Schedules forming part of the Financial ... - Thomas Cook India

SCHEDULE “Q” : NOTES TO THE FINANCIAL STATEMENTS
Thomas Cook (India) Limited
Schedules forming part of the Financial Statements
for the year ended 31st December, 2011
1. Significant Accounting Policies
The financial statements are prepared to comply in all material aspects with the applicable accounting principles in India, the accounting
standards notified under sub-section (3C) of Section 211 of The Companies Act, 1956 (the ‘Act’) and the other relevant provisions of the Act.
The significant accounting policies are as follows:
(a) Basis of Accounting
The financial statements are prepared in accordance with the historical cost convention.
(b) Fixed Assets and Depreciation / Amortisation
(i) The gross block of fixed assets is stated at the purchase price of acquisition of such fixed assets including any attributable cost
for bringing the asset to its working condition for its intended use.
(ii) Depreciation on fixed assets is provided at the rates specified in Schedule XIV of the Companies Act, 1956 or the rates determined
based on the useful lives of the assets as estimated by the management, whichever are higher. Depreciation is provided on
Straight Line Method. The rates adopted for depreciation determined on the basis of useful lives of fixed assets are as follows:
Description of Asset
Rate of
Depreciation/ Amortisation
Software (including software - internally generated/developed) 25%
Computers 25%
Office Equipment - VSAT and Communication Router 10%
Vehicles 15%
Fixed assets costing ` 5,000 or less are fully depreciated in the year of acquisition.
(iii) Leasehold properties are amortised over the period of the lease.
(c) (i) Foreign Currency Transactions
All the monetary items denominated in foreign currency are valued at the Foreign Exchange Dealers Association of India
(FEDAI) rate (except for Sri Lanka branch) and the exchange variations arising out of settlement/conversion at the FEDAI rate are
recognised in the Profit and Loss Account.
Monetary items of Sri Lanka branch are valued at closing rates obtained from Central Bank of Sri Lanka, as the daily buying and
selling rates are set on rates obtained from them.
Profit or loss on purchase and sale of foreign exchange by the company in its capacity as Authorised Foreign Exchange Dealer are
accounted as a part of the revenue.
(ii) Foreign Branch
Monetary assets and liabilities are translated at the closing exchange rates.
Non monetary assets are translated at the exchange rates prevailing on the date of the transaction.
Revenue items except depreciation are translated at average rate.
Depreciation is translated at the rates used for the translation of respective fixed assets.
(d) Investments
Long-term Investments are stated at cost. Provision is made to recognise a decline, other than temporary, in the value of Long-term
Investments. Current Investments are stated at lower of cost or fair value.
(e) Employee Benefits
(i) Long-term Employee Benefits
(a) Defined Contribution Plans
The Company has Defined Contribution Plan for Post Employment Benefit in the form of Superannuation scheme.
Contributions to Superannuation scheme are charged to the Profit and Loss account as incurred. The contribution to
Superannuation scheme are based on the premium contribution called for by Life Insurance Corporation of India (LIC) with
whom the Company has entered into an agreement for its Indian operations.
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