Polaris Software Lab

1.  [B15] Investments in subsidiaries and associates
 
 a) The subsidiaries of the Company were incorporated to provide
 software development services, business process management services and
 to promote Companys software products and work on the business
 development efforts in the regions where the subsidiaries are located.
 The details of the accumulated losses as per the audited financial
 statements of the loss making subsidiaries as at March 31, 2009 are
 given below:
 
 Subsidiary                        Profit / (loss) Accumulated loss as
                                          2008-09    at March 31, 2009
 
 Polaris Software Lab Canada Inc        (67.03)           336.77
 
 Polaris Software Lab B.V, Netherlands   17.82              3.88
 
 Optimus Global Services Limited       (187.95)         1,433.77
 
 Accumulated losses of the subsidiaries are on account of initial /
 start-up stage of operations and subsidiaries are expected to earn
 profits in the future. Accordingly, management believes that there is
 no other than temporary diminution in the value of its investments in
 the subsidiaries and hence it is stated at cost.
 
 b) The Companys equity ownership interest in Adrenalin eSystems
 Limited is 40.25% as at March 31, 2009. Adrenalin eSystems Limited
 (ASL) is primarily engaged in the business of providing specific
 solutions relating to Human Relations suite of software solutions and
 products and has been incurring losses. The Company believes that the
 accumulated losses to the extent of Rs.3,044.15 as per the unaudited
 financial statements of ASL as on March 31, 2009 are on account of
 initial stage of operations. The full version of the ASLs main product
 Adrenalin was launched in January 2006 and ASLs evaluation of the
 products market acceptability is positive. The Company believes that,
 in pursuing business models based on mass adoption of similar
 technologies on global scale, the start up costs on brand building,
 product development costs and franchise acquisitions are significant
 and the international experience also suggests that the product
 companies have longer gestation period. Further, the promoters of ASL
 are committed to provide continued support to its operations and ASL is
 expected to generate profits in the future. As per the unaudited
 financial statement of ASL for the year ended March 31, 2009, ASL has
 earned a nominal net profit after tax. The management expects to
 improve the revenue and profitability in the coming years and all
 intangibles have also been amortized fully during the year.
 Accordingly, there is no other than temporary diminution in the value
 of its investments in ASL and hence, it is stated at cost.
 
 c) The Companys equity ownership interest in NMS Works Software
 Private Limited (NMS) is 45.85% as at March 31, 2009. NMS is
 primarily engaged in the business of designing network management in
 Telecommunication and Internet Services.  NMS has been incurring losses
 since its inception and based on the unaudited financials statements as
 at March 31, 2009, NMS had accumulated losses aggregating to Rs 741.02.
 Accordingly, the Company has determined and recorded a provision of Rs
 415.00 for other than temporary diminution in the value of its equity
 investment in NMS.
 
 d) The Company has fully divested its holding in AIG Systems Solutions
 Private Limited and made a profit on sale of investments of Rs.
 1,979.45 during the year.
 
 2.  [B19] As at March 31, 2009, the Company had no outstanding dues to
 small-scale industrial (SSI) undertakings and Micro and Medium
 enterprises (March 31, 2008: Rs Nil). The list of SSI undertakings
 Micro and Medium enterprises was determined by the Company on the basis
 of information available with the Company. The Company also had no
 outstanding dues that require to be furnished under Section 22 of the
 Micro, Small and Medium Enterprises Development Act, 2006.
 
 3.  [B20] Previous year figures have been regrouped/reclassified,
 wherever necessary, to conform to current year presentation.