1.  Accounting Convention
 
 The Financial statements are prepared under historical cost convention,
 on an accrual basis and in accordance with the generally accepted
 accounting principles in india, the applicable mandatory Accounting
 Standards as notified by the Companies (Accounting Standard) Rules,
 2006 and the relevant provisions of the Companies Act,1956
 
 2.  Revenue Recognition:
 
 Revenue from contracts priced on a time and materials basis are
 recognized when services are rendered and related costs are incurred.
 
 Revenue from product sales is stated exclusive of returns, and
 applicable trade discounts but inclusive of Duties and Taxes collected
 on the same.
 
 Service Income is recognized as per the terms of Contracts with the
 Customer, when the related services are performed.
 
 3.  Retirement Benefits to Employees:
 
 i) Defined Contribution plan
 
 In respect of retirement benefits in the form of provident fund, the
 contribution payable by the company for a year is charged to the Profit
 and Loss account.
 
 ii) Defined Benefit Plan
 
 General Description of Plans:- Leave encashment: The Company does not
 have any scheme for Leave encashment.
 
 Gratuity: Gratuity benefit is applicable to all permanent and full time
 employees of the company.  Gratuity paid out is based on last drawn
 basic salary and DA at the time of termination or retirement.  The
 scheme takes into account each completed year of service or part
 thereof in excess of 6 months.  Annual contribution to the employees''s
 Gratuity fund, Established with LIC of India (LIC) are determined based
 on an acturial valuation made by the LIC as at the year end.
 
 4.  Foreign Currency Transactions:
 
 Income and Expenditure in foreign currency is accounted at the exchange
 rate prevalent when such expenditure/income is incurred/arised . The
 exchange difference arising on foreign currency transactions are
 recognized as income or Expenses in the period in which the payment is
 made/income received.
 
 5.  Income Tax:
 
 5.1 Current Tax:
 
 Provision for current tax is made and retained in the Accounts on the
 basis of estimated tax liability as per the applicable provisions of
 the income-tax Act,1961.
 
 5.2 Deferred Tax:
 
 Deferred tax has been accounted in accordance with Accounting Standard
 - 22  Accounting for Taxes on Income issued by the ICAI, under the
 liability method.
 
 A provision is made for Income tax annually based on the Tax Liability
 computed. The difference that result between the profit offered for
 income taxes and the Profit as per the Financial Statements are
 identified and thereafter a deferred tax asset or deferred tax
 liability for timing differences, namely the difference that originate
 in one accounting period and reverse in another, based on the tax
 effect of the aggregate amount being considered.
 
 The tax effect is calculated on the accumulated timing differences at
 the end of an accounting period based on prevailing enacted
 regulations. Deferred tax assets are recognized only if there is
 reasonable certainty that they will be realized and are reviewed for
 the appropriateness of their respective carrying values at each balance
 sheet date .
 
 5.3 MAT Credit Entitlement:
 
 MAT Credit Entitlement is recognised in the books of accounts as per
 the Tax Laws existing on the Balance Sheet Date.
 
 6.  Fixed Assets
 
 Fixed assets are valued at original cost including incidental
 expenditures, taxes and duties net of CENVAT and VAT credit availed.
 
 Capital expenditure incurred on Expansion Project at Hardware
 Technology Park (HTP) is shown under Capital Work In Progress.
 
 7.  Research and Development Expenditure:
 
 Revenue expenditure incurred on Research and Development is charged to
 Profit and Loss Account in the year it is incurred.
 
 8.  Depreciation
 
 Depreciation has been charged on fixed assets on WDV method as per the
 rates specified in Schedule XIV of the Companies Act,1956.
 
 9.  Inventories
 
 Inventories of Components are valued at cost or realizable value which
 ever is less. Work in progress is valued at cost of materials and
 services used .
 
 10.  Warranty Expenses
 
 Anticipated product warranty costs for the period of warranty are
 provided for in the year of sale.
 
 11.  Segment Reporting :
 
 Since the Company has no Reportable segment to report, Segment
 Reporting  under Accounting Standard 17 issued by the ICAI is not
 applicable .
 
 12.  Related Party Disclosures:
 
 a) There are no related parties where control exists other than 100%
 Wholly Owned subsidiary.
 
 b) 100% Wholly Owned Subsidiary Avant-Grade Infosystems.
 
 c) Key Management Personnel:
 
 Col. L.V.Raju (Retd) - Managing Director B. Murali Mohan - Whole Time
 Director
 
 13.  Impairment Of Assets :
 
 An Assets is treated as impaired when the carrying cost of the asset
 exceeds its recoverable value being higher of value in use and
 netselling price. Value in use is computed at net present value of cash
 flow expected over the balance useful life of the assets. An impairment
 loss is recognised as an expense in the profit and loss account in the
 year in which an asset is identifed as impaired. The impairment loss in
 prior accounting period is reversed if there has been an improvement in
 recoverable amount.
 
 The Management of the Company is of the opinion that there are no Fixed
 Assets to be impaired for the period, as identified by the sources of
 Information, mentioned in the Accounting Standard -28 Impairment of
 Assets issued by the ICAI.