GAMMON INDIA LIMITED

c) Revenues from providing services are recognized in income statement at the moment said services are
completed.
d) Insurance claims are accounted for on cash basis.
e) On infrastructure development business:
(i) Annuity and Toll Receipts:
The toll collection from the users is accounted when the amount is due and recovered. Our
Company earns an annuity income from some of its BOT projects which is recognized on a time
basis over the period during which the annuity is earned. Revenues from bonus and other claims are
recognized upon acceptance from customer/counterparty.
(ii) Berth Operations:
Revenue by way of Berth Hire Charges, Dust Suppression Charges, Cargo Handling Charges, Plot
Rent, Wharf Age, Barge Freight, Other Charges etc. are recognized on an accrual basis and is billed
as per the terms of the contract with the customers at the rates approved by Tariff Authority for
Marine Ports (TAMP) as the related services are performed. Other income is recognized on an
accrual basis when the same is due.
f) Cargo freight income is recognized at the time of booking of the consignment and is being accounted
net of rebates, discounts and booking commission.
g) Revenue for design and assemblies are recognized on the basis of work progress reports provided for
each contract.
h) Revenue from the sale of goods and finished products are recognized at the time of transfer to the
customer of the risks and benefits relating to the product sold, normally coinciding with the shipment
of goods to the customers and acceptance by the same; revenue from services are recognized in the
accounting period where the services are rendered.
Turnover
Turnover represents work certified as determined by taking into consideration the actual cost incurred and
profit evaluated by adopting the percentage of the work completion method of accounting and once our
Company has transferred to the purchaser all the significant risks and benefits related to the asset
ownership. Turnover also includes the revenue from the supply of material in the equipment supply
contracts in accordance with the terms of contract.
Research and Development Expenses
All expenditure of revenue nature is charged to the profit and loss account of the period. All expenditure of
capital nature is capitalized and depreciation provided thereon, at the rates as applied to other assets of
similar nature.
The cost for development in relation to specific project are capitalized only when our Company is able to
show the technical possibility of carrying out the intangible asset in order to make it available for use and
sale, its intension to make it available for use and sale, the modalities the activity can provide for future
economic benefits, the availability of technical, financial, as well as any other kind of resources in order to
carry out development and it‘s capacity to reliably assess the cost attributable to the activity during its
development.
After the original recognition, the costs of development are assessed net of the corresponding quotas of
amortization and of the impairment loss. Further capitalized costs for development are amortized with
reference to the period of time where it is expected that the project thereof will produce revenue for our
Company.
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