Prism Informatics (PR1SM1NFO), incorporated in 1983. is engaged in software development. Earlier known as Aakruli Holdings, it got its present name on Nov. 11, 2005. Specializing in web technologies, application development, mobile computing and systems programming, company focus has been on delivering cutting edge software solutions coupled with building client relationships.

1.1 Going Concern

The financial report has been prepared on a going concern basis, which contemplated continuity of normal business activities and the realisation of assets and settlement of liabilities in the ordinary course of business except in case of following -

(a) JLT- investment and net commitments towards the defecit in the net worth of the Company: The company has 100% subsidiary Prism Software Consultancy DMCC (formerly known as Prism Software Consultancy JLT). The subsidiary has incurred loss of AED 34,63,603 in the current year resulting erosion of its capital. As these business conditions indicate the existence of material uncertainty that may cast significant doubt regarding Prism Software Consultancy DMCC (formerly known as Prism Software Consultancy JLT) ability to continue as going concern. In the Opinion of the management there is a decline, other than temporary, in the carrying amounts of long term investments. Hence reduction in the carrying amount of investment Rs. 7,16,500 has been charged to the profit and loss statement as an exceptional / extraordinary item. The Loan receivable of Rs. 85,03,705 and Interest receivable of Rs 11,64,553 has been provided as doubtful and considered in the exceptional / Extraordinay items.

The Prism India has also provided towards the committments of subsidiary of Rs.3,25.44,001 towards their loans and accounts payable.

(b) Prism Infoglobal, Seychelles- The company had incorporated operations at Seychelles as 100% subsidiary for the strategic business purpose. The Company has not commenced the business as a result the investment in the company Rs 5,495 and loan of Rs. 49,455 has been provided and considered in the exceptional/ extraordinary item.

(c) Prism INC,USA - During the current financial year the company has provided for receivables of Rs. 2,81,87,277 and committment charges of Rs.4,42.54.698 and considered in the exceptional/ extraordinary item.

In case of previous financial year, the Company had step down subsidiary TLC Technologies INC under Prism Inc US. The Prism India holds 100% shareholding in the Prism Inc US and Prism Inc held 51% in the TLC Technologies INC Company. The TLC was incurring losses from the operations resulting in substantial erosion of the capital. Subsequent to the sale of shares of step down subsidiary TLC, the business conditions indicate the existence of material uncertainty that may cast significant doubt regarding Prism Inc's.. ability to continue as going concern. In the Opinion of the management there is a decline, other than temporary, in the carrying amounts of long term investments. Hence reduction in the carrying amount of investment Rs 2,56,23,329 has been charged to the profit and loss statement as an exceptional / extraordinary item. The Accounts receivable from the TLC Technologies Rs 1,68,16,560 has also been provided as doubtful debt and considereed in the exceptional / Extraordinay items.

(d) Prism PTE, Singapore - In the financial year 2013-14 the Company has made provision Rs 3,12,97,902 towards the Prism Pte Ltd for the carrying value of investments for the permanent decline in the investment value which is other than temprary in nature.

2 Amounts due to micro, small and medium enterprises

As at 31 March, 2015, the Company has no outstanding dues to any vendors registered with appropriate authority under the Micro, Small and Medium Enterprises Development Act, 2006. There have been no delays in settlement of dues to such vendors, warranting any payment of interest as provided in the above Act(2014 : Nil).

3 Leases

Finance Lease :-

The Company does not have any item covered under finance lease which needs disclosure as per Accounting Standard 19 - "Accounting for Leases".

Operating Leases:

The significant leasing arrangements entered into by the Company include the following:

1) Office premises taken on operating lease with lease 36 months and which are renewable on a periodic basis by mutual consent of both parties. There are no restrictions imposed by lease arrangements, such as those concerning dividends and additional debt.

4 Tax on Regular Assessment

During the year the company received a draft assessment order for KY.10-11 according to which there were upward additions made by the Transfer Pricing officer of Rs. l1,01,298 on account of Transfer pricing adjustment. Also, deduction u/s I0AA was reduced for adjustment of Interest on loan from Bank. CCD and others for allocation to SEZ unit of the company by Rs. 20.02,40 7. As per these two adjustment additional tax liability (including interest u/s 234 B but excluding penalty) amounts to Rs.24,3 3,444. As per the draft order, penalty proceeding u/s 271 (1)(o) were initiated separately. However, this liability was not quantified. Hence as on the Balance sheet date, the contingent liability of the company is Rs.24.33,444. Also, demand of Rs.94,374 and Rs.24,738 were pending against the company for F.Y.2009-10 and F.Y.2010-11 respectively.

The company has contested the additions by filing the appeal with DRF and in the opinion of the management the relief will be granted in the favour of the Company.

5 Prior year comparatives

Previous year figures have been appropriately reclassified to conform to the current year's presentations.