective is to collect both the contractual
cash flows and cash flows arising from the sale of
assets, the same is measured at fair value through other
comprehensive income (FVOCI). If neither of these is
applicable (e.g. financial assets are held for trading
purposes), then the financial assets are classified as
part of 'other' business model and measured at FVTPL.
SPPI: Where the business model is to hold assets
to collect contractual cash flows (i.e. measured at
amortized cost) or to collect contractual cash flows
and sell (i.e. measured at fair value through other
comprehensive income), the Company assesses
whether the financial instruments' cash flows represent
solely payments of principal and interest (the 'SPPI
test'). In making this assessment, the Company
considers whether the contractual cash flows are
consistent with a basic lending arrangement i.e. interest
includes only consideration for the time value of money,
credit risk, other basic lending risks and a profit margin
that is consistent with a basic lending arrangement.
Where the contractual terms introduce exposure to risk
or volatility that are inconsistent with a basic lending
arrangement, the related financial asset is classified
and measured at fair value through profit or loss. The
amortized cost, as mentioned above, is computed using
the effective interest rate method.
After initial measurement, these financial assets are
subsequently measured at amortized cost using the
effective interest rate (EIR) method less impairment.
Amortized cost is calculated by taking into account any
discount or premium on acquisition and fees or costs
that are an integral part of the EIR. The EIR amortization
is included in interest income in the statement of profit
and loss. The losses arising from impairment are
recognized under the head 'impairment on financial
instruments' in the statement of profit and loss.
The measurement of credit impairment is based on the
three-stage expected credit loss model described in
Note: Impairment of financial assets (refer note 3(j)).
Effective interest method - The effective interest
method is a method of calculating the amortized cost
of a debt instrument and of allocating interest income
over the relevant period. The effective interest rate is
the rate that exactly discounts estimated future cash
receipts (including all fees and points paid or received
that form an integral part of the effective interest rate,
transaction costs and other premiums or discounts)
through the expected life of the debt instrument, or,
where appropriate, a shorter period, to the net carrying
amount on initial recognition. The amortized cost of
the financial asset is adjusted if the Company revises
its estimates of payments or receipts. The adjusted
amortized cost is calculated based on the original or
latest re-estimated EIR and the change is recorded
as 'Interest and similar income' for financial assets.
Income is recognized on an effective interest basis
for loan portfolio other than those financial assets
classified as at FVTPL.
Equity instruments and Mutual Funds
Equity instruments and mutual funds included within
the FVTPL category are mandatorily measured at fair
value with all changes recognized in the statement of
profit and loss.
Financial liabilities
Initial Measurement
Financial liabilities are classified and measured at
amortized cost. All financial liabilities are recognized
initially at fair value and, in the case of loans and
borrowings and payables, net of directly attributable
transaction costs. The Company's financial liabilities
include trade and other payables, loans and borrowings
including bank overdrafts and derivative financial
instruments.
Subsequent Measurement
Financial liabilities are subsequently carried at
amortized cost using the effective interest method.
De-recognition of financial assets and financial
liabilities
The company de-recognises a financial asset when the
contractual right to the cash flows from the asset expire,
or when it transfers the financial asset and substantially
all the risks and rewards of ownership of the assets
to another party. If the company neither transfers
nor retains substantially all the risks and rewards of
ownership and continues to control the transferred
asset, the Company recognizes its retained interest in
the asset and an associated liability for amounts it may
have to pay. If the company retains substantially all the
risks and rewards of ownership of a transferred financial
asset, the Company continues to recognize the financial
asset and also recognises an associated liability as
collateralized borrowing for the proceeds received.
On derecognition of a financial asset, the difference
between the asset's carrying amount and the sum
of the consideration received and receivable and the
cumulative gain or loss that had been recognized in
OCI, and accumulated in equity is recognized in OCI and
accumulated in equity is recognized in the statement of
profit and loss.
A financial liability is derecognized from the balance
sheet when the Company has discharged its obligation
or the contract is cancelled or expires.
Securitization and direct assignment
In case of transfer of loans through securitization and
direct assignment transactions, the transferred loans
are de-recognised and gain/losses are accounted for,
only if the Company transfers substantially all risks
and rewards specified in the underlying assigned loan
contract.
In accordance with the Ind AS 109, on de-recognition
of a financial asset under assigned transactions,
the difference between the carrying amount and the
consideration received are recognised in the statement
of profit and loss.
Net gain on derecognition of financial instruments
measured at FVOCI
Gains arising out of direct assignment transactions
comprise the difference between the interest on the
loan portfolio and the applicable rate at which the direct
assignment is entered into with the assignee, also known
as the right of excess interest spread (EIS). The future
EIS is based on the scheduled cash flows on execution
of the transaction, discounted at the applicable rate
entered into with the assignee is recorded upfront in
the statement of profit and loss.
Derivatives and hedging activities
The Company enters into a variety of derivative fi nancial
instruments to manage its exposure to interest rate
risk and foreign exchange rate risk, including cross
currency interest rate swaps and cross currency
swaps. Derivatives are initially recognised at fair value
at the date the derivative contracts are entered into
and are subsequently remeasured to their fair value at
the end of each reporting date. The resulting gain or
loss is recognised in the statement of profit and loss
immediately unless the derivative is designated and
effective as a hedging instrument, in which event the
timing of recognition in profit or loss depends on the
nature of the hedging relationship and nature of the
hedge item.
Embedded derivatives
Derivatives embedded in a host contract that is an
asset within the scope of Ind AS 109 are not separated.
Financial assets and financial liabilities with embedded
derivatives are considered in their entirety when
determining whether their cash flows are solely payment
of principal and interest.
Derivatives embedded in all other host contract are
separated only if the economic characteristics and risks
of the embedded derivatives are not closely related to
the economic characteristics and risks of the host and
accordingly, are measured at fair value through profit or
loss. Embedded derivatives closely related to the host
contracts are not separated.
Hedge accounting
The Company designates foreign currency forward
derivative contracts as hedges of foreign exchange
risk associated with the cash flows of foreign currency
risks associated with the borrowings denominated in
foreign currency (referred to as 'cash flow hedges'). The
Company documents at the inception of the hedging
transaction the economic relationship between the
hedging instruments and hedge items including
whether the hedging instrument is expected to offset
changes in the cash flows of hedge items. The Company
documents its risk management objective and strategy
for undertaking various hedge transactions at the
inception of the hedging relationship.
) Impairment on financial assets
Overview of principles for measuring expected credit
loss ('ECL')
In accordance with Ind AS 109, the Company is required
to measure expected credit losses on its financial
instruments designated at amortized cost and fair value
through other comprehensive income. Accordingly, the
Company is required to determine lifetime losses on
financial instruments where credit risk has increased
significantly since its origination. For other instruments,
the Company is required to recognize credit losses over
next 12-month period. The Company has an option to
determine such losses on individual basis or collectively
depending upon the nature of underlying portfolio. The
Company has a process to assess credit risk of all
exposures at each year end as follows:
Stage I
These represent exposures where there has not been a
significant increase in credit risk since initial recognition
or that has low credit risk at the reporting date. The
Company has assessed that all standard exposures
(i.e., exposures with no overdues) and exposure upto
30 day overdues fall under this category. In accordance
with Ind AS 109, the Company measures ECL on such
assets over next 12 months.
Stage II
Financial instruments that have had a significant
increase in credit risk since initial recognition are
classified under this stage. Based on empirical
evidence, significant increase in credit risk is witnessed
after the overdues on an exposure exceed for a period
more than 30 days. Accordingly, the Company classifies
all exposures with overdues exceeding 30 days at each
reporting date under this Stage. The Company measures
lifetime ECL on stage II loans.
Stage III
All exposures having overdue balances for a period
exceeding 90 days are considered to be defaults and are
classified under this stage. Accordingly, the Company
measures lifetime losses on such exposure. Interest
revenue on such contracts is calculated by applying
the effective interest rate to the amortized cost (net of
impairment allowance) instead of the gross carrying
amount.
Methodology for calculating ECL
The Company determines ECL based on a probability
weighted outcome of factors indicated below to
measure the shortfalls in collecting contractual cash
flows.
The Company does not discount such shortfalls
considering relatively shorter tenure of loan contracts.
Key factors applied to determine ECL are outlined as
follows:
a) Probability of default (PD) - The probability of
default is an estimate of the likelihood of default
over a given time horizon (12-month or lifetime,
depending upon the stage of the asset).
b) Exposure at default (EAD) - It represents an
estimate of the exposure of the Company at a
future date after considering repayments by the
counterparty before the default event occurs.
c) Loss given default (LGD) - It represents an
estimate of the loss expected to be incurred when
the event of default occurs.
Forward looking information
While estimating the expected credit losses, the
Company reviews macro-economic developments
occurring in the economy and market it operates in.
On a periodic basis, the Company analyses if there is
any relationship between key economic trends like
GDP, Unemployment rates, Benchmark rates set by the
Reserve Bank of India, inflation etc. with the estimate
of PD, LGD determined by the Company based on its
internal data. While the internal estimates of PD, LGD
rates by the Company may not be always reflective of
such relationships, temporary overlays are embedded
in the methodology to reflect such macro-economic
trends reasonably.
Write-offs (Refer Note 51)
Loans are written off (either partially or in full) when
there is no realistic prospect of recovery. This is
generally the case when the Company determines that
the borrower does not have assets or sources of income
that could generate sufficient cash flows to repay the
amounts subjected to write-offs. All such write-offs
are charged to the statement of profit and loss. Any
subsequent recoveries against such loans are credited
to the statement of profit and loss.
k) Impairment of non-financial assets
The carrying amount of assets is reviewed at each
balance sheet date if there is any indication of
impairment based on internal/external factors. An
impairment loss is recognized wherever the carrying
amount of an asset exceeds its recoverable amount.
The recoverable amount is the greater of the assets, net
selling price and value in use. In assessing value in use,
the estimated future cash flows are discounted to their
present value using a pre-tax discount rate that reflects
current market assessments of the time value of money
and risks specific to the asset. In determining net selling
price, recent market transactions are taken into account,
if available. If no such transactions can be identified, an
appropriate valuation model is used. After impairment,
depreciation is provided on the revised carrying amount
of the asset over its remaining useful life.
|