Depreciation is provided on Written Down Value method at the rates and in the manner
prescribed under the Schedule XIV to the Companies Act, 1956 on fixed assets, other than
expenditure incurred on improvements of assets acquired on operating lease, which are
written off evenly over the balance period of the lease.
On revalued assets, depreciation is charged over the residual life and the additional
charge of depreciation is withdrawn from the Revaluation reserve.
Intangible assets (other than internally generated) are amortized on straight-line basis.
Useful life of intangible assets is as given below:
Software: 3 years
Landing Rights: up to 20 years
Trademarks: 10 years
Jet Privilege (JP) Miles, which are valid for three years, are accrued in the individual
Jet Privilege accounts of the members based on the sectors they have flown on Jet
Airways' network. Provisions are made based on accrued JP Miles (cumulatively for all
members) as on the reporting date, in respect of incremental operating expenses, which
would be incurred when these miles are redeemed by the members. As and when the miles
are actually redeemed, the provision is proportionately reversed to the extent of the
operating expenses incurred.
The 'Provision for Taxation' line includes the following elements:
What are the various items constituting 'Non-operating Revenue'?
The 'Non-operating Revenue' line includes the following elements:
In case of sale of aircraft, the difference between the sale price and the book value of
the aircraft is recognized as profit or loss. Such profit on sale of aircraft forms part
of 'Non-operating Revenue' in the Profit/(Loss) Account. In case of aircraft, which is
acquired through a hire-purchase agreement, the outstanding hire-purchase installment(s)
is repaid out of the sale proceeds.
There is no specific accounting impact in case of lease-back, except accounting for
lease rentals as may be applicable in the Profit/(Loss) Account.
Monetary items denominated in foreign currencies at year-end are restated at year-end
rates. In case of monetary items which are covered by forward exchange contracts, the
difference between the year end rate and rate on the date of the contract is recognized
as exchange difference and the premium paid on forward contracts is recognized over the
life of the contract.
Any income or expense on account of exchange difference either on settlement or on
translation is recognized in the Profit and Loss Account except in cases where they
relate to acquisition of fixed assets in which case, they are adjusted to the carrying
cost of such assets.
Financial Derivative instruments are considered as off-balance sheet items and cash
flows arising therefrom are recognized in the books of accounts as and when the
settlements take place in accordance with the terms of the respective contracts over the
tenor thereof. The gain/loss accrued on unsettled financial derivative instruments is
taken to the Profit & Loss account on the reporting date. Gains/losses from derivative
transactions are adjusted under the head, 'Interest Expenditure', in the Profit & Loss
Our commission structure in case of passenger fares is as follows:
Agency commission to travel agents:5% on INR fares and 7% on USD fares
Over-riding commission to General Sales Agent (GSA): 2% - 3% Corporate incentives
are provided as per individual agreements.
Aircraft maintenance, Auxiliary Power Unit (APU) and engine maintenance as well as
repair costs are expensed as incurred, except where such overhaul cost in respect of
engines/ APU is covered by third party maintenance agreement and these are accounted in
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