Heritage Foods Limited

Heritage Foods Limited 228 reviewed at each fi nancial year end and adjusted prospectively, if appropriate. j. Investment property Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment properties are stated at cost less accumulated depreciation and accumulated impairment loss, if any. The cost includes the cost of replacing parts and borrowing costs for long-term construction projects if the recognition criteria are met. When signi fi cant parts of the investment property are required to be replaced at intervals, the Group depreciates them separately based on their speci fi c useful lives. All other repair and maintenance costs are recognised in the consolidated statement of pro fi t and loss as incurred. The Group depreciates building component of investment property over the useful life prescribed in Schedule II to the Companies Act, 2013. Though the Group measures investment property using cost based measurement, the fair value of investment property is disclosed in the note 8 to the consolidated fi nancial statements. Investment properties are derecognised either when they have been disposed of or when they are permanently withdrawn from use and no future economic bene fi t is expected from their disposal. The di ff erence between the net disposal proceeds and the carrying amount of the asset is recognised in the consolidated statement of pro fi t and loss in the period of de-recognition. k. Intangible assets Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquired in a business combination is their fair value at the date of acquisition. Following initial recognition, intangible assetsarecarriedat cost lessanyaccumulatedamortisation and accumulated impairment losses. Internally generated intangibles, excluding capitalised development costs, are not capitalised and the related expenditure is re fl ected in the consolidated statement of pro fi t and loss in the period in which the expenditure is incurred. The useful lives of intangible assets are assessed as either fi nite or inde fi nite. Intangible assets with fi nite lives are amortised on straight line basis over the estimated useful economic life. The amortisation expense on intangible assets with fi nite life is recognised in the consolidated statement of pro fi t and loss. The estimated useful life of intangible assets is mentioned below: Asset Useful life (years) Brand 5 Non-compete 3 Procurement 5 Computer Software 5 Distribution network 5 Intangible assets with fi nite lives are assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method for an intangible asset with a fi nite useful life are reviewed at least at the end of each reporting period. Changes in the expected useful life or the expected pattern of consumption of future economic bene fi ts embodied in the asset are considered to modify the amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The amortisation expense on intangible assets with fi nite lives is recognised in the consolidated statement of pro fi t and loss unless such expenditure forms part of carrying value of another asset. Intangible assets with inde fi nite useful lives are not amortised, but are tested for impairment annually, either individually or at the cash-generating unit level. The assessment of inde fi nite life is reviewed annually to determine whether the inde fi nite life continues to be supportable. If not, the change in useful life from inde fi nite to fi nite is made on a prospective basis. Gains or losses arising fromde-recognition of an intangible asset are measured as the di ff erence between the net disposal proceeds and the carrying amount of the asset and are recognised in the consolidated statement of pro fi t and loss when the asset is derecognised. l. Borrowing cost Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of the asset. All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds. m. Leases E ff ective 1 April 2019, the Group adopted Ind AS 116, Leases, using the modi fi ed retrospective application method. On transition, the adoption of the new standard resulted in recognition of ‘Right of Use’ asset of ₹ 67.49 and a lease liability of ₹ 71.41. The cumulative e ff ect of applying the standard, amounting to ₹ 2.94 was debited to retained earnings, net of taxes.