Consolidated financial statement of JSW S.A. Capital Group for 2012

2.19. Subsidies

Subsidies are not recognized until obtaining reasonable certainty that the Group will satisfy the required conditions and receives such subsidies.

Subsidies which involve a principal condition that the Group acquires or develops fixed assets, are recognized in the consolidated statement of financial position in the deferred income line item and charged to the financial result systematically throughout the anticipate economic life of such assets.

Other subsidies are systematically recognized in revenues, over a period required to compensate the costs which such subsidies were intended to compensate. Subsidies due as compensation of costs or losses already incurred or as a form of direct financial support for the Group without incurring future costs, are recognized in the financial result over the period in which they are due.