Estimated useful life of assets (Schedule II)
- For a class of companies, to be prescribed, the 2013 Act removes the minimum thresholds and provides indicative useful lives and residual values under Part C of Schedule II to the 2013 Act. If such a company uses a different useful life or residual value, then it shall disclose the justification for the same.
- No transition period provided for this change and the change needs to be applied prospectively.
- For other companies the useful life of an asset may not be longer than the indicated/ prescribed useful life, and the residual value shall not be higher than that prescribed in Part C, i.e. 5 %.