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Notes to Accounts of Softsol India Ltd.

Mar 31, 2016

1. Employee benefits (AS-15):

The following tables summarizes the components of expense / benefit recognized in the Statement of Profit and Loss and Balance Sheet for the respective employee benefit plans.

The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

2. Segment Reporting (AS-17):

The Company is engaged in the business of Software. Since the inherent nature of all software jobs are integrated and govern by the same set of risks and returns and operating in the same economic environment, these are treated as a single Business and Geographical Segment. The said treatment is in accordance with the Accounting Standard - 17, Segment Reporting.

3. Related Party Disclosures (AS-18):

Names of the related parties and nature of relationships and particulars of transactions with the said related parties during the year are as follows:

a) Name of related parties and description of relationship:

i) Key Management Personnel Sri. Madala Srinivasa Rao, Chairman

Sri.Madala Bhaskara Rao, WTD

Sri. Mandava Srinivas, CFO

Sri . B.Laxman, Company Secretary

ii) Subsidiary Comapnay SoftSol Resources Inc., USA

iii) Holding Company SoftSol Technologies Inc., USA (up to 21-09-2015)

4: Information of related parties and the relationship is as identified by the Company on the basis of information available with them and relied upon by the auditors.

5: As the liability for Gratuity is provided on actuarial basis for all the employees of the company as a whole, the amount pertaining to the Key Management Personnel is not ascertainable and therefore not included in the above.

6. Accounting for Taxes on Income (AS-22):

In terms of Accounting Standard 22, there are no deferred tax liabilities (Prev. year-Nil-) Following prudence, no deferred tax asset has been recognized (Previous year -Nil -).

7. Other explanatory information:

8.1.Additional Information as required under Schedule III to the Companies Act, 2013 to the extent applicable to the company:

9.. During the financial year 2005-06, the Govt. of A.P. allotted a land of one acre to the company, bearing Plot No.6, in Sy.No.408/1, I.T. Industries Layout, Madhurawada Village, Visakhapatnam District on outright sale basis under its ICT policy 2005-10 at a consideration of Rs.10.00 lakhs per acre vide MOU dt.13.06.2005 and Agreement for sale of land dt.23.02.2006. Accordingly, the company has paid the consideration and took possession of the same and started developing the same for its IT facility. Subsequently, on getting the permission from the Govt. of India for developing, operating and maintaining IT / ITES SEZ in the said land, the Govt. of A.P. converted the above sale of land into lease and fixed a onetime lease payment of Rs.10.00 lakhs per acre and further fixed an annual lease rental of Rs.1,000/-per acre vide lease deed dated 05.02.2009. As per the above, the GOAP adjusted the amount of Rs.10.00 lakhs paid by the company towards sale consideration for the one time lease premium.

As per the lease deed, the land will be converted from leasehold to freehold after a period of 10 years from the execution of the above lease deed, subject to provisions of the SEZ Act, 2005 / SEZ Rules, 2006.

As the period of 10 years from the execution of the lease deed is not yet completed, the company is continuing to pay the annual lease rental of Rs.1,000/- and showing the said land as a leasehold land in the fixed asset schedule.

10. Trade Receivables include ''84,49,219/- (Previous year ''1,58,35,786) due from SoftSol Resources Inc., a wholly owned foreign subsidiary of this company. Maximum amount outstanding at any time during the year is ''2,48,65,293/-(Prev. Years ''2,00,27,037/-)

11. In the opinion of the board, the assets other than fixed assets and non-current investments, have a value on realization in the ordinary course of business of at least equal to the amount at which they are stated in the balance sheet.

12. Previous year’s figures have been regrouped wherever necessary to conform to the layout adopted in the current year.

13. - Nature of Business

SoftSol Resources, Inc. dba SoftSol Inc. (the “Company”) was incorporated in the state of California on January 11, 1993. The company is a provider of E- commerce, network technology, internet infrastructure and other special technology areas. Its IT services include application development, system integration, IT consulting and staffing, IT project management, domestic and offshore outsourcing. The Company has diverse client-based ranging from large customers to small high-tech startup companies. The Company’s vision is to create a global enterprise by taking a leading role in the revolution in Information Technology to provide highly competent and innovative software solutions.

14. - Summary of Significant Accounting Policies

Basis of Accounting

The Company uses the accrual method of accounting for both financial and income tax reporting.

use of Estimates

The preparation of financial statements and related disclosures in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the period reported. Actual results could differ from those estimates. Estimates are used in accounting for, among other things, allowances for uncollectible receivables, depreciation, employee benefits, taxes, restructuring reserves and contingencies. Estimates and assumptions are reviewed periodically and the effects of revisions are reflected in the Financial Statements in the period they are determined to be necessary.

Cash

Cash consist of cash in Bank. Occasionally, the Company has cash deposited in a financial institutions in excess of federally insured limits.

Accounts Receivable

The company uses the Aging of the Accounts Receivable method for valuation of allowance for bad debts. Accordingly, accounts receivable represents the net realizable value.

Property and Equipment

Property and Equipment are stated at cost. Depreciation is provided principally on a straight-line method over the estimated useful lives of the assets. Estimated useful lives are as follows:

Furniture & Fixtures 7 years

Office Equipment 5 years

Automobile 5 years

The cost of significant additions and replacement of components is capitalized and depreciated while expenditures for maintenance and repairs are charged to expense as incurred. When assets are sold or otherwise disposed of, the cost and related depreciation are removed from the books and the resulting gain or loss is reflected in the determination of net income or loss. Depreciation expense for the year ended March 31, 2016 was $ 4,349.

Long-Lived Assets

The Company accounts for the impairment and disposition of long-lived assets in accordance with FASB ASC No. 360, “Accounting for the Impairment or Disposal of Long-Lived Assets”. ASC No. 360 requires that long-lived assets be reviewed for impairment whenever events or circumstances indicate that the carrying amount of an asset may not be recoverable.

Intangible Assets

Intangible assets consist of the cost to acquire the domain name “SoftSol.com” registered to a third party. It is being amortized on a straight-line basis over the estimated useful lives of 15 years. Amortization expense for the year March 31, 2016 was $ 2,000.

Revenue Recognition

The Company derives revenues from consulting projects which are billed by actual time and expenses incurred. Revenues are recognized on the accrual basis as services are rendered.

For Fixed price projects, the Company recognizes revenue and cost of contracts on the percentage-of-completion method, measured by the percentage of cost incurred to date to estimated total cost for each contract. Management considers total cost to be the best available measure of progress on the contracts.

The asset, costs and estimated earnings in excess of billings on uncompleted contracts, represents revenues recognized in excess of amounts billed. The liability, billings in excess of cost and estimated earnings on uncompleted contracts, represents billings in excess of revenues recognized.

There were no fixed price projects during the year ended March 31, 2016.

Deferred Revenue

Advance payment received for services to be provided under contract agreements are deferred until the requisite service is provided and accepted, at which time revenue is considered earned and recognized. There is no deferred revenue as of March 31, 2016.

Income Taxes

The Company accounts for income taxes in accordance with FASB ASC No. 740 “Accounting for Income Taxes”, which requires an asset and liability approach to financial accounting and reporting of income taxes. Deferred income tax assets and liabilities are computed annually for differences between the financial statement and tax basis of assets and liabilities that will result in taxable or deductible amounts in future based on the enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowance is established when necessary to reduce deferred tax assets to the amount expected to be realized.

Financial Accounting Standards Boards issued FIN 48 now known as ASC No. 740-10 “ Accounting for Uncertainty in Income Taxes” recognizes the tax benefits from uncertain tax positions only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such positions are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement.

The Company’s income tax filings are subject to audit by various taxing authorities. The Company’s open audit periods are 2012-2014. In evaluating the Company’s tax provisions and accruals, future taxable income, and the reversal of temporary differences, interpretations and tax planning strategies are considered. The Company believes their estimates are appropriate based on current facts and circumstances

Advertising Costs

The cost of advertising is charged to expense as incurred.

15. - Concentration of Risk Cash

Cash is maintained with one major financial institutions in the United States. Deposits with one banks exceed the amount of the $250,000 Federal Deposit Insurance Corporation insurance provided on such deposits. The Company has not experienced any losses in such accounts and believes it is into subject to any significant credit risk as all its deposits are maintained in high quality financial institutions.

Accounts Receivable and Sales

The Company performs ongoing credit evaluations of its customers and maintains allowances for potential uncollectible accounts as deemed necessary. The Company generally does not require collateral to secure its accounts receivable. It estimates credit losses based on management’s evaluation of historical experience and current industry trends. Although the Company expects to collect amounts due, actual collections may differ from the estimated amounts.

The Company’s sales to its four major customers, totaled approximately $6 million that accounts for 71% of the Company’s total revenue for the year. Accounts receivable from these three customers as of March 31, 2016 was approximately $543,000 which is 55% of total accounts receivable.

16. - Employee Advances

The advances given to employees are for travel related expenses to which the employees are required to present documentation and any amount not substantiated is refunded to the Company. As of March 31, 2016, the employee advances balance was $ 25,050.

17. Related Party Transactions

The Company is wholly owned by SoftSol India Limited (also known as SIL India), an Indian based company.

Softsol Technologies, Inc. (known as STI) a Nevada Corporation is owned by Mrs. Durga Madala, spouse of Mr. Srinivasa Rao Madala, the Company CEO. The Company has entered into professional services agreement with Softsol Technologies, Inc., and Softsol India Limited. The Company also subleases it office space to STI referred to as rental income.

18. Line of Credit

In February 2014, the Company was granted a line of credit (“LOC”) from Citibank NA of a maximum of $750,000. and renewable every year. In August 2015, the line maximum amount increased to $1,250,000. The line of credit bears an interest of greater of Citibank NA Prime Rate or minimum interest rate plus margin of 0% per annum. In 2015, interest rate was at 3.75%. The LOC is secured by irrevocable standby letter of credit in favor of Citibank NA not to exceed $800,000 issued by Citibank NA, Hyderabad (SIL). As at March 31, 2016, the total amount outstanding under this LOC was $750,000. Interest expense during the year was approximately $27,000.

19. Employee Pension Plan

The Company had a 401 (K) plan known as the SoftSol Resources & MedSoft, Inc. 401 (K) plan (the “Plan”) which was terminated on December 31, 2001. Total accumulated contribution as of March 31, 2016 was $1,896 and is payable to participants.

A new 401 (k) plan known as Softsol Resources Inc. 401(k) Plan (Plan no. 7113353) was adapted effective October 1, 2005. The Plan is available to eligible employees through payroll deductions within statutory and plan limits. There was no matching contribution from the employer for the year ended December 31, 2015.

20. Flexible Spending

The Company has a voluntary flexible spending plan wherein a certain amount of money opted by the employee at the beginning of the plan year to be deducted from employee’s payroll every month. The contributed amount will be used to reimburse the employees for their eligible medical expenses and childcare expenses. As of March 31, 2016 the accumulated contributions was $19,893. This account is included in the accrued expenses and other liabilities account.

21. Vacation Leave

The Company provides paid vacation leave to certain employees of the Company. Vacation leave credits are expensed within the year and are not carried forward the following year, therefore, no accrual is recognized in the financial statements.

22. Income Taxes

The company accounts for income taxes under the provisions of FA SB ASC 740, “Accounting for Income Taxes”. Under ASC 740, deferred taxes are required to be classified based on the financial statement classification of the related assets and liabilities which give rise to temporary differences. Deferred taxes result from temporary differences between the financial statement carrying amounts and the tax bases of assets and liabilities.

All of the income before tax as shown in the Statement of Income for the year ended March 31,2016 is derived in the United States.

23. Commitments under Operating Lease

On April 17, 2013 the Company had entered into agreement with Prologis Limited Partnership I to lease 6,825 square feet office located at 46755 Fremont Boulevard, Fremont, California. The lease has tem of five (5) years beginning June 1, 2013. The future minimum lease payments under this operating lease are as follows.

Rent expense related to this lease including common area maintenance charges of approximately $24,400 totaled approximately $70,400 for the year ended March 31, 2016.

The Company also leases storage space on a month to month basis.

24. Stockholders’ Equity

The Company is authorized to issue up to 1,000,000 shares of its common stock, of which 13,120 shares were issued and outstanding. Softsol India Limited owns all these 13,120 shares.

25. Contingencies

There are no pending legal actions, including arbitrations, class actions and other litigation, arising in connection with the Company’s activities as IT consultants. Legal reserves will be established in accordance with FASB ASC 450 “ Accounting for Contingences”. Once established, reserves are adjusted when there is more information available or when an event occurs requiring a change. There are no legal reserves in the statement of financial condition as of March 31, 2016.

26. Subsequent Events

Subsequent events have been evaluated through May 10, 2016, which is the date the financial statements were available to be issued.


Mar 31, 2015

1. Employee benefits (AS-15):

The following tables summarizes the components of expense / benefit recognized in the Statement of Profit and Loss and Balance Sheet for the respective employee benefit plans.

2. Segment Reporting (AS-17):

The Company is engaged in the business of Software. Since the inherent nature of all software jobs are integrated and govern by the same set of risks and returns and operating in the same economic environment, these are treated as a single Business and Geographical Segment. The said treatment is in accordance with the Accounting Standard - 17, Segment Reporting.

3. Related Party Disclosures (AS-18):

Names of the related parties and nature of relationships and particulars of transactions with the said related parties during the year are as follows:

a) Name of related parties and description of relationship:

i) Key Management Personnel

Sri. Madala Srinivasa Rao, Chairman

Sri.Madala Bhaskara Rao, WTD

Sri. Mandava Srinivas, CFO

Smt. Chavali Lalitha, Company Secretary ( April 2014 to September 2014)

Mr.B.Laxman, Company Secretary ( October' 2014 to March' 2015)

ii) Subsidiary Company

SoftSol Resources Inc., USA

iii) Holding Company

SoftSol Technologies Inc., USA

Note: Information of related parties and the relationship is as identified by the Company on the basis of information available with them and relied upon by the auditors.

4. Accounting for Taxes on Income (AS-22):

In terms of Accounting Standard 22, there are no deferred tax liabilities (Prev. year-Nil-) Following prudence, no deferred tax asset has been recognized (Previous year -Nil -).

5. Contingent liabilities and commitments (AS-29):

(to the extent not provided for)

As at As at Particulars 31st March 31st March 2015 2014 Rs. Rs.

A) Contingent liabilities:

(i) Claims against the company not acknowledged as debt NIL NIL

(ii) Guarantees given by the bankers 26,61,332 16,61,332

(iii) Other money for which the company is contingently liable: Guarantee given to Citi Bank, N.A., for giving Stand by letter of credit (SBLC) to the wholly owned subsidiary of the 9,00,00,000 4,80,80,000 company

B) Commitments:

Estimated amount of contracts remaining to be executed on capital account and NIL 5,00,000 not provided for

6. During the financial year 2005-06, the Govt. of A.P. allotted a land of one acre to the company, bearing Plot No.6, in Sy.No.408/1, I.T. Industries Layout, Madhurawada Village, Visakhapatnam District on outright sale basis under its ICT policy 2005-10 at a consideration of Rs.10.00 lakhs per acre vide MOU dt.13.06.2005 and Agreement for sale of land dt.23.02.2006. Accordingly, the company has paid the consideration and took possession of the same and started developing the same for its IT facility. Subsequently, on getting the permission from the Govt. of India for developing, operating and maintaining IT / ITES SEZ in the said land, the Govt. of A.P. converted the above sale of land into lease and fixed a one time lease payment of Rs.10.00 lakhs per acre and further fixed an annual lease rental of Rs.1,000/- per acre vide lease deed dated 05.02.2009. As per the above, the GOAP adjusted the amount of Rs.10.00 lakhs paid by the company towards sale consideration for the one time lease premium.

As per the lease deed, the land will be converted from leasehold to freehold after a period of 10 years from the execution of the above lease deed, subject to provisions of the SEZ Act, 2005 / SEZ Rules, 2006.

As the period of 10 years from the execution of the lease deed is not yet completed, the company is continuing to pay the annual lease rental of Rs.1,000/- and showing the said land as a leasehold land in the fixed asset schedule.

7. Trade Receivables include Rs. 1,58,35,786/- (Previous year Rs. 1,32,12,849) due from SoftSol Resources Inc., a wholly owned foreign subsidiary of this company. Maximum amount outstanding at any time during the year is Rs. 2,00,27,037/-(Prev. Years Rs. 1,12,17,750/-)

8. In the opinion of the board, the assets other than fixed assets and non-current investments, have a value on realization in the ordinary course of business of atleast equal to the amount at which they are stated in the balance sheet.

9. Previous year's figures have been regrouped wherever necessary to conform to the layout adopted in the current year.


Mar 31, 2014

1. Note: The Company has only one class of shares i.e. equity shares with equal rights for dividend and repayment. Each holder of the shares is entitled to one vote per share.

2. Note: Due by Directors or other officers of the company or any of them either severally or jointly with any persons or due by firms/ private companies in which any director is a partner or a director or a member.

3. Note: Due by Directors or other officers of the company or any of them either severally or jointly with any persons or due by firms/ private companies in which any director is a partner or a director or a member.

4. Employee benefits (AS-15):

The following tables summarizes the components of expense / benefit recognized in the Statement of Profit and Loss and Balance Sheet for the respective employee benefit plans.

5. Segment Reporting (AS-17):

The Company is engaged in the business of Software. Since the inherent nature of all software jobs are integrated and govern by the same set of risks and returns and operating in the same economic environment, these are treated as a single Business and Geographical Segment. The said treatment is in accordance with the Accounting Standard - 17, Segment Reporting.

6. Note: Information of related parties and the relationship is as identified by the Company on the basis of information available with them and relied upon by the auditors.

7. Note: As the liability for Gratuity is provided on actuarial basis for all the employees of the company as a whole, the amount pertaining to the Key Management Personnel is not ascertainable and therefore not included in the above.

8. . Accounting for Taxes on Income (AS-22):

In terms of Accounting Standard 22, there are no deferred tax liabilities (Prev. year-Nil-) Following prudence, no deferred tax asset has been recognized (Previous year -Nil -).

9. Contingent liabilities and commitments (AS-29): (to the extent not provided for)

As at As at Particulars 31st March 31st March 2014 2013 Rs. Rs.

A) Contingent liabilities:

(i) Claims against the company not acknowledged as debt NIL NIL

(ii) Guarantees given by the bankers 16,61,332 27,47,614

(iii) Other money for which the company is contingently liable:

Guarantee given to Citi Bank, N.A., for giving Stand by letter of credit (SBLC) to the wholly owned subsidiary of the company 4,80,80,000 -

B) Commitments:

Estimated amount of contracts remaining to be executed on capital account and not provided for 5,00,000 1,50,00,000

10. During the financial year 2005-06, the Govt. of A.P. allotted a land of one acre to the company, bearing Plot No.6, in Sy.No.408/1, I.T. Industries Layout, Madhurawada Village, Visakhapatnam District on outright sale basis under its ICT policy 2005-10 at a consideration of Rs.10.00 lakhs per acre vide MOU dt.13.06.2005 and Agreement for sale of land dt.23.02.2006. Accordingly, the company has paid the consideration and took possession of the same and started developing the same for its IT facility. Subsequently, on getting the permission from the Govt. of India for developing, operating and maintaining IT / ITES SEZ in the said land, the Govt. of A.P. converted the above sale of land into lease and fixed a one time lease payment of Rs.10.00 lakhs per acre and further fixed an annual lease rental of Rs.1,000/- per acre vide lease deed dated 05.02.2009. As per the above, the GOAP adjusted the amount of Rs.10.00 lakhs paid by the company towards sale consideration for the one time lease premium.

As per the lease deed, the land will be converted from leasehold to freehold after a period of 10 years from the execution of the above lease deed, subject to provisions of the SEZ Act, 2005 / SEZ Rules, 2006.

As the period of 10 years from the execution of the lease deed is not yet completed, the company is continuing to pay the annual lease rental of Rs.1,000/- and showing the said land as a leasehold land in the fixed asset schedule.

11. Trade Receivables include Rs. 1,32,12,849/- (Previous year Rs. NIL) due from SoftSol Resources Inc., a wholly owned foreign subsidiary of this company. Maximum amount outstanding at any time during the year is Rs. 1,32,12,849/-(Prev. Years Rs. 1,35,20,467/-)

12. In the opinion of the board, the assets other than fixed assets and non-current investments, have a value on realization in the ordinary course of business of atleast equal to the amount at which they are stated in the balance sheet.

13. Previous year''s figures have been regrouped wherever necessary to conform to the layout adopted in the current year.


Mar 31, 2013

1.1. Employee benefits (AS-15):

The following tables summarize the components of net benefit recognized in the Statement of Profit and Loss and amounts recognized in the Balance Sheet for the respective employee benefit plans.

1.2. The Company is engaged in the business of Software. Since the inherent nature of all software jobs are integrated and govern by the same set of risks and returns and operating in the same economic environment, these are treated as a single Business and Geographical Segment. The said treatment is in accordance with the Accounting Standard - 17, Segment Reporting.

1.3. Related Party Disclosures (AS-18):

Names of the related parties and nature of relationships and particulars of transactions with the said related parties during the year are as follows:

a) Name of related parties and description of relationship:

i) Key Management Personnel Sri.Madala Bhaskara Rao, WTD.

ii) Subsidiary SoftSol Resources Inc., USA

Note: Information of related parties and the relationship is as identified by the Company on the basis of information available with them and relied upon by the auditors.

1.4. Contingent liabilities and commitments (AS-29): (to the extent not provided for)

As at As at Particulars 31st March 2013 31st March 2012

A) Contingent liabilities:

(i) Claims against the company not acknowledged as debt:- Disputed demands of Income-tax NIL 2,49,59,584

(ii) Guarantees and letters of credit- Guarantees given by the bankers 27,47,614 25,11,332

B) Commitments:

Estimated amount of contracts remaining to be executed on capital account and not provided for 1,50,00,000 1,20,00,000

1.4.2. During the financial year 2005-06, the Govt, of A.P. allotted a land of one acre to the company, bear- ing Plot No.6, in Sy.No.408/1,1.T. Industries Layout, Madhurawada Village, Visakhapatnam District on outright sale basis under its ICT policy 2005-10 at a consideration of Rs. 10.00 lakhs per acre vide MOU dt. 13.06.2005 and Agreement for sale of land dt.23.02.2006. Accordingly, the company has paid the consideration and took possession of the same and started developing the same for its IT facility. Subsequently, on getting the permission from the Govt, of India for developing, operating and main- taining IT / ITES SEZ in the said land, the Govt, of A.P. converted the above sale of land into lease and fixed a one time lease payment of Rs.10.00 lakhs per acre and further fixed an annual lease rental of Rs.1,000/- per acre vide lease deed dated 05.02.2009. As per the above, the GOAP adjusted the amount of Rs. 10.00 lakhs paid by the company towards sale consideration for the one time lease premium.

As per the lease deed, the land will be converted from leasehold to freehold after a period of 10 years from the execution of the above lease deed, subject to provisions of the SEZ Act, 2005 / SEZ Rules, 2006.

As the period of 10 years from the execution of the lease deed is not yet completed, the company is continuing to pay the annual lease rental of Rs. 1,000/- and showing the land as a leasehold land in the fixed asset schedule.

1.4.3. Sundry Debtors include ^ NIL (Previous year Rs.95,08,785/-) due from SoftSol Resources Inc., a wholly owned foreign subsidiary of this company. Maximum amount outstanding at any time during the year is Rs.l,35,20,467/-(Prev. Years Rs.1,77,88,398/-)

1.4.4. In the opinion of the board, the assets other than fixed assets and non-current investments, have a value on realization in the ordinary course of business of atleast equal to the amount at which they are stated in the balance sheet.

1.4.5. As per the scheme of buyback of company''s shares approved in financial year 2009-10, during the year, the company bought back 2,08,197 (Previous Year 5,58,586)equity shares at a total cost of Rs.1,33,61,550/- (Previous Year Rs.3,57,86,315/-). Towards this, an amount of Rs.20,81,970/-, being the amount equivalent to the face value of shares bought back was transferred from statement of Profit & Loss to the Capital Redemption Reserve Account and an amount of Rs. 1,12,79,5 80/- (Prev. Year Rs.3,02,00,455/-) being the amount equivalent to the difference amount between the face value and the actual consideration paid for the shares bought back, was utilized from the balance available in securities premium account.

1.4.6. Previous year''s figures have been regrouped wherever necessary to conform to the layout adopted in the current year.


Mar 31, 2012

1. General Information:

SoftSol India Limited is engaged in development and export of software solution.

2. Contingent Liabilities not provided for:

Particulars As at 31st March 2012 As at 31st March 2011

a) Estimated amount of contracts remaining to be executed on capital account and not provided for 1,20,00,000 1,20,00,000

b) Guarnatees given by the bankers 25,11,332 20,75,000

c) Disputed demands of Income-tax. 2,67,92,384 2,67,92,384

3. Employee benefits:

The following tables summarize the components of net benefit recognized in the Profit and Loss account and amounts recognized in the Balance Sheet for the respective employee benefit plans.

4. The Company is engaged in the business of Software solutions. Accordingly, disclosure of segment information as prescribed in the Accounting Standard 17 "Segment Reporting" is not applicable.

5 In terms of Accounting Standard 22 "Accounting for Taxes on Income" (AS 22) issued by The Institute of Chartered Accountants of India, the Company has accounted for the deferred taxes. The following are the components of deferred tax Assets.

In view of lack of certainty of reversal, no deferred Tax Asset is recognised.

6. The Land of one acre purchased by the company during the financial year 2005-06 was covered under Special Economic Zone vide notification No.S.0.565(E) Dt. 11.04.2007 by Government of Andhra Pradesh. The company entered into lease agreement with Andhra Pradesh Industrial Infrastructure Corporation Limited for a period of 99 years on payment of Rs. 1,000/- per annum towards lease rentals. As per the deed the company is given an option to reconvert the leasehold land to freehold land after a period of 10 year subject to the provisions of SEZ Act, 2005 and SEZ rules without any further payment.

Accordingly the Land, which is treated as freehold during earlier years has been shown as Leasehold Land.

7. As per the information available with the company none of the suppliers informed the company regarding their status as defined under the "Micro, Small and Medium Enterprises Development Act, 2006". Accordingly the information regarding the dues to such suppliers could not be furnished.

8. Fixed Deposit for Rs.25,11,332/- (Previous year Rs.20,75,000/) are in lien with Bankers towards margin against guarantees issued by them.

9. As required by Accounting Standard (AS 28) "Impairment of Assets" issued by the Institute of Chartered Accountants of India, the management has carried out the assessment of impairment of assets and no impairment loss exists during the year.

10. a) In the opinion of the management, the Current Assets, Loans and Advances are expected to realize at least the amount at which they are stated, if realized in the ordinary course of business.

b) Sundry Debtors includes an amount of ^95,08,785/- (Previous year Rs.50,23,125/-) due from a wholly owned foreign subsidiary Company viz., SoftSol Resources Inc.

11. The Board of Directors of the company vide resolution dated 24th October, 2011 approved buyback of 12,90,000 equity shares of Rs.10/- each at a price not exceeding Rs.65/- per share and total cost of buyback is restricted to Rs. 7,00,00,000/-. During the year the company bought back 5,58,586 ( Previous Year 52,604 ) equity shares atRs.3,57,86,315/- (Previous Year Rs.28,78,854/-) inclusive of premium of Rs.3,02,00,455/-(Previous Year Rs.23,52,814/-). The premium of Rs.3,02,00,455/- is adjusted against share premium account and redemption reserve of Rs.55,85,860/- being the face value of shares bought back, created.

12. Previous year figures have been regrouped wherever necessary.


Mar 31, 2011

1. The Land of one acre purchased by the company during the financial year 2005-06 was covered under Spe- cial Economic Zone vide notification No.S.0.565(E) Dt.11.04.2007 by Government of Andhra Pradesh. The company entered into lease agreement with Andhra Pradesh Industrial Infrastructure Corporation Limited for a period of 99 years on payment of Rs. 1,000- per annum towards lease rentals. As per the deed the company is given an option to reconvert the leasehold land to freehold land after a period of 10 year subject to the provisions of SEZ Act, 2005 and SEZ rules without any further payment.

Accordingly the Land, which is treated as freehold during earlier years has been shown as Leasehold Land.

2. As per the information available with the company none of the suppliers informed the company regarding their status as defined under the "Micro, Small and Medium Enterprises Development Act, 2006". Accordingly the information regarding the dues to such suppliers could not be furnished.

3. In terms of Accounting Standard 22 "Accounting for Taxes on income" (AS 22) issued by the Institute of Chartered Accountants of India, the Company has accounted for the deferred taxes during the year.

Major components of Deferred Tax on account of timing differences:

4. Fixed Deposit for Rs.20,75,000/- (Previous year Rs.20,75,000/) are in lien with Bankers towards margin against guarantees issued by them.

5. As required by Accounting Standard (AS 28) "Impairment of Assets" issued by the Institute of Chartered Accountants of India, the management has carried out the assessment of impairment of assets and no impairment loss exists during the year.

6. a) In the opinion of the management, the Current Assets, Loans and Advances are expected to realize at least the amount at which they are stated, if realized in the ordinary course of business.

b) Sundry Debtors includes an amount of Rs.50,23,125/- (Previous year Rs.2,16,67,200/-) due from a wholly owned foreign subsidiary Company viz., SoftSol Resources Inc.

7. The Board of Directors of the company vide resolution dated 30th July 2009 approved buyback of 14,00,000 equity shares of Rs. 10/- each at a price not exceeding Rs.55/- per share and total cost of buyback is restricted to Rs. 7,00,00,000/-. During the year the company bought back 52,604 (Previous Year 9,85,708)equity shares at Rs. 28,78,854/- ( Previous Year Rs.5,37,91,383/-)inclusive of premium of Rs. 23,52,814/-(Previous Year Rs.4,39,34,303/-). The premium of Rs.23,52,814/- is adjusted against share premium account and redemption reserve of Rs.5.26.040/- beine the face value of shares boueht back, created.

8. There are no separate reportable segments as per the accounting Standard -17 " Segmental Reporting " is- sued by the Institute of Chartered Accountants of India.

9. The details of related party transactions in terms of Accounting Standard (AS) 18 are as follows: i) Key Management Personnel

Sri Madala Bhaskara Rao, Whole time Director ii) a) Subsidiary : M/s SoftSol Resources Inc USA (SRI)

b) Associate : M/s SoftSol Technologies Inc, USA (STI)

10. Employee Benefits:

The following table summaries the components of the net benefit recognized in the profit and loss account and amounts recognized in the balance sheet for the respective plans.

11. Previous year figures have been regrouped wherever necessary.


Mar 31, 2010

1. The Land of one acre purchased by the company during the financial year 2005-06 was covered under Special Economic Zone vide notification No.S.0.565(E) Dt. 11.04.2007 by Government of Andhra Pradesh. The company entered into lease agreement with Andhra Pradesh Industrial Infrastructure Corporation Limited for a period of 99 years on payment of Rs. 1,000- per annum towards lease rentals. As per the deed the company is given as an option to reconvert the leasehold land to freehold land after a period of 10 yeas subject to the provisions of SEZ Act, 2005 and SEZ rules without any further payment. Accordingly the Land, which is treated as freehold during earlier years has been shown as Leasehold Land.

2. None of the suppliers provided information to die Company regarding their status as defined under die "Micro, Small and Medium Enterprises Development Act, 2006". Accordingly the information regarding the dues to such suppliers could not be furnished.

3. In terms of Accounting Standard 22 "Accounting for Taxes on income" (AS 22) issued by the Institute of Chartered Accountants of India, the Company has accounted for the deferred taxes during the year. Under prudential concept, the Board of directors decided to recognize the deferred tax asset to the extent of deferred tax liability existing in the books.

4. Fixed Deposit for Rs.20,75,000/- (Previous year Rs.20,75,000) are in lien with Bankers towards margin against guarantees issued by them.

5. As required by Accounting Standard (AS 28) "Impairment of Assets" issued by the Institute of Chartered Accountants of India, the management has carried out the assessment of impairment of assets and no impairment loss exists during the year.

6. 6 year National saving certificates of the face value of Rs.6,000/-(Previous year Rs.6,000/-) shown under investments are in die name of the employees of the company and were pledged with various Government Departments as security.

7. a) In the opinion of the management, the Current Assets, Loans and Advances are expected to realize at least the amount at which they are stated, if realized in the ordinary course of business.

b) Sundry Debtors includes an amount of Rs.2,16,67,200/- (Previous year Rs. 1,01,90,000/-) due from a wholly owned foreign subsidiary Company viz., SoftSol Resources Inc.

8. The Board of Directors of the company vide resolution dated 30th July 2009 approved buyback of 14,00,000 equity shares of Rs. 10/- each at a price not exceeding Rs.55/- per share and total cost of buyback is restricted to Rs.7,00,00,000/ During the year the company bought back 9,85,708 equity shares at Rs. 5,37,91,383/- inclusive of premium of Rs. 4,39,34,303/-. The premium of Rs. 4,39,34,303/- is adjusted against share premium account and redemption reserve of Rs.98,57,080/- being the face value of shares bought back, created

9. Contingent liabilities not provided for on account of:

a) Guarantees given by the bankers 20,75,000 20,75,000

b) Claims against the company not acknowledged as debts 10,91,266 5,95,521

c) Disputed demands of Income Tax 30,36,473 1,82,38,564

10. There are no separate reportable segments as per the accounting Standard -17 " Segmental Reporting " issued by the Institute of Chartered Accountants of India.

11. The details of related party transactions in terms of Accounting Standard (AS) 18 are as follows :

i) Key Management Personnel

Sr. Madala Bhaskara Rao, Whole time Director

ii) a) Subsidiary : M/s. SoftSol Resources Inc., USA (SRI)

b) Associate : M/s. SoftSol Technologies Inc., USA (STI)

12. Employee Benefits:

The following table summaries the components of the net benefit recognized in the profit and loss account and amounts recognized in the balance sheet for the respective plans.

The estimates of future salary increase; considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

13. Previous year figures have been regrouped wherever necessary.

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