(a) Basis of Preparation of Financial Statements:
 
 The financial statements are prepared and presented under the
 historical cost conventions, on accrual basis of accounting to comply
 in all material respects, with the mandatory Accounting Standards as
 notified by the Companies (Accounting Standards) Rules, 2006 as amended
 (''the Rules'') and the relevant provisions of the Companies Act,1956
 (''the Act''). The accounting policies have been consistently applied by
 the Company and the Accounting Policies not referred to otherwise are
 in conformity with Indian Generally Accepted Accounting Principles
 (''Indian GAAP'')
 
 (b) Use of Estimates:
 
 The preparation of financial statements in conformity with the ''Indian
 GAAP'' requires management to make estimates and assumptions that may
 affect the reported amounts of Assets and Liabilities and disclosures
 relating to Contingent Liabilities as at the date of the financial
 statements and the reported amounts of incomes and expenses during the
 reporting period. Although these estimates are based upon management''s
 best knowledge of current events and actions, actual results could
 differ from these estimates. Differences between the actual results and
 estimates are recognized in the year in which the results are known/
 materialized.
 
 (c) Fixed Assets
 
 (I) Fixed Assets are stated at cost, less accumulated depreciation and
 impairment, if any. Cost includes all expenditure necessary to bring
 the asset to its working condition for its intended use.
 
 (ii) Capital work-in-progress comprises advances paid to acquire fixed
 assets along with incidental expenses incurred to acquire such fixed
 assets that are not ready for their intended use at the reporting date.
 
 (d) Depreciation:
 
 Depreciation is being provided on all tangible assets on Straight Line
 Method as per the rates and in the manner prescribed in Schedule XIV
 to the Companies Act, 1956.
 
 (e) Amortization
 
 Intangible assets are recognized when it is probable that the future
 economic benefits that are attributable to the assets will flow to
 enterprise and the cost of the assets can be measured reliably. The
 Intangible assets are recorded at the consideration paid for the
 acquisition of such assets and are carried at cost less accumulated
 amortization and impairment loss, if any.
 
 (f) Impairment of Assets:
 
 An asset is treated as impaired when the carrying cost of the asset
 exceeds its recoverable value. An impairment loss is charged to profit
 & loss account in the year in which an asset identified as impaired.
 The impairment loss recognized in prior accounting period is reversed
 if there has been a change in the estimate of recoverable amount.
 
 (g) Foreign Currency Transactions:
 
 (i) Initial Recognition:
 
 Transactions in foreign currency are recorded at the original rate of
 exchange in force at the time, transactions are affected.
 
 (ii) Conversion:
 
 Foreign currency monetary items are reported using the closing rates as
 on the date of financial statements.
 
 (iii) Exchange Difference:
 
 Exchange difference arising on the settlement of transactions of
 monetary items or on reporting such monetary items at rates different
 from those at which they were initially recorded during the year or
 reported in previous financial statements, are recognized as income or
 expense in the year in which they arise/reported.
 
 (h) Investment:
 
 Investments that are readily realizable and intended to be held for not
 more than a year are classified as Current Investments. 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 including investment in subsidiaries are carried
 at Cost. Cost includes any incidental costs incurred towards
 acquisition of said investment. However, provision if necessary for
 diminution in value is made to recognize a decline other than the one
 temporary in nature.
 
 (i) Revenue Recognition:
 
 Revenue is recognized to the extent that it is probable that the
 economic benefits will flow to the company and the revenue can be
 reliably measured.
 
 I) Sale of Goods:
 
 Revenue is recognized when the significant risks and rewards in respect
 of ownership of products are transferred by the company. Sales are
 recorded net of Returns, Sales tax/Value added tax and applicable trade
 discounts and allowances.
 
 ii) Software Development and Licensing:
 
 Revenue is primarily derived from sale of developed software and
 related services and from licensing of the software products. Software
 sales are recognized only on customers'' acceptance of delivery.
 
 Annual Technical Services revenue and revenue from fixed-price
 maintenance contracts are recognized proportionately over the period in
 which services are rendered.
 
 iii) Interest:
 
 Interest income is recognized on time proportionate basis taking into
 account the amount outstanding and the rate applicable.
 
 iv) Dividend:
 
 Dividend income from investment is recognized when the right to receive
 the payment is established.
 
 v) Others:
 
 Other revenue (including in respect of insurance or other claims or
 refunds, etc.) is accounted for in the year in which the right to
 receive the payment is established.
 
 (j) Expenditure:
 
 The cost of software / hardware purchased / developed and incidental
 cost incurred for software development are expensed during the year.
 
 Cost of maintenance services for software developed is not provided
 for, even since in many of the related services and licensing of
 software products do stipulate free maintenance as part of the
 contract. The maintenance obligation are in the opinion of the
 management, not material in value and based on empirical experience,
 not expected to crystallize in the near future and hence not provided
 for.
 
 Cost of warranties is also not provided for in the context of its
 specific exclusion in terms with the customers.  Provisions are made
 for all known losses and liabilities.
 
 (k) Inventories:
 
 Raw Materials, works-in-progress and finished/traded goods are valued
 at lower of cost or net realizable value.
 
 Self-developed software is valued at cost of development or at net
 realizable value, whichever is lower.
 
 (l) Research & Development:
 
 Revenue expenditure on Research & Development is expensed as and when
 incurred and Capital expenditure incurred on Research & Development is
 added to the Cost of respective fixed assets.
 
 (m) Employees Benefits:
 
 (I) Provident Fund:
 
 The eligible employees of the Company are entitled to receive benefits
 under the provident fund, a defined contribution plan, in which both
 employees and the Company makes monthly contribution at a specified
 percentage of the covered employee''s salary. The Company has no further
 obligation under the provident fund plan beyond its monthly
 contribution.
 
 (ii) Gratuity:
 
 Gratuity liability is a defined benefit obligation and is provided for
 on actuarial valuation made as at the balance sheet date.
 
 (n) Borrowing Cost:
 
 Borrowing Costs that are attributable to the Acquisition, Construction
 or Production of qualifying assets are capitalized as part of the cost
 of such assets. A qualifying asset is one that necessarily takes a
 substantial period of time to get ready for its intended use. All other
 borrowing costs are charged to revenue.
 
 (o) Income Tax:
 
 Tax expense for a year comprises of Current tax and Deferred tax.
 
 Current tax is measured at the amount expected to be paid to the tax
 authorities, after taking into consideration, the applicable deductions
 and exemptions admissible under the provisions of the Income Tax Act,
 1961.
 
 Deferred tax reflects the impact of current year timing differences
 between taxable income and accounting income for the year and reversal
 of timing differences of earlier years. Deferred tax is measured based
 on the tax rates and the tax laws enacted or substantively enacted at
 the balance sheet date. Deferred tax assets are recognised only to the
 extent that there is reasonable certainty that sufficient future
 taxable income will be available against which such deferred tax assets
 can be realised. If there is unabsorbed depreciation or carry forward
 of losses under tax laws, deferred tax assets are recognised only to
 the extent that there is virtual certainty supported by convincing
 evidence that sufficient future taxable income will be available
 against which such deferred tax assets can be realised.
 
 Deferred tax resulting from timing differences which originate during
 the tax holiday period but are expected to reverse after such tax
 holiday period is recognised in the year in which the timing
 differences originate using the tax rates and laws enacted or
 substantively enacted at the balance sheet date. At each balance sheet
 date, the company reassesses unrecognised deferred tax assets. It
 recognises unrealised deferred tax assets to the extent it has become
 reasonably certain or virtually certain, as the case may be, that
 sufficient taxable income will be available against which the deferred
 tax can be realised.
 
 Minimum Alternative Tax (MAT) credit is recognised as an asset only
 when and to the extent there is convincing evidence that the Company
 will pay income tax higher than that computed under MAT, during the
 period that MAT is permitted to be set off under the income Tax Act, 
 1961 (specified period). In the year, in which the MAT credit becomes 
 eligible to be recognised as an asset in accordance with the 
 recommendations contained in the guidance note issued by the Institute 
 of Chartered Accountants of India (ICAI), the said asset is created 
 byway of a credit to the profit and loss account and shown as MAT credit
 entitlement. The Company reviews the same at each balance sheet date
 and writes down the carrying amount of MAT credit entitlement to the
 extent there is no longer convincing evidence to the effect that the
 Company will pay income tax higher than MAT during the specified
 period.
 
 (p) Segment Reporting
 
 Segment Reporting as per Accounting Standard 17: The Company operates
 solely in the Information Technology Solutions Segment. The analysis of
 geographical segments is based on the areas in which the products of
 the Company are sold.
 
 (q) Provisions, Contingent Liabilities and Contingent assets:
 
 Provisions involving substantial degree of estimation in measurement
 are recognised when there is a present obligation as a result of past
 events and it is probable that there will be an outflow of resources.
 Contingent liabilities are not recognised but are disclosed in the
 notes to accounts. Contingent assets are neither recognised nor
 disclosed in the financial statements.
 
 (r) Cash Flow Statement:
 
 The Cash Flow Statement is prepared by the Indirect Method set out in
 Accounting Standard 3 on Cash Flow Statement and presents the cash
 flows by Operating, Investing and Financing activities of the Company.
 
 (s) Leases:
 
 Lease under which the Company assumes substantially all the risks and
 rewards of ownership are classified as finance leases. Such assets
 acquired are capitalized at fair value of the asset or present value of
 the minimum lease payments at the inception of the leases, whichever is
 lower. Lease payments under operating leases are recognised as an
 expense on a straight line basis in the statement of profit and loss
 over the lease term.
 
 The Company has only one class of share referred to as equity shares
 having a par value of Rs 10/- Each holder of equity shares is entitled
 to one vote per share.
 
 The Company declares and pays dividend in Indian rupees. The dividend
 proposed by the Board of Directors is subject to the approval of the
 shareholders in the ensuing Annual General Meeting.
 
 In the event of liquidation of the Company, the holder of equity shares
 will be entitled to receive any of the remaining assets of the company,
 after distribution of all preferential amounts . However , no such
 preferential amount exist currently . The distribution will be in
 proportion to number of equity shares held by the shareholders.
 
 * Cash Credit\Overdraft borrowings are secured against Current Assets,
 entire Fixed Asset and property situated at Mahape belonging to Micro
 Cloud Computing Pvt.Ltd and Corporate Guarantee of Micro Cloud Computing
 Pvt Ltd and personal Guarantee of Directors Dr. P Sekhar and Ms
 Jayanthi S.
 
 * As per Technical evaluation done by the Company certain
 Software were un economical to use due to change in Technology and hence
 Were not Supposed to give future economic benefit and accordingly these
 asset was charged to Statement of Profit & loss during last Financial
 Year.
 
 ** The Company has provided for the exchange rate fluctuation on FCCB
 Outstanding on the Financial Statement date that are yet to be
 converted/ redeemed