Shriram City Union Finance Limited - Karvy

c. Fixed Assets, Depreciation / Amortization and Impairment of assetsFixed AssetsFixed assets are stated at cost less accumulated depreciation/amortization and impairment losses, if any. Costcomprises the purchase price and any attributable cost of bringing the asset to its working condition for itsintended use. Borrowing costs relating to acquisition of fixed assets are included to the extent they relate to theperiod till such assets are ready to be put to use.Depreciation / AmortizationDepreciation is provided pro rata on Straight Line Method (‘SLM’), which reflect the management’s estimate ofthe useful lives of the respective fixed assets and are greater than or equal to the corresponding rates prescribed inSchedule XIV of the Act. The assets for which higher rates are applied are as follows:Particulars Rates (SLM) Schedule XIV rates (SLM)Windmills 10% 5.28%Computer Software 33.33% 16.21%Leasehold improvement is amortized over the primary period of lease subject to a maximum of 60 months. Allfixed assets individually costing Rs.5000 or less are fully depreciated in the year of installation.Impairment of assetsThe carrying amount of assets is reviewed at each balance sheet date if there is any indication of impairmentbased on internal/external factors. An impairment loss is recognized wherever the carrying amount of an assetexceeds its recoverable amount. The recoverable amount is the greater of the assets’ net selling price and value inuse.After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining usefullife.A previously recognized impairment loss is increased or reversed depending on changes in circumstances.However the carrying value after reversal is not increased beyond the carrying value that would have prevailed bycharging usual depreciation if there was no impairment.Up to year ended March 31, 2007Fixed Assets and Depreciation:-Fixed assets have been stated at historical cost less depreciation. Depreciation has been provided under straightline method at rates prescribed under the Companies Act, 1956. Assets costing Rs.5000/- or less are fullydepreciated in the year of purchase.F-45