• Submitted By: aschandel
  • Date Submitted: 08/15/2009 8:45 PM
  • Category: Business
  • Words: 2146
  • Page: 9
  • Views: 335

5 years Revenue Recognition Policy, Depreciation Policy and Foreign exchange Translation Policy

Company Name: Aditya Birla Nuvo Limited

Submitted By: Ashutosh Singh Chandel

Analysis of Changes:

Revenue Recognition Policy: Revenue recognition policy of the company has changed couple of times to include the policies for additional businesses and accounting procedure changes. Company’s name was changed in 05-06 to Aditya Birla Nuvo and the company included some other businesses of Aditya Birla group and thus fertilizer business became part of Aditya Birla Nuvo in 05-06 and from that year company started including the policy for fertilizer support. Also to reflect the inclusion of CER income in accounting standards company started mentioning their policy for CER income also in their revenue recognition policy since 07-08.

Depriciation Policy:
Deprecation policy has some adjustments made in the estimation of useful life of assets. The company in the year 04-05 had a statement recording depreciation of on the amounts capitalized on account of foreign exchange fluctuation. Also in 04-05 the company had two heads furniture and fixtures with 5 and 6 years as estimated life respectively at the showroom and others. From 05-06 company started reporting the estimated life of furniture and fixtures as a separate head and assets at showrooms as a separate head.

Since year 05-06 the company included the fertilizers business, it started including the deprecation of catalysts used.

The company classified some assets as office electronic equipments (Other then computers) since 2007-08 with an estimated useful life of 4 years. The company also changed the estimated useful life for Furniture, Fixtures and Equipments from 6 years to 7 years in 2008-09, this might be justified as now the equipments do not include the office electronic equipments, which are now being depreciated at a faster rate.

The company did...

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