Quarterly report pursuant to Section 13 or 15(d)

Note 10 - Investment Under Equity Method

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Note 10 - Investment Under Equity Method
 3 Months Ended
Sep. 30, 2011
Equity Method Investments Disclosure [Text Block]
NOTE 10 – INVESTMENT UNDER EQUITY METHOD

On April 10, 2009, the Company entered into an agreement to form a joint venture with the Atheeb Trading Company, a member of the Atheeb Group (“Atheeb”). The joint venture entity, Atheeb NetSol Saudi Company Ltd., is a company organized under the laws of the Kingdom of Saudi Arabia. The venture was formed with an initial capital contribution of $268,000 by the Company and $266,930 by Atheeb with a profit sharing ratio of 50.1:49.9, respectively. The final formation of the company was completed on March 7, 2010. The joint venture was accounted for as an equity method investment as the Company has not established control over the affairs of Atheeb NetSol Saudi Company Ltd. due to its minority representation on the board of directors.

The Company's investment in equity for the period ended September 30, 2011 was as follows:

       
Net book value at June 30, 2010
  $ 200,506  
         
Net loss for the year ended June 30, 2011
    (542,929 )
NetSol's share (50.1%)
    (272,007 )
Loss adjusted against investment
    (200,506 )
Net book value at June 30, 2011
  $ 0  
         
Investment during the period
    100,000  
Net loss for the three months ended September 30, 2011
    (134,075 )
NetSol's share (50.1%)
    (67,172 )
Unabsorbed losses brought forward
    (51,731 )
Total loss
    (118,903 )
Loss adjusted against investment
    (100,000 )
Net book value at September 30, 2011
  $ 0