Depreciation Policy of TATA CONSULTANCY SERVICES

LIMITED

Digesh Shah
Roll No. – 29
TATA CONSULTANCY SERVICES LIMITED

SUMMARY:

In respect of Capital Assets that are not in the ownership of the company, the
company follows the policy of depreciating them over their useful life or in 5 years
whichever is less. Thus all the assets that have been taken on lease will be
depreciated completely in a maximum of 5 years. In respect of all other assets, the
company follows a policy of providing for depreciation on a straight line basis at
the rates mentioned in Schedule XIV of Companies Act 1956 or on the basis of
estimated useful life of the asset whichever is higher.

Freehold land is not depreciated, while leasehold land is amortized over the
life of the lease. The policy of depreciating the Computer Equipments was 50%
till March 31, 2008 which was reduced to 25% in the financial year 2008-2009.
The company has not explicitly mentioned these changes in any of the applicable
annual reports in Schedule Q. Thus the disclosures of policy changes are not clear.

During the Financial year 2004-2005, 2005-2006, 2006-2007 and 2007-

2008, however the company’s depreciation policy was significantly same.
TATA CONSULTANCY SERVICES LIMITED

I) DEPRECIATION POLICY OF THE FY`09:

SCHEDULE ‘Q’- NOTES TO ACCOUNTS:

a) Depreciation:

Depreciation other than on freehold land and capital work-in-progress is charged so as to write-
off the cost of assets, on the following basis:

Particulars Method Depreciation

Leasehold Land and Buildings Straight line Lease period
Freehold Buildings Written down value 5%
Leasehold Improvements Straight line Lease period
Plant and Machinery Straight line 33.33%
Computer Equipment Straight line 25%
(March 31, 2008: 50%)
Motor Cars Written down value 25.89%
Office Equipment Written down value 13.91%
Electrical Installations Written down value 13.91%
Furniture and Fixtures Straight line 100%
Intellectual Straight line 24-36 months
Property/Distribution Rights

Fixed assets purchased for specific projects are depreciated over the period of the project.

II) DEPRECIATION POLICY OF THE FY`08:

SCHEDULE ‘Q’- NOTES TO ACCOUNTS:

b) Depreciation:

Depreciation other than on freehold land and capital work-in-progress is charged so as to write-
off the cost of assets, on the following basis:

Particulars Method Depreciation

Leasehold Land and Buildings Straight line Lease period
Freehold Buildings Written down value 5%
Leasehold Improvements Straight line Lease period
Plant and Machinery Straight line 33.33%
Computer Equipment Straight line 50%
Motor Cars Written down value 25.89%
Office Equipment Written down value 13.91%
Electrical Installations Written down value 13.91%
TATA CONSULTANCY SERVICES LIMITED

Furniture and Fixtures Straight line 100%

Intellectual Straight line 24-36 months
Property/Distribution Rights

Fixed assets purchased for specific projects are depreciated over the period of the project.

III) DEPRECIATION POLICY OF THE FY`07:

SCHEDULE ‘Q’- NOTES TO ACCOUNTS:

c) Depreciation:

Depreciation other than on freehold land and capital work-in-progress is charged so as to write-
off the cost of assets, on the following basis:

Particulars Method Depreciation

Leasehold Land and Buildings Straight line Lease period
Freehold Buildings Written down value 5%
Leasehold Improvements Straight line Lease period
Plant and Machinery Straight line 33.33%
Computer Equipment Straight line 50%
Motor Cars Written down value 25.89%
Office Equipment Written down value 13.91%
Electrical Installations Written down value 13.91%
Furniture and Fixtures Straight line 100%
Intellectual Straight line 24-36 months
Property/Distribution Rights

Fixed assets purchased for specific projects are depreciated over the period of the project.

IV) DEPRECIATION POLICY OF THE FY`06:

SCHEDULE ‘Q’- NOTES TO ACCOUNTS:

d) Depreciation:

Depreciation other than on freehold land and capital work-in-progress is charged so as to write-
off the cost of assets, on the following basis:

Particulars Method Depreciation

Leasehold Land and Buildings Straight line Lease period
Freehold Buildings Written down value 5%
Leasehold Improvements Straight line Lease period
Plant and Machinery Straight line 33.33%
TATA CONSULTANCY SERVICES LIMITED

Computer Equipment Straight line 50%

Motor Cars Written down value 25.89%
Office Equipment Written down value 13.91%
Electrical Installations Written down value 13.91%
Furniture and Fixtures Straight line 100%
Intellectual Straight line 24-36 months
Property/Distribution Rights

Fixed assets purchased for specific projects are depreciated over the period of the project.

V) DEPRECIATION POLICY OF THE FY`05:

SCHEDULE ‘Q’- NOTES TO ACCOUNTS:

e) Depreciation:

Depreciation other than on freehold land and capital work-in-progress is charged so as to write-
off the cost of assets, on the following basis:

Particulars Method Depreciation

Leasehold Land and Buildings Straight line Lease period
Freehold Buildings Written down value 5%
Leasehold Improvements Straight line Lease period
Plant and Machinery Straight line 33.33%
Computer Equipment Straight line 50%
Motor Cars Written down value 25.89%
Office Equipment Written down value 13.91%
Electrical Installations Written down value 13.91%
Furniture and Fixtures Straight line 100%
Intellectual Straight line 24-36 months
Property/Distribution Rights

Fixed assets purchased for specific projects are depreciated over the period of the project.