BSNL Asset Management Chapter 13 Quiz

What is the main purpose of maintaining asset records in BSNL?

Which of the following is NOT a type of fixed asset according to the text?

What is Work in Progress (WIP) in the context of asset management in BSNL?

Why is it necessary to maintain a Consolidated Fixed Asset Register at Circle Level in BSNL?

Which of these is an example of a fixed asset according to the text?

What do fixed assets in a company like BSNL primarily consist of?

What is the main difference between tangible assets and intangible assets?

How are capital expenditures initially treated in accounting for fixed assets?

When is depreciation applied on fixed assets?

Which costs are included in the purchase price of fixed assets?

In the context of BSNL, how were overheads initially provided for during the DoT period?

What happens to interest and finance charges on loans identified with a particular project or scheme in relation to fixed assets?

Tangible and Intangible Assets

Tangible assets have physical substance and can be seen and touched, examples include Buildings, Plant, and machinery.
Tangible assets are governed by Accounting Standard 10.
Intangible assets do not have physical substance but are expected to provide future economic benefits to the enterprise, examples include goodwill, trademark, computer software, and patents.

Asset Classification and Expenditure

Assets and liabilities of DTS and DTO were transferred to BSNL on its formation on 01.10.2000.
Assets worth approximately 63,000 crore were provisionally transferred to BSNL.
Expenditure incurred by the company can be classified as either revenue expenditure or capital expenditure.
Capital expenditure is initially booked under Inventory, Work in Progress, or directly under Assets.

Capital Expenditure and Depreciation

Depreciation on assets starts from the date of booking under Fixed Assets.
Depreciation does not start until the capital expenditure is transferred to Fixed Assets, if booked under WIP or Inventory.

Cost of Fixed Assets

A fixed asset is capitalized at cost, which includes:
- Purchase price
- Other directly attributable costs (e.g. site preparation, installation, and related professional fees)
- Customs and other taxes and duties (less rebates)
- Interest and finance charges on loans identifiable with a particular project/scheme
- Administration and other general overhead expenses specifically attributable to construction or acquisition

Asset Management in BSNL

BSNL maintains detailed Fixed Asset Registers at SSA and Circle levels.
Assets are classified into two types: current assets (e.g. Cash in hand, Amount receivable) and fixed assets (e.g. Land, Building, Apparatus & Plants, Computers, Office Machinery).
Fixed assets are further classified into categories.

Test your knowledge on the management of assets in BSNL, covering topics like asset classification, maintenance of records, scrapping, and disposal. This quiz focuses on Chapter 13 of the E3-E4 Management Revision material dated 05-04-2011.