Annual Report.CDR - Colombo Stock Exchange

More documents

Recommendations

Info

S I G N I F I C A N T A C C O U N T I N G P O L I C I E S 4.5.1. Depreciation Depreciation is charged so as to write off the cost or valuation of assets, other than freehold land and properties under construction, over their estimated useful lives, using the diminishing balance method. The estimated useful lives, residual values, and depreciation method are reviewed at each year-end, with the effect of any changes in estimate is accounted for on a prospective basis. Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or, where shorter, the term of the relevant lease. No depreciation is charged on freehold lands. Depreciation is charged on all other property, plant and equipment including leased assets, on the reducing instalment basis consistent with that of the previous year and is calculated at the rates specified below. Freehold Buildings Furniture & Fittings Office Equipment Motor Vehicles 2.5% p.a. 10% p.a 10% p.a. 20% p.a. 4.6. IntangibleAssets Intangible assets acquired separately are reported at cost less accumulated amortization and accumulated impairment losses. Amortization is charged on a straight-line basis over their estimated useful lives. The estimated useful life and amortization method are reviewed at the end of each annual reporting period, with the effect of any changes in estimate being accounted for on a prospective basis. 4.7. OtherAssets Other assets are stated at amounts expected to be realized after making provisions for bad debts. 4.8. Cash and Cash equivalents Cash and Cash equivalents are defined as cash in hand, demand deposits and short-term highly liquid investments readily convertible to known amounts of cash, subject to insignificant risk of changes in value. For the purpose of the cash flow statement, cash and cash equivalents comprise cash in hand, deposits held at call with banks, and other demand deposits net of bank overdrafts. 4.9. Impairment of tangible and intangible assets The company assesses at each reporting date, or more frequently if events or changes in circumstances indicate that the carrying value may be impaired, whether there is an indication that an asset may be impaired. If such indication exists, or when an annual impairment testing for an asset is required, the company makes an estimate of the asset's recoverable amount. If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognized immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease. T H E F I N A N C E C O . P L C - A N N U A L R E P O RT 2 0 0 9 - 2 0 1 0 27
S I G N I F I C A N T A C C O U N T I N G P O L I C I E S 5. LIABILITIES AND PROVISIONS 5.1. Retirement benefit costs Contributions to defined contribution retirement benefit plans are recognized as expenses when employees have rendered service entitling them to the contributions. 5.1.1. Defined Benefit Plan Provision has been made for retirement gratuities from the completion of the first year of service for all employees, in conformity with SLAS 16. However, under the Payment of Gratuity Act No. 12 of 1983, the liability to an employee arises only on completion of 5 years of continued service. An amount equivalent to the provision is invested in gratuity fund established outside the company. The actual gratuity payments are charged to the gratuity fund. The fund has been actuarially valued by professionally qualified actuaries once in three years. 5.1.2. Defined Contribution Plan Employees are eligible for Employees' Provident Fund contribution and Employees' Trust Fund contributions in line with respective statues and regulations. The company contributes 15% and 3% of gross emoluments of employees to Employees' Provident Fund and Employees' Trust Fund respectively. 5.1.3. Pension Plan All employees who would complete 10 or more years of service by the age of 55 years have the option of contributing to the pension scheme where the company and the employees would contribute 5% each of the basic salary. Amount equivalent to the contribution for the year is invested in a pension fund established outside the company. 5.2. Provisions Provisions are recognized when the company has a present obligation (legal or constructive) as a result of a past event, it is probable that the company will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation, The amount recognized a provision is the best estimate of the consideration required to settle the present obligation at the balance sheet date, taking into account the risks and uncertain surrounding the obligation . Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows. When some or all of the economic Benefits required to settle a provision are expected to be recovered from a third party, the receivable is recognized as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably. T H E F I N A N C E C O . P L C - A N N U A L R E P O RT 2 0 0 9 - 2 0 1 0 28
Page 2 and 3: C O N T E N T S Financial Highlight
Page 4 and 5: C O R P O R AT E I N F O R M AT I O
Page 6 and 7: K E Y E X E C U T I V E S M E S S A
Page 8 and 9: R E V I E W O F O P E R AT I O N S
Page 10 and 11: R E P O RT O F T H E D I R E C T O
Page 12 and 13: R E P O RT O F T H E D I R E C T O
Page 14 and 15: C O R P O R AT E G O V E R N A N C
Page 16 and 17: STATEMENT OF DIRECTORS RESPONSIBILI
Page 18 and 19: TELEGRAM: ASSETS, COLOMBO E-MAIL- t
Page 20 and 21: BALANCE SHEET AS AT 31.3.2010 31.3.
Page 22 and 23: CASH FLOW STATEMENT FOR THE YEAR EN
Page 24 and 25: S I G N I F I C A N T A C C O U N T
Page 32 and 33: NOTES TO THE FINANCIAL STATEMENTS F
Page 34 and 35: NOTES TO THE FINANCIAL STATEMENTS (
Page 58 and 59: S H A R E H O L D E R I N F O R M A
Page 60 and 61: B R A N C H N E T W O R K AMBALANTO
Page 62 and 63: S E RV I C E C E N T R E S Maharaga
Page 64 and 65: F O R M O F P R O X Y I/We………

Annual Report.CDR - Colombo Stock Exchange

Create successful ePaper yourself

Delete template?

Save as template?