1.  Basic of preparation of financial statements
 
 The financial statements are prepared under historical cost convention,
 on the accrual basis of accounting and in accordance with the generally
 accepted accounting principals, accounting standards issued by the
 institute of Chartered Accountants of India and provision of Companies
 Act, 1956.
 
 2.  Revenue recognition
 
 a) Revenue from Sale of goods and services are recognized as per sale
 contracts terms.
 
 b) Other Income is accounted on accrual basis except where the receipt
 of income is uncertain.
 
 3.  Fixed Assets
 
 Fixed Assets are stated at the cost of acquisition including taxes,
 duties, freight and other incidental expenses related to acquisition
 and installation.
 
 4.  Depreciation
 
 Depreciation on Fixed Assets is provided on the straight-line basis at
 the rates and manner prescribed under schedule XIV of the Companies
 Act, 1956.
 
 5.  Inventories
 
 a) Raw Materials, Stores and spares, and other inventories are valued
 at cost or net receivable value whichever is low on FIFO basis.
 
 b) Hardware, peripheral and software sets are valued at cost on FIFO
 basis.
 
 6.  Miscellaneous Expenditure
 
 The preliminary and pre-operative expenses and project development
 expenses are written off over a period of 10 years.
 
 7.  Foreign Currency transactions
 
 Transaction in foreign currency is recorded at the rates prevailing on
 the date of transactions. The year end balances in foreign currency are
 translated at rates as the end of the year. The gain/loss on such
 translation is charged to the profit and loss account.
 
 8.  Retirement Benefits
 
 The gratuity payable is accounted as and when applicable on the
 actuarial basis.
 
 9.  Provisions, Contingent Liabilities:
 
 A provision is recognized when the Company has present obligation as a
 result of past events and it is probable that an out flow of resources
 will be required to settle such obligation, in respect of which a
 reliable estimate can be made.
 
 Contingent liabilities not provided for in the accounts are disclosed
 in the accounts by way of notes specify the nature and quantum of such
 liabilities.
 
 10.  Income Tax
 
 Provision for taxation includes current tax and deferred tax. Current
 Tax is measured at the amount expected to be paid to the tax
 authorities, using the applicable tax rates and tax laws.
 
 Deferred tax assets and liabilities are recognized for further tax
 consequences attributable to the timing differences between taxable
 income and accounting income that are capable of reversal in one or
 more subsequent periods and are measured using tax rates enacted or
 substantively enacted as at the Balance Sheet date. Deferred Tax assets
 are not recognized unless, in the management judgment, there is virtual
 certainty that sufficient future taxable income will be available
 against which such deferred tax assets can be realized. The carrying
 amount of deferred tax is reviewed at each balance sheet date.