The Equity shares of the company got listed on BSE and NSE on 19th October, 2011 and it has issued 55,00,000 equity shares of Rs. 10/- each at a premium of Rs. 140/- per share.The equity shares were issued to public through Initial Public Offer (IPO).

Note 2.1:

The company has availed Cash credit facility from IDBI Bank Limited for an amount of Rs.8,50,00,000/- and isprimarily secured by first charge on all current assets, present and future of the company, Equitable mortgage of land & Residential houses belonging to Managing director, Relatives and Others, Personal guarantee of Managing director, relatives of directors & Others and Corporate Guarantee by Lexicon Private Limited.

Notes:

Note 3.1 : - The company has obtained a car loan of Rs.6,90,000/- from Sundaram Finance Limited at 12.73% rate of interest, repayable in 36 Equated Monthly Installments ( EMI's) from October, 2009 onwards.

Note 3.2 : - The company has obtained a Unsecured Business loan of Rs.25,00,000/- from ABN Amro Bank at 18.00% rate of interest, repayable in 48 Equated Monthly Installments ( EMI's) from September,2008 onwards.

Note 3.3 : - The company has obtained a Business loan of Rs.30,00,000/- from Reliance Capital Limited at 19.00% rate of interest, repayable in 48 Equated Monthly Installments ( EMI's) from September,2008 onwards.

b) Interest accured and due on borrowings.

( The said interest amount was payable on Inter Corporate Deposits received by the company from various parties. The Inter Corporate Deposits were repaid during the year out of the proceeds of the IPO and the interest was payable as at the end of the year)

Note 4.1:- The Company has made an Inter Corporate Deposit of Rs.23 Crores with M/s. Silver Point Infratech Limited on 14th 0ctober,2011. This said ICD shall carry an Interest @ 14% per annum.The initial tenure of the ICD is Six months which can be extendable by such period as lender and borrower deem fit by mutual Negotiations.

                                                       (Amount in Rs.)

5.  Contingent Liabilities:                    2011-12      2010-11

On Income Tax                           Rs.12,44,50,327         -

6. Managerial Remuneration:

The key management personnel comprise four directors. Particulars of Remuneration and other benefits provided to key management personnel is given below:

7. Quantitative Details:

The Company is engaged in the development of Computer Software and services. The production and sale of such software and services cannot be expressed in any generic unit. Hence, it is not possible to give the quantitative details of sales and the information as required under Paragraphs 3 and 4C of Part II of Schedule VI to the Companies Act, 1956.

8. Related Party Transactions:

During the financial year 2011-12 the Company has entered into some transactions, which can be deemed as related party transactions.

9. Operating Lease:

The company has taken its office premises on lease under operating lease agreement that is renewable on a periodic basis at the option of the both the lessor and the lessee. Rental expenses under those leases were Rs. 2,400,000/- and for the previous year Rs. 2,400,000/-.

10. Foreign Currency Outflows:

Foreign Exchange outflows as reported by the Company to Government of India and as certified by Management.

11. Foreign Currency Inflows:

Foreign Exchange inflows as reported by the Company to Government of India and as certified by Management.

12. Segment Reporting:

The Company is mainly engaged in the area of providing Software Development Services. Hence, Segment reporting as required by Accounting Standard 17 "Segment Reporting" is not applicable to the company.

13. Dues to Micro & Small Enterprises:

There are no overdue principle amounts and interest thereon payable to Micro Enterprises and Small Enterprises, as at 31-03-2012.

14. Compounding Fee:

a) Paid Up Share Capital includes preferential allotment of 43, 76,008 Equity shares by the company to Lexicon Private Limited in respect of which the company has filed an application with Foreign Investment Promotion Board (FIPB) and the approval of FIPB has been received vide FIPB approval letter No FC.II. 254 (2003)/196 (2003) dated 25.03.2011. Further the FIPB has directed the company to approach Reserve Bank of India (RBI) for levy of Compounding fees. The company has filed an application dated 24.05.2011 to RBI for levy of compounding fees. RBI had disposed the case with a compounded amount of Rs.5,00,000/-vide compounding order CA.No.1806/2011 dated 6th September 2011,Against that company had paid compounding fee of Rs.5,00,000/- to RBI on 12.09.2011.

b) In addition to the above compounding fee, the company has also paid Rs. 1,00,000/- and 1,50,000/- to the RBI on 29-09-2011 in respect of the compounding application made by the company in respect of share transfers where FIPB approvals were obtained post facto.

15. SEBI Order

a) Relating to Utilization of IPO Proceeds:

The company has raised an amount of Rs. 82,50,00,000/- through Initial Public Offer (IPO) which was subscribed by the public between 29-09-2011 to 04-10-2011. On the receipts of such IPO proceeds, company was under an obligation to utilize the proceeds as per the prospectus filed before SEBI. The SEBI had carried out an Investigation on the issue of utilization of IPO proceeds. During the course of investigation, the SEBI has come to a prima facie conclusion that the proceeds of the IPO were utilized for the objects other than the objects mentioned in the Prospectus.

b) SEBI Order relating to Operative Instructions:

Vide Order No. WTM/PS/IVD/ID8/43/Dec/2011 dated 28th December, 2011, SEBI has directed the company and directors in the following ways:

(i) The Company is prohibited from raising any further capital, in any manner whatsoever, till further directions.

(ii) The Company and its directors are prohibited from buying, selling or dealing in securities in any manner whatsoever, till further directions.

c) SEBI Order relating to Calling back of IPO funds:

Vide Order No. WTM/PS/IVD/ID8/43/Dec/2011 dated 28th December, 2011, SEBI has directed the company in the following ways:

a) To call back the ICD placed with Silverpoint Infratech Limited amounting to Rs. 23 Crores and place the proceeds in an interest bearing escrow bank account opened with a scheduled commercial bank, till further directions.

b) Proceeds of IPO invested by the company in the India bulls Mutual Fund-Liquid Fund; amounting to Rs. 5 Crores; shall also be redeemed and transferred to the said escrow account, till further directions.

c) In addition, the Company shall deposit the proceeds of IPO still remaining with it; as on the date of this Order; in the said escrow account, till further directions. The confirmation for the same should be given to stock exchanges where the company is listed; within 7days from the date of this Order.

d) SEBI Vide Order No. WTM/PS/IVD/ID8/43/Dec/2011 dated 28th December, 2011 has made certain observations on matters relating to disclosures etc.

16. The company has filed its reply to the order issued by SEBI Vide Order No. WTM/PS/IVD/ID8/43/Dec/2011 dated 28th December, 2011 on 04th January 2012 by stating its objections to the SEBI Order.

Subsequently, the company has filed its detailed reply on 12th September, 2012 by contesting the SEBI order through its legal consultants M/s. Mindspright Legal, Mumbai and the final outcome is pending.

17. Confirmation of Closing Balances:

Closing Balances of Debtors, Creditors, Loans and Advances are subject to confirmations.

18. The figures of previous year have been re-grouped /re- arranged wherever necessary.

19. The figures have been rounded off to the nearest rupee.