bs 08 mam - Educomp Solutions Ltd.

Intangible Assets
Intangible asset are stated at cost of acquisition less accumulated amortization. Amortization on the
Intangible assets is provided on pro-rata basis on the straight-line method based on management’s
estimate of useful life, which are as follows:
Life (in years)
Software 3
Knowledge-based content/ Smart class software 4
(v) Impairment of Assets
All assets other than inventories, financial assets including investments and deferred tax asset, are
reviewed for impairment, wherever events or changes in circumstances indicate that the carrying
amount may not be recoverable. An Impairment loss is charged to the profit & loss account in the
year in which an asset is impaired.
Reversal of impairment loss is recognized immediately as income in the Profit & loss account.
(vi) Leases
Lease rentals in respect of operating lease arrangements are recognized as an expense in the profit
and loss account.
(vii) Inventories
Items of Inventories are measured at lower of cost and net realizable value after providing for
obsolescence, if any. Cost of inventories comprises of cost of purchase, freight & other expenses
incurred in bringing the inventories to their present location and condition. The cost is determined
using the weighted average method.
(viii) Investments
Long term Investments are stated at cost, less provision for other than temporary diminution in value.
Short term investments are carried at lower of cost and quoted value/ fair value, computed categorywise.
(ix) Foreign exchange transactions
a. Foreign exchange transactions are recorded at the exchange rates prevailing at the date of
transaction. Receivables and payables at the year end are translated at the exchange rate
prevailing on the balance sheet date and differences coming there on are recognized in profit
and loss account except.
b. Monetary items denominated in foreign currencies at the year-end are re-stated at year-end
rates.
c. Realized gains and losses on foreign exchange transactions during the year, other than those
relating to fixed assets, are recognized in the profit and loss account.
d. Foreign currency assets and liabilities are translated at the year-end rates and resultant gains/
losses on foreign exchange translations other than those relating to fixed assets are recognized
in the profit and loss account.
e. In translating the Financial statements of liaison offices which are treated as integral foreign
operations, the monetary assets and liabilities are translated at the rate prevailing on the balance
sheet date; non monetary assets and liabilities are translated at the exchange rate prevailing at
the date of transaction and income and expenses items are translated at the respective monthly
average rate.
f. The company uses forward exchange contracts to hedge the foreign currency risk of its highly
probable forecast transactions in respect of foreign currency funds parked outside India. The