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July 2008

Straight-lining of lease rent pursuant to clarification by EAC of ICAI

By Himanshu V. Kishnadwala, Chartered Accountant
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Section B : Miscellaneous


 3 Straight-lining of lease rent pursuant to
clarification by EAC of ICAI


 

BATA INDIA LTD. — (31-12-2007)

From Notes to Accounts :

Pursuant to clarification issued by Expert Advisory Committee
of Institute of Chartered Accountants of India on Accounting Standard-19 on
Leases on recognition of operating lease rent expense, the Company has decided
to recognise the scheduled rent increases over the lease term on a straight-line
basis in respect of all lease rent agreements entered on or after April 1, 2001
and still in force. The total impact in respect of these agreements till
December 31, 2006 of Rs.29,712 (Net of deferred tax impact of Rs.2,540) is
disclosed as ‘Prior period item’ in Schedule-21 in accordance with Accounting
Standard-5 on ‘Net Profit or Loss for the Period, Prior Period items and Changes
in Accounting Policies’.

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