performed, its cost is recognised in the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisfi ed. All other repair and maintenance costs are recognised in the standalone statement of profi t and loss as incurred. The present value of the expected cost for the decommissioning of an asset after its use is included in the cost of the respective asset if the recognition criteria for a provision are met. Spare parts are capitalized when they meet the defi nition of PPE, i.e., when the company intends to use these during more than a period of 12 months. Depreciation is provided on the basis of straight-line method at the useful life and in the manner prescribed in Schedule II of the Companies Act, 2013 except in respect of the following assets, based on technical assessment made by technical expert and /or internal evaluation. Management believes that these estimated useful lives are realistic and refl ect fair approximation of the period over which the assets are likely to be used. The useful life provided for diff erent asset classes under schedule II of the Act and considered by the management are as follows: Asset class Useful life considered by management (in years) Useful life prescribed under the Act (in years) Buildings (including investment property) 5 – 30 30 Plant and machinery 1 – 20 15 Furniture and Fixtures 1 – 15 10 Vehicles 2 – 10 8 Office Equipment 1 – 20 5 i) Depreciation on Improvements to leasehold property is provided over the period of lease. ii) Depreciation in respect of its Renewable Energy business is provided on straight line method and at rates/ methodology prescribed under the relevant Central Electricity Regulatory Commission (CERC) regulations. Depreciation on assets which are commissioned during the year is charged on pro -rata basis from the date of commissioning. The company depreciates general spares over the life of the spare from the date it is available for use. An item of property, plant and equipment and any signifi cant part initially recognised is derecognised upon disposal or when no future economic benefi ts are expected from its use or disposal. Gains or losses arising from de-recognition of a tangible asset are measured as the diff erence between the net disposal proceeds and the carrying amount of the asset and are recognised in the standalone statement of profi t and loss when the asset is derecognised. The residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at each fi nancial year end and adjusted prospectively, if appropriate. h. 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 signifi cant parts of the investment property are required to be replaced at intervals, the Company depreciates them separately based on their specifi c useful lives. All other repair and maintenance costs are recognised in the standalone statement of profi t and loss as incurred. The Company depreciates building component of investment property over the useful life prescribed in Schedule II to the Act. Though the Company measures investment property using cost based measurement, the fair value of the investment property is disclosed in the note 8 to the standalone 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 benefi t is expected from their disposal. The diff erence between the net disposal proceeds and the carrying amount of the asset is recognised in the standalone statement of profi t and loss in the period of de-recognition. i. 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 assets are carried at cost less any accumulated amortisation and accumulated impairment losses. Internally generated intangibles, excluding capitalised Heritage Foods Limited | 31st Annual report 2022-23 198
RkJQdWJsaXNoZXIy NTE5NzY=