SECTION B: REVISED AS 10 ‘PROPERTY, PLANT & EQUIPMENT’ APPLICABLE FROM ACCOUNTING YEARS COMMENCING FROM 1ST APRIL 2016 ONWARDS FOLLOWED IN FY 2015-16

NHPC Ltd. (31-3-2016)

From Notes to Financial Statements

Note 29, para 15:

The Ministry of Corporate Affairs has notified revised AS-10,
“Property, Plant & Equipment” on 30.03.2016, to be applicable for
accounting periods commencing on or after that date. Para 9 of revised AS-10 permits
Unit of Measure Approach which allows capitalisation of expenditure of capital
nature incurred for creation of facilities, over which the company does not
have control but the creation of which is essential principally for
construction of the project.  Further,
the transitional provision in revised AS-10 allows retrospective capitalisation
of costs charged earlier to the statement of profit and loss but eligible to be
included as a part of the cost of a project for construction of property, plant
and equipment in accordance with the requirements of paragraph 9. The Unit of
Measure Approach also exists in Para 9 of Ind AS-16, “Property, Plant &
Equipment.” It strengthens the accounting policy no.2.3.4 on capital work in
progress. Had this policy not been adopted but implemented from 01.04.2016, the
para 88 of Revised AS-10 on transitional provision would automatically take
care of capitalisation of such expenditure. 
As such, significant accounting policy no.2.3.4 and consequential
accounting treatment of enabling assets as followed in FY 2014-15 has been
continued. Accordingly, an amount of Rs.176.21 crore (Previous year Rs.173.61
crore) has been included in Fixed Assets as Tangible Assets/CWIP.

From Auditors’ Report

Emphasis of Matters

We draw attention to the following matters in the Notes to
the financial statements:

a)    
to e) … not reproduced