Fa - Project Report

Project Report -Financial Accounting

Inventory Valuation and Depreciation Analysis

Britannia Industries Ltd and Emami Ltd

Submitted by:

Anu Mohan

Talem Anupama Roy

Thulasirami Reddy

Vamsi Krishna

As part of the Depreciation and Inventory valuation analysis, we have considered the annual report for Britannia Industries Ltd and Emami Ltd for the past 2 years. We have verified the Depreciation methods used by the companies and the Inventory Valuation methods.

Britannia Industries Ltd

Analyzing the Depreciation and Inventory Valuation

Depreciation and amortization:

Depreciation in respect of all the assets is provided on straight line method. The rates of depreciation prescribed in Schedule XIV to the Act are considered as minimum rates. If the Management’s estimate of the useful life of a fixed asset at the time of the acquisition of the asset or of the remaining useful life on a subsequent review is shorter than envisaged in the aforesaid schedule, depreciation is provided at a higher rate based on the Management’s estimate of the useful life / remaining useful life.

* Vehicles acquired on finance lease are depreciated over a period of five years.

* Computers (part of office equipments) are depreciated over a period of four years.

* Computer software is fully depreciated over a period of six years, based on the review of useful life of such assets.

* Assets costing individually up to ` 5,000/- are fully depreciated in the year of addition.

* Leasehold land is amortized over the period of primary lease.

Tangible assets

Expected range of useful life of assets of Group is as mentioned below:

Buildings: 20 - 30 years,

Plant and equipment: 10 - 30 years,

Computers (part of office equipment) : 4 - 6 years, and

Furniture and fixtures: 4 - 16 years.

In respect of assets held by J B Mangharam Foods Private Limited and Ganges Vally Foods Private Limited,...