So, does that mean when company prepares it's financial statements at the end of the day it uses SLM approach to show the depricaiation expenses??(with reference to india)as u said companies uses SLM for companies act Also i had not given the panel a detailed answer but i said that WDV is used in India. also one more question- they asked me that if we keep reducing the value of an asset by charging depriciation each year, for eg if today the value is 1000rs. the value will decrease in subsequent years owing to depriciation and suppose if the value comes down to, lets say 50.45 rs at some point of time then what do we do with this value??
Correct. Depreciation is separately calculated for block of assets as per Tax depreciation rates to arrive at the Tax figure. This Tax figure is then used for financial reporting (annual report) purposes.
Small amounts are generally expensed in P/L
Here is an excerpt from the Notes to Accounts of one of the Sensex companies to give you an idea
Depreciation and Amortisation Depreciation on fixed assets is provided using the straight-line method at rates prescribed under Schedule XIV of the Companies Act, 1956 subject to the following deviations:
Additions and disposals are reckoned on the first day and the last day of the month respectively.
Individual items of plant and machinery and vehicles costing upto Rs 25,000/- are wholly depreciated.
in respect of additions arising on account of Insurance spares, on additions/extentions forming an integral part of existing plants and on the revised carrying amount of the assets identified as impaired on which depreciation has been provided over residual life of the respective fixed assets.
Intangible assets are amortised over its expected useful life.
Amortisation of leasehold land has been done in proportion to the period of lease.
i have understood everybody's explanations regarding the method of depriciation used but i am not clear what should be the answer to such questions like the one asked to me..should the answer be "both"??
A novice to this thread but having enthu towards finance
My session will be starting @lbs, delhi this june..have thought of taking finance as preference at second year..but would like to have some preparations done just for a head start...!!
Could you please suggest me some links which i can go through from my office?Any damn thing in finance which i can work upon in these days..have an engg background. CFA : can i go and directly start with the notes..or do i need to clear the basics from some other source and then start?Please suggest
I would suggest one very good book - it is not very "heavy" so can be absorbed by newcomers esp Engg people. I have prescribed this book as a starting reading when I was teaching at IBS.
This would give a fair understanding of Financial Management and then you can branch off to any area that you like.
A novice to this thread but having enthu towards finance
My session will be starting @lbs, delhi this june..have thought of taking finance as preference at second year..but would like to have some preparations done just for a head start...!!
Could you please suggest me some links which i can go through from my office?Any damn thing in finance which i can work upon in these days..have an engg background. CFA : can i go and directly start with the notes..or do i need to clear the basics from some other source and then start?Please suggest
i have understood everybody's explanations regarding the method of depriciation used but i am not clear what should be the answer to such questions like the one asked to me..should the answer be "both"??
that sure seems like the correct answer going by what fellow puys have said. you could probably distinguish the two and quote the Company's Act and IT Act as one of the explanations here already did.
Good. Why don't you compile some data on this if you are interested in helping me in a research paper / project.
It would be easier if you have access to Capitaline or Prowess. I would need the depreciation policies and Investments data for last 10 years for various classes of companies.
I am currently working on a GARCH based VaR model and the analysis of VIX for compilation of a volatility arbitrage system. Post this, I am thinking of analyzing Non Trade Investments to Total Assets ratio of Indian companies. Perhaps I can expand this and incorporate your results in a future study.
Good. Why don't you compile some data on this if you are interested in helping me in a research paper / project.
It would be easier if you have access to Capitaline or Prowess. I would need the depreciation policies and Investments data for last 10 years for various classes of companies.
I am currently working on a GARCH based VaR model and the analysis of VIX for compilation of a volatility arbitrage system. Post this, I am thinking of analyzing Non Trade Investments to Total Assets ratio of Indian companies. Perhaps I can expand this and incorporate your results in a future study.
I have an access to Capitaline. Let me know what u exactly need.
Links to some very good videos have been posted here.:) Can some one pls post similar links to videos showing some complex applications of Foreign Exchange Arithmetic. I cud only find very basic stuff. Thanks in advance.
Can anybody please suggest me some good profiles in finance for the summer internship. As in which profile could help me in future for final placements and which have greater prospects in the job market. Thanks in advance
Treasuries (Forex , Fixed Income Securities , Capital Markets) Corporate Banking (B2B) Retail Banking , Wholesale Banking , Commercial banking Non Fund related services such as Letter of Credit , Bank Guarantees etc Asset Liability Management Basel III Risk Management (Credit , Interest Rate , Liquidity , Market, Operational) Credit Research , Credit Appraisal etc..
Buddy u hav'nt left anything in this list :) 1. Pls differentiate b/w Corporate & Wholesale banking . 2. Pls focus on wat kind of work a student will do if hes given Credit RESEARCH ??
Buddy u hav'nt left anything in this list :) 1. Pls differentiate b/w Corporate & Wholesale banking . 2. Pls focus on wat kind of work a student will do if hes given Credit RESEARCH ??
I didnt get your first point should i have left something? :)
Corporate Banking is a part of wholesale banking which serves corporate clients, mid size businesses , real estate developers and investors, international trade finance businesses etc
And Credit research analyst is a profile where one needs to find out the creditworthiness of the client before giving them any financial, services fund based or non fund based for corporate clients it includes financial statement analysis , trying to project growth of revenues and cash flows , and in turn trying to find out the probability of returns in future
PS: please correct me if i am wrong ..
PPS: For more details , I have given the links , Kindly go through them 😃
yesterday read some news abt JP morgans $2 bil losses due to wrong hedging strategy so dangerous business it is