a.  Basis of Preparation of Financial Statements
 
 The financial statements are prepared in accordance with Indian
 Generally Accepted Accounting Principles (GAAP) under the historical
 cost convention on the accrual basis. GAAP comprises mandatory
 accounting standards prescribed by the Companies (Accounting Standards)
 Rules 2006 and guidelines issued by the Securities and Exchange Board
 of India (SEBI). Accounting policies have been consistently applied
 except where a newly issued accounting standard is initially adopted or
 a revision of an existing accounting standard requires a change in the
 accounting policy hitherto in use.
 
 b.  Use of Estimates
 
 The preparation of the financial statements in conformity with GAAP
 requires the management to make estimates and assumptions that affect
 the reported balances of assets and liabilities and disclosures
 relating to contingent assets and liabilities as at the date of the
 financial statements and reported amounts of income and expenses during
 the period. Examples of such estimates include provisions for doubtful
 debts, future obligations under employee retirement benefit plans,
 income taxes, post-sales customer support and the useful lives of fixed
 assets and intangible assets. Actual result could differ from these
 estimates.  Difference between the actual results and estimates are
 recognised in the period in which the results are known/ materialised.
 
 c.  Revenue Recognition
 
 i. Revenue from sale of solutions and services is recognized in
 accordance with the sales contract and when significant risks and
 rewards in respect of ownership are transferred to the customers.
 
 ii. Revenue from customer-related long-term contracts is recognised by
 reference to the percentage of completion of the contract at the
 balance sheet date.  Company''s long term contracts specify a fixed
 price for the sale of license and installation of software solutions &
 services and the related revenue is determined using the percentage of
 completion method. The percentage of completion is calculated by
 comparing costs incurred to date with the total estimated costs of the
 contract. If the contract is considered profitable, it is valued at
 cost plus attributable profits by reference to the percentage of
 completion. Any expected loss on individual contracts is recognised
 immediately as an expense in the Profit & Loss Account.
 
 iii. Income from maintenance contract is recognized proportionately
 over the period of the contract.
 
 iv Dividend on investments held by the Company is accounted for as and
 when it is declared.
 
 d.  Fixed Assets, Intangibles, Depreciation, Amortisation and Capital
 Work in Progress (CWIP)
 
 i. All Fixed Assets are stated at cost of acquisition or construction
 less accumulated depreciation and impairment loss, if any. Where the
 acquisition of fixed assets are financed through long term foreign
 currency loans the exchange difference on such loans are added to or
 subtracted from the cost of such fixed assets.
 
 ii. The company provides depreciation on fixed assets on Straight Line
 Method (SLM), at the rates and in the manner specified in schedule XIV
 of the Companies Act, 1956 except for computer plant and its related
 equipments.
 
 iii. Depreciation on computer plant and its related equipment is
 provided on the Straight Line Method (SLM) over the economic useful
 life of assets, which is ascertained to be 4 years by the management.
 
 iv.  Leasehold land is amortised over the period of lease.
 
 v. Capital Work-in-Progress is stated at cost comprising of direct cost
 and related incidental expenditure. The advances given for acquiring /
 construction of fixed assets are shown under CWIP.
 
 vi.  Intangibles:
 
 Intellectual Property Rights are amortised over a period of ten years
 
 Computer Software is amortised over a period of 4 years.
 
 e.  Impairment of Assets
 
 The fixed assets are reviewed for impairment at each balance sheet
 date. In case of any such indication, the recoverable amount of these
 assets is determined, and if such recoverable amount of the asset or
 cash-generating unit to which the asset belongs is less than its
 carrying amount, the impairment loss is recognized by writing down such
 assets to their recoverable amount. An impairment loss is reversed if
 there is change in the recoverable amount and such loss either no
 longer exists or has decreased.
 
 f.  Investments
 
 Investments are classified into Current Investment and Long Term
 Investments. Current Investments are carried at lower of the cost and
 fair value. Long Term Investments are carried at cost. Provision for
 diminution is made only if, in the opinion of the management, such a
 decline is other than temporary.
 
 g.  Inventories
 
 Systems, Softwares, Peripheral and Spares are valued at lower of cost
 or net realisable value on first in first out basis.
 
 Finished products are valued at lower of cost or net realisable value.
 h.  Foreign Currency Transactions
 
 i. Foreign currency transactions are recorded at the exchange rate
 prevailing on the date of transaction.
 
 ii. All monetary foreign currency assets/liabilities are translated at
 the rates prevailing on the date of balance sheet.
 
 iii. The exchange difference between the rates prevailing on the date
 of transaction and on the date of settlement as also on translation of
 monetary items at the end of the year (other than those relating to
 long term foreign currency monetary items) is recognised as income or
 expense, as the case may be.
 
 iv. Exchange differences relating to long term foreign currency
 monetary items, to the extent they are used for financing the
 acquisition of fixed assets are added to or subtracted from the cost of
 such fixed assets and the balance is accumulated in ''Foreign Currency
 Monetary Item Translation Difference Account'' and amortised over the
 balance term of the long term monetary item or 31st March, 2012
 whichever is earlier.
 
 v. The premium / discount arising at the inception of the forward
 contract is amortised as expenses or income over the life of the
 contract.
 
 vi. Gain /loss on cancellation or renewal of forward exchange contract
 are recognised as income or expenses for the period.
 
 i.  Employee Benefits
 
 1.  Short Term Employee Benefits
 
 Short Term Employees Benefits are recognized as an expense at the
 undiscounted amount in the Profit and Loss Account of the year in which
 the related services is rendered.
 
 2.  Post Employment Benefits
 
 Provident Fund
 
 The Company contributes monthly at a determined rate. These
 contributions are remitted to the Employee Provident Fund Commissioner
 office and are charged to Profit and Loss account on accrual basis.
 
 Gratuity
 
 The Company provides for gratuity (a defined benefit retirement plan)
 to all the eligible employees. The benefit is in the form of lump sum
 payments to vested employees on retirement, on death while in
 employment, or termination of employment for an equivalent to 15 days
 salary payable for each completed year of service subject to a maximum
 of Rs. 10 lacs. Vesting occurs on completion of five years of service.
 Liability in respect of gratuity is determined using the projected unit
 credit method with actuarial valuations as on the balance sheet date
 and gains/ losses are recognized immediately in the profit and loss
 account.
 
 Leave Encashment
 
 Liability in respect of leave encashment is determined using the
 projected unit credit method with actuarial valuations as on the
 balance sheet date and gains/losses are recognized immediately in the
 profit and loss account.
 
 j.  Borrowing Cost
 
 Borrowing costs that are directly attributable to the acquisition or
 construction of qualifying assets are capitalised as part of the cost
 of that assets. A qualifying asset is one that necessarily takes
 substantial period of time to get ready for intended use. All other
 borrowing costs are recognised as an expense in the period in which
 they are incurred.
 
 k.  Earnings Per Share
 
 In accordance with the Accounting Standard 20 ( AS — 20) Earnings Per
 Share issued by the Institute of Chartered Accountants of India, basic
 / diluted earnings per share is computed using the weighted average
 number of shares outstanding during the period.
 
 l.  Income Tax
 
 Income tax comprises of current tax, and deferred tax.  Deferred tax
 assets and liabilities are recognized for the future tax consequences
 of timing differences, subject to the consideration of prudence.
 Deferred tax assets and liabilities are measured using the tax rates
 enacted or substantively enacted by the balance sheet date. The
 carrying amount of deferred tax asset / liability is reviewed at each
 balance sheet date.
 
 m.  Shares/Bond Issue Expenses and Premium on Redemption of Bonds Share
 / Bond issue expenses and premium payable on redemption of bonds are
 written off to Securities Premium Account.
 
 n.  Warranty Cost
 
 The company accrues the estimated cost of warranties at the time when
 the revenue is recognised. The accruals are based on the Company''s
 historical experience of material usage and service delivery cost.
 
 o.  Prior Period Items
 
 Prior period expenses/incomes are accounted under the respective heads.
 Material items, if any, are disclosed separately by way of a note.
 
 p.  Provisions & Contingent Liabilities
 
 The company creates a provision when there is a present obligation as a
 result of an obligating event that probably requires an outflow of
 resources and a reliable estimate can be made of the amount of the
 obligation. A disclosure for a contingent liability is made when there
 is a possible obligation or a present obligation that may, but probably
 will not, require an outflow of resources. Where there is a possible
 obligation or a present obligation in respect of which the likelihood
 of outflow of resources is remote, no provision or disclosure is made.
 
 q.  Leases
 
 Operating leases: Rental in respect of all operating leases are charged
 to Profit & Loss Account.
 
 r.  Other Accounting Policies
 
 These are consistent with the generally accepted accounting practices.