Fixed Assets Gross block would increase by the amount of new assets added in the year, net of historical actual purchase price of assets sold or discarded during the year. However, if there is a substantial sale of assets during the year, accumulated depreciation figure should be adjusted. When you look at any balance sheet, you may find that accumulated depreciation figure does not add up to previous balance and current provision. This is due to the fact that every year there may be some assets, which are either sold or discarded and accumulated depreciation amount gets adjusted by that amount. Net Block or net asset is gross block less accumulated depreciation.
Investment portfolio is of two types.
One which is driven by business needs and the other a parking slot for surplus funds. The investment driven by business needs would include equity investment in subsidiaries, customers, key vendors, joint ventures or deposits with statutory authorities. Whereas the discretionary investment portfolio can comprise debt, fixed income securities or equities purchased through secondary market. Many a time, companies invest in other listed companies belonging to the same group. This investment is discretionary and in most cases detrimental to shareholders interests.