Mar 31, 2015
1.1 Basis of preparation of Financial Statements:
These financial statements have been prepared in accordance with the
Generally Accepted Accounting Principles in India ("Indian GAAP") to
comply with the Accounting Standards specified under section 133 of the
Companies Act, 2013, read with Rule 7 of the Companies (Accounts)
Rules, 2014 and the relevant provisions of the Companies Act, 2013,
financial statements have been prepared under the historical cost
convention on accrual basis, except for certain financial instruments
which are measured at fair value.
1.2 Use of Estimates:
The preparation of financial statements requires the management of the
Company to make estimates and assumptions that effect the reported
balances of assets and liabilities and disclosures relating to the
contingent liabilities as at the date of the financial statements and
reported amounts of income and expenses during the year. Examples of
such estimates include provisions for doubtful receivables, employee
benefits, provision for income taxes, the useful lives of depreciable
fixed assets and provision for impairment. Future results could differ
due to changes in these estimates and the difference between the actual
result and the estimates are recognized in the period in which the
results are known/ materialize.
1.3 Revenue Recognition
Revenue from services is recognized based on time and material and
billed to the clients as per the terms of the contract. In the case of
fixed price contracts, revenue is recognized on periodical basis based
on units executed and delivered.
Revenue from sale of software is recognized on delivery and transfer of
ownership of the software to the clients.
Revenue from sale of software licenses are recognized upon delivery
where there is no customization required. In case of customization the
same is recognized over the life of the contract using the
proportionate completion method.
Other Income: Interest Income is accounted on accrual basis. Dividend
income is accounted for when right to receive is established.
1.4 Fixed Asset, Depreciation and Amortisation
a) Fixed Assets:
Fixed Assets are stated at cost less accumulated depreciation/
amortisation. For this purpose cost comprises of cost of acquisition
and all costs directly attributable to bringing the asset to the
present condition for its intended use.
b) Method of Depreciation:
In respect of fixed assets acquired during the year, depreciation/
amortization is charged on a straight line basis so as to write-off the
cost of the assets over the useful lives and for the assets acquired
prior to 1st April, 2014, the carrying amount as on 1st April, 2014 is
depreciated over the remaining useful life based on an evaluation.
Type of Assets Period
Air-conditioners 15 years
Computer - End users devices 3 years
Computer - Servers and Networks 6 years
Electrical Installations 10 years
Furniture & Fixtures 10 years
Office Equipment 5 years
Motor Cars 8 years
Software Purchased 6 years
Software Internally Developed 3 years
1.5 Investments :
Investments are valued at cost inclusive of all expenses incidental to
their acquisition. All the investments are intended to be held for a
period of more than one year from the date on which investments are
made are classified as long term investments. All long term
investments are carried at cost. No provision for diminution in value
of long term investments is made. Overseas Investments are carried at
their original rupee cost of acquisition.
1.6 Foreign Currency Transactions:
Transactions in foreign currency are recorded at the rates of exchange
prevailing on the date of transactions. Exchange differences are
recorded when the amount actually received on sales or actually paid
when expenditure is incurred, is converted into Indian Rupees. The
exchange differences arising on foreign currency transactions are
recognized as income or expense in the year in which they arise.
Fixed assets purchased are recorded at cost, based on the exchange rate
as of the date of purchase.
Monetary current assets and monetary current liabilities that are
denominated in foreign currency are translated at the exchange rate
prevailing at the date of balance sheet. In case of items which are
covered by forward exchange contracts, the difference between the
exchange rate prevailing at the Balance Sheet date and the rate on the
day of contract is recognized as exchange difference. The resulting
difference is also recorded in the Statement of Profit and Loss.
1.7 Retiring Benefits:
The Company has Defined Contribution Plan for its Employees' Retirement
Benefits comprising of Provident Fund, Employees' State Insurance Fund
which are recognized by the Income Tax Authorities. The Company and
eligible employees make monthly contributions to the Provident Fund
equal to specified percentage of the covered employees' salary. The
Company also contributes to Employees' State Insurance Fund and has no
further obligation to the plan beyond its monthly contribution.
The Company has Defined Benefit Plan comprising of Gratuity. The
benefits are based on final salary and cost of the benefit is entirely
borne by the Company. The benefits of the scheme are paid in accordance
with the Payment of Gratuity Act, 1972 without any monetary limit. The
liability for Gratuity is determined on the basis of an independent
actuarial valuation done at the year end. The liability is computed
based on current salary levels projected to the probable due date. The
method employed is projected unit credit method.
As per Company Policy the unused accumulated leave balance lapses at
the yearend and no employee is entitled to cash compensation for unused
accumulated leave balance at the end of the year , hence, no provision
is required to be made.
1.8 income Tax
Tax expense comprises of current and deferred tax.
Current income tax is measured at the amount expected to be paid to the
tax authorities in accordance with the Income-tax Act, 1961 after
complying with the various provisions of the Act.
Provision for deferred tax is made using the applicable rate of
taxation, for all timing differences which arise during the year and
are reversed in subsequent periods.
Minimum alternative tax (MAT) paid in accordance to the tax laws, which
gives rise to future economic benefits in the form of adjustment of
future income tax liability is considered as an asset when there is
convincing evidence that the Company will pay normal income tax after
the tax holiday period. Accordingly MAT is recognized as asset in the
balance sheet when it is probable that the future economic benefit
associated with it will flow to the Company and the asset can be
measured reliably.
1.9 Inventory:
Work-In-Progress is valued at cost. Traded goods are valued at lower of
cost or net realizable value.
1.10 Software:
The Company has internally generated software for its captive use for
the various long term projects received. The direct cost of this
software is capitalized and shown as Intangible assets under the Group
Fixed Assets. This amount would be amortized beginning from the year
subsequent to the year in which the said is put to use. The
amortization period would be the project period or three equal yearly
installments whichever is less.
1.11 Earning Per Share:
In determining earnings per share, the Company considers the net profit
after tax. The number of shares used in computing basic earnings per
share is the weighted average number of shares outstanding during the
period. The number of shares used in computing diluted earnings per
share comprises the weighted average shares considered for deriving
basic earnings per share, and also the weighted average number of
equity shares that could have been issued on the conversion of all
dilutive potential equity shares.
1.12 Contingent Liability:
Claims against the Company are recognized when Board of Directors
determine that it is probable that the liability will be payable.
Claims made by the Company are recognized when formal intimation of the
agreement of the Claim is received from the counter parties. Contingent
Liabilities are not recognized but are disclosed in the notes (Refer
note 3.1).
1.13 Leases:
In respect of Operating leases, lease rentals are expensed with
reference to the terms of lease.
1.14 Accounting policies not specifically referred to are consistent
with the Indian Normally Accepted Accounting Principles.
Mar 31, 2014
1.1 Basis of preparation of Financial Statements:
The financial statements have been prepared under the historical cost
convention, on the basis of going concern and on accrual method of
accounting except the provision of interest on deposit as referred to
note no 3.7, in accordance with Normally Accepted Accounting Principles
and provisions of the Companies Act, 1956 as adopted consistently by
the Company. All incomes and expenditures having material bearing on
financial statements are recognized on accrual basis. The Company has
complied with all the mandatory Accounting Standards (AS) to the extent
applicable as prescribed by the Company''s (Accounting Standards) Rules,
2006, the provisions of the Companies Act, 1956 (which continues to be
applicable in respect of Section 133 of the Companies Act, 2013 in
terms of the General Circular 15/2013 dated 13th September, 2013 of the
Ministry of Corporate Affairs). The Accounting policies have been
consistently applied except where a newly issued Accounting Standard is
initially adopted or a revision to an existing Accounting Standard
requires a change in the Accounting Policy hitherto in use.
1.2 Use of Estimates:
The preparation of the financial statements in conformity with Normally
Accepted Accounting Principles requires estimates and assumptions to be
made that affect the reported amounts of the assets and liabilities on
the date of financial statements and the report amount of revenues and
expenses during the reported period. Difference between the actual
results and estimates are recognized in the period in which it gets
materialized.
1.3 Revenue Recognition
Revenue from services is recognized based on time and material and
billed to the clients as per the terms of the contract. In the case of
fixed price contracts, revenue is recognized on periodical basis based
on units executed and delivered.
Revenue from sale of software is recognized on delivery and transfer of
ownership of the software to the clients. Revenue from sale of
software licenses are recognized upon delivery where there is no
customization required. In case of customization the same is
recognized over the life of the contract using the proportionate
completion method. Other Income: Interest Income is accounted on
accrual basis. Dividend income is accounted for when right to receive
is established.
1.4 Fixed Asset, Depreciation and Amortisation
a) Fixed Assets:
Fixed Assets are stated at cost less accumulated depreciation. For this
purpose cost comprises of cost of acquisition and all costs directly
attributable to bringing the asset to the present condition for its
intended use. Capital work in progress comprises advance paid to
acquire fixed assets and the cost of fixed assets that are not ready
for their intended use at the balance sheet date.
b) Method of Depreciation:
Depreciation is provided during the year under Straight Line method, on
pro-rata basis on assets put to use at the rates prescribed under
Schedule XIV of the Companies Act, 1956. Individual low cost assets
(acquired for less than ''5,000/-) are entirely depreciated in the year
of acquisition.
1.5 Investments :
Investments are valued at cost inclusive of all expenses incidental to
their acquisition. All the investments are intended to be held for a
period of more than one year from the date on which investments are
made are classified as long term investments. All long term investments
are carried at cost. No provision for diminution in value of long term
investments is made. Overseas Investments are carried at their original
rupee cost of acquisition.
1.6 Foreign Currency Transactions:
Transactions in foreign currency are recorded at the rates of exchange
prevailing on the date of transactions. Exchange differences are
recorded when the amount actually received on sales or actually paid
when expenditure is incurred, is converted into Indian Rupees. The
exchange differences arising on foreign currency transactions are
recognized as income or expense in the year in which they arise.
Fixed assets purchased are recorded at cost, based on the exchange rate
as of the date of purchase.
Monetary current assets and monetary current liabilities that are
denominated in foreign currency are translated at the exchange rate
prevailing at the date of balance sheet. In case of items which are
covered by forward exchange contracts, the difference between the
exchange rate prevailing at the Balance Sheet date and the rate on the
day of contract is recognized as exchange difference. The resulting
difference is also recorded in the Statement of Profit and Loss.
1.7 Retiring Benefits:
The Company has Defined Contribution Plan for its Employees'' Retirement
Benefits comprising of Provident Fund, Employees'' State Insurance Fund
which are recognized by the Income Tax Authorities. The Company and
eligible employees make monthly contributions to the Provident Fund
equal to specified percentage of the covered employees'' salary. The
Company also contributes to Employees'' State Insurance Fund and has no
further obligation to the plan beyond its monthly contribution.
The Company has Defined Benefit Plan comprising of Gratuity. The
benefits are based on final salary and cost of the benefit is entirely
borne by the Company. The benefits of the scheme are paid in accordance
with the Payment of Gratuity Act, 1972 without any monetary limit. The
liability for Gratuity is determined on the basis of an independent
actuarial valuation done at the year end. The liability is computed
based on current salary levels projected to the probable due date. The
method employed is projected unit credit method.
As per Company Policy the unused accumulated leave balance lapses at
the yearend and no employee is entitled to cash compensation for unused
accumulated leave balance at the end of the year , hence, no provision
is required to be made.
1.8 Income Tax
Tax expense comprises of current and deferred tax.
Current income tax is measured at the amount expected to be paid to the
tax authorities in accordance with the Income-tax Act, 1961 after
complying with the various provisions of the Act.
Provision for deferred tax is made using the applicable rate of
taxation, for all timing differences which arise during the year and
are reversed in subsequent periods.
Minimum alternative tax (MAT) paid in accordance to the tax laws, which
gives rise to future economic benefits in the form of adjustment of
future income tax liability is considered as an asset when there is
convincing evidence that the Company will pay normal income tax after
the tax holiday period. Accordingly MAT is recognized as asset in the
balance sheet when it is probable that the future economic benefit
associated with it will flow to the Company and the asset can be
measured reliably.
1.9 Inventory:
Work-In-Progress is valued at cost. Traded goods are valued at lower of
cost or net realizable value.
1.10 Software:
The Company has internally generated software for its captive use for
the various long term projects received. The direct cost of this
software is capitalized and shown as Intangible assets under the Group
Fixed Assets. This amount would be amortized beginning from the year
subsequent to the year in which the said is put to use. The
amortization period would be the project period or three equal yearly
installments whichever is less.
1.11 Earning Per Share:
In determining earnings per share, the Company considers the net profit
after tax. The number of shares used in computing basic earnings per
share is the weighted average number of shares outstanding during the
period. The number of shares used in computing diluted earnings per
share comprises the weighted average shares considered for deriving
basic earnings per share, and also the weighted average number of
equity shares that could have been issued on the conversion of all
dilutive potential equity shares.
1.12 Contingent Liability:
Claims against the Company are recognized when Board of Directors
determine that it is probable that the liability will be payable.
Claims made by the Company are recognized when formal intimation of the
agreement of the Claim is received from the counter parties. Contingent
Liabilities are not recognized but are disclosed in the notes (Refer
note 3.1).
1.13 Leases:
In respect of Operating leases, lease rentals are expensed with
reference to the terms of lease.
1.14 Miscellaneous Expenditure (To the extent not written off or
adjusted):
Expenses incurred would be amortized over a period of ten years
beginning from the date of incurrence.
1.15 Accounting policies not specifically referred to are consistent
with the Indian Normally Accepted Accounting Principles.
Mar 31, 2010
1) Basis of preparation of Financial Statement
The financial statements have been prepared under the historical cost
convention, on the basis of going concern and on accrual method of
accounting, in accordance with Normally Accepted Accounting Principles
and provisions of the Companies Act, 1956 as adopted consistently by
the company. All incomes and expenditures having material bearing on
financial statements are recognized on accrual basis. The Company has
complied with all the mandatory Accounting Standards (ÃAS) to the
extent applicable as prescribed by the Companys (Accounting Standards)
Rules, 2006, the provisions of the Companies Act 1956. The Accounting
policies have been consistently applied except where a newly issued
Accounting Standard is initially adopted or a revision to an existing
Accounting Standard requires a change in the Accounting Policy hitherto
in use.
2) Use of Estimates
The preparation of the financial statements in conformity with Normally
Accepted Accounting Principles requires estimates and assumptions to be
made that affect the reported amounts of the assets and liabilities on
the date of financial statements and the report amount of revenues and
expenses during the reported period. Difference between the actual
results and estimates are recognized in the period in which it gets
materialized.
3) Revenue Recognition
(a) Revenue from services is recognized based on time and material and
billed to the clients as per the terms of the contract. In the case of
fixed price contracts, revenue is recognized on periodical basis based
on units executed and delivered.
(b) Revenue from sale of software is recognized on delivery and
transfer of ownership of the software to the clients.
(c) Revenue from sale of software licences are recognized upon delivery
where there is no customization required. In case of customization the
same is recognized over the life of the contract using the
proportionate completion method.
(d) Other Income: Interest Income is accounted on accrual basis.
Dividend income is accounted for when right to receive is established.
4) Fixed Asset, Depreciation and Amortisation
(a) Fixed Assets
Fixed Assets are stated at cost less accumulated depreciation. For this
purpose cost comprises of cost of acquisition and all costs directly
attributable to bringing the asset to the present condition for its
intended use. Capital work in progress comprises advance paid to
acquire fixed assets and the cost of fixed assets that are not ready
for their intended use at the balance sheet date.
(b) Method of Depreciation
Depreciation is provided during the year under Straight Line method, on
pro-rata basis on assets put to use at the rates prescribed under
Schedule XIV of the Companies Act, 1956. Individual low cost assets
(acquired for less than Rs.5,000/-) are entirely depreciated in the
year of acquisition.
5) Investments
Investments are valued at cost inclusive of all expenses incidental to
their acquisition. All the investments are intended to be held for a
period of more than one year from the date on which investments are
made are classified as long term investments. All long term investments
are carried at cost. No provision for diminution in value of long term
investments is made. Overseas Investments are carried at their
original rupee cost of acquisition.
6) Foreign Currency Transactions
Transactions in foreign currency are recorded at the rates of exchange
prevailing on the date of transactions. Exchange differences are
recorded when the amount actually received on sales or actually paid
when expenditure is incurred, is converted into Indian Rupees. The
exchange differences arising on foreign currency transactions are
recognized as income or expense in the year in which they arise.
Forward premia/ discount in respect of forward exchange contracts are
recognized over the life of the contract.
Fixed assets purchased are recorded at cost, based on the exchange rate
as of the date of purchase.
Monetary current assets and monetary current liabilities that are
denominated in foreign currency are translated at the exchange rate
prevailing at the date of balance sheet. In case of items which are
covered by forward exchange contracts, the difference between the
exchange rate prevailing at the Balance Sheet date and the rate on the
day of contract is recognized as exchange difference. The resulting
difference is also recorded in the profit and loss account.
7) Retiring Benefits
The Company has Defined Contribution Plan for its Employees Retirement
Benefits comprising of Provident Fund, Employees State Insurance Fund
which are recognized by the Income Tax Authorities. The Company and
eligible employees make monthly contributions to the Provident Fund
equal to specified percentage of the covered employees salary. The
Company also contributes to Employees State Insurance Fund and has no
further obligation to the plan beyond its monthly contribution.
The Company has Defined Benefit Plan comprising of Gratuity. The
benefits are based on final salary and cost of the benefit is entirely
borne by the company. The benefits of the scheme are paid in accordance
with the Payment of Gratuity Act, 1972 without any monetary limit. The
liability for Gratuity is determined on the basis of an independent
actuarial valuation done at the year end. The liability is computed
based on current salary
levels projected to the probable due date. The method employed is
projected unit credit method.
As per Company Policy the unused accumulated leave balance lapses at
the year end and no employee is entitled to cash compensation for
unused accumulated leave balance at the end of the year , hence, no
provision is required to be made.
8) Income Tax
The Company is 100% Export Oriented Unit and registered member of
Software Technology Park of India. In view of the same Company is
claiming exemption of its income under section 10B of the Income Tax
Act, 1961. However, Company has provided Minimum Alternate Tax under
section 115JB of the Income Tax Act, 1961. Minimum alternative tax
(MAT) paid in accordance to the tax laws, which gives rise to future
economic benefits in the form of adjustment of future income tax
liability is considered as an asset when there is convincing evidence
that the Company will pay normal income tax after the tax holiday
period. Accordingly MAT is recognized as asset in the balance sheet
when it is probable that the future economic benefit associated with it
will flow to the Company and the asset can be measured reliably.
9) Inventory
Work in Progress is valued at cost.
10) Software
The company has internally generated software for its captive use for
the various long term projects received and also developed software for
sale of its licences .The direct cost of this software is capitalized
and shown as Intangible assets under the Group Fixed Assets. This
amount would be amortized beginning from the year subsequent to the
year in which the said is put to use and/or sale of its licences. The
amortization period would be the project period or three equal yearly
installments whichever is less.
11) Earning per Share
In determining earnings per share, the company considers the net profit
after tax. The number of shares used in computing basic earnings per
share is the weighted average number of shares outstanding during the
period. The number of shares used in computing diluted earnings per
share comprises the weighted average shares considered for deriving
basic earnings per share, and also the weighted average number of
equity shares that could have been issued on the conversion of all
dilutive potential equity shares.
12) Contingent Liability
Claims against the Company are recognized when Board of Directors
determine that it is probable that the liability will be payable.
Claims made by the Company are recognized when formal intimation of the
agreement of the Claim is received from the counter parties.
13) Leases
In respect of Operating leases, lease rentals are expensed with
reference to the terms of lease.
14) Deferred Tax
The deferred taxes in respect of timing differences which originates
during the tax holiday period and reverse during the tax holiday period
is not recognized during the year. However deferred tax in respect of
timing difference which originate during the tax holiday period and but
reverse after the tax holiday period is recognized during the year and
necessary adjustment have been carried out.
15) Miscellaneous Expenditure (To the extent not written off or
adjusted)
Expenses incurred would be amortized over a period of ten years
beginning from the date of incurrence.
16) Accounting policies not specifically referred to are consistent
with the Indian Normally Accepted Accounting Principles.
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