Annual Report cb smile - Jet Airways

Significant Accounting Policies and Notes forming part of Consolidated Accounts (contd.)
O. AIRCRAFT MAINTENANCE AND REPAIRS COST:
Aircraft Maintenance, Auxiliary Power Unit (APU) and Engine maintenance and repair costs are expensed on
incurrence as incurred except with respect to Engines / APU which are covered by third party maintenance agreement
and these are accounted in accordance with the relevant terms.
P. TAXES:
Provision for current tax is made after taking into consideration benefits admissible under the provisions of the
Income Tax Act, 1961.
Deferred tax resulting from “timing differences” between book and taxable profit is accounted for using the tax rates
and laws that have been enacted or substantively enacted as on the balance sheet date. The deferred tax asset is
recognised and carried forward only to the extent that there is a reasonable / virtual certainty, as the case may be,
that the asset will be realised in future.
Fringe Benefit Tax is recognized in accordance with the relevant provisions of the Income Tax Act, 1961 and the
Guidance note on Fringe Benefit Tax issued by the Institute of Chartered Accountants of India (ICAI).
Q. SHARE ISSUE EXPENSES:
Issue Expenses are adjusted against the Share Premium Account.
R. SALE AND LEASE BACK TRANSACTION:
Profit or loss on sale and lease back arrangements resulting in operating leases are recognized, in case the
transaction is established at fair value, else the excess over the fair value is deferred and amortized over the period
for which the asset is expected to be used.
S. ACCOUNTING FOR DERIVATIVE INSTRUMENTS:
Interest Rate Swaps, Currency Option, Currency Swaps and other products, entered into by the Company for hedging
the risks of foreign currency exposure (including interest rate risk) are marked to market and losses, if any is
accounted based on the principles of prudence as enunciated in Accounting Standard 1 (AS-1) “Disclosure of
Accounting Policies”.
T. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS:
Provisions involving a substantial degree of estimation in measurement are recognised when there is a present
obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent
Liabilities are not recognised but are disclosed in the notes. Contingent Assets are neither recognised nor disclosed
in the financial statements.
II. NOTES TO ACCOUNTS:
1. The consolidated financial statements present the consolidated accounts of Jet Airways (India) Limited with the
following subsidiary:
Name of the Subsidiary Company Country of Incorporation Extent of Holding as on
31st March, 2010
Jet Lite (India) Limited India 100%
2. Estimated amount of Contracts remaining to be executed on capital account net of advances, not provided for:
Tangible Assets Rs. 1,390,286 lakhs (Previous Year Rs. 1,618,788 lakhs)
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