Subsequent expenditure

Subsequent expenditure is capitalized only if it is probable that future economic benefits associated with the
expenditure will flow to the entity.

Depreciation

Depreciation on property, plant and equipment

Depreciation is provided on the Written Down Value (“WDV”) method, except in the case of buildings, ATMs,
ATM sites, demo assets, POS machines, vehicles for cash management and stores and spares where the Straight-
Line Method (“SLM”) is used, over the estimated useful life of each asset as determined by our management.
Depreciation is provided on a pro-rata basis, i.e., from the date on which the asset is put to use.

The estimated useful lives and method of depreciation of items of property, plant and equipment are as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Asset Method of Depreciation Useful life (years)
Buildings SLM 30-60
‘ATM machines*A SLM 5-10
Other assets at ATM sites** SLM 7;
POS machines*” SLM 3-5
Demo assets# SLM 2-5
Stores and sparest# SLM
Plant and machinery* WDV 10-15
Furniture and fixtures/ WDV 2-10
Office equipment, electrical installation and air conditioners" WDV 2-10
Computers* WDV 1-6
Vehicles for office purposes WDV 8
Vehicles for cash management® SLM 7

 

* ATM machines, other assets at ATM sites, POS machines, vehicles for cash management business and plant and machinery are
depreciated over the estimated useful lives, which is lower than the useful life indicated in Schedule I of the Act. The management has
estimated, supported by independent assessment by professionals, the useful lives of the classes of assets.

# Management has estimated, supported by independent assessment by professionals, the useful lives of the classes of assets.

* Foreign subsidiaries are depreciating assets on SLM basis. The useful life for ATM machines, POS machines, furniture and fixtures, office
equipment; electrical installation and air conditioner and computers have been estimated to be five years, three years, two years, two to
three years and one year, respectively.

Leasehold improvements are amortized over the primary period of lease, i.e., lease period which ranges from
three to ten years as per the agreement or the life of respective assets, whichever is lower.

Depreciation method, useful lives and residual values are reviewed at each financial year-end and adjusted if
appropriate.

Asset held for sale

Assets are classified as held for sale if their carrying amount will be recovered principally through a sale
transaction rather than through continuing use and a sale is considered highly probable. They are measured at
lower of their carrying amount or fair value less cost to sell.

Intangible assets

Recognition and measurement

Intangible assets acquired separately are measured on initial recognition at cost.

Internally generated intangible assets, excluding capitalized development costs, are not capitalized and
expenditure is reflected in the Restated Consolidated Statement of Profit and Loss in the year in which the

expenditure is incurred.

Intangibles which are not ready for intended use as on the reporting date are disclosed as “Intangible under
development”.

332
