Accounting Policies of California Software Company Ltd. Company

Mar 31, 2015

Not Available

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Mar 31, 2014

1. Basis of preparation of Financial Statements

The consolidated financial statements consist of:

** California Software Company Ltd (Parent company incorporated in India)

** CSWL, Inc., incorporated in USA (100% Equity held by parent company) and its subsidiaries consisting of

* International Innovations Inc, USA (100% Equity held by CSWL Inc.,)

* Waldron Limited a Corporation incorporated in Hongkong in which CSWL, Inc. owns 100% of outstanding voting stock.

* AspireSoft Corporation (Aspiresoft) in which CSWL Inc holds 100% of the outstanding voting stock (P.Y. 51%).

** Aspire Communications Private limited (Aspire) incorporated in India,a 100% subsidiary of parent company and its 100% subsidary Aspire peripherals Private Ltd, Mysore.

All these financial statements have been prepared under the historical cost convention and comply with accounting standards in all material respects. Of the above CSWL Inc (under liquidation), Aspire Communications P ltd and its subsidiary Aspire peripherals P ltd have stopped their operations entirely. During the year Parent company has disinvested Inatech Infosolutions Private Limited, Bangalore and hence the financial statements do not include those companies results.

The consolidated financial statements are prepared in accordance with the Principles and procedures for the preparation and presentation of consolidated financial statements as laid down under AS-21 prescribed by the Institute of Chartered Accountants of India. Consolidated financial statements are prepared using uniform accounting policies.

The financial statements of the parent Company and subsidiaries have been combined on line by line basis by adding together the book values of like items of assets, liabilities, income & expenses after eliminating intra group balances / transactions.

2. Use of Estimates

The preparation of financial statements in conformity with the generally accepted accounting principles requires the management to make estimates and assumptions that affect the reported amount of assets, liabilities, revenue and expenses and disclosure of contingent liabilities as of the date of the financial statements. The estimates and assumptions used in the accompanying financial statements are based upon the management''s evaluations of the relevant facts and circumstances as of the date of the financial statements. Actual results could differ from these estimates.

3. Revenue Recognition

Revenue from software development is recognised based on software developed and billed to clients as per the terms of specific contracts. Revenue from consultancy services is recognised when the services have been provided to the customer. Revenue from the sale of software products is recognised when the sale is completed with the passing of title. Revenue from maintenance services is accrued over the period of the contract.

Deferred revenue includes amounts currently due and payable from and payments received from customers for various expenses for services and amounts deferred if other conditions to revenue recognition is not met. Deferred revenue that is expected to be earned in the next twelve months is reflected as current liability.

Software revenue from software license agreements is recognized when collection is probable and the product is shipped.

4. Expenditure

Expenses are accounted on the accrual basis and provisions are made for all known losses and liabilities.

5. Fixed Assets

Fixed assets are stated at cost less accumulated depreciation. Cost includes direct costs and financing costs related to borrowing attributable to to qualifying assets. CSWL Inc, Aspire Communications P ltd and its subsidiary Aspire peripherals P ltd is not having any fixed assets.

6. Impairment

Consideration is given at each Balance Sheet date to determine whether there is any modification or impairment of the carrying amount of the fixed assets. If any condition exists, an asset''s recoverable amount is estimated. An impairment loss is recognised whenever the carrying amount of any asset exceeds recoverable amount.

7. Depreciation & Amortization

The parent Company and its Subsidiaries are charging depreciation under straight line method.

8. Leases

In the case of assets taken under operating lease, the rentals are charged to profit and loss account when due.

9. Inventories

As of 31st March 2014, none of the group companies were holding inventory.

10. Investments

Long term investments are stated at cost with provisions where necessary, for diminution other than temporary, in the value of investment.

11. Foreign Currency Transactions

Foreign currency transactions including expenses incurred on Trading/Non Trading Overseas offices and revenue accounts of onsite offices are accounted at the exchange rates ruling on the date of transaction. At the year end all monetary assets and liabilities denominated in foreign currency other than investments are restated at the closing exchange rates. Exchange differences arising out of actual payments/realizations and from the year end restatement referred to above are reckoned in the profit and loss account.

Translation of Financial Statements of the Overseas Subsidiaries denominated in US dollar to Indian rupee.

i) For the purpose of consolidation, the operation of overseas subsidiaries are considered non integral in nature and on the basis of AS-9 prescribed by the Institute of Chartered Accountants of India, during the current financial year with effect from 1 April 2005, their assets and liabilities are translated at the year-end exchange rate. The resultant translation adjustment is reflected as a separate component of Shareholders funds as ''Cumulative Translation Reserve''. Only in case of disposal and dissolution of Non Indian Subsidiaries the balance in Currency Translation reserve in relation to the subsidiary will stand transferred to Profit and Loss Account. Income and expenditure are accounted in the consolidated Profit and Loss Account of each year as given below:

a) Revenues and expenses are converted into Indian Currency at the average rate prevailing during the year.

b) Depreciation on Fixed Assets is converted at the average rate prevailing during the year.

12. Employee Benefits

A) California Software company Limited

The company has transferred its entire employees except one in the administrative office before the end of previous year. PF is being paid as per rules.

B) CSWL Inc, USA

The company has stopped its operations and is having no employees.

C) Aspire communications P Ltd and Aspire Peripherals P ltd did not have any employees during the period.

13. Taxation

Provision for current tax is made based on the liability computed in accordance with the relevant tax rates and tax laws. Provision for deferred tax is made for timing differences arising between the taxable income and accounting income computed at current applicable tax rates. Deferred tax assets are recognised only if there is a virtual certainty that they will be realised in the foreseeable future and are reviewed for the appropriateness of their carrying value at each balance sheet date.

In view of the substantial losses/stoppage of operations, parent company and subsidiaries except Inatech Infosolutions Limited has not considered deferred tax effect.

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Mar 31, 2013

1. Basis of preparation of Financial Statements

The financial statements are prepared under historical cost convention, in accordance with Generally Accepted Accounting Principles ("GAAP") in India and to comply with applicable Accounting Standards notified under Section 211 (3C) of the Companies Act, 1956 and the relevant provisions of the Companies Act, 1956.

2. Use of Estimates

The preparation of financial statements in conformity with the generally accepted accounting principles requires the management to make estimates and assumptions that affect the reported amount of assets, liabilities, revenue and expenses and disclosure of contingent liabilities as of the date of the financial statements. The estimates and assumptions used in the accompanying financial statements are based upon the management''s evaluations of the relevant facts and circumstances as of the date of the financial statements. Actual results could differ from these estimates.

3. Revenue Recognition

Revenue from software development is recognised based on software developed and billed to clients as per the terms of specific contracts.

Revenue from consultancy services is recognised when the services have been provided to the customer.

Revenue from the sale of software products is recognised when the sale is completed with the passing of title.

Revenue from maintenance services is accrued over the period of the contract.

4. Fixed Assets

Fixed assets are stated at cost less accumulated depreciation. Cost includes direct costs and financing costs related to borrowing attributable to qualifying assets.

5. Impairment

Consideration is given at each Balance Sheet date to determine whether there is any modification or impairment of the carrying amount of the fixed assets. If any condition exists, an asset''s recoverable amount is estimated. An impairment loss is recognised whenever the carrying amount of any asset exceeds recoverable amount.

6. Depreciation

Depreciation on tangible fixed assets is calculated on straight- line method at the rates prescribed in Schedule XIV of the Companies Act, 1956, except for computers which are depreciated over a period of 3 Years. Intangible assets are amortized over their estimated useful lives (Computer Software 2 Years ; Product Solutions 5 Years).

Depreciation charge on additions / deletions is restricted to the period of use.

Assets individually costing $ 5,000 or less are fully depreciated in the year of addition.

In the event the useful life of any fixed assets being assessed to be lower than the life derived from the rates specified above, the book value of such assets is charged off as depreciation over their balance useful lives.

7. Leases

In the case of assets taken under operating lease, the rentals are charged to profit and loss account when due.

8. Investments

Long term investments are stated at cost with provisions where necessary, for diminution other than temporary, in the value of investment.

9. Foreign Currency Transactions

Foreign currency transactions including expenses incurred on Trading / Non Trading Overseas offices and revenue accounts of onsite offices are accounted at the exchange rates ruling on the date of transaction. At the year end all monetary assets and liabilities denominated in foreign currency other than investments are restated at the closing exchange rates. Exchange differences arising out of actual payments / realisations and from the year end restatement referred to above are reckoned in the profit and loss account.

10. Employee Benefits

The Company has transferred its entire employees except one in the administrative office before the end of this year. However till the date of such transfer following employee benefits were provided.

a. Short Term

Short term Employee Benefits are recognised as expenses as per the company''s scheme based on the expected obligation.

b. Long Term

Liability in respect of long term Employee Benefits in the nature of accumulated compensated absence is provided for based on actuarial valuation using projected unit credit method.

c. Post Retirement

i) Provident fund

This is a defined contribution plan and contributions made to the fund, in accordance with the applicable rules/statutes are charged to revenue. The Company has no further obligation for future provident fund benefits other than aforesaid contributions.

ii) Superannuation

This is a defined contribution plan. The Company contributes a sum equivalent to 15% of eligible employee''s salary towards superannuation fund administered by Life Insurance Corporation of India and are charged to profit and loss account.

iii) Gratuity

This is a defined benefit plan. The Company has subscribed to California Software Company Employees'' Group Gratuity Scheme, which is being administrated by a Trust set up for this purpose under the aegis of the Life Insurance Corporation of India (LIC). Liabilities with regard to the Gratuity payable to the employees are determined by actuarial valuation using projected unit credit method, based upon which, the Company makes contribution to the Trust. The funds contributed to the Trust are remitted to the LIC. Actuarial gains and losses comprising of experience adjustments and the effects of changes in actuarial assumptions are recognised immediately in the profit and loss account as income or expense.

11. Taxation

Provision for current tax is made based on the liability computed in accordance with the relevant tax rates and tax laws. Provision for deferred tax is made for timing differences arising between the taxable incomes and accounting income computed at current applicable tax rates. Deferred tax assets are recognised only if there is a virtual certainty that they will be realised in the foreseeable future and are reviewed for the appropriateness of their carrying value at each balance sheet date. As the company has been incurring losses for several years now entire deferred tax asset has been written back in the previous year.

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Mar 31, 2011

1. Basis of preparation of Financial Statements

The financial statements are prepared under historical cost convention, in accordance with Generally Accepted Accounting Principles (“GAAP”) in India and to comply with applicable Accounting Standards notified under Section 211 (3C) of the Companies Act, 1956 and the relevant provisions of the Companies Act, 1956.

2. Use of Estimates

The preparation of financial statements in conformity with the generally accepted accounting principles requires the management to make estimates and assumptions that affect the reported amount of assets, liabilities, revenue and expenses and disclosure of contingent liabilities as of the date of the financial statements. The estimates and assumptions used in the accompanying financial statements are based upon the management's evaluations of the relevant facts and circumstances as of the date of the financial statements. Actual results could differ from these estimates.

3. Revenue Recognition

Revenue from software development is recognised based on software developed and billed to clients as per the terms of specific contracts. Revenue from consultancy services is recognised when the services have been provided to the customer.

Revenue from the sale of software products is recognised when the sale is completed with the passing of title. Revenue from maintenance services is accrued over the period of the contract.

4. Fixed Assets

Fixed assets are stated at cost less accumulated depreciation. Cost includes direct costs and financing costs related to borrowing attributable to qualifying assets.

5. Impairment

Consideration is given at each Balance Sheet date to determine whether there is any modification or impairment of the carrying amount of the fixed assets. If any condition exists, an asset’s recoverable amount is estimated. An impairment loss is recognised whenever the carrying amount of any asset exceeds recoverable amount.

6. Depreciation

Depreciation on tangible fixed assets is calculated on straight-line method at the rates prescribed in Schedule XIV of the Companies Act, 1956, except for computers which are depreciated over a period of 3 Years. Intangible assets are amortized over their estimated useful lives (Computer Software 2 Years ; Product Solutions 5 Years).

Depreciation charge on additions / deletions is restricted to the period of use.

Assets individually costing Rs.5,000 or less are fully depreciated in the year of addition.

In the event the useful life of any fixed assets being assessed to be lower than the life derived from the rates specified above, the book value of such assets is charged off as depreciation over their balance useful lives.

7. Leases

In the case of assets taken under operating lease, the rentals are charged to profit and loss account when due.

8. Investments

Long term investments are stated at cost with provisions where necessary, for diminution other than temporary, in the value of investment.

9. Foreign Currency Transactions

Foreign currency transactions including expenses incurred on Trading / Non Trading Overseas offices and revenue accounts of onsite offices are accounted at the exchange rates ruling on the date of transaction. At the year end all monetary assets and liabilities denominated in foreign currency other than investments are restated at the closing exchange rates. Exchange differences arising out of actual payments / realisations and from the year end restatement referred to above are reckoned in the profit and loss account.

10. Employee Benefits

a. Short Term

Short term Employee Benefits are recognised as expenses as per the company’s scheme based on the expected obligation.

b. Long Term

Liability in respect of long term Employee Benefits in the nature of accumulated compensated absence is provided for based on actuarial valuation using projected unit credit method.

c. Post Retirement

i) Provident fund

This is a defined contribution plan and contributions made to the fund, in accordance with the applicable rules/statutes are charged to revenue. The Company has no further obligation for future provident fund benefits other than aforesaid contributions.

ii) Superannuation

This is a defined contribution plan. The Company contributes a sum equivalent to 15% of eligible employee’s salary towards superannuation fund administered by Life Insurance Corporation of India and are charged to profit and loss account.

iii) Gratuity

This is a defined benefit plan. The Company has subscribed to California Software Company Employees’ Group Gratuity Scheme, which is being administrated by a Trust set up for this purpose under the aegis of the Life Insurance Corporation of India (LIC). Liabilities with regard to the Gratuity payable to the employees are determined by actuarial valuation using projected unit credit method, based upon which, the Company makes contribution to the Trust. The funds contributed to the Trust are remitted to the LIC. Actuarial gains and losses comprising of experience adjustments and the effects of changes in actuarial assumptions are recognised immediately in the profit and loss account as income or expense.

11.Taxation

Provision for current tax is made based on the liability computed in accordance with the relevant tax rates and tax laws. Provision for deferred tax is made for timing differences arising between the taxable incomes and accounting income computed at current applicable tax rates. Deferred tax assets are recognised only if there is a virtual certainty that they will be realised in the foreseeable future and are reviewed for the appropriateness of their carrying value at each balance sheet date.

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Mar 31, 2010

1. Basis of preparation of Financial Statements

The financial statements are prepared under historical cost convention, in accordance with Generally Accepted Accounting Principles (“GAAP”) in India and to comply with applicable Accounting Standards notified under Section 211 (3C) of the Companies Act, 1956 and the relevant provisions of the Companies Act, 1956.

2. Use of Estimates

The preparation of financial statements in conformity with the generally accepted accounting principles requires the management to make estimates and assumptions that affect the reported amount of assets, liabilities, revenue and expenses and disclosure of contingent liabilities as of the date of the financial statements. The estimates and assumptions used in the accompanying financial statements are based upon the managements evaluations of the relevant facts and circumstances as of the date of the financial statements. Actual results could differ from these estimates.

3. Revenue Recognition California Software Company Limited

Revenue from software development is recognised based on software developed and billed to clients as per the terms of specific contracts. Revenue from consultancy services is recognised when the services have been provided to the customer. Revenue from the sale of software products is recognised when the sale is completed with the passing of title. Revenue from maintenance services is accrued over the period of the contract.

4. Fixed Assets

Fixed assets are stated at cost less accumulated depreciation. Cost includes direct costs and financing costs related to borrowing attributable to qualifying assets.

5. Impairment

Consideration is given at each Balance Sheet date to determine whether there is any modification or impairment of the carrying amount of the fixed assets. If any condition exists, an assets recoverable amount is estimated. An impairment loss is recognised whenever the carrying amount of any asset exceeds recoverable amount.

6. Depreciation

Depreciation on tangible fixed assets is calculated on straight-line method at the rates prescribed in Schedule XIV of the Companies Act, 1956, except for computers which are depreciated over a period of 3 Years. Intangible assets are amortized over their estimated useful lives (Computer Software 2 Years ; Product Solutions 5 Years).

Depreciation charge on additions / deletions is restricted to the period of use.

Assets individually costing Rs.5,000 or less are fully depreciated in the year of addition.

In the event the useful life of any fixed assets being assessed to be lower than the life derived from the rates specified above, the book value of such assets is charged off as depreciation over their balance useful lives.

7. Leases

In the case of assets taken under operating lease, the rentals are charged to profit and loss account when due.

8. Investments

Long term investments are stated at cost with provisions where necessary, for diminution other than temporary, in the value of investment.

9. Foreign Currency Transactions

Foreign currency transactions including expenses incurred on Trading / Non Trading Overseas offices and revenue accounts of onsite offices are accounted at the exchange rates ruling on the date of transaction. At the year end all monetary assets and liabilities denominated in foreign currency other than investments are restated at the closing exchange rates. Exchange differences arising out of actual payments / realisations and from the year end restatement referred to above are reckoned in the profit and loss account.

10. Employee Benefits

a. Short Term

Short term Employee Benefits are recognised as expenses as per the company’s scheme based on the expected obligation.

b. Long Term

Liability in respect of long term Employee Benefits in the nature of accumulated compensated absence is provided for based on actuarial valuation using projected unit credit method.

c. Post Retirement i) Provident fund

This is a defined contribution plan and contributions made to the fund, in accordance with the applicable rules/statutes are charged to revenue. The Company has no further obligation for future provident fund benefits other than aforesaid contributions.

ii) Superannuation

This is a defined contribution plan. The Company contributes a sum equivalent to 15% of eligible employee’s salary towards superannuation fund administered by Life Insurance Corporation of India and are charged to profit and loss account.

iii) Gratuity

This is a defined benefit plan. The Company has subscribed to California Software Company Employees’ Group Gratuity Scheme, which is being administrated by a Trust set up for this purpose under the aegis of the Life Insurance Corporation of India (LIC). Liabilities with regard to the Gratuity payable to the employees are determined by actuarial valuation using projected unit credit method, based upon which, the Company makes contribution to the Trust. The funds contributed to the Trust are remitted to the LIC. Actuarial gains and losses comprising of experience adjustments and the effects of changes in actuarial assumptions are recognised immediately in the profit and loss account as income or expense.

11. Taxation

Provision for current tax is made based on the liability computed in accordance with the relevant tax rates and tax laws. Provision for deferred tax is made for timing differences arising between the taxable incomes and accounting income computed at current applicable tax rates. Deferred tax assets are recognised only if there is a virtual certainty that they will be realised in the foreseeable future and are reviewed for the appropriateness of their carrying value at each balance sheet date.