SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

Jun. 30, 2012

Estimated Useful Lives of Assets

Depreciation for financial reporting purposes is provided using the straight-line method over the estimated useful lives of the assets as follows:

	Useful Life
	(In years)
Buildings	5-20
Machinery	5-10
Office equipment & motor vehicles	5

Exchange Rates Used to Translate Amounts in RMB to U.S. Dollars

The exchange rates used to translate amounts in RMB into U.S. Dollars for the purposes of preparing the consolidated financial statements are based on the rates as published on the website of People’s Bank of China and are as follows:

	June 30, 2012		December 31, 2011
Balance sheet items, except for equity accounts		US$1=RMB 6.3249		US$1=RMB 6.3009
	Three months ended June 30,
	2012		2011
Items in the statements of income and cash flows		US$1=RMB 6.3074		US$1=RMB 6.5011
	Six months ended June 30,
	2012		2011
Items in the statements of income and cash flows		US$1=RMB 6.3074		US$1=RMB 6.5411