i.  Use of estimates
 
 The preparation of financial statements in conformity with generally
 accepted accounting principles in India requires the management to make
 estimates and assumptions that affect the reported amounts of revenues,
 expenses, assets and liabilities at the date of the financial statement
 and notes thereto and the reported amounts of revenues and expenses
 during the accounting period. Any revision to the accounting estimates
 is recognized prospectively in the current and future periods. Examples
 of such estimates include provision for doubtful debts, economic useful
 lives of fixed assets, etc. Actual results could differ from those
 estimates.
 
 ii.  Fixed assets and depreciation Tangible Fixed assets
 
 Fixed assets, tangible 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. Borrowing costs relating to acquisition of qualifying
 fixed assets which takes substantial period of time to get ready for
 its intended use are also included to the extent they relate to the
 period till such assets are ready to be put to use.
 
 Depreciation
 
 Depreciation is provided using the Straight Line Method as per the
 useful lives of the assets estimated by the management, or at the rates
 prescribed under schedule XIV of the companies Act, 1956 whichever is
 higher. The rates currently applied as follows:
 
 Capital work-in-progress includes the cost of fixed assets that are not
 ready for their intended use and advances paid to acquire the fixed
 assets.
 
 iii. Intangible assets
 
 Intangible assets acquired separately are measured on initial
 recognition at cost. Following initial recognition, intangible assets
 are carried at cost less accumulated amortization and accumulated
 impairment losses, if any.
 
 Intangible assets are amortized on a straight line basis over the
 estimated useful economic life. The amortization period and
 amortization method are reviewed at least at each financial year end.
 If the expected useful life of the asset is significantly different
 from previous estimates, the amortization period is changed
 accordingly. Gain or losses arising from derecognition of an intangible
 asset are measured as the difference between the net disposal proceeds
 and the carrying amount of the asset and are recognized in the
 statement of Profit and loss, when the asset is derecognized.
 
 iv.  Impairment
 
 a.  The carrying amounts of assets are reviewed at each balance sheet
 date to see if there is any indication of impairment based on
 internal/external factors. An impairment loss is recognized 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.
 
 b.  After impairment, depreciation is provided on the revised carrying
 amount of the asset over its remaining useful life.
 
 v.  Investment
 
 Investments that are readily realizable 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, any decline, other than temporary, in the value of the
 investments is charged to the profit and loss account.
 
 vi.  Revenue recognition Software service income
 
 a.  Revenue from software testing on software testing and allied
 services comprises revenue from time and material contracts and fixed
 price contracts.
 
 b.  Revenue from time-and-materials contracts is recognized based on
 time/efforts spent on software tested and billed to clients as per the
 terms of specific contracts.
 
 c.  On fixed-price contracts, revenue is recognized on the
 proportionate completion method on the basis of the work completed.
 
 d.  Revenue from software testing includes reimbursement of expenses
 billed as per the terms of contracts.
 
 Interest income
 
 Interest on deployment of surplus funds is recognized using the
 time-proportion method.
 
 Government grant
 
 Government grant is recognized upon confirmation of the entitlement of
 the grant.
 
 vii. Retirement and other employee benefits
 
 a.  Retirement benefits in the form of Provident Fund / Social Security
 payments is defined contribution schemes and the contributions are
 charged to the Profit and Loss Account of the year when the
 contributions are made to the concerned authorities. The Company has no
 further obligations under the plan beyond its periodic contributions.
 
 b.  Gratuity liability is a defined benefit obligation and is provided
 for on the basis of an actuarial valuation made at the end of each
 financial year under the projected unit credit method. Actuarial
 Gains/Losses comprise experience adjustments and the effect of changes
 in actuarial assumptions and are recognized immediately in Profit &
 Loss Account as Income/Expense.
 
 c.  The company does not allow leave encashment on retirement. However,
 appropriate provision has been made based on estimates for the accrued
 and unaveiled leave entitlements which are short-term in nature.
 
 viii.  Taxation
 
 Tax expense comprises current tax, deferred tax charge or credit and
 Minimum Alternate Tax credit. Current income tax is measured at the
 amount expected to be paid to the tax authorities in accordance with
 the relevant tax laws of each country. 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, deferred tax assets are recognised only if there is virtual
 certainty supported by convincing evidence that such deferred tax
 assets can be realised against future taxable profits.
 
 The company has got two 100% Export Oriented Unit (EOU)
 registered with the Software Technology Parks of India (STPI) one
 in Chennai and another in Bengaluru. The Company has operations in
 Special Economic Zone (SEZ) - MEPZ Tambaram, also from the financial
 year 2009-10. The Company enjoyed tax holiday for Export earnings
 relating to its EOU in Chennai under Section 10A of the Income Tax
 Act,1961 till the financial year 2009-10. Such tax holiday is available
 for the financial year 2010-11 also in respect of export earnings
 relating to its EOU in Bengaluru. Income from MEPZ''s is fully tax
 exempt for the first five years, 50% exempt for the next five years and
 50% exempt for another five years subject to fulfilling certain
 conditions.
 
 MAT Credit is measured at the amounts of Minimum Alternative Tax
 payable for the year, which is adjustable against regular tax payable
 in subsequent years and is recognized to the extent considered probable
 of such adjustment.
 
 ix.  Earnings per share
 
 Basic earnings per share are 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 earnings per share, 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.
 
 x.  Foreign currency transactions and translations
 
 a.  Initial recognition
 
 Foreign currency transactions are recorded in the reporting currency,
 by applying to the foreign currency amount the exchange rate between
 the reporting currency and the foreign currency at the date of the
 transaction. Income and expenditure transactions of the foreign
 operations are recognized at the rate on transaction date / average
 rate applicable for the year.
 
 b.  Conversion
 
 Foreign currency monetary items are reported using the closing rate.
 Non-monetary items which are carried in terms of historical cost
 denominated in a foreign currency are reported using the exchange rate
 at the date of the transaction.
 
 c.  Exchange differences
 
 Exchange differences arising on the settlement of monetary items 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.  Exchange
 differences on account of conversion of foreign operations are also
 recognized as income or as expenses in the year in which they arise.
 
 d.  Forward contracts in foreign currency
 
 The Company uses, to a limited extent, foreign exchange forward
 contracts to hedge its exposure to movements in foreign exchange rates.
 The company does not use the foreign currency forward contracts for
 trading or speculation purposes. Realized/unrealized gains and losses
 on forward contracts are accounted in the profit and loss account for
 the period. Premium/Discount on forward contracts are accounted over
 the contract period.
 
 e.  Transalation of integral and non-integral foreign operation
 
 The company classifies all its foreign operation as either integral
 foreign operations. The financial statements of an integral foreign
 operation are translated as if the transactions of the foreign
 operation have been those of the company itself.
 
 xi.  Provisions
 
 A provision is recognised when an enterprise has a present obligation
 as a result of past event and 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.
 
 xii. Leases
 
 Where the company is lessee
 
 Leases where the lessor effectively retains substantially all the risks
 and benefits of ownership of the leased term, are classified as
 operating leases. Operating lease payments are recognized as an expense
 in the Profit and Loss account as per the terms of the agreements over
 the lease term.
 
 Where the company is lessor
 
 Operating lease receipts are recognized as Other Income in the Profit
 and Loss account as per the terms of the agreements over the sub lease
 period
 
 xiii.  Employee stock compensation cost
 
 Measurement and disclosure of the employee share-based payment plans is
 done in accordance with the Guidance Note on Accounting for Employee
 Share-based Payments, issued by the Institute of Chartered Accountants
 of India. The Company measures compensation cost relating to employee
 stock options using the intrinsic value method. Compensation expense is
 amortized over the vesting period of the option on a straight line
 basis.
 
 xiv. Segment information Business segments
 
 The group''s operations predominantly relate to software validation and
 verification services relating to banking and financial services
 industry and, accordingly, this is the only primary reportable segment.
 
 Geographical segments
 
 The segmental information is provided on geographical basis classified
 as India and Rest of the World.
 
 xv.  Cash flows
 
 Cash flows are reported using indirect method, whereby net profit
 before tax is adjusted for the effects of transactions of a non-cash
 nature and any deferrals or accruals of past or future cash receipts or
 payments. The cash flows from regular revenue generating, investing and
 financing activities are segregated.
 
 Cash and cash equivalents: Cash and cash equivalents, in the statement
 of cash flow, comprise cash at bank and in hand and fixed deposits with
 original maturity of maximum 90 days.
 
 xvi. Contingent liabilities
 
 A contingent liability is a possible obligation that arises due to past
 events whose existence will be confirmed by the occurrence or
 non-occurrence of one or more uncertain future events beyond the
 control of the company or a present obligation that is not recognized
 because it is not probable that an outflow of resources will be
 required to settle the obligation. A contingent liability also arises
 in extremely rare cases where there is a liability that cannot be
 recognized because it cannot be measured reliably. The company does not
 recognize a contingent liability but discloses its existence in the
 financial statements
 
 b.  Terms/rights attached to equity shares
 
 The company has only one class of equity shares having a par value of
 Rs.10 per share. Each holder of equity share is entitled to one vote
 per share. The company declares and pays dividend in Indian rupees. The
 dividend proposed by Board of Directors is subject to approval of the
 shareholders in the ensuing Annual General Meeting