a.  Basis for preparation of statements

 The financial statements have been prepared under the historical cost
 convention in accordance with the Generally Accepted Accounting P
 principles (GAPP) in India and the relevant provisions of the Companies
 Act, 1956. All income and expenditure having a material bearing on
 the financial statements are recognized on accrual basis. GAAP
 comprises mandatory accounting standards issued by the Institute of
 Chartered Accountants of India (ICAI) and the provisions of the
 Companies Act, 1956 , to the extent applicable

 b.  Revenue Recognition

 The Company follows the Mercantile System of Accounting and recognizes
 Income and Expenditure on an accrual basis. Sales are recognized when
 services are rendered. Interest income is recognized on a time
 proportion basis taking into account the amount outstanding and the
 rate applicable. Sign up Fees are accounted in the year of sign up.

 c.  Fixed Assets

 Fixed Assets are stated at original cost less depreciation. Fixed
 Assets are stated at cost of acquisition inclusive of inward freight,
 duties and taxes and incidental expenses related to acquisition.  In
 respect of major projects involving construction related pre- operative
 expenses form part of the value of the assets capitalized.

 d.  Capitalization and Am- ordination of Software Product
 Acquisition and Product Development Costs Costs incurred towards
 acquisition and development t of Computer Software products meant for
 sale, lease or otherwise marketed, are capitalized until the product is
 available for release to the customers. Capitalized Software Costs are
 amortized on a product by product basis based on straight-line method
 over the estimated economic life of the product. The carrying value of
 Capitalized Software Costs is reviewed at each Balance Sheet date and
 adjusted for any changes to the estimated economic life of the product.

 e.  Depreciation

 Depreciation is charged for those assets which have been put into use
 during the year under straight line method on pro rata basis at the
 rates specified in Schedule XIV to the Companies Act, 1956 as amended
 by the Government of India, Ministry of Law, Justice & Company Affairs
 rs vide notification No. GSR 756 (E) dated 16.12.1993.

 Depreciation on additions/deletions for the period is provided pro
 rata with reference to the month of addition/deletion.  Depreciation on
 Intangible Assets (Computer Software) are provided based on the
 management s estimate of useful lives and at the rate of 16.21% pro
 rata with reference to the month of addition/deletion.

 f.  Investments

 Investments are valued at cost price. Any temporary diminution in the
 value of investment meant to be held for a long term is not recognized.
 There is no impairment perceived in investments as on date.

 g.  Taxation

 The current charge for Income Tax and Fringe Benefit Tax is based on
 the tax liability computed after considering tax allowances and
 exemptions.

 Deferred tax is provided using the liability method in respect of
 taxation effect arising from all material timing difference between the
 accounting and Tax treatment of Income and Expenditure which are
 expected with reasonable probability to crystallize in the foreseeable
 future.

 h.  Earnings per Share

 In determining earnings per share, the Company considers the net profit
 after tax and includes the post tax effect of any extra- ordinary /
 exceptional item. The number of shares used in computing basic earnings
 per share is the weighted average number of shares outstanding during
 the period. The number of shares used in computing diluted earnings per
 share comprises the weighted average shares considered for deriving
 basic earnings per share, and also the weighted average number of
 equity shares that could have been issued on the conversion of all
 dilutive potential equity shares.

 i.  Deferred Revenue Expenditure

 The expenses relating to Brand Building and development of Course
 Content is deferred and the amount is written off over a period of 5
 years from the year in which the expenditure is

 j.  Public Issue Expenses

 Expenses related to Initial Public Offering (IPO) ar e written off in 5
 equal installments starting from the year of public issue.

 k.  Cash Flow statement

 Cash flows are reported using the indirect method, whereby net profit
 before tax is adjusted for the effects of transactions of a non-cash
 nature and any deferrals or accruals of past or future cash receipts or
 payments. The cash flows from regular revenue generating, investing and
 financing activities of the Company are segregated.

 l.  Employee Benefits

 Expenses and Liabilities in respect of Employee benefits are recorded
 in accordance with Revised Accounting Standard 15 -

 Employee Benefits (Revised 2005)

 i.  Gratuity

 Gratuity is a post employment benefit and is in the nature of a defined
 benefit plan. The liability recognized in the Balance Sheet in respect
 of Gratuity is the present value of the defined benefit obligation at
 the Balance Sheet date less the fair value of plan assets, together
 with adjustments for recognized actuarial gains or losses and past
 service costs. . The defined benefit obligation is calculated at or
 near the Balance Sheet date by an independent actuary using the
 projected unit credit method.  Actuarial gains and losses arising from
 past experience and changes in actuarial assumptions are charged or
 credited to the Profit and Loss Account in the year in which such gains
 or losses are determined.

 ii.  Provident Fund

 The Company makes contribution to statutory provident fund in
 accordance with Employees Provident Fund and Miscellaneous provision
 Act, 1952 which is a defined contribution plan and contribution payable
 is recognized as an expense in the period in which services are rendered
 by the employee.

 Leases of assets under which significant risks and rewards of ownership
 are effectively retained by the lesser are classified as operating
 leases. Lease payments under an operating lease are recognized as
 expense in the Profit and Loss Account on a straight tine basis over
 the lease term.  n.  Impairment of Assets

 The Company assesses at each Balance Shetdate whether there is any
 indication that an asset may be impaired. If any such indication
 exists, the Company estimates the recoverable amount of the asset. If
 such recoverable amount of the asset or the recoverable amount of the
 cash generating unit to which the asset belongs is less than its
 carrying amount, the carrying amount is reduced to its recoverable
 amount and the reduction is treated as an impairment loss and is
 recognized in the Profit and Loss Account. If at the Balance Sheet date
 there is an indication that a previously assessed impairment loss no
 longer exists, the recoverable amount is reassessed and the asset is
 reflected at the recoverable amount subject to a maximum of depreciated
 historical cost.

 o.  Foreign Exchange Transactions

 The Revenue earnings are accounted on estimated basis at the date of
 the transaction and the Exchange Fluctuation is accounted separately on
 realization.

 p.  Segment Reporting The Company operates in the same segment which
 are subject to same risks and returns.  

 q.  Miscellaneous Expenditure

 Preliminary Expenses is amortized over a period of 10 years.  

 r.  Interim Financial Reporting

 Quarterly Financial results are published in accordance with the
 guidelines given by SEBI. The recognition admeasurements and
 measurement principles are laid down in the Standard are followed with
 respect to such results. The Quarterly results are also subjected to a
 limited review by the auditors as required by SEBI.

 s.  Consolidated Financial Statements

 Consolidated Financial Statement of the Company and its subsidiary
 Vidhyadhana Education Services Private Limited are annexed.  

 t. Contingent Liabilities

 Depending upon the facts of each case and after due evaluation of legal
 aspect, claims against the Company not acknowledged as debts are
 treated as contingent liabilities. In respect of statutory dues
 disputed and contested by the Company, contingent liabilities are
 provided for and disclosed as per original demand without taking into
 account any interest or penalty that may accrue thereafter.