| Financial Statements are prepared under historical cost convention
method and comply with the mandatory Accounting Standards issued by The
Institute of Chartered Accountant of India.
The significant accounting policies followed by the company are stated
below.
A) INCOME AND EXPENDITURE :
a) Company follows accrual system of accounting in general.
b) Revenue from software development is recognized at the time of
invoicing them to customers,
c) Capitalisation of Revenue Expenses
As the company is in development of new software and also in
maintenance of existing software and revenue is derived from sale and
service of upgraded existing software and most of the resources are
utilized for development of new software, the revenue expenditures
shown in the expenses of Profit & Loss Account under "operational and
administrative expenses staff cost &, development expenses have been
proportionally capitalized and disclosed as additions to "Computer
peripherals and software" under Schedule 03 of "Fixed Assets".
B) FIXED ASSETS:
Fixed assets have been valued at cost less depreciation. Cost includes
other attributable expenses relatable to the cost of acquisition.
C) DEPRECIATION:
a) Depreciation on fixed assets has been provided on straight line
method at the rates prescribed in schedule XIV of The Companies Act
1956 including assets costing less than Rs.5000/-and charged on the
basis of usage of the asset.
b) Depreciation on fixed assets added /disposed off during the year is
provided on pro-rata basis with reference to the month of addition
/disposal.
D) VALUATION OF CLOSING STOCK:
As there is no stock in trade, the question of valuation does not
arise.
E) INVESTMENT IN SUBSIDIARIES;
As no commercial activity has commenced at both the subsidiary in
Singapore & USA, the financial information relating to the subsidiaries
are not furnished and consolidated financial information also not
furnished..
F) MISCELLANEOUS EXPENDITURE
Miscellaneous Expenditure including preliminary expenses are written
off over a period of ten years.
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