Annual Report 2010-11

Annual Report 2010-11
10. DEPRECIATION
(a) Depreciation on Fixed Assets is charged on
Straight Line Method as follows -
(i) On the assets added upto March 31,
1991 at the rates derived from the
rates provided for the corresponding
assets under the Income Tax Rules in
force at the time of purchase or
acquisition of assets.
(ii) On the assets added from April 1,
1991, at the rates prescribed under
Schedule XIV to the Companies Act,
1956.
(iii) With effect from April 1, 2001,
additions to/deductions during the
year are depreciated on pro-rata
basis.
(b) Assets individually costing upto ` 5,000/-
are fully depreciated in the year of
acquisition.
(c) Leasehold lands and buildings:
(i) Leasehold lands are amortized over
the period of lease.
(ii) Leasehold buildings and buildings
constructed on leasehold lands are
fully depreciated over the period of
lease in case period of lease is less
than the useful life derived from the
rates as per Schedule XIV of the
Companies Act 1956.
(d) Intangible assets comprising of
computer software are amortized on
straight line method over a period of
legal right or three years whichever is
earlier on pro-rata basis.
11. FOREIGN CURRENCY TRANSACTIONS
a) Foreign currency transactions are recorded
on initial recognition at the exchange rate
prevailing on the date of the transaction.
On settlement of transactions, the realized
gains and losses on foreign exchange
transactions are recognized in the Profit
and Loss Account.
b) Foreign currency monetary items
remaining unsettled at the end of the year
are reported at year-end rates. The
exchange rate differences arising thereof
are recognized in the Profit and Loss
Account. Non Monetary items which are
carried at historical cost denominated in a
foreign currency, are reported using the
exchange rate at the date of the
transaction.
c) Financial statements of Foreign branch are
considered to be integral and are
translated as follows:
- Monetary assets and liabilities at rates
of exchange prevailing at the end of the
year.
- Non-monetary items at exchange rates
prevailing on the date of transaction.
- Revenue items are accounted for at the
exchange rate, which approximates the
rate prevailing as on the date of
transaction.
- Resultant translation differences
arising there from are recognized in the
Profit and Loss Account.
d) In respect of forward contracts premium or
discount arising at the inception of forward
exchange contracts is amortised as an
expense or income over the period of the
contract. Forward contracts remaining
unsettled at the end of the year are
reported at year end rates. Any profit or
loss arising on cancellation or renewal of
forward exchange contracts is recognized
as income or expense in the year in which
such profit or loss arises.
12. EMPLOYEE BENEFITS
a) Short term Employee Benefits are
recognized as an expense on an
undiscounted basis in the Profit & Loss
Account of the year in which the related
service is rendered.
b) The employees' group gratuity fund
scheme and provident fund scheme are
the Society's defined benefit plans, which
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