OTHER RECEIVABLES & PREPAID EXPENSES - Note 9

12 Months Ended

Dec. 31, 2011

Notes to Financial Statements

OTHER RECEIVABLES & PREPAID EXPENSES - Note 9

NOTE 9 — OTHER RECEIVABLES & PREPAID EXPENSES

As of December 31, 2011 and 2010, the Company's other receivables and prepaid expenses consisted of the following:

	December 31, 2011		December 31, 2010
Advance to employees	$	23,882	$	64,737
Deposit for equipment lease	211,583		49,730
Prepaid expenses		238,857		36,982
Bank notes (a)	9,226,641
Other	83,044		79,875
Total other receivables	$	9,784,007	$	432,205

The deposit for equipment lease is recoverable within one year.

(a) Per purchase contract signed in 2010, CECCC provided mobile phone components to the Company. The Company paid in advance to CECCC by payment of 'bank notes'. During 2011, no purchase transaction was completed. As of December 31, 2011, the total outstanding amount is $9.3 million (RMB 58.7 million) and during the first quarter of 2012, the Company was repaid approximatelt $4.8 million (RMB 30.4 million) by CECCC.