CONCENTRATIONS AND RISKS

9 Months Ended

Sep. 30, 2013

NOTE 11 - CONCENTRATIONS AND RISKS

The Company maintains certain bank accounts in the PRC and BVI, which are not protected by Federal Deposit Insurance Corporation (“FDIC”) insurance or other insurance. The cash balance held in the PRC bank accounts was $15,707,244 and $2,515,264 as of September 30, 2013 and December 31, 2012, respectively. The cash balance held in the BVI bank accounts was $7,605,476 and $18,457 as of September 30, 2013 and December 31, 2012, respectively. As of September 30, 2013 and December 31, 2012, the Company held $4,312 and $10,393 of cash balances within the United States, none of which was in excess of FDIC insurance limits.

During the periods ended September 30, 2013 and 2012, almost 100% of the Company's assets were located in the PRC and 100% of the Company's revenues were derived from its subsidiaries located in the PRC.

The Company’s principal raw material used during the year was gold, which accounted for almost 100% of its total purchases for the three months and nine months ended September 30, 2013 and 2012. The Company purchased gold directly, and solely, from The Shanghai Gold Exchange, the largest gold trading platform in the PRC.

- Definition

The entire disclosure for any concentrations existing at the date of the financial statements that make an entity vulnerable to a reasonably possible, near-term, severe impact. This disclosure informs financial statement users about the general nature of the risk associated with the concentration, and may indicate the percentage of concentration risk as of the balance sheet date.

+ References+ Details