VASO Corp - FORM 8-K/A - EX-99.1.2 - PJM AUDITED FINANCIALS 12/31/10

Attached files

file	filename
8-K/A - VASO Corp	vaso8ka-sept42011.htm
EX-99.2 - VASOMEDICAL UNAUDITED PROFORMA FINANCIALS - VASO Corp	vaso8kaproforma-ex992.htm
EX-99.1.4 - PJM UNAUDITED FINANCIALS 6/30/11 - VASO Corp	vaso8ka-pjm2011ex9914.htm
EX-99.1.1 - BIOX AUDITED FINANCIALS 12/31/10 - VASO Corp	vaso8ka-biox2010ex9911.htm
EX-99.1.3 - BIOX UNAUDITED FINANCIALS 6/30/11 - VASO Corp	vaso8ka-biox2011ex9913.htm

PEACE JOY MANAGEMENT LIMITED

REPORTS AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2010

PEACE JOY MANAGEMENT LIMITED

REPORTS AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2010

CONTENTS

	PAGE(S)



DIRECTOR'S REPORT	1-2

INDEPENDENT AUDITOR'S REPORT	3 - 4

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME	5

CONSOLIDATED STATEMENT OF FINANCIAL POSITION	6

STATEMENT OF FINANCIAL POSITION	7

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY	8

CONSOLIDATED STATEMENT OF CASH FLOWS	9

NOTES TO THE FINANCIAL STATEMENTS	10 -21

PEACE JOY MANAGEMENT LIMITED

DIRECTOR'S REPORT

The director has pleasure in presenting his report with the audited financial statements of the

Company and its subsidiary (collectively the "Group") for the year ended 31 December 2010.

PRINCIPAL ACTIVITY

The Group continues to engage in the manufacturing of medical devices.

RESULTS AND APPROPRIATIONS

The results of the Group for the year ended 31 December 2010 are set out in the consolidated

statement of comprehensive income on page 5 to the financial statements. The director does not

recommend the payment of any dividend.

FIXED ASSETS

Details of movements in the plant and equipment during the year are shown in note 12 to the

financial statements.

SHARE CAPITAL

Details of the share capital of the Company are set out in note 17 to the financial statements.

DIRECTOR

The sole director of the Company during the year and up to the date of this report was:

LI Xichang

The sole director should continue in office.

The Company did not enter into any agreement, other than the contracts of service with the

director, whereby any individual, firm or body corporate undertakes the management and

administration of the whole, or any substantial part of any business of the Company.

PEACE JOY MANAGEMENT LIMITED

DIRECTOR'S REPORT

DIRECTOR'S SHARE AND DEBENTURE OPTIONS

At no time during the year was the Company or its subsidiary a party to any arrangements to

enable the director of the Company to acquire benefits by means of the acquisition of shares in,

or debentures of, the Company or any other body corporate.

DIRECTOR'S INTERESTS IN CONTRACTS

Other than as disclosed in note 20 to the financial statements concerning related party

transactions, there has been no contract of significance to which the Company or its subsidiary

was a party and in which a director of the Company had a material interest, whether directly or

indirectly, at the end of the year or at any time during the year.

AUDITOR

The financial statements have been audited by G Tong & Co., Certified Public Accountants.

On behalf of the Board

/s/ Li Xichang

SOLE DIRECTOR

9 March 2011

G TONG & CO.

Certified Public Accountants

Management Consultants

Unit 1411 14/F. LippoSun Plaza.

2B Cantor Road. Tsim Sha Tsui,

Kowloon, Hong Kong

Ter : (852) 2420 4006

Fax : (852) 2892 1856

E-mail : holistic@gtongcpa.com.hk

INDEPENDENT AUDITOR'S REPORT

TO THE SHAREHOLDERS OF PEACE JOY MANAGEMENT LIMITED

(Incorporated in the British Virgin Islands with limited liability)

We have audited the consolidated financial statements of PEACE JOY MANAGEMENT

LIMITED (the "Company") and its subsidiary (together the "Group") set out on pages 5 to 21,

which comprise the consolidated and company statements of financial position as at 31

December 2010, and the consolidated statement of comprehensive income, the consolidated

statement of changes in equity and the consolidated statement of cash flows for the year then

ended, and a summary of significant accounting policies and other explanatory notes.

Director's responsibility for the financial statements

The director of the Company is responsible for the preparation of consolidated financial

statements that give a true and fair view in accordance with the Hong Kong Financial Reporting

Standard for Private Entities issued by the Hong Kong Institute of Certified Public Accountants,

and for such internal control as the director determines is necessary to enable the preparation of

the consolidated financial statements that are free from material misstatement, whether due to

fraud or error,

Auditor's responsibility

Our responsibility is to express ati opinion on these consolidated financial statements based on

our audit and to report our opinion solely to you, as a body, in the coming general meeting of the

Company, and for no other purpose. We do not assume responsibility towards or accept

liability to any other person for the contents of this report. We conducted our audit in

accordance with Hong Kong Standards on Auditing issued by the Hong Kong Institute of

Certified Public Accountants. Those standards require that we comply with ethical

requirements and plan and perform the audit to obtain reasonable assurance about whether the

consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and

disclosures in the consolidated financial statements. The procedures selected depend on the

auditor's judgment, including the assessment of the risks of material misstatement of the

consolidated financial statements, whether due to fraud or error. In making those risk

assessments, the auditor considers internal control relevant to the entity's preparation of the

consolidated financial statements that give a true and fair view in order to design audit

procedures that are appropriate in the circumstances, but not for the purpose of expressing an

opinion on the effectiveness of the entity's internal control. An audit also includes evaluating

the appropriateness of accounting policies used and the reasonableness of accounting estimates

made by the director, as well as evaluating the overall presentation of the consolidated financial

statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a

basis for our audit opinion.

G TONG & CO.

Certified Public Accountants

Managefnent Consultants

Unit 1411,14/F, Lippo Sun Plaza

28 Canton Road. Tsim Sha Tsui.

Kowloon Hong Kong

Tel: (852) 2420 4006

Fax: (852] 2892 1856

E-mail: holistic@gtongcpa.com.hk

INDEPENDENT AUDITOR'S REPORT

TO THE SHAREHOLDERS OF PEACE JOY MANAGEMENT LIMITED

(Incorporated in the British Virgin Islands with limited liability)

Opinion

In our opinion, the consolidated financial statements give a true and fair view of the state of

affairs of the Company and of the Group as at 31 December 2010 and of the Group's profit and

cash flows for the year then ended in accordance with the Hong Kong Financial Reporting

Standard for Private Entities.

/s/
G TONG & CO.

Certified Public Accountant

Hong Kong, 9 March 2011

PEACE JOY MANAGEMENT LIMITED

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER 2010


	NOTES		2010 US$			2009 US$
Revenue		4		572,S36			925,380
Cost of sales				(299,068	)		(424,660	)
Gross profit				273,768			500,720
Other income		5		180			168
Distribution costs				(10,135	)		(22.653	)
Administrative expenses				(98,499	)		(89.246	)
Other expenses				(35,992	)		(32,987	)
Finance costs		6		(12,479	)		(22,849	)
Profit before tax		7		116,843			333,153
Income tax expense		8		.			.
PROFIT FOR THE YEAR				116,843			333,153
Other comprehensive income				·			.
TOTAL COMPREHENSIVE INCOME FOR THE YEAR				116,843			333,153
Profit for the year and total comprehensive income attributable to owners of the Group				116,843			333,153

The accompanying notes form an integral part of these financial statements.

PEACE JOY MANAGEMENT LIMITED

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2010


	NOTES		2010 US$		2009 US$
ASSETS
Current Assets
Trade receivables				192,649		213,306
Other receivables and deposits				31,870		6,873
Amounts due from related companies		10		60,885		1,933
Inventories		11		261,992		247.930
Bank balances and cash				130,403		70,661
Non-Current Assets
Plant and equipment		12		9,832		12,385
Total Assets				687,631		553,088
LIABILITIES AND EQUITY
Current Liabilities
Trade payables				230,539		104,338
Other payables and accrued charges				30,912		32,629
Amount due to a related company		14		-		74,208
Amount due to director		15		146,965		146,954
Loans		16		315,683		348,270
				724,099		706,399

Equity
Share capital		17		3,000		3,000
Reserves		18		(39,468)		(156,311)
				(36,468)		(153,311)
Total Liabilities and Equity				687,631		553,088

The financial statements on pages 5 to 21 were approved by the Board of Director on 9 March 2011 and are signed on its behalf by:

/s/ Li Xichang

SOLE DIRECTOR

The accompanying notes form an integral part of these financial statements.

PEACE JOY MANAGEMENT LIMITED

STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2010


	NOTES		2010 US$		2009 US$
ASSETS
Current Assets
Trade receivables				192,649		200.529
Other receivables and deposits				23,002
Amount due from a related company		10		53,300		1,933
Bank balances and cash				817		4.243
				269,768		206,705
Non-Current Assets
Interests in subsidiary		13		133,000		133,000
Total Assets				402,768		339,705

LIABILITIES AND EQUITY
Current Liabilities
Trade payables				175,000		65,698
Other payables and accrued charges				5,128		13,145
Amount due to a related company		14		-		74,208
Amount due to director		15		147,000		147,000
				327,128		300,051

Equity		17		3.000		3,000
Share capital		18		72,640		36.654
Reserves				75,640		39,654


Total Liabilities and Equity				402,768		339,705

The financial statements on pages 5 to 21 were approved by the Board of Director on 9 March 2011 and are signed on its behalf by:

/s/ Li Xichang

SOLE DIRECTOR

The accompanying notes form an integral part of these financial statements.

PEACE JOY MANAGEMENT LIMITED

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 DECEMBER 2010



	Share capital	Accumulated losses		Total
	US$	US$		US$
At 31 December 2009	3,000	(156,311	)	(153,311	)
Profit for the year	-	116,843		116.843
At 31 December 2010	3,000	(39,468	)	(36,468	)

The accompanying notes form an integral part of these financial statements.

PEACE JOY MANAGEMENT LIMITED

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED 31 DECEMBER 2010


		2010		2009
		US$		US$
Cash inflows from operating activities
Profit before taxation		116,843		333,153
Depreciation		5,003		12,477
Interest income	(180)			(168	)
Operating profit before working capital changes		121,666		345,462
Decrease (increase) in trade receivables		20,657		(175,597	)
(Increase) decrease In other receivables and deposits		(24,997	)	237,617
(Decrease) increase in amounts due from related companies		(58,952	)	69,494
(Increase) decrease in inventories		(14,062	)	81J14
Increase (decrease) in trade payables		126,201		(162,142	)
Increase (decrease) in other payables and accrued charges		(1,717	)	(211,712	)
Decrease in amount due to a related company		(74,208	)	(25,524	)
Increase in amount due to director		11		66
Net cash generated from operating activities		94,599		158,778
Cash flows from investing activities
Purchase of equipment		(2,450	)	(700	)
Net cash used in investing activities		(2,450	)	(700	)
Cash flows from financing activities
Interest received	180			168
Repayment of loan principal		(122,646	)	(161,150	)
New loan principal raised		75,850		-
Increase in loans interest accrual		14,209		22,849
Net cash used in financing activities		(32,407)		(138,133	)
Increase in cash and cash equivalents		59,742		19,945
Cash and cash equivalents at beginning of the year		70,661		50,716
Cash and cash equivalents at end of the year
Represented by bank balances and cash		130,403		70,661

The accompanying notes form an integral part of these financial statements.

PEACE JOY MANAGEMENT LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2010

1. GENERAL

The Company is a private limited company incorporated in the British Virgin Islands. Its

registered office is locatcd at Akara Building, 24 De Castro Street, Wickhanis Cay I, Road

Town, Tortola, British Virgin Islands

The Group continues to engage in the manufacturing of medical devices.

The consolidated financial statements are presented in United States Dollars ("US$"), the

functional currency of the Group.

2. ADOPTION OF NEW HONG KONG FINANCIAL REPORTING STANDARD FOR PRIVATE ENTITIES

In the current year, the Group has taken the option to apply, for the first time, a number of

the new Hong Kong Financial Reporting Standard for Private Entities ("HKFRS - Private

Entities"), issued by the Hong Kong Institute of Certified Public Accountants ("HKICPA").

The Group does not produce financial staternents available for public use.

The adoption of the new HKFRS - Private Entities has not resulted in a material change to

the accounting policies and also has no material effect on how the results for the current or

prior accounting periods are prepared. Accordingly, no prior year adjustment has been

required.

The HKICPA has also issued the following standards and interpretations that are not yet

effective, which the Company has considered these options but does not expect they will

have a material effect on how the results of operations and financial position of the

Company and the Group are prepared and present.

HKFRSs (Amendments)	Improvements to HKFRSs 2010	Effective for accounting periods beginning on or after 1 July 2010 or 1 January 2011

HK (IFRJC)-INT 17	Classification of Rights Issues	February 2010
HK (IFR1C)-INT I9	Extinguishing Financial Liabilities with Equity Instruments	1 July 2010
HKAS 24 (Revised)	Related Party Disclosure	1 January 2011
HKAS 12 (Amendments)	Income Taxes	1 January 2012
HKFRS 9	Financial Instruments	1 January 2013

PEACE JOY MANAGEMENT LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2010

3. SIGNIFICANT ACCOUNTING POLICIES

Basis of preparation

The financial statements have been prepared under the historical cost convention and in

accordance with HKFRS - Private Entities issued by HKICPA and accounting principles

generally accepted in Hong Kong.

At the reporting date, the Group has a net current liahilities of US$46,300 (2009:

US$165,696) and net liabilities of US$36,468 (2009: US$153,311). However, the

Company's director has strong confidence to obtain adequate financial supports to enable

the Group to meet its liabilities as and when they fall due so that the Group can continue its

business in the foreseeable future. Consequently, the director has prepared the financial

statements of the Group on a going concern basis.

The principal accounting policies adopted are set out below.

Consolidation

These consolidated financial statements incorporate the financial statements of the

Company and its subsidiary. A subsidiary is an entity (including special purpose entity)

over which the Group has the power to govern the financial and operating policies so as to

obtain benefits from its activities, generally but not necessarily accompanying a

shareholding of more than half of the voting power. The subsidiary is fully consolidated

from the date on which control is transferred to the Group and is de-consolidated from the

date that control ceases.

All intra-group transactions, balances, income and expenses are eliminated on

consolidation. Accounting policies of the subsidiary have been changed where necessary

to ensure consistency with the policies adopted by the Group. There is no difference in

the reporting date of the financial statements of the Company and its subsidiary used in the

preparation of the consolidated financial statements.

In the statement of financial position of the Company, investment in subsidiary is stated at

cost less provision for impairment loss. The results of the subsidiary are accounted by the

Company on the basis of dividend received and receivable.

Revenue recognition

Revenue during the year represents sales of goods, which are recognized when goods are

delivered and title has been passed.

Interest income is recognized as it accrues using the effective interest method.

PEACE JOY MANAGEMENT LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2010

3. SIGNIFICANT ACCOUNTING POLICIES - cont'd

Plant and equipment

Items of plant and equipment are measured at cost less accumulated depreciation and any

accumulated impairment losses.

Depreciation is charged so as to allocate the cost of assets less their residue values (10% of

cost) over their estimated useful lives, using the straight-line method. The following

annual rates are used for the depreciation of plant and equipment.

Machinery	18%
Furniture and equipment	18%
Motor vehicles	18%

If there is an indication that has been a significant change in the depreciation rate, useful

life or residual value of an asset, the depreciation of that asset is revised prospectively to

reflect the new expectations.

An asset's carrying amount is written down immediately to its recoverable amount if the

asset's carrying amount is greater than its estimated recoverable amount.

The gain or loss arising from the disposal or retirement of an asset is determined as the

difference between the sale proceeds and the carrying amount of the asset and is recognized

in the profit or loss.

Impairmeat of non-financial assets, other than inventories

At each reporting date, the Group reviews the carrying amounts of plant and equipment to

determine whether there is any indication that those assets have suffered an impairment

loss. If there is an indication of possible impairment, the recoverable amount of any

affectcd asset (or group of related assets) is estimated and compared with its carrying

amount. If an estimated recovered amount, and an impairment loss is recognized

immediately in profit and loss.

If an impairment loss subsequently reverses, the carrying amount of the asset (or group of

related assets) is increased to the revised estimate of its recoverable amount, but not in

excess of the amount that would have been determined had no impairment loss been

recognized for the asset (group of related assets) in prior year. A reversal of an

impairment loss is recognized immediately in profit or loss.

PEACE JOY MANAGEMENT LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAH ENDED 31 DECEMBER 2010

3. SIGNIFICANT ACCOUNTING POLICIES - cont'd

Borrowings

Borrowings are recognized initially at the transaction price and arc subsequently stated at

amortised cost. Borrowings are classified as current liabilities unless the Group has an

unconditional right to defer settlement of the liabilities for at least twelve months after the

reporting date.

Interest expense is recognized on the basis of the effective interest method and is included

in finance cost.

Trade receivables

Trade receivables are recognized initially at the transaction price. They are subsequently

measured at amortised cost using the effective interest method less provision for

impairment. A provision for impairment of trade receivables is established when there is

objective evidence that the Group will not be able to collect all amounts due according to

the original terms of receivables.

Inventories

Inventories are stated at the lower of cost and selling price less costs to complete and sell.

Cost is calculated using the average cost method. The cost of finished goods and work in

progress is comprised of packaging costs, raw materials, direct labour, other direct costs and

related production overheads (based on normal operating capacity). At each reporting date,

inventories are assessed for impairment and the carrying amount is reduced to its selling

price less cost to complete and sell with the impairment loss recognized immediately in

profit and loss.

Operating lease

Rental payable under operating lease is charged to profit and loss on a straight-line basis

over the term of the relevant lease.

Trade payables

Trade payables are recognized initially at the transaction price and subsequently measured

at amortised cost using the effective interest method.

Foreign currencies translation

The financial statements are presented in United State Dollars, which is the functional and

presentation currency of the Group.

Foreign currency transactions are translated into the functional currency using the exchange

rates prevailing at the dates of the transactions. Foreign exchange gains and losses

resulting from the settlement of such transactions and from the translation of monetary

assets and liabilities denominated in foreign currencies at the exchange rates prevailing at the

reporting sheet date are recognized in the profit and loss account.

PEACE JOY MANAGEMENT LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2010

3. SIGNIFICANT ACCOUNTING POLICIES -cont'd

Related parties

For the purpose of these financial statements, related party includes a person and entity as

defined below;

(a) A person or a close member of that person's family is related to the Company if that

person:

(i)	is a member of the key management personnel of the Company or of a parent of the Company;

(ii)	has control over the Company; or
(iii)	has joint control or significant influence over the reporting entity or has significant voting power in it.

(b) An entity is related to the Company if any of the following conditions applies:

(i)	the entity and the Company are members of the same group (which means that each parent, subsidiary and fellow subsidiary is related to the others).
(ii)	either entity is an associate or joint venture of other entity (or a member of a group of which the other entity is a member).
(iii)	both entities are joint ventures of a third entity.
(iv)	either entity is a joint venture of a third entity and the other entity is an associate of the third entity.
(v)	the entity is a post-employment benefit plan for the benefit of employees of either the Company or an entity related to the Company. If the reporting entity is itself such a plan, the sponsoring employers are also related to the plan.
(vi)	the entity is controlled or jointly controlled by a person identified in (a).
(vii)	a person identified in (a) has significant voting power in the entity.

Taxation

Income tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs

from profit as reported in the statement of comprehensive income because of items of

income or expense that are taxable and deductible in other years and items that are never

taxable or deductible. The Group's liability for current tax is calculated using tax rates

that have been enacted or substantively enacted by the end of the reporting period.

PEACE JOY MANAGEMENT LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2010

3. SIGNIFICANT ACCOUNTING POLICIES - cont'd

Taxation - cont'd

Deferred tax is recognized on temporary differences between the carrying amount of assets

and liabilities in the financial statements and the corresponding tax bases used in the

computation of taxable profit. Deferred tax liabilities are generally recognized for all

taxable temporary differences that are expected to increase taxable profit in the future.

Deferred tax assets are recognized to the extent that it is probable that taxable profits will

be available against which deductible temporary differences can be utilized. Such

deferred assets and liabilities are not recognized if the temporary difference arises from

goodwill or from the initial recognition (other than in a business combination) of other

assets and liabilities in a transaction that affects neither the taxable profit nor the

accounting profit.

The carrying amount of deferred tax assets is reviewed at the reporting date and reduced to

the extent that it is no longer probable that sufficient taxable profits will be available to

allow all or part of the asset to be recovered.

Deferred tax assets and liabilities are measured at the rates that are expected to apply in the

period when the liability is settled or the asset is realized, based on tax rates (and tax laws)

that have been enacted or substantively enacted at the reporting date. The measurement of

deferred tax liabilities and assets reflects the tax consequences that would follow from the

manner in which the Group expects, at the reporting date, to recover or settle the carrying

amount of its assets and liabilities. However, the measured at fair value does not exceed

the amount of tax that would be payable on its sale to an unrelated market participant at fair

value at the reporting date. Deferred tax is recognized in profit or loss, expect when it

relates to items that are recognized in other comprehensive income or directly in equity, in

which case the deferred tax is also recognized in other comprehensive income or directly in

equity respectively.

Cash equivalents

Cash equivalents represent short-term, highly liquid investments which are readily

convertible into known amounts of cash and which were within three months of maturity

when acquired, less advances from banks repayable within three months from the date of

the advance.

Employee benefit obligations

Salaries, wages, bonuses, paid leave, contributions to defined contribution retirement plans

and the cost of non-monetary benefits are accrued in the year in which the associated

services are rendered by employees. Where payment or settlement is deferred and the

effect would be material, these amounts are stated at their present values.

PEACE JOY MANAGEMENT LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2010

4. REVENUE

Revenue, which is also the Group's turnover, represents the net invoiced value of goods

sold during the year.

5. OTHER INCOME

	2010	2009
	US$	US$
Bank interest income	180	168

6. FINANCE COSTS

	2010	2009
	US$	US$
Interest on loans wholly repayable within five years	12,479	22,849

7. PROFIT BEFORE TAX

	2010		2009
	US$		US$
Profit from continuing operations before taxation
has been arrived at after charging (crediting) :

Audit fee		2,564		2,564
Depreciation		5,003		12,477
Director's remuneration		16,997		10,987
Exchange differences		9,031		(5,689	)
Operating lease rentals for factory premise		13,654		10,632
Staff costs (excluded director's remuneration)		73,216		49,442

Staff costs above include social insurance contribution in the People's Republic of China amounted to US$ 11,456 (2009: US$8,569).

PEACE JOY MANAGEMENT LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2010

8. INCOME TAX EXPENSE

No provision for income tax has been made in the financial statements as neither the

Company nor its subsidiary has assessable profit.

At the reporting date, insignificant deferred tax has not been provided in the financial

statements.

9. NET PROFIT FOR THE YEAR

Of the consolidated profit of US$ 116,843 (2009: US$333,153) a net profit of

US$35,986 (2009: US$142,799) has been recognized within the financial statements of the

Company,

10. AMOUNTS DUE FROM RELATED COMPANIES


	Maximum outstanding balance during the year		Balance at 31.12.2010		Balance at 31.12.2009
	US$		US$		US$
The Group
Fast Growth Enterprise Limited		53,300		53,300		1,933
Other		7,585		7,585		-
				60,885		1,933
The Company
Fast Growth Enterprise Limited		53,300		53,300		1,933

The amounts due from related companies are interest-free, unsecured and have no fixed terms of repayment. The Company’s director is a director and shareholder of the above related companies.

PEACE JOY MANAGEMENT LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2010

13. INVENTORIES

	2010	2009
	USS	USS
The Group
Raw materials	120,362	110,561
Work-in-progress	88,918	70,882
Finished goods	52,712	66,487
	261,992	247,930

12, PLANT AND EQUIPMENT


	Furniture & Equipment	Machinery	Motor Vehicles	Total
The Group	US$	US$	US$	US$
Cost
At 1.1.2010	27,723	19,660	21,294	68,677
Additions	2,031	419	-	2,450
At 31.12.2010	29,754	20,079	21,294	71,127
Accumulated Depreciation
At 1.1.2010	22,944	12,179	21,169	56,292
Charge for The year	2,005	2,873	125	5,003
At 31.12.2010	24,949	15,052	21,294	61,295

Carrying Amount
At 31.12.2010	4,805	5,027	-	9,832

At 31,12,2009	4,779	7,481	125	12,385

13. INTERESTS IN SUBSIDIARY

	2010		2009
	US$		US$

Contributed capital		120,000		120,000
Amount due from subsidiary		13,000		13,000

		133,000		133,000

PEACE JOY MANAGEMENT LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2010

13. INTERESTS IN SUBSIDIARY - cont'd

Particulars of the subsidiary dircctly held by the Company at the reporting date.

Name		Country of Incorporation		Paid-up registered Capital		Percentage holding		Principal Activity
Life Enhancement Technology Limited		People’s Republic of China		US$120,000		100%		Manufacturing of medical device

Amount due from subsidiary is unsecured, interest free and has no fixed term of repayment.

14. AMOUNT DUE TO A RELATED COMPANY

Amount due to Nature Way Technology Limited was unsecured, interest free and had been

fully repaid during the year. The Company's director is a director and shareholder of

Nature Way Technology Limited.

15. AMOUNT DUE TO DIRECTOR

Amount due to director is unsecured, interest free and has no fixed term of repayment.

16. LOANS

	2010		2009
	US$		US$
Loans
Principals		258,858		305,654
Interest accruals		56,825		42,616
		315,683		348.270

The loan raised by the subsidiary in previous years is unsecured, interest-bearing at the

bank lending rate and repayable within one year. During the current reporting period, the

subsidiary has also obtained another unsecured loan, interest-bearing at 3.65% per annum

and repayable within one year. According to the Company's director, concerned parties

are not related parties to the Group.

PEACE JOY MANAGEMENT LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2010

17. SHARE CAPITAL

	2010	2009
	US$	US$
Authorized
50,000 shares of US$1 each	50.000	50,000

Issued and fully paid
3,000 shares of US$1 each	3,000	3,000

18. RESERVES

	Retained Earnings (Accumulated Losses) US$


The Group
At 31 December 2009		(156,311	)
Profit for the year		116,843

At 31 December 2010		(39,468	)

The Company
At 31 December 2009		36,654
Profit for the year		35,986

At 31 December 2010		72,640

19. OPERATING LEASE COMMITMENTS

At the reporting date, the Group had commitments payable regarding the total of future

minimum lease payments under non-cancellable operating leases with respect to rented factory

premises as follows:

	2010	2009
	US$	US$

Within one year	14,970	3,544
Later than one year but within five years	18,712	-

	33,682	3,544

PEACE JOY MANAGEMENT LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2010

20. RELATED PARTY TRANSACTIONS

Details of significant related party transactions during the year as at the reporting date are as

follows:


	2010	2009
	US$	US$

Amount due from;
Fast Growth Enterprise Limited	53,300	1,933
Other	7.585	-

Amount due to:
Nature Way Technology Limited	-	74.208
LI Xichang	146,965	146,954

Li Xichang is the Company's director, who is also director and shareholder of the above

related companies. All the above concerned amounts are unsecured, interest free and have

no fixed terms of repayment.

The Company's director is of the opinion that the above transactions have been entered into

on normal commercial terms.

The remuneration of the Company's director set out in note 7 to the financial statements

will be reviewed in the coming general meeting of the Company.

21. FAIR VALUE

The Company's director considers that the carrying amounts of the financial instruments

approximate their fair values at the reporting date.

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