1.  Nature of Operations
 
 Spanco Limited (''Spanco'' or ''the Company'') is in the business of
 creating Technology Infrastructure to help drive governance efficiency
 across key sectors. Spanco is SEI CMM Level 3 and ISO 9001:2008
 certified.
 
 Spanco caters to large complex Technology Infrastructure projects
 across Government, Power, Transport and Telecom Service Provider''s
 space. Spanco has been an active player in creation of Technology
 Infrastructure for over a decade and today ranks amongst the best in
 India. It has presence across India and provide high quality, cost
 effective scalable Technology Infrastructure solutions. Spanco has
 recently entered into business of Power Distribution. It already has a
 formidable presence over a decade in the BPO space catering to India,
 US/Europe, Middle East and African markets.
 
 Spanco''s Business Unit in Government, eGovernance and Transport are
 predominantly focused on building core infrastructure and providing
 services to help drive better and more effective governance.
 
 Service Provider Business Unit of Spanco caters to carriers in India
 providing solutions to meet networking infrastructure requirements of
 its clients using cutting-edge technologies.
 
 Spanco''s offerings within the Power space revolve around utilizing
 information technology to increase the efficiency of power
 distribution. Spanco is empanelled as a System Integrator with Power
 Finance Corporation (PFC) and aggressively participating in
 modernization programs like RAPDRP and Distribution Franchise. In Power
 Distribution business, Spanco has bagged Input based Nagpur Power
 Distribution Franchisee (DF) contract in the state of Maharashtra and
 is aggressively participating in Power DF tenders across India.
 
 2) Statement of Significant Accounting Policies
 
 a.  Basis of Preparation
 
 The financial statements have been prepared to comply in all material
 respects with the Notified Accounting Standards by Companies
 (Accounting Standards) Rules, 2006 ''As amended'' and the relevant
 provisions of the Companies Act, 1956. The financial statements have
 been prepared under the historical cost convention on an accrual basis
 for wherein provision for impairment is made. The accounting policies
 applied by the Company are consistent with those used in the previous
 year.
 
 b.  Use of Estimates
 
 The preparation of financial statements in conformity with Generally
 Accepted Accounting Principles (GAAP) requires the management to make
 estimates and assumptions that affect the reported amounts of assets
 and liabilities and disclosure of contingent liabilities at the date of
 the financial statements and the results of operations during the
 reporting period end.  Although these estimates are based upon
 management''s best knowledge of current events and actions, actual
 results could differ from these estimates. The difference between the
 actual result and estimate are recognised in the period in which
 results are known or materialised.
 
 c.  Fixed Assets and Capital Work-in-Progress
 
 Fixed assets are stated at cost, less accumulated depreciation and
 impairment losses if any. Cost comprises the purchase price and any
 attributable cost of bringing the asset to its working condition for
 its intended use.
 
 In respect of accounting periods commencing on or after December 7,
 2006, but not beyond March 31, 2012, exchange differences arising on
 reporting of the long-term foreign currency monetary items at rates
 different from those at which they were initially recorded during the
 period, or reported in the previous financial statements are added to
 or deducted from the cost of the asset and are depreciated over the
 balance life of the asset, if these monetary items pertain to the
 acquisition of a depreciable fixed asset.
 
 Capital Work-in-Progress is carried at cost comprising of direct cost,
 attributable interest and related incidental expenditure.  The advances
 given for acquiring fixed assets are shown under Capital
 Work-in-Progress.
 
 d.  Depreciation / Amortisation
 
 Depreciation is provided on fixed assets (other than assets for the
 Build-Own-Operate-Transfer (BOOT) project, leasehold improvements and
 intangible assets) on written down value method at the rates and in the
 manner prescribed under Schedule Plant and Machinery acquired for BOOT
 projects is amortised over the life of projects. Leasehold Improvements
 are amortised over the un-expired period of leasehold premises on a
 straight-line basis.
 
 e.  Impairment
 
 i. 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 impairment loss is recognised wherever the
 carrying amount of an asset exceeds its recoverable amount. The
 recoverable amount is the 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 their present value at the weighted average
 cost of capital.
 
 ii.  After impairment, depreciation is provided on the revised carrying
 amount of the asset over its remaining useful life.
 
 f.  Intangible Assets Goodwill
 
 Goodwill is amortised on a straight-line basis over a period of ten
 years.
 
 Patent
 
 Costs relating to patents, which are acquired, are capitalised and
 amortised on a straight-line basis over a period of five years (useful
 life as assessed by the management).
 
 Software
 
 Software is capitalised where it is expected to provide future enduring
 economic benefits. Capitalisation costs include license fees and costs
 of implementation / system integration services. The management
 estimates the useful lives of intangible assets to be five years and
 expects to derive economic benefits from such assets evenly over the
 period of its useful life.  Accordingly, software is amortised over a
 period of five years on a straight- line basis.
 
 g.  Leases
 
 Finance leases, which effectively transfer to the Company substantially
 all the risks and benefits incidental to ownership of the leased item,
 are capitalised at the lower of the fair value and present value of the
 minimum lease payments at the inception of the lease term and disclosed
 as leased assets. Lease payments are apportioned between the finance
 charges and reduction of the lease liability based on the implicit rate
 of return. Finance charges are charged directly against income. Lease
 management fees, legal charges and other initial direct costs are
 capitalised.
 
 If there is no reasonable certainty that the Company will obtain the
 ownership by the end of the lease term, capitalised leased assets are
 depreciated over the shorter of the estimated useful life of the asset
 or the lease term.
 
 Leases where the lessor effectively retains substantially all the risks
 and benefits of ownership of the leased item are classified as
 operating leases. Operating lease payments are recognised as an expense
 in the Profit and Loss account on a straight-line basis over the lease
 term.
 
 Assets subject to operating leases have been included under the head
 ''Investment Property'' and ''Fixed Assets''. Lease income is recognised in
 the Profit and Loss Account on a straight-line basis over the lease
 term. Costs, including depreciation are recognised as an expense in the
 Profit and Loss Account. Initial direct costs such as legal costs,
 brokerage costs, etc. are recognised immediately in the Profit and Loss
 Account.
 
 h.  Borrowing Cost
 
 Borrowing Cost that are directly attributable to the acquisition,
 construction or production of a qualifying asset are capitalised as
 part of the cost of the asset. A qualifying asset is one that necessary
 takes substantial period of time to get ready for intended use or sale.
 Other borrowing costs are recognised as an expense in the period in
 which they are incurred.
 
 i.  Investments
 
 Investments that are readily realisable 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 are carried at
 cost. However, provision for diminution in value is made to recognise a
 decline other than temporary in the value of the investments.
 Investment property is amortised at the rate of 5% p.a. on written down
 value.
 
 j.  Inventories
 
 Inventories of Raw Materials and Consumables
 
 Inventories are ascertained on First-in-First-out method, and are
 valued at lower of cost and net realisable value.
 
 Inventories of Traded Goods
 
 Inventories are ascertained on the specific identification of cost
 method, and are valued at lower of cost and net realisable value. Net
 realisable value is the estimated selling price in the ordinary course
 of business, less estimated costs of completion and estimated costs
 necessary to make the sale.
 
 Software Developed and held for Sale
 
 Software products developed / under development are stated at lower of
 cost and net realisable value.
 
 Research costs are expensed as incurred. Development expenditure
 incurred on an individual project is carried forward when its future
 recoverability can reasonably be regarded as assured.
 
 Software development costs incurred on products ready for marketing are
 amortised equally over a period of four years or earlier, based on
 Management''s evaluation of expected sales volumes and duration of the
 products'' life cycles.
 
 Work-in-progress
 
 The work in process in case of network engineering services and other
 projects is valued based on the percentage of completion of work under
 respective contracts.
 
 k.  Revenue Recognition
 
 Revenue is recognised to the extent that it is probable that the
 economic benefits will flow to the Company and the revenue can be
 reliably measured.
 
 Sale of Goods
 
 Revenue is recognised on delivery / dispatch of goods when the
 significant risks and rewards of ownership of the goods have passed to
 the buyer. Excise Duty, Sales Tax and VAT included in the amount of
 turnover are deducted from turnover (gross).
 
 Supply of Power
 
 Revenue from sale of electrical energy is accounted for on the basis of
 billing to consumers & is inclusive of energy charges, fixed charges,
 fuel adjustment charges (FAC), adjustment charges and additional
 charges as per the relevant Tariff Regulation /Tariff orders notified
 by
 
 MERC and DF agreement with MSEDCL. Generally all consumers are billed
 on the basis of recording of energy consumption by installed meters.
 Where meters have stopped working or are faulty, the bills are
 generated on the basis of average of the consumption recorded by
 installed meters for past 12 months.
 
 Interest on overdue receivables of energy bills is accounted for as &
 when recovered as PF penalty and incentive.
 
 Income from Services
 
 Revenues from maintenance contracts / network integration services are
 recognised pro-rata over the period of the contract as and when
 services are rendered. Revenue and costs associated with network
 engineering services are recognised as revenue and expenses
 respectively by reference to the stage of completion of the project at
 the balance sheet date.
 
 Software Sales
 
 Software sales are recognised on customers'' acceptance of delivery.
 
 Interest
 
 Revenue is recognised on a time proportion basis taking into account
 the amount outstanding and the rate applicable.
 
 l.  Foreign Currency Translation
 
 (i) Initial Recognition
 
 Foreign currency transactions are recorded in the reporting currency,
 by applying to the foreign currency amount the exchange rate prevailing
 between the reporting currency and the foreign currency on the date of
 the transaction.
 
 (ii) Conversion
 
 Foreign currency monetary items are reported using the rate prevailing
 at the year end.
 
 (iii) Exchange Differences
 
 Exchange differences, in respect of accounting periods commencing on or
 after December 7, 2006, arising on reporting of long-term foreign
 currency monetary items at rates different from those at which they
 were initially recorded during the period, or reported in previous
 financial statements, in so far as they relate to the acquisition of a
 depreciable capital asset, are added to or deducted from the cost of
 the asset and are depreciated over the balance life of the asset, and
 in other cases, are accumulated in a Foreign Currency Monetary Item
 Translation Difference Account in the enterprise''s financial
 statements and amortised over the balance period of such long-term
 asset / liability but not beyond accounting period ending on or before
 March 31, 2012.
 
 Exchange differences arising on the settlement of monetary items not
 covered above, or on reporting such monetary items of company at rates
 different from those at which they were initially recorded during the
 year, or reported in previous financial statements, are recognised as
 income or as expenses in the year in which they arise.
 
 (iv) Forward Exchange Contracts not intended for trading or speculation
 purposes
 
 The premium or discount arising at the inception of forward exchange
 contracts is amortised as expense or income over the life of the
 contract. Exchange differences on such contracts are recognised in the
 statement of profit and loss in the year in which the exchange rates
 change. Any profit or loss arising on cancellation or renewal of
 forward exchange contract is recognised as income or as expense for the
 year. The Company does not enter into forward exchange contracts for
 trading or speculation purposes.
 
 m.  Employee Benefits
 
 Short Term Employee Benefits
 
 Short term employee benefits are recognised as expenses at the
 undiscounted amount in the Profit and Loss Account of the year in which
 the related services are rendered.
 
 Retirement Benefits
 
 i. Provident Fund is a defined contribution scheme and the
 contributions are charged to the Profit and Loss Account of the year
 when the contributions to the respective funds are due.
 
 ii. Gratuity liability is a defined benefit obligation and is provided
 for on the basis of actuarial valuation on projected unit credit method
 made at the end of each year. The gratuity liability is funded through
 group gratuity insurance scheme of Life Insurance Corporation of India.
 
 iii.  Long term compensated absences are provided for based on
 actuarial valuation. The actuarial valuation is done as per projected
 unit credit method at the end of each year.
 
 iv.  Actuarial gains / losses are immediately taken to Profit and Loss
 Account.
 
 n.  Accounting for Taxes on Income
 
 Tax expense comprises of current and deferred tax. Current income tax
 is measured at the amount expected to be paid to the tax authorities in
 accordance with the Indian Income Tax Act. Deferred income taxes
 reflect 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. In situations
 where the Company has unabsorbed depreciation or carry forward tax
 losses, all deferred tax assets are recognised only if there is virtual
 certainty supported by convincing evidence that they can be realised
 against future taxable profits.
 
 At each Balance Sheet date the Company re-assesses unrecognised
 deferred tax assets. It recognises unrecognised deferred tax assets to
 the extent that it has become reasonably certain or virtually certain,
 as the case may be that sufficient future taxable income will be
 available against which such deferred tax assets can be realised.
 
 The carrying amount of deferred tax assets are reviewed at each balance
 sheet date. The Company writes-down the carrying amount of a deferred
 tax asset to the extent that it is no longer reasonably certain or
 virtually certain, as the case may be, that sufficient future taxable
 income will be available against which deferred tax asset can be
 realised. Any such write-down is reversed to the extent that it becomes
 reasonably certain or virtually certain, as the case may be, that
 sufficient future taxable income will be available.
 
 o.  Expenditure on New Projects (including arrangements on BOOT basis)
 
 Expenditure directly relating to setting up of projects is capitalised.
 Indirect expenditure incurred during setting-up period is capitalised
 as part of the indirect setting-up cost to the extent to which the
 expenditure is directly related to construction or is incidental
 thereto. Other indirect expenditure incurred during the setting-up
 period which is not related to the setting-up activity nor is
 incidental thereto is charged to the Profit and Loss Account. Income
 earned during setting-up phase is deducted from the total of the
 indirect expenditure.
 
 p.  Earnings Per Share (''EPS'')
 
 Basic EPS is calculated by dividing the net profit or loss for the
 period attributable to equity shareholders by the weighted average
 number of equity shares outstanding during the period.
 
 For the purpose of calculating diluted EPS, the net profit or loss for
 the period attributable to equity shareholders and the weighted average
 number of shares outstanding during the period are adjusted for the
 effects of all dilutive potential equity shares.
 
 q.  Provisions / Contingent Liabilities and Contingent Asset
 
 A provision is recognised 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 the current best
 estimates.
 
 Contingent Liabilities are disclosed by way of Notes to Accounts.
 Contingent Assets are not recognised in the Financial Statements.
 
 r.  Cash and Cash Equivalents
 
 Cash and cash equivalents in the balance sheet comprise cash at bank
 and in hand.
 
 s.  Prior Period Items
 
 Prior Period Items are included in the respected heads of accounts and
 material items are disclosed by way of Notes to Accounts.
 
 t.  Other Accounting Policies
 
 These are consistent with the Generally Accepted Accounting Principles.