Depreciation under schedule ii
This query is : Resolved
25 February 2015
Dear Sir/Madam
Schedule II of companies act specifies the useful life of the asset instead of depreciation rates which are used in previous companies acts.
By using the useful life of the asset the act is specifying to depreciate the carried amount over the remaining useful life.
So depreciation amount will be Carried amount / Useful life
So depreciation amount will be equal over the useful life.
Is it means that Companies act impliedly asks only to use SLM method for computing depreciation? Can WDV method of depreciation be used for computing depreciation? If yes, how can that be done?
Schedule II of companies act specifies the useful life of the asset instead of depreciation rates which are used in previous companies acts.
By using the useful life of the asset the act is specifying to depreciate the carried amount over the remaining useful life.
So depreciation amount will be Carried amount / Useful life
So depreciation amount will be equal over the useful life.
Is it means that Companies act impliedly asks only to use SLM method for computing depreciation? Can WDV method of depreciation be used for computing depreciation? If yes, how can that be done?
Amol S Joglekar
(Expert)
25 February 2015
Few radical changes are sought for with the inclusion of IFRS.
This depreciation method is on similar lines as that of IFRS.
No need to STICK to WDV once the method is given in the schedule of the companies act.
This depreciation method is on similar lines as that of IFRS.
No need to STICK to WDV once the method is given in the schedule of the companies act.
25 February 2015
yes indirectly its slm method only,
no wdv now not possible under current scheme of charging dep under co act 2013
no wdv now not possible under current scheme of charging dep under co act 2013
26 February 2015
Sir,
I found this rate chart under companies act, 2013.
https://www.club4ca.com/formats/wp-content/uploads/2013/10/Depreciation-Rate-chart-companies-act-2013.pdf
I even found that a rate can be obtained for WDV by using the following formula in ICAI cpt material
Rate= 1- nth root of (Residual value/Cost of Asset)
By this is not mentioned in Companies Act 2013.
How to go about now?
I found this rate chart under companies act, 2013.
https://www.club4ca.com/formats/wp-content/uploads/2013/10/Depreciation-Rate-chart-companies-act-2013.pdf
I even found that a rate can be obtained for WDV by using the following formula in ICAI cpt material
Rate= 1- nth root of (Residual value/Cost of Asset)
By this is not mentioned in Companies Act 2013.
How to go about now?
26 February 2015
only what is allowed under co act sch ii is allowed rest u cant follow practically
27 February 2015
you are welcome samrat.........................
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