| 1.1 Accounting Policies not specifically referred to otherwise are
consistent and in consonance with generally accepted accounting
principles and mandatory accounting standards issued by the Institute
of Chartered Accountants of India.
1.2 Basis of Accounting
The financial statements are prepared in accordance with the relevant
presentation requirements of the Revised Schedule VI of the Companies
Act, 1956 under the Historical cost convention on the basis of going
concern and accrual unless otherwise stated.
1.3 Revenue recognition
Revenue is primarily derived from Software development, Consulting and
allied services. Arrangements for software development and related
services are either on fixed-price and fixed-timeframe or on a time
and material basis. Revenue from fixed-price and fixed-time frame
contracts , where there is no uncertainly as to measurement or
collectability of consideration is recognised based on
percentage-completion method. Where there is uncertainity as to
measurement or collectability revenue recognition is postponed until
such uncertainity is resolved. Revenue from fixed-price maintenance
contracts are recognised ratably over the period in which services are
rendered.
1.4 Fixed Assets
Fixed Assets are stated at cost less depreciation. The company
capitalizes all costs incidental to acquisition and installation of
Fixed Assets. Depreciation on fixed assets is provided on WDV method
at the rates prescribed in Schedule XIV of the Companies Act, 1956.
1.5 Preliminary Expenses and Pre Operative Expenses
Preliminary Expenses and Pre Operative Expenses are to be amortized
over a period often years from the date of commencement of commercial
activities.
1.6 Taxon Income
Current tax is determined as the amount of tax payable in respect of
taxable income for the period. Deferred tax is recognized, subject to
the consideration of prudence, on timing differences, being the
difference between taxable income and accounting income that originate
in one period and are capable of reversal in one or more subsequent
periods. Deferred tax assets are not recognized on unabsorbed
depreciation and carry forward of losses unless there is virtual
certainty that sufficient future taxable income will be available
against which such deferred tax assets can be realized.
1.7 Provisions and contingent liabiiites
A provision is recognised if as a result of a past event, the group
has a present legal obligation that can be estimated reliably, and it
is probable that an outflow of economic benefits will be required to
settle the obligation, a. Contingent Liabilities are determined on the
basis of available information and are disclosed byway of a note to
the accounts.
1.8 Foreign Exchange Transactions:
For the purpose of Consolidation, Ajel Technologies, Inc was treated
as Integral foreign operation in accordance with the Accounting
Strandard ll-"Effects of Changes in Foreign Exchange Rates" and
transactions in foreign currency for the items of income and expenses
are recorded at the Average rate of exchange for the period . All the
Assets and Liabilities were recorded at the Closing rate of exchange.
Exchange differences arising there from is transferred to Foreign
Currency Loss and transferred to Profit and Loss Account.
1.9 Earning per Share
Basic earnings per share is computed by dividing the net profit after
tax by the weighted average number of equity shares outstanding during
the period. Diluted Earnings per share is computed by dividing the net
profit aftertax by the weighted average number of equity shares
considered for deriving the basic earnings per share and also the
weighted average number of the equity shares that could have been
issued upon conversion of all dilutive potential equity shares.
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