Status of Investor Complaints for the quarter ended March 31, 2009

Complaints Pending at the beginning of the quarter Nil

Complaints Received during the quarter 30

Complaints disposed off during the quarter 30

Complaints unresolved at the end of the quarter Nil

1. The above financial statements were reviewed by the Audit Committee and approved by the Board of Directors at their respective meetings held on April 25, 2009 and April 26, 2009. There are no qualifications in the Auditors´ report on these financial statements.

2. During the year ended March 31, 2009, the Company allotted 3,000 fully paid up equity shares of Rs. 10/- each, to an employee, in pursuance of the stock options exercised in July 2008.

3. The Board of Directors recommended a Final Dividend of Rs 2.50/- per share (on equity share of par value of Rs. 10/-} at their Board meeting held on April 26, 2009. The payment is subject to the approval of the shareholders at the ensuing Annual General Meeting of the Company.

4. Mr. Janki Ballabh has been appointed as an Additional Director on the Board with effect from November 15, 2008. He assumed Chairmanship of the Board consequent to Lt. Gen, T. P. Singh (Retd.) relinquishing office on November 15, 2008.

5. The Company made an additional investment of EURO 100,000 in Nucleus Software Netherlands B. V., its wholly owned subsidiary by way of subscription to its equity share capital during the quarter ended March 31, 2009.

6. During the year ended March 31, 2009, the Company incorporated a wholly-owned subsidiary, Nucleus Software Ltd in India, as a part of expansion plans and made an investment of Rs. 10 crore by subscribing to the equity share capital of the subsidiary. In addition, the Company disbursed a loan of Rs 2.51 crore to the subsidiary, which is repayable after three years from the date of commencement of operations.

7. During the year ended March 31, 2009, the Company received Interim dividend of Rs 4.25 crore from VirStra-1 Technology Services Ltd , a wholly owned subsidiary.

8. The Finance Act, 2007 included Fringe Benefit Tax {FBT) on Employee Stock Options Plan (ESOPs). FBT liability crystallizes on the date of exercise of stock options. During the year ended March 31, 2009, 3,000 equity shares were issued pursuant to the exercise of stock options by an employee under ESOP 2002 Scheme. FBT on exercise of stock options has been paid by the company and subsequently recovered from the employee.

9. The Company follows Accounting Standard (AS) 30 - Financial Instruments: Recognition and Measurement to the extent that the adoption does not conflict with existing mandatory accounting standards and other authoritative pronouncements and other regulatory requirements. Effective April 01, 2008, the Company adopted hedge accounting in accordance with principles set out in AS 30. If the Company, would have not adopted hedge accounting, net profit before tax for the quarter and year ended March 31, 2009, would have been higher by Rs 1.77 crore and lower by Rs. 0.97 crores respectively.

10. The Board of Directors, at their meeting held on April 26, 2009, approved closure of two wholly owned subsidiaries viz. Nucleus Software (Australia) Pty Ltd,, Australia and Nucleus Software (HK) Ltd., Hongkong subject to approvals, which may be required from regulatory authorities in India and respective host countries. The future prospects in these countries would be looked after by the Singapore subsidiary, Nucleus Software Solutions Pte. Ltd.

11. Pursuant to the changes in the Indian Income Tax Act, 1961, the Company has calculated its tax liability after considering Minimum Alternate Tax(MAT). A sum of Rs 5.73 crore is carried forward and shown under Loans and Advances in the Balance Sheet as at March 31, 2009 to be set off against future tax liabilities.

12. Software Development Expenses for the current quarter in the stand alone accounts of the Company include Rs 0.46 crore pertaining to previous quarter. This amount was however, considered in the previous quarter in the consolidated accounts and hence has ´nil´ effect on the consolidated profits for the previous quarter.

13. Provision for taxation includes current tax, deferred tax, fringe benefit tax and income tax for earlier years.

14. Previous period/year figures have been regrouped /reclassified, wherever necessary.

15. Fixed assets used in the Company´s business cannot be specifically identified with any of the reportable segments, as these are used interchangeably between various segments. The Management believes that it is not practicable to provide segment-wise disclosures relating to total assets and liabilities since a meaningful segregation of the available data is not possible.

Vishnu R Dusad
Managing Director