1.  Basis of preparation of financial statements
 
 The financial statements are prepared under the historical cost
 convention, on the accrual basis of accounting, in accordance with
 Indian Generally Accepted Accounting Principles (GAAP). GAAP
 comprises mandatory Accounting Standards prescribed by the Company
 Accounting Standards Rules, 2006.  The management evaluates all
 recently issued or revised Accounting Standards on an ongoing basis.
 
 2.  Use of Estimates
 
 The preparation of the financial statements in conformity with GAAP
 requires that the management makes estimates and assumptions that
 affect the reported amounts of assets and liabilities, disclosure of
 contingent liabilities as at the date of the financial statements and
 the reported amounts of revenue and expenses during the reported
 period. Examples of such estimates includes provision for doubtful
 debts , future obligations under employee benefit plans, income taxes
 and the useful lives of fixed assets. Contingencies are recorded when
 it is probable that a liability will be incurred, and the amount can be
 reliably estimated. When no reliable estimate can be made, a disclosure
 is made as contingent liability. Actual results could differ from those
 estimates.
 
 3.  Revenue Recognition
 
 Revenue from Telecom Value Added Services including royalty income, net
 of customer credits, is recognized on provision of services in terms of
 revenue sharing arrangements with the telecom operators.
 
 Revenue from sale of user licences for software applications is
 recognized when the applications are functionally installed at the
 customer''s location as per the terms of the contracts.
 
 Revenue from Other Services including maintenance services is
 recognized proportionately over the period during which the services
 are rendered as per the terms of contract.
 
 Dividend on current investment is recognized on an accrual basis.
 Profit on sale of investments is recorded on transfer of title from the
 Company and is determined as the difference between the sale price and
 the then carrying value of the investment.
 
 Rental Income is recognised on an accrual basis.
 
 Interest Income is recognised on an accrual basis.
 
 4.  Fixed assets
 
 Fixed assets are stated at cost of acquisition including taxes, duties,
 freight and other incidental expenses relating to acquisition and
 installation.
 
 Capital work in progress is stated at cost and includes advances paid
 to acquire fixed assets and the cost of fixed assets that are not ready
 for their intended use at the Balance Sheet date.
 
 5.  Depreciation/Amortisation
 
 Depreciation/Amortisation on assets is provided on a monthly basis
 using the straight-line method based on useful/commercial lives of
 these assets as estimated by the Management, other than for Market
 development and deployment rights which is amortised over its useful/
 commercial life in time proportion of its economic benefits that are
 expected to accrue to the Company.  The amortisation method is reviewed
 at each year end for any significant change in the expected pattern of
 the economic benefits.
 
 Individual assets costing less than Rs.5,000/- are depreciated in full
 in the year of purchase. The depreciation rates adopted are the same as
 or higher than the rates specified in Schedule XIV of the Companies
 Act, 1956.
 
 6.  Investments
 
 Short term investments are stated at lower of cost and market value.
 
 Long term investments are stated at cost. Provision is made for any
 diminution in value of long term investment which is other than that of
 a temporary in nature.
 
 7.  Foreign currency transactions
 
 Transactions in foreign currencies are translated at the exchange rate
 prevailing on the date of the transaction.  Monetary assets and
 Monetary liabilities denominated in foreign currencies are translated
 at the exchange rate prevalent at the date of the Balance sheet.
 Exchange differences arising on foreign currency translations are
 recognized as income or expense in the year in which they arise.
 
 Premium or discount on forward exchange contract is amortised over the
 life of such contract and is recognised as income or expense.
 
 Any profit or loss arising on cancellation,renewal or restatement of
 forward contract is recognised in the Profit and Loss account.
 
 8.  Employee Benefits
 
 a. Short term employee benefits including salaries, social security
 contributions, short term compensated absences (such as paid annual
 leave) where the absences are expected to occur within twelve months
 after the end of the period in which the employees render the related
 employee service, profit sharing and bonuses payable within twelve
 months after the end of the period in which the employees render the
 related services and non monetary benefits (such as medical care) for
 current employees are estimated and measured on an undiscounted basis.
 
 b. Defined Contribution Plan
 
 Company''s contributions paid / payable during the year to Provident
 Fund are recognised in the Profit and Loss Account.
 
 c. Defined Benefit Plan
 
 Liabilities for gratuity funded in terms of a scheme administered by
 the Life Insurance Corporation of India, are determined by Actuarial
 Valuation made at the end of each financial year. Provision for
 liabilities pending remittance to the fund is carried in the Balance
 Sheet.
 
 Actuarial gains and losses are recognized immediately in the statement
 of Profit and Loss Account as income or expense. Obligation is measured
 at the present value of estimated future cash flows using a discounted
 rate that is determined by reference to market yields at the Balance
 Sheet date on Government bonds where the currency and terms of the
 Government bonds are consistent with the currency and estimated terms
 of the defined benefit obligation.
 
 d. Long term liability for Leave Encashment is provided based on
 actuarial valuation of the accumulated leave credit outstanding to the
 employees as on the Balance Sheet date.
 
 9.  Employee Stock Option Plan
 
 The Company has formulated 11 Employee Stock
 
 Option Plans (ESOP) - OnMobile Employees Stock
 
 Option Plan – I 2003, OnMobile Employees Stock
 
 Option Plan – II 2003, OnMobile Employees Stock
 
 Option Plan – III 2006, OnMobile Employees Stock
 
 Option Plan – I 2007, OnMobile Employees Stock
 
 Option Plan – II 2007, OnMobile Employees Stock
 
 Option Plan – I 2008, OnMobile Employees Stock
 
 Option Plan – II 2008, OnMobile Employees Stock
 
 Option Plan – III 2008, OnMobile Employees Stock
 
 Option Plan – IV 2008, OnMobile Employees Stock
 
 Option Plan – I 2010 and OnMobile Employees Stock Option Plan – II 2010
 
 The Company has obtained legal opinion that the guidance note on
 Accounting for Employees Share based payments are not applicable to
 OnMobile Employee Stock Option Plan – I 2003 and II 2003.  Options
 granted in terms of OnMobile Employee Stock Option Plan – III 2006,
 OnMobile Employees Stock Option Plan – I 2007, OnMobile Employees Stock
 Option Plan – II 2007, OnMobile Employees Stock Option Plan – I 2008,
 OnMobile Employees Stock Option Plan – II 2008, OnMobile Employees
 Stock Option Plan – III 2008, OnMobile Employees Stock Option Plan – IV
 2008, OnMobile Employees Stock Option Plan – I 2010 and OnMobile
 Employees Stock Option Plan – II 2010 to which the said guidance note
 is applicable, are accounted under intrinsic value method and
 accordingly, the difference between the fair value of the underlying
 shares and the exercise price, if any, is expensed to profit and loss
 account over the period of vesting.
 
 10.  Leases
 
 Assets taken on lease where the company acquires substantially the
 entire risks and rewards incidental to ownership are classified as
 finance leases. The amount recorded is the lower of the present value
 of minimum lease rental and other incidental expenses during the lease
 term or the fair value of the assets taken on lease. The rental
 obligations, net of interest charges, are reflected as secured loan.
 Leases that do not transfer substantially all the risks and rewards of
 ownership are classified as operating leases and lease rentals are
 expensed to Profit & Loss account on accrual basis.
 
 11.  Borrowing Cost
 
 Borrowing costs incurred for the acquisition of qualifying assets are
 recognised as part of cost of such assets when it is possible that they
 will result in future economic benefits to the company while other
 borrowing costs are expensed.
 
 12.  Income Tax
 
 Income tax expense includes Indian and International income
 taxes.Income tax comprises of the current tax provision and net change
 in deferred tax asset or liability in the year.
 
 Provision for current tax is made taking into account the admissible
 deductions/allowances and is subject to revision based on the taxable
 income for the fiscal year ending 31 March each year.
 
 Minimum alternate tax (MAT) paid in accordance with the tax laws, which
 gives rise to future economic benefits in the form of adjustment of
 future income tax liability, is considered as an asset if there is
 convincing evidence that the Company will pay normal income tax in the
 future years. Accordingly, MAT is recognised as an asset in the balance
 sheet where it is probable that the future economic benefit associated
 with it will flow to the Company and the asset can be measured
 reliably.
 
 Provision for taxation includes tax liabilities in India on the
 Company''s global income as reduced by exempted income and any tax
 liabilities arising overseas on income sourced from those countries.
 
 Deferred tax assets and liabilities are recognized for the future tax
 consequences of timing differences between carrying values of the
 assets and liabilities and their respective tax bases and are measured
 using enacted tax rates applicable on the Balance Sheet date.
 
 Deferred Tax assets are recognized subject to management''s judgement
 that realization is reasonably/ virtually certain.
 
 The effect of changes in tax rates on deferred tax assets and
 liabilities is recognized in the income statement in the year of
 enactment of change.
 
 13.  Cash flow Statement
 
 Cash Flow Statement has been prepared in accordance with the Indirect
 method prescribed in Accounting Standard 3- Cash flow statements .
 The cash flows from operating, investing and financing activities of
 the Company are segregated.
 
 14.  Impairment of Assets
 
 The carrying amounts of assets are reviewed at each Balance Sheet date
 if there is any indication of impairment based on internal / external
 factors. An asset is treated as impaired when the carrying cost of
 assets exceeds its recoverable amount. An impairment loss is charged to
 Profit and Loss Account in the year in which an asset is identified as
 impaired. The recoverable amount is greater of the asset''s net selling
 price and value in use. In assessing value in use, the estimated future
 cash flows are discounted to the present value.
 
 A previously recognized impairment loss is further provided or reversed
 depending on changes in circumstances.
 
 15.  Earnings per Share
 
 In determining the Earnings per share, the Company considers the net
 profit after tax. The number of shares used in computing Basic Earnings
 per share is the weighted average number of equity shares outstanding
 during the year. The number of shares used in computing Diluted
 Earnings per share comprises the weighted average number of equity
 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.  Dilutive
 potential equity shares are deemed converted as of the beginning of the
 year unless issued at a later date.
 
 16.  Provisions and Contingencies
 
 Provision is recognized when an enterprise has a present obligation as
 a result of past event; 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 best estimate required to
 settle the obligation at the Balance Sheet date. These are reviewed at
 each Balance Sheet date and adjusted to reflect current best estimates.