India - Service Sector in India 2006-07, NSS 63rd round

Item 901: Land and Building:
is used for the enterprise. This will also include improvement to land. However, if only a portion of the land
belonging to the residence of a household is utilised for the enterprise, only that portion of the land may be
considered as capital assets for the enterprise. Land owned with permanent heritable possession with or without
right to transfer the title would come under this item. Land held on long-term lease, say, 30 years or more will
also be treated as land owned. Encroached land will be considered as hired assets with ‘0’ rent.
Building is the structures like shed, house, portions of a house or other structure, building under construction and other
conveniences in which the activities of the enterprise are carried out. This will include other constructions such as
passage, boundary wall, partition, water tank, sewerage, tube-well, etc.

Item 902: Plant and machinery: Plant is generally the name given to an assembly of machinery/ equipment/
devices installed for the operation of entrepreneurial activities. Machinery means an implement or mechanical
device used in the entrepreneurial activities. These are assets of durable nature and can be easily identified.
The full value of the machinery should be reported even if the machinery was purchased during the year on hirepurchase
basis. Advance payments made for the purchase of machinery (not in possession during the reference
year) will not be recorded as the approach for recording information here is by physical approach.

Item 903: Transport equipment: All vehicles, power-driven or man/animal -driven, used for transporting persons,
goods and materials by the enterprise in connection with its activity will be covered by this item. Animals, if
used for drawing vehicles or carrying loads, will be treated as part of transport equipment; otherwise they will be
included in item 905. If the equipment is used both for domestic as well as enterprise purposes, the criterion to
be followed is major time disposition of the equipment i.e., whether equipment is used more for domestic purpose
or for use in enterprise. Transport equipment that is occasionally rented out will be included if it is mainly used for
the activities of the enterprise.

Item 904: Software and Hardware: Considering the growing importance of computers and softwares used in
various industries, a separate item on this has been made during this round. Computers and all kinds of software
used by the enterprise must be entered in item 804.

Item 905: Tools and other fixed assets: Tools refer to small loose implements, generally held in hand for operation
and having normal life of more than one year. Other fixed assets refer to other durable equipment (not covered
under items 801 to 804 above), which are used for the entrepreneurial activity either directly or indirectly. These
will include furniture, fixtures, laboratory equipment, office equipment, mobile handset, etc. Livestock used as P &
M will also be included under this item. If the same animal is used part of the time in oil mills and part of the time
for transporting materials, it will be classified under item 903 or item 905 depending upon major time spent.

Item 906: Capital work in progress: These are expenses made by the enterprise on some fixed assets although
the amount spent has not yet been capitalised. Building, machinery, etc. under construction will be recorded
here.
Item 909: Total: This is total of items 901 to 906.

Item 911: investments (other than trade): The definition is given in 3.0.16. Purchase of financial instruments
other than trade are the financial investments of an enterprise. All such investments will be recorded in this item.
Generally, for these investments, three types of values are provided, viz. ‘face value’, ‘cost value’ and ‘market
value’. In the balance sheet, the ‘cost value’ is shown. This cost value, amount that the enterprise spent to
procure the asset will be recorded in item 911.

Item 912: loans to members: Some enterprises, particularly the Self-Help Groups (SHG’s) and co-operative credit
societies provide loans to the members of the societies. These loans are financial assets of the enterprises.
These will be recorded here.

Items 913 to 915 are provided to record all the current assets of an enterprise, both physical and financial.

Item 913: inventories (physical and financial): All raw materials, packing materials, and similar physical goods in
stock will constitute the physical inventories. Similar financial inventories (stock of shares used for trading, etc.)
will also be considered here.

Item 914: loans and advances: Loans and advances given to staff, advances given for supply of some goods or
services, etc. will be recorded here.

Item 915: others: The other current assets will include cash and bank balances, sundry debtors, prepaid
expenses, balance with govt. authorities, security deposits (e.g., bank guarantee, electricity deposit, etc.), tender
deposits of short duration, advance tax and TDS, etc.

Item 919: total: This is the total of items 911 to 915. Items 809 and 819 together will cover all the assets of an
enterprise excluding the intangibles like goodwill, etc.

Item 921: interest/dividend receivable during the reference year: Interests and dividends receivable by the
enterprise during the entire reference year will be recorded in this item. These interest and dividends may accrue
from the investments made by the enterprise, from interests charged on late payments made by some supplier,
etc.

Items 922 and 923: Capital gain and loss during the reference year: When an enterprise sells some of its assets,
be it physical or financial, the value received by the enterprise may differ from the depreciated book value of the
asset sold. If the value realised by the enterprise is more than the book value of the asset, it is called capital gain.
This capital gain will be reported in item 922. If the value realised is less than the book value, it is considered a
capital loss. The capital loss will be reported in item 923.
For the financial enterprises, purchase and sale of financial instruments form a part of their core activity. Hence,
for these enterprises, loss/gain due to purchase and sale of financial instruments will not be reflected in items
922 and 923.