NOTE 11 - INCOME TAXES

3 Months Ended

Mar. 31, 2016

Notes to Financial Statements

NOTE 11 - INCOME TAXES

NOTE 11 INCOME TAXES

No provision was made for income tax for the three months ended March 31, 2016 and 2015, since the Company and its subsidiaries had significant net operating loss. In the three months ended March 31, 2016 and 2015, the Company and its subsidiaries incurred net operating losses for tax purposes of approximately $173,384 and $0,356, respectively. Total net operating losses carry forward as at March 31, 2016 and 2015, (i) for Federal and State purpose were $11,761,918 and $11,523,939, respectively and (ii) for its entities outside of the United States $152,489 and $78,483. The net operating loss carry-forwards may be used to reduce taxable income through the year 2025. The availability of the Company's net operating loss carry-forwards are subject to limitation if there is a 50% or more change in the ownership of the Company's stock.

There was no significant difference between reportable income tax and statutory income tax. The gross deferred tax asset balance as at March 31, 2016 and December 31, 2015 was approximately $5,067,280 and $4,945,148 respectively. A full valuation allowance has been established against the deferred tax assets, as the utilization of the loss carry-forwards cannot reasonably be assured.

A reconciliation between the income tax computed at the Hong Kong and PRC China statutory rate and the Group's provision for income tax is as follows:

	2016	2015
Malaysia statutory rate	25%	25%
Tax allowance	-	-
Valuation allowance – Loss carryforward under Malaysia rate	(25%)	(25%)
Provision for income tax	-	-