Amortisation is not like Depreciation. Hard assets are depreciated over their useful life time. Post that the value of asset becomes zero. And rightly so.
In case of Amortisation, the value of acquired asset… instead of depreciating, actually appreciates over its life time.
So when amortisation is charged from P&L account, the company gets a tax break and the value of acquired asset or brands keeps growing. So, its a win win for the company.
On ESOP, I believe it would be charged only for Q1. So from Q2 onwards, the company should get the full benefit of operating leverage on the increased sales.
Regards,
Ranvir Dehal
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