July 2020

FROM PUBLISHED ACCOUNTS

Himanshu V. Kishnadwala
Chartered Accountant

DISCLOSURES RELATED TO IMPLEMENTATION OF Ind AS 116 – ‘LEASES’ FOR THE YEAR ENDED 31ST MARCH, 2020

 

Compiler’s Note

The Ministry of Company Affairs on 30th March, 2019 notified Ind AS 116 – Leases. Under Ind AS 116 lessees have to recognise a lease liability reflecting future lease payments and a ‘right-of-use asset’ for almost all lease contracts. This is a significant change compared to Ind AS 17, under which lessees were required to make a distinction between a finance lease (on balance sheet) and an operating lease (off balance sheet). Ind AS 116 also gives lessees optional exemptions for certain short-term leases and leases of low-value assets.

 

Given below are disclosures by a few companies for the above.

 

TCS LTD. (consolidated)

 

From Notes forming part of Financial Statements

LEASES

A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

 

Group as a lessee

The Group accounts for each lease component within the contract as a lease separately from non-lease components of the contract and allocates the consideration in the contract to each lease component on the basis of the relative stand-alone price of the lease component and the aggregate stand-alone price of the non-lease components. The Group recognises right-of-use asset representing its right to use the underlying asset for the lease term at the lease commencement date. The cost of the right-of-use asset measured at inception shall co

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