1. Basis of preparation of Financial Statements
 
 The financial statements are prepared under historical cost convention,
 in accordance with Generally Accepted Accounting Principles (“GAAP”) in
 India and to comply with applicable Accounting Standards notified under
 Section 211 (3C) of the Companies Act, 1956 and the relevant provisions
 of the Companies Act, 1956.
 
 2. Use of Estimates
 
 The preparation of financial statements in conformity with the
 generally accepted accounting principles requires the management to
 make estimates and assumptions that affect the reported amount of
 assets, liabilities, revenue and expenses and disclosure of contingent
 liabilities as of the date of the financial statements. The estimates
 and assumptions used in the accompanying financial statements are based
 upon the management''s evaluations of the relevant facts and
 circumstances as of the date of the financial statements. Actual
 results could differ from these estimates.
 
 3. Revenue Recognition
 
 Revenue from software development is recognised based on software
 developed and billed to clients as per the terms of specific contracts.
 Revenue from consultancy services is recognised when the services have
 been provided to the customer.
 
 Revenue from the sale of software products is recognised when the sale
 is completed with the passing of title. Revenue from maintenance
 services is accrued over the period of the contract.
 
 4. Fixed Assets
 
 Fixed assets are stated at cost less accumulated depreciation. Cost
 includes direct costs and financing costs related to borrowing
 attributable to qualifying assets.
 
 5. Impairment
 
 Consideration is given at each Balance Sheet date to determine whether
 there is any modification or impairment of the carrying amount of the
 fixed assets. If any condition exists, an asset’s recoverable amount is
 estimated.  An impairment loss is recognised whenever the carrying
 amount of any asset exceeds recoverable amount.
 
 6. Depreciation
 
 Depreciation on tangible fixed assets is calculated on straight-line
 method at the rates prescribed in Schedule XIV of the Companies Act,
 1956, except for computers which are depreciated over a period of 3
 Years. Intangible assets are amortized over their estimated useful
 lives (Computer Software 2 Years ; Product Solutions 5 Years).
 
 Depreciation charge on additions / deletions is restricted to the
 period of use.
 
 Assets individually costing Rs.5,000 or less are fully depreciated in
 the year of addition.
 
 In the event the useful life of any fixed assets being assessed to be
 lower than the life derived from the rates specified above, the book
 value of such assets is charged off as depreciation over their balance
 useful lives.
 
 7. Leases
 
 In the case of assets taken under operating lease, the rentals are
 charged to profit and loss account when due.
 
 8. Investments
 
 Long term investments are stated at cost with provisions where
 necessary, for diminution other than temporary, in the value of
 investment.
 
 9. Foreign Currency Transactions
 
 Foreign currency transactions including expenses incurred on Trading /
 Non Trading Overseas offices and revenue accounts of onsite offices are
 accounted at the exchange rates ruling on the date of transaction. At
 the year end all monetary assets and liabilities denominated in foreign
 currency other than investments are restated at the closing exchange
 rates.  Exchange differences arising out of actual payments /
 realisations and from the year end restatement referred to above are
 reckoned in the profit and loss account.
 
 10. Employee Benefits
 
 a. Short Term
 
 Short term Employee Benefits are recognised as expenses as per the
 company’s scheme based on the expected obligation.
 
 b. Long Term
 
 Liability in respect of long term Employee Benefits in the nature of
 accumulated compensated absence is provided for based on actuarial
 valuation using projected unit credit method.
 
 c. Post Retirement
 
 i) Provident fund
 
 This is a defined contribution plan and contributions made to the fund,
 in accordance with the applicable rules/statutes are charged to
 revenue. The Company has no further obligation for future provident
 fund benefits other than aforesaid contributions.
 
 ii) Superannuation
 
 This is a defined contribution plan. The Company contributes a sum
 equivalent to 15% of eligible employee’s salary towards superannuation
 fund administered by Life Insurance Corporation of India and are
 charged to profit and loss account.
 
 iii) Gratuity
 
 This is a defined benefit plan. The Company has subscribed to
 California Software Company Employees’ Group Gratuity Scheme, which is
 being administrated by a Trust set up for this purpose under the aegis
 of the Life Insurance Corporation of India (LIC). Liabilities with
 regard to the Gratuity payable to the employees are determined by
 actuarial valuation using projected unit credit method, based upon
 which, the Company makes contribution to the Trust. The funds
 contributed to the Trust are remitted to the LIC. Actuarial gains and
 losses comprising of experience adjustments and the effects of changes
 in actuarial assumptions are recognised immediately in the profit and
 loss account as income or expense.
 
 11.Taxation
 
 Provision for current tax is made based on the liability computed in
 accordance with the relevant tax rates and tax laws. Provision for
 deferred tax is made for timing differences arising between the taxable
 incomes and accounting income computed at current applicable tax rates.
 Deferred tax assets are recognised only if there is a virtual certainty
 that they will be realised in the foreseeable future and are reviewed
 for the appropriateness of their carrying value at each balance sheet
 date.