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10.2. In respect of USAID borrowing, the exchange loss or gain is debited or credited
to the head ‘Amount Recoverable from GOI against USAID Borrowing’ as the
exchange loss on USAID borrowing is borne by the GOI.
10.3. Income and Expenditure items are translated at the exchange rates prevailing on
the date of the transaction.
10.4. Foreign exchange forward contracts outstanding as at the balance sheet date and
not intended for trading are valued at the closing spot rate as notified by FEDAI.
The premium or discount arising at the inception of such forward exchange contract
is amortized as expense or income over the life of the contract. The resultant gain/
loss on revaluation is recognized in the Profit & Loss Account under the head
Exchanges Gain/ (Loss).
10.5. In accordance with AS 11 ‘The Effects of changes in Foreign Exchange Rates’,
contingent liabilities in respect of outstanding foreign exchange forward contracts,
derivatives, guarantees, endorsements, Principle Only Swaps (POS) and other
obligations are stated at the exchange rates notified by FEDAI corresponding to
the balance sheet date.
11. Impairment of Assets
Impairment loss is recognised when the carrying amount of an asset exceed recoverable
amount.
12. Provisions, Contingent Liabilities and Contingent Assets
Provisions involving substantial degree of estimation in measurement are recognized
when there is a present obligation as a result of past event, it is probable that there
will be an outflow of resources and a reliable estimate can be made of the amount of
the obligation. Contingent Assets are neither recognized nor disclosed in the financial
statements. Contingent liabilities are disclosed by way of schedules to Balance Sheet.
13. NPA/ Overdue Accounting
The appropriation of amount recovered from NPA Account is carried out account wise
and installment wise on FIFO basis. The order of appropriation within an account/
installment is first Additional Interest is settled followed by Interest and then Principal
amount. Further parallel ledger is maintained for accrual of interest in overdue account
without booking the same in the Profit and Loss Account.
Notes forming parts of the accounts for the year ended 30th June 2021
290 | Annual Report 2020-21
to the head ‘Amount Recoverable from GOI against USAID Borrowing’ as the
exchange loss on USAID borrowing is borne by the GOI.
10.3. Income and Expenditure items are translated at the exchange rates prevailing on
the date of the transaction.
10.4. Foreign exchange forward contracts outstanding as at the balance sheet date and
not intended for trading are valued at the closing spot rate as notified by FEDAI.
The premium or discount arising at the inception of such forward exchange contract
is amortized as expense or income over the life of the contract. The resultant gain/
loss on revaluation is recognized in the Profit & Loss Account under the head
Exchanges Gain/ (Loss).
10.5. In accordance with AS 11 ‘The Effects of changes in Foreign Exchange Rates’,
contingent liabilities in respect of outstanding foreign exchange forward contracts,
derivatives, guarantees, endorsements, Principle Only Swaps (POS) and other
obligations are stated at the exchange rates notified by FEDAI corresponding to
the balance sheet date.
11. Impairment of Assets
Impairment loss is recognised when the carrying amount of an asset exceed recoverable
amount.
12. Provisions, Contingent Liabilities and Contingent Assets
Provisions involving substantial degree of estimation in measurement are recognized
when there is a present obligation as a result of past event, it is probable that there
will be an outflow of resources and a reliable estimate can be made of the amount of
the obligation. Contingent Assets are neither recognized nor disclosed in the financial
statements. Contingent liabilities are disclosed by way of schedules to Balance Sheet.
13. NPA/ Overdue Accounting
The appropriation of amount recovered from NPA Account is carried out account wise
and installment wise on FIFO basis. The order of appropriation within an account/
installment is first Additional Interest is settled followed by Interest and then Principal
amount. Further parallel ledger is maintained for accrual of interest in overdue account
without booking the same in the Profit and Loss Account.
Notes forming parts of the accounts for the year ended 30th June 2021
290 | Annual Report 2020-21
