Note 5 - Related Party Transactions

3 Months Ended

Jun. 30, 2012

Note 5 - Related Party Transactions:

Note 5 - Related Party Transactions

NOTE 5 - RELATED PARTY TRANSACTIONS

The Company periodically has receivables from its affiliates, owned by Mr. Pu Fachun, the single largest shareholder and president of the Company. The Company expects all outstanding amounts due from its affiliates will be repaid and no allowance is considered necessary. The Company also periodically borrows money from its shareholders to finance the operations.

The details of loans to/from related parties are as follows:

	June 30, 2012			September 30, 2011
Short term:
Short term loan from Chunfei Real Estate	$		387,882	$	783,266
Short term loan from Pu Fachun			1,119,168		302,508
Short term loan from Zhang Lizi		-			313,481
	$		1,507,050	$	1,399,255
Long term:
Loan From Chunfei Real Estate	$		1,471,922	$	55,486
Loan From Chunfei Daily Chemical			276,534		275,270
Loan From Pu Fachun			1,563,728		1,442,237
Loan From Other Officer and Employee			8,654		8,616
Loan From Other Officer and Employee	$		3,320,838	$	1,781,609

Sichuan Chunfei Daily Chemicals Co. Ltd (“Daily Chemical”) and Sichuan Chunfei Real Estate (“Chunfei Real Estate”) are owned by Mr. Pu Fachun. Zhang Lizi is the wife of Pu Fachun.  

Short term loans from Chunfei Real Estate of $387,882 with fixed interest of 1% per month are due on June 1 and October 2, 2012. Short term loan from Mr. Pu of $1,119,168 is due on December 9, 2012 with fixed interest of 1% per month.

Long-term loans from Chunfei Real Estate of $1,471,922 are due on December 31, 2013 with  $1,415,657 of these loans bearing interest of 1% per month and $55,741 with  no interest.  Long term loans from Daily Chemical are due on December 31, 2012 bear no interest. Long term loans from Mr. Pu were $ 1,563,727 which included $1,370,182 due on December 31, 2014 bearing no interest and $193,545 due on January 30, 2014 with interest of 1% per month. Long term loans from other officer and employee were $8,654 due on December 31, 2013 and with no interest

Interest expense, including imputed interest, for the three and nine months ended June 30, 2012 was approximately $172,000 and $241,000.