A) GENERAL
 
 The accounts of the company are prepared under the historical cost
 convention using the accrual method of accounting.
 
 B) REVENUE RECOGNITION
 
 All expenses, claims and subsidies etc. to the extent considered
 payable and receivable respectively unless specifically stated to be
 otherwise are accounted for on accrual basis.
 
 C) SALES
 
 Sales are inclusive of excise duty.
 
 D) PURCHASE
 
 Purchases are net of modvat receipts, if any.
 
 E) FIXED ASSETS
 
 Fixed assets have continued to be shown at cost less depreciation on
 straight line method at the rates specified in schedule - XIV of the
 Companies Act, 1956 as notified by department of company affairs vide
 notification dated 16-12-93. Further, no depreciation has been charged
 on assets which had not been used during the year.
 
 F) INVENTORIES AND THEIR VALUATION
 
 (As taken, valued and certified by the management)
 
 (i) GENERAL
 
 The company has taken value of trading items at estimated cost as per
 past practice.
 
 (ii) RAW MATERIAL
 
 All raw materials stock except refrigerator and CCTV stocks have been
 valued at last purchase price except PCB stocks which have been valued
 at weighted average minus 25% as compared to reduction of 10% only in
 the previous year. The stocks have become non-usable for production and
 have also become non-moving items. The market value of the same could
 not be ascertained.
 
 (iii) WORK-IN-PROGRESS :
 
 Work in progress, has all been merged with raw material as the same
 could not be converted to finished products.  
 
 (iv) FINISHED STOCK (MANUFACTURED)
 
 Finished goods have been valued at last purchase price of raw material
 cost plus estimated production cost and freight and, reduced by 25% as
 compared to reduction of 10% only in the previous year as the stocks
 have become slow moving.
 
 The amount involved in reduction of cost of raw material and finished
 stock a result of reductions in % AGE as noted in point No. F-(ii) and
 (iv) above calculated to Rs. 33,66,153.00 (previous year Rs.
 22,44,103.00),
 
 (v) Trading items ( Refrigerators, CCTV & Educational Games)                                          
 
 Valued at estimated cost as per past practice.
 
 G) FOREIGN CURRENCY TRANSACTION
 
 First all foreign exchange transactions have been entered at the rate
 prevalent on the dates of transaction. But all amount
 receivable/payable as on 31/03/2000 have been taken at foreign exchange
 rates applicable as on 31/03/2000.
 
 H) EXPORT BENEFITS
 
 No export benefits accrued during the year ended on 31/03/2000.
 
 I) CONTINGENT LIABILITIES
 
 Contingent liabilities are disclosed by way of a note to the balance
 sheet and no provision for the same has been made in accounts.
 Liabilities, if any arising out of contingent shall be accounted for on
 payment basis.
 
 J) GRATUITY
 
 Gratuity payments have been accounted for on payment basis. No
 provision has been made for the liability accrued for those who have
 completed five years as on 31-3-2000 on account of gratuity which could
 not be ascertained for want of details (previous year Rs. 22.16 lacs).
 No gratuity has been provided for nor calculated and ascertained for
 those who have not completed five years on 31/03/2000.
 
 K) BENEFIT ON IMPORTS AND FOREIGN OBLIGATIONS
 
 Benefits against value based advance licences have been accounted for
 on accrual basis.