1.  ACCOUNTING CONVENTIONS:
 
 The financial statements are prepared under the historical cost
 convention, in accordance with Generally Accepted Accounting Principles
 (GAAP) in India, the accounting standards prescribed by the Companies
 (Accounting Standards) Rules, 2006 and the provisions of the Companies
 Act, 1956, adopted consistently by the Company. All income and
 expenditure having a material bearing on the financial statements are
 recognized on accrual basis.
 
 The preparation of the financial statements in conformity with GAAP
 requires that the management make estimates and assumptions that affect
 the reported amounts of assets and liabilities, and disclosure of
 contingent assets and liabilities as of the date of the financial
 statements, and the reported amounts of revenue and expenses during the
 reporting period. Actual results could differ from these estimates and
 differences between these actual results and estimates are recognised
 in the period in which these results are known / have materialized.
 
 The accounting policies as discussed below, are consistent with those
 used in the previous year.
 
 2.  REVENUE RECOGNITION:
 
 - Licensing Income
 
 Revenue from sale of user licenses for software applications is
 recognised only after the title in the user license is transferred on
 obtaining confrmation from the customer as per the terms of the
 agreement.
 
 - Software Sales
 
 Revenue is recognised to the extent it is probable that the economic
 benefits will flow to the Company and no significant uncertainty exists 
 as to its ultimate realization or collection. Software sale is accounted
 as and when the sale takes place.
 
 - Product Sales
 
 The Company recognises the sale of hardware devices on shipment of the
 same to the customer.
 
 - Services
 
 Annual Technical / Maintenance Services revenue is accrued over the
 period of the contract.
 
 - Interest
 
 Revenue is recognised on a time proportion basis taking into account
 the amount outstanding and the rate applicable.
 
 - Dividend Income
 
 Revenue is recognised when the right to receive the same is established
 upto the Balance Sheet Date.
 
 - Other Income
 
 Other Income is accounted on accrual basis as and when the right to
 receive arises.
 
 3.  FIXED ASSETS, INTANGIBLE ASSETS AND WORK IN PROGRESS:
 
 - Fixed Assets
 
 Fixed assets are stated at cost, less accumulated depreciation and
 impairment losses, if any, thereon. Cost comprises the purchase price
 and any cost attributable to bringing the asset to its intended
 location and in working condition for its intended use.
 
 - Intangible Asset
 
 The costs related to development of a new base software are capitalised
 along with related implementation costs and are classified under
 Intangible Assets as per AS-26. Its enduring useful life is reasonably
 estimated by the management.
 
 - Capital Work In Progress
 
 Costs incurred for acquiring of software rights and development of new
 software are recognised as internally generated software and
 transferred to Capital WIP till the product is launched.
 
 Revenue expenditure incurred on further research for development / on
 up-gradation of the existing software is charged to Profit and Loss
 Account in the year in which it is incurred.
 
 - Leasehold improvements:
 
 Leasehold improvements are written off from the date they are put to
 use over the remaining period of the primary lease.
 
 4.  DEPRECIATION:
 
 - Depreciation, on all assets except those specified in the table below,
 is provided for using the Written Down Value Method as per the useful
 lives of the assets estimated by the management, or at the rates
 prescribed under Schedule-XIV of the Companies Act, 1956 whichever are
 higher.  Depreciation on additions and deletions is charged pro-rata
 from / till the period of their use.
 
 - Depreciation on Testing and Tooling Software and other Computer
 software is provided for at 40% on WDV based on the estimated useful
 life of the computer software, which rate is higher than that
 prescribed under the Companies Act, 1956.
 
 5.  IMPAIRMENT OF ASSETS:
 
 The Company assesses at each balance sheet date whether there is any
 indication that an asset including goodwill may have been impaired. In
 case of such indication, 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 to is less than its carrying amount, the carrying amount is
 reduced to its recoverable amount. The reduction is treated as an
 impairment loss and is recognised in the Profit and Loss Account. If at
 the Balance Sheet date there is an indication that if 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.
 
 In respect of development costs and goodwill the impairment loss is
 reversed only when it is caused by specific external events and their
 effects have been reversed by subsequent external events.
 
 6.  INVESTMENTS:
 
 Investments that are intended to be held for a period of not more than
 a year at the time of purchase are classified as a current investment.
 All other investments are classified as Long Term Investments. Current
 Investments are carried at lower of cost and fair value determined on
 an individual investment basis.  Long Term Investments are carried at
 cost.  However the provision for diminution in value is made to
 recognise a decline other than temporary in the value of long term
 investments.
 
 7.  INVENTORIES:
 
 Closing stock of finished goods of GeoAmida is valued at cost or net
 realizable value, whichever is lower. Cost is determined using
 First-in-First-Out method. Work in progress is valued at cost. Stock in
 transit is valued at cost.
 
 8.  LEASES:
 
 a) Finance lease payments are apportioned between the finance lease
 charges and the reduction of the outstanding lease liability.  The
 finance lease charges are recognised in the Profit and Loss Account.
 
 b) Leases where the lessor effectively retains substantially all the
 risks and benefits of ownership of the leased term, are classified as
 operating leases. Operating lease payments are recognised as an expense
 in the Profit and Loss Account on a straight line basis over the lease
 term.
 
 9.  FOREIGN CURRENCY TRANSACTIONS:
 
 The Company is exposed to currency fuctuations on foreign currency
 transactions.
 
 - Initial Recognition
 
 Foreign Currency transactions are recorded in the reporting currency,
 by applying to the foreign currency amount the exchange rate between
 the reporting currency and the foreign currency at the date of the
 transaction.
 
 - Conversion
 
 Foreign currency monetary items are converted into reported currency on
 the balance sheet date using the closing rate.
 
 - Exchange Difference
 
 The difference between the rate at which foreign currency transactions
 are accounted and the rate at which they are realized /settled, is
 recognized in the Profit and Loss Account.
 
 - The Company uses foreign exchange forward and option contracts to
 hedge its exposure to movements in foreign exchange rates. The use of
 these foreign exchange forward and option contracts reduce the risk or
 cost to the Company and the Company does not use those for trading or
 speculation purposes.
 
 Exchange differences on such contracts are recognised in the Profit and
 Loss Account in the year in which the exchange rates change. Any profit
 or loss arising on cancellation or renewal of forward exchange contract
 is recognised as income or as expense for the year.
 
 Effective from 1st January, 2011 the Company has adopted AS 30 and 32
 Financial Instrument (Recognition and Measurement) Accounting Standards
 as prescribed by ICAI. The forward exchange contracts entered into, to
 hedge the foreign currency risk of a frm commitment or a highly
 probable transaction are marked to market at the end of the year and
 the gains and losses arising therein are included in the results of the
 operations and the same are reflected in the Hedge Reserve Account until
 the transaction is complete.
 
 10.  RETIREMENT BENEFITS:
 
 a) Defined Contribution Plan:
 
 Company''s contributions paid/payable to provident fund are recognised
 in the Profit and Loss account of the year when the contribution to the
 fund is due. The provident fund plan is operated by the regional
 Provident Fund Commissioner.
 
 b) Defined Benefit Plan:
 
 The Company provides for gratuity a defined benefit retirement plan (the
 Gratuity Plan) covering eligible employees. In accordance with the
 Payment of Gratuities Act, 1972, The Gratuity Plan provides a lump sum
 payment to vested employees at retirement, death, incapacitation or
 termination of employment, of an amount based on the respective
 employee''s salary and the tenure of employment. Liabilities with regard
 to the Gratuity Plan are determined by actuarial valuation as of the
 Balance Sheet date, based upon which, the Company contributes all the
 ascertained liabilities to the LIC Gratuity Fund.  Liabilities with
 regard to Leave Encashment are determined by actuarial valuation as of
 the Balance Sheet date, based upon which, the Company contributes to
 the LIC Leave Encashment Fund.
 
 11.  PROVISION FOR TAXATION:
 
 Income tax comprises of current tax provision and the net change in the
 deferred tax. Current tax provision is made in accordance with the
 Income Tax Act, 1961.
 
 Minimum Alternative Tax (MAT) paid in accordance to the tax laws, which
 gives rise to the future economic benefits in the form of adjustment of
 future income tax liabilities, is considered as an asset if there is
 convincing evidence that the Company will pay normal income tax after
 the tax holiday period. The tax effect of temporary differences between
 the book profit and taxable profit are reflected through Deferred Tax
 Asset / Deferred Tax Liability.
 
 The Company is eligible for 100% tax holiday under Section 10A of the
 Income Tax Act, 1961 until March 2011. The Company has started
 operations in SEEPZ from end of September 2008, which is a SEZ and
 which is entitled to 100% tax holiday under Section 10AA of the Income
 Tax Act, 1961 until March 2019.  As a result, deferred tax, arising out
 of timing differences originating and reversing during the tax holiday
 period, is recognised.
 
 No provision is considered necessary for taxation for the year since
 there is no taxable income under the normal provisions of the Income
 Tax Act. Further even the book profit is not liable to Minimum Alternate
 Tax as the same entirely arises from an undertaking in the Special
 Economic Zone (SEZ).
 
 The Company started manufacture of GeoAmida in F.Y. 2009-10 at their
 unit in Roorkee in, Uttaranchal, which is located in a tax free zone
 eligible for tax holiday under section 80(I)C of the Indian Income tax
 Act, 1961 until March 2019. As a result, deferred tax, arising out of
 timing differences originating and reversing during the tax holiday
 period, is recognised in the books.
 
 12.  EARNINGS PER SHARE:
 
 Basic Earnings per share are calculated by dividing the net profit or
 loss for the period attributable to equity shareholders (the said net
 profit or loss has been arrived at after deducting preference dividend
 and attributable taxes) by the weighted number of equity shares
 outstanding during the period. The weighted number of equity shares
 outstanding during the period is adjusted for events of bonus issue;
 bonus element in a rights issue to existing shareholders; share split
 and reverse share split (consolidation of shares). For the purpose of
 calculating diluted earnings per share, the net profit or loss for the
 period attributable to equity shareholders and the weighted average
 number of shares outstanding during the period are adjusted for the
 effects of all dilutive potential equity shares.
 
 13.  MISCELLANEOUS EXPENDITURE:
 
 Preliminary Expenses are amortised equally over a period of ten years.
 Share /Bond Issue Expenses and Deferred Revenue Expenses are amortised
 equally over a period of fve years.
 
 14.  SEGMENT REPORTING: Primary Business Segment
 
 The Company is primarily engaged in a single business segment of
 software product sale and related consultancy services, and
 accordingly, there is only one reportable segment.
 
 Geographical Segment
 
 Secondary segmental reporting is based on the geographical location of
 customers. The geographical segment has been disclosed on the revenues
 within India and revenues outside India.
 
 15.  EMPLOYEE STOCK COMPENSATION COST:
 
 Measurement and disclosure of the employee share based payment plans is
 done in accordance with the Guidance Note on Accounting for Employee
 share based payments, issued by the Institute of Chartered Accountants
 of India. The Company measures compensation cost relating to employee
 stock options using the intrinsic value method.  Compensation expense
 is amortized over the vesting period of the option on a straight line
 basis.
 
 16.  BORROWING COSTS:
 
 The Company conservatively provides for interest on the FCCB at the
 notional interest rate as specified in the Term Sheet. The notional
 interest charge for the year is adjusted for exchange rate fuctuation
 by applying the closing exchange rate and the corresponding effect is
 given to the provision for interest on Bonds.
 
 17. PROVISION AND CONTINGENT LIABILITIES:
 
 Provision is recognised when the Company has a present obligation as a
 result of past events and it is probable that an outflow of resources
 will be required to settle the obligation, in respect of which a
 reliable estimate can be made. Provisions are not discounted to its
 present value and are determined based on management estimate required
 to settle the obligation at the Balance Sheet date. These are reviewed
 at each Balance Sheet date and adjusted to reflect the current
 management estimates.