Section 2
[(ii) 3 [For intangible assets, the relevant Indian Accounting Standards (Ind As) shall apply. Where a company is not required to comply with the Indian Accounting Standards (Ind As), it shall comply with relevant Accounting Standards under Companies (Accounting Standards) Rules, 2006] except in case of intangible assets (Toll Roads) created under 'Build, Operate and Transfer', 'Build, Own, Operate and Transfer' or any other form of public private partnership route in case of road projects. Amortisation in such cases may be done as follows:—
2 [(ii) 3 [For intangible assets, the relevant Indian Accounting Standards (Ind As) shall apply. Where a company is not required to comply with the Indian Accounting Standards (Ind As), it shall comply with relevant Accounting Standards under Companies (Accounting Standards) Rules, 2006] except in case of intangible assets (Toll Roads) created under 'Build, Operate and Transfer', 'Build, Own, Operate and Transfer' or any other form of public private partnership route in case of road projects. Amortisation in such cases may be done as follows:—
(a) Mode of amortization
Amortisation Rate =
Amortisation Amount=
Cost of Intangible Assets (A) x
Amorisation Amount
x 100
Cost of Intangible Assets (A)
Actual Revenue for the year (B)
Projected Revenue from Intangible Asset (till the end of the concession period) (C)
(b) Meaning of particulars are as follows :—
Cost of Intangible Assets (A)
= Cost incurred by the company in accordance with the accounting standards.
Actual Revenue for the year (13)
= Actual revenue (Toll Charges) received during the accounting year.
Projected Revenue from Intangible Asset (C)
Total projected revenue from the Intangible Assets as provided to the project lender at the time of financial closure/agreement.
The amortisation amount or rate should ensure that the whole of the cost of the intangible asset is amortised over the concession period.