if any, arising on disposal of investments (net of selling expenditure such as commission, brokerage, etc) made from the Special Fund and Grants under specific Scheme shall be recognised and credited/debited to Special Fund Account and Grant under specific scheme Account respectively.

Fixed Assets

a. All Fixed Assets shall be carried at cost less accumulated depreciation. The cost of fixed assets shall include cost incurred/money spent in acquiring or installing or constructing fixed asset, interest on borrowings directly attributable to acquisition or construction of qualifying fixed assets up to the date of commissioning of the assets and other incidental and indirect expenditures incurred up to that date.

. Any addition to or improvement to the fixed asset that results in increasing the utility or useful life of the asset shall be capitalised and included in the cost of fixed asset.

C. Any Fixed Asset, which has been acquired free of cost or in respect of which no payment has been made, shall be recorded at nominal value of Re. 1/-.

d. Where the assets are compulsorily acquired for non-payment of taxes or duties, the unpaid amount as appearing in the books constitutes the consideration for the acquisition and the asset acquired should accordingly be recorded at such amount.

e. Revaluation of assets shall be done only with the written sanction of the Government. An increase in netbook value arising on revaluation shall be credited to a reserve account under the Panchayat fund as "Revaluation Reserve Account. A decrease in netbook value arising on revaluation of fixed assets shall be charged to Income and Expenditure Account.

f. Revaluation of a class of assets should not result in the netbook value of that class being greater than the recoverable amount of the assets of that class.

g. Revaluation reserve shall be reduced by transfer of equivalent amount of depreciation charged on the revalued portion of the cost of the fixed assets.

h. Depreciation shall be charged by Straight Line Method (SLM) on all fixed assets except land. The rate of depreciation for each type of fixed assets will be based on the estimated useful life and will be prescribed by the Government. All assets costing less than Rs. 5,000 shall be depreciated at 100% in the year of purchase.

i. All assets which have been fully depreciated shall be carried at a book value of Re. 1/- Depreciation shall be provided at full rates for assets, which are purchased / Constructed before October 1 of an Accounting Year. Depreciation shall be provided at half the rates for assets, which are purchased/constructed on or after October 1 of an Accounting Year.

k.Depreciation shall be provided at full rates for assets, which are disposed on or after October 1 of an Accounting Year. Depreciation shall be provided at half the rates for assets, which are disposed before October 1 of an Accounting Year.

I. Assets recorded in the register but not physically available shall be written off after a specified period after obtaining specific sanction from the Government.

m. Land that are acquired free of cost from the government or provided by individuals or institutions under endowment for specific purposes shall be valued at Re. 1/-.

n. Where the ownership of the asset has not been transferred in favour of the Panchayat, but the asset is in the permissive possession of the Panchayat, it shall be included in the Fixed Asset Register with Re. 1/- as its value. How ever there should be a clear mention in the Register that in case the Government takes back the asset at any point of time in future, reversal of entry shall be made in the Fixed Asset Register. Cost of developing such assets, if any, shall be booked under the respective head of accounts.

o. No depreciation shall be charged on those assets for which the value is taken as Re. 1/- e.g. assets acquired free of cost, assets not transferred in the name of the Panchayat, etc.

p. Cost of land improvements such as leveling, filling or any other developmental activity shall be capitalised as apart of the Cost of land.

q. Statues and Heritage Assets-Statues and valuable works of artshall be charged at original costand no depreciation shall be charged thereon.