10-Q/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10−Q /A

Amendment No. 1

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: June 30, 2012

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to _____________

Commission File Number: 000-25108

UNILAVA CORPORATION

(Exact Name of Registrant as Specified in Its Charter)

Wyoming	80-0568736
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

353 Sacramento Street, Suite 1500

San Francisco, CA 94111

(Address of principal executive offices, Zip Code)

(415) 321-3490

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes   x   No   o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes   o No   o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	o	Accelerated filer	o
Non-accelerated filer	o	Smaller reporting company	x
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes   o   No x

The number of shares outstanding of each of the issuer’s classes of common stock, as of August 15, 2012 is as follows:

Class of Securities	Shares Outstanding
Common stock, no par value	100,051,107

1

EXPLANATORY NOTE

We are filing this Amendment No. 1 on Form 10-Q/A to our Quarterly Report on Form 10-Q for the quarter ended June 30, 2012 (the “Form 10-Q”), which was originally filed with the Securities and Exchange Commission on August 20, 2012, for the sole purpose of furnishing the Interactive Data File as Exhibit 101 in accordance with Rule 405 of Regulation S-T. Exhibit 101 to this report furnishes the following items from the Form 10-Q formatted in eXtensible Business Reporting Language (XBRL): (i) the unaudited Consolidated Balance Sheets as of June 30, 2012 and audited Consolidated Balance Sheets as of December 31, 2011, (ii) the unaudited Consolidated Statements of Operations and Comprehensive Loss for the three and six months ended June 30, 2012 and 2011, (iii) the unaudited Consolidated Statements of Cash Flows for the six months ended June 30, 2012 and 2011, and (iv) the unaudited Notes to Condensed Consolidated Financial Statements.

No other changes have been made to the Form 10-Q. This Amendment does not reflect events that have occurred after the August 20, 2012 filing date of the Form 10-Q, or modify or update the disclosures presented therein, except to reflect the amendment described above.

2

ITEM 6. EXHIBITS.

The following exhibits are filed as part of this report or incorporated by reference:

Exhibit No.	Description
31.1	Certifications of Principal Executive Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. *
31.2	Certifications of Principal Financial Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. *
32.1	Certifications of Principal Executive Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. *
32.2	Certifications of Principal Financial Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. *
101.INS	XBRL Instance Document **
101.SCH	XBRL Taxonomy Extension Schema **
101.CAL	XBRL Taxonomy Extension Calculation Linkbase **
101.DEF	XBRL Taxonomy Extension Definition Linkbase **
101.LAB	XBRL Taxonomy Extension Label Linkbase **
101.PRE	XBRL Extension Presentation Linkbase **

*   Previously filed.

** Furnished herewith.

3

SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: August 27 , 2012	UNILAVA CORPORATION
	By:	/s/ Baldwin Yung
		Baldwin Yung, Chief Executive Officer and Chief Financial Officer (Principal Executive, Financial and Accounting Officer)

4

EXHIBIT INDEX

Exhibit No.	Description
31.1	Certifications of Principal Executive Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. *
31.2	Certifications of Principal Financial Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. *
32.1	Certifications of Principal Executive Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. *
32.2	Certifications of Principal Financial Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. *
101.INS	XBRL Instance Document **
101.SCH	XBRL Taxonomy Extension Schema **
101.CAL	XBRL Taxonomy Extension Calculation Linkbase **
101.DEF	XBRL Taxonomy Extension Definition Linkbase **
101.LAB	XBRL Taxonomy Extension Label Linkbase **
101.PRE	XBRL Extension Presentation Linkbase **

*    Previously filed.

** Furnished herewith.

5

XML

Segment Reporting (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011	Dec. 31, 2011
Revenue from external customers	$ 735,910	$ 887,256	$ 1,556,797	$ 1,825,313
Cost of revenue	399,753	425,040	788,815	895,974
Gross profit	336,157	462,216	767,982	929,339
Operations and support expenses	642,530	739,924	1,454,402	1,508,192
Depreciation and amortization	35,271	38,845	71,987	78,680
Total segment operating expenses	712,800	778,769	1,526,390	1,586,872
Segment operating income	(376,643)	(316,553)	(758,408)	(657,533)
Total other income (expense)	(95,941)	(118,429)	(199,001)	(220,581)
Net loss allocable to minority interest	(13,442)	(17,062)	(22,076)	(34,440)
Segment income before income taxes	(459,142)	(417,920)	(935,333)	(843,674)
Segment assets	2,796,385	4,163,039	2,796,385	4,163,039	2,920,910
AdvertisingSolutions [Member]
Revenue from external customers	191,806	258,767	404,903	550,920
Cost of revenue	68,784	66,963	132,879	193,895
Gross profit	123,022	191,804	272,024	357,025
Operations and support expenses	456,221	481,201	960,297	974,993
Depreciation and amortization	15,577	18,486	32,600	37,962
Total segment operating expenses	471,798	499,687	992,897	1,012,955
Segment operating income	(348,776)	(307,883)	(720,873)	(655,930)
Total other income (expense)	(97,178)	(102,208)	(184,105)	(188,322)
Net loss allocable to minority interest
Segment income before income taxes	(445,954)	(410,091)	(904,978)	(844,252)
Segment assets	2,564,739	2,815,984	2,564,739	2,815,984
Wireless [Member]
Revenue from external customers	68,894	53,483	153,360	73,645
Cost of revenue	81,309	67,752	141,980	101,358
Gross profit	(12,415)	(14,269)	11,380	(27,713)
Operations and support expenses	21,068	17,484	34,024	39,348
Depreciation and amortization	19,322	19,987	38,645	39,975
Total segment operating expenses	40,390	37,471	72,669	79,323
Segment operating income	(52,805)	(51,740)	(61,289)	(107,036)
Total other income (expense)	1,237	(16,221)	(14,931)	(32,259)
Net loss allocable to minority interest	13,442	17,062	22,076	34,440
Segment income before income taxes	(38,126)	(50,899)	(54,144)	(104,855)
Segment assets	1,526,627	1,676,083	1,526,627	1,676,083
Wireline [Member]
Revenue from external customers	475,210	575,006	998,534	1,200,748
Cost of revenue	249,660	290,325	513,956	600,721
Gross profit	225,550	284,681	484,578	600,027
Operations and support expenses	194,848	234,006	452,574	483,949
Depreciation and amortization	372	372	743	743
Total segment operating expenses	195,220	234,378	453,317	484,692
Segment operating income	30,330	50,303	31,261	115,335
Total other income (expense)			35
Net loss allocable to minority interest
Segment income before income taxes	30,330	50,303	31,296	115,335
Segment assets	1,031,261	2,133,155	1,031,261	2,133,155
Other1Member
Revenue from external customers
Cost of revenue
Gross profit
Operations and support expenses	5,391	7,233	7,509	9,902
Depreciation and amortization
Total segment operating expenses	5,391	7,233	7,509	9,902
Segment operating income	(5,391)	(7,233)	(7,509)	(9,902)
Total other income (expense)
Net loss allocable to minority interest
Segment income before income taxes	(5,391)	(7,233)	(7,509)	(9,902)
Segment assets	44	56	44	56
Elimination [Member]
Revenue from external customers
Cost of revenue
Gross profit
Operations and support expenses	1		(2)
Depreciation and amortization
Total segment operating expenses	1		(2)
Segment operating income	(1)		2
Total other income (expense)
Net loss allocable to minority interest
Segment income before income taxes	(1)		2
Segment assets	$ (2,326,286)	$ (2,462,239)	$ (2,326,286)	$ (2,462,239)

XML

Going Concern (Details Narrative) (USD $)	Jun. 30, 2012	Dec. 31, 2011
Going Concern Details Narrative
Accumulated deficit	$ (6,306,094)	$ (5,370,761)
Working capital	$ (7,324,965)

XML

Related Party Transactions (Details Narrative) (USD $)	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Dec. 31, 2011
Loan balance	$ 4,380,098		$ 3,900,728
Repayment of related party loan	11,214	9,000
Other related party transactions	0
BoardOfDirectorsChairman [Member]
Loan balance			176,352
Outstanding accounts payable related party			7,689
Repayment of related party loan	11,214
Additional financing received	25,000
BaldwinYung [Member]
Loan balance	66,135		387,000
BaldwinYung [Member] | ChiefExecutiveOfficer [Member]
Outstanding accounts payable related party			65,049
Boaz Yung EVP [Member]
Loan balance	1,125
Outstanding accounts payable related party			13,691
CherieYung Member]
Loan balance			76,609
CherieYung Member] | Director [Member]
Loan balance	257,144		135,000
Outstanding accounts payable related party			54,572
DickenYung [Member]
Loan balance	30,812
DickenYung [Member] | BoardOfDirectorsChairman [Member]
Loan balance	190,536
Boaz YungEVP2ndLoanOutstandingMember
Loan balance			$ 14,431

XML

Accounts Receivable

6 Months Ended

Jun. 30, 2012

Notes to Financial Statements

Accounts Receivable

The Company provides billing information to a third party billing company for the majority of its monthly billings.  Billings submitted are “filtered” by this billing company and the LEC’s. Net accepted billings are recognized as revenue and accounts receivable.  The billing company remits payments to the Company on the basis of cash ultimately received from the LEC’s by the billing company.  The billing company and LEC’s charge fees for services, which are netted against the gross accounts receivable balance. The billing companies also apply holdbacks to the remittance for potentially uncollectible accounts.  These dilution amounts will vary due to numerous factors and the Company may not be certain as to the actual amounts of dilution on any specific billing submittal until several months after that submittal.  The Company estimates the amount of these charges and holdbacks based on historical experience and subsequent information received from the billing companies.  The Company also estimates uncollectible account balances and provides an allowance for such estimates.  As of June 30, 2012 and December 31, 2011, the amount reserved for uncollectible account balances is $3,521 and $4,465, respectively.

The billing companies retain certain holdbacks that may not be collected by the Company for a period extending beyond one year. The balances are charged to bad debt expense.  However, when true-up balances occur with the LEC after six to eighteen months, the money received will be classified as revenue to offset current bad debt expenses.

The Company experiences significant dilution of its gross billings by the billing company.  The Company negotiates collections with the billing companies on the basis of the contracted terms and historical experience.  The Company’s cash flow may be affected by holdbacks, fees, and other matters, which are determined by the LEC’s and the billing company.  The Company processes its billings through the primary billing company.

XML

Fixed Assets (Details) (USD $)	Jun. 30, 2012	Dec. 31, 2011
Fixed assets, Gross	$ 2,515,537	$ 2,515,197
Accumulated depreciation	(935,004)	(863,304)
Fixed assets, net	1,580,533	1,651,953
MicrowaveTowers [Member]
Fixed assets, Gross	1,949,019	1,949,019
Fixed assets, net	1,949,019	1,949,019
ComputerEquipment [Member]
Fixed assets, Gross	226,265	226,265
Fixed assets, net	226,265	226,265
FurnitureAndEquipmentRentalExpenseOperatingLease [Member]
Fixed assets, Gross	117,446	117,106
Fixed assets, net	117,446	117,106
Software [Member]
Fixed assets, Gross	35,858	35,858
Fixed assets, net	35,858	35,858
TenantImprovements [Member]
Fixed assets, Gross	186,949	186,949
Fixed assets, net	$ 186,949	$ 186,949

XML

Accounts Receivable (Details Narrative) (USD $)	Jun. 30, 2012	Dec. 31, 2011
Accounts Receivable Details Narrative
Amount reserved for uncollectible account balances	$ 3,521	$ 4,465

XML

Fixed Assets (Details Narrative) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Fixed Assets Details Narrative
Depreciation expense	$ 35,271	$ 38,845	$ 71,987	$ 78,680

XML

Line of Credit and Notes Payable (Details) (USD $)	Jun. 30, 2012	Dec. 31, 2011	Jun. 30, 2012 ThermoCreditLlc [Member]	Jun. 30, 2011 ThermoCreditLlc [Member]	Jun. 30, 2012 BrilliantCapital [Member]	Jun. 30, 2011 BrilliantCapital [Member]	Jun. 30, 2012 Ahap [Member]	Jun. 30, 2011 Ahap [Member]	Jun. 30, 2012 InfoCityLlcAndOthers [Member]	Jun. 30, 2011 InfoCityLlcAndOthers [Member]	Jun. 30, 2012 DickenYung [Member]	Jun. 30, 2011 DickenYung [Member]	Jun. 30, 2012 BaldwinYung [Member]	Jun. 30, 2011 BaldwinYung [Member]	Jun. 30, 2012 BoazYung [Member]	Jun. 30, 2011 BoazYung [Member]	Jun. 30, 2012 CherieYung Member]	Jun. 30, 2011 CherieYung Member]
Principal Amount	$ 4,380,098	$ 3,900,728	$ 1,507,176	$ 1,507,176	$ 868,941	$ 574,899	$ 40,000	$ 40,000	$ 1,128,176	$ 1,079,176	$ 190,536	$ 176,352	$ 387,000	$ 387,000	$ 1,125	$ 1,125	$ 257,144	$ 135,000
Interest Rate			17.00%	17.00%		8.00%	8.00%	8.00%	8.00%	8.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%
Maturity Date			January 17, 2011	January 17, 2011	Upon Demand	Upon Demand	Upon Demand	Upon Demand	Upon Demand	Upon Demand	Upon Demand	Upon Demand	Upon Demand	Upon Demand	Upon Demand	Upon Demand	Upon Demand	Upon Demand
Interest Rate					Various

XML

Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2012

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Basis of Presentation

The unaudited consolidated financial statements include the accounts of Unilava Corporation and its subsidiaries, Telava Networks, Inc. (100% owned), Telava Acqusitions, Inc. (100% owned), Telava Wireless, Inc. (75% owned), Telava Mobile, Inc. (80% owned), Local Info Pages, Inc. (100% owned Korea-based entity) and IBFA Acqusitions LLC (100% owned) which are 100% consolidated in the financial statements as adjusted for various minority interests.  All material intercompany accounts and transactions have been eliminated. All significant intercompany transactions and balances are eliminated on consolidation.

The accompanying unaudited consolidated financial statements as of June 30, 2012 and for the three and six month periods ended June 30, 2012 and 2011 have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and of Regulation S-X.  Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to the Securities and Exchange Commission’s rules and regulations. In the opinion of management, these unaudited consolidated interim financial statements include all adjustments and disclosures considered necessary to a fair statement of the results for the interim periods presented.  All adjustments are of a normal recurring nature.  The results of operations for the three and six months ended June 30, 2012 are not necessarily indicative of the results for the full fiscal year ending December 31, 2012.  

You should read this discussion in conjunction with the consolidated financial statements, accompanying notes and management’s discussion and analysis of financial condition and results of operations included in our Annual Report on Form 10-K for the year ended December 31, 2011.

Fair Value of Financial Instruments

Accounting Standards Codification (“ASC”) 820, Fair Value Measurements and Disclosures , requires disclosing fair value to the extent practicable for financial instruments that are recognized or unrecognized in the balance sheet. Fair value of financial instruments is the amount at which the instruments could be exchanged in a current transaction between willing parties. The Company considers the carrying amounts of cash, restricted cash, accounts receivable, related party and other receivables, accounts payable, notes payable, related party and other payables, customer deposits, and short term loans approximate their fair values because of the short period of time between the origination of such instruments and their expected realization. The Company considers the carrying amount of long term bank loans to approximate their fair values based on the interest rates of the instruments and the current market rate of interest.

Level 1   The preferred inputs to valuation efforts are “quoted prices in active markets for identical assets or liabilities,” with the caveat that the reporting entity must have access to that market.  Information at this level is based on direct observations of transactions involving the same assets and liabilities, not assumptions, and thus offers superior reliability. However, relatively few items, especially physical assets, actually trade in active markets.

Level 2   FASB acknowledged that active markets for identical assets and liabilities are relatively uncommon and, even when they do exist, they may be too thin to provide reliable information. To deal with this shortage of direct data, the board provided a second level of inputs that can be applied in three situations.

Level 3   If inputs from levels 1 and 2 are not available, FASB acknowledges that fair value measures of many assets and liabilities are less precise. The board describes Level 3 inputs as “unobservable,” and limits their use by saying they “shall be used to measure fair value to the extent that observable inputs are not available.” This category allows “for situations in which there is little, if any, market activity for the asset or liability at the measurement date”. Earlier in the standard, FASB explains that “observable inputs” are gathered from sources other than the reporting company and that they are expected to reflect assumptions made by market participants.

Foreign Currency Adjustments

The financial position and results of operations of the Company’s foreign subsidiary, LIP, is measured using the foreign subsidiary’s local currency as the functional currency.  Revenues and expenses of the subsidiary have been translated into U.S. dollars at average exchange rates prevailing during the period.  Assets and liabilities have been translated at the rates of exchange on the balance sheet date.  The resulting translation gain and loss adjustments are recorded as a separate component of stockholders’ equity, unless there is a sale or complete liquidation of the underlying foreign investments. 

Cash and Cash Equivalents

This includes all short-term highly liquid investments that are readily convertible to known amounts of cash and have original maturities of three months or less.  The Company has a restricted cash balance of $28,101 and $28,078 on June 30, 2012 and December 31, 2011, respectively, which is comprised of Certificates of Deposit.   The restricted cash is held in certificates of deposit at various banking institutions.  The Company is expected to maintain the amounts in the certificates of deposit per agreements with certain vendors.

Accounts Receivable

Accounts receivable are reported at the customers' outstanding balances less any allowance for doubtful accounts. Interest is not accrued on overdue accounts receivable.  The Company evaluates receivables on a regular basis for potential reserve.

Fixed Assets

Fixed assets are stated at cost.  Major renewals and improvements are charged to the asset accounts while replacements, maintenance and repairs, which do not improve or extend the lives of the respective assets, are expensed.  At the time property and equipment are retired or otherwise disposed of, the asset and related accumulated depreciation accounts are relieved of the applicable amounts.  Gains or losses from retirements or sales are credited or charged to income.

The Company depreciates its fixed assets on a straight line basis at the following rates:

Microwave towers	25 years
Computer equipment	5 years
Furniture and equipment	7 years
Software	3 years
Leasehold improvements	5 years

 Long-lived Assets

Accounting for the Impairment or Disposal of Long-Lived Assets requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that the historical cost-carrying value of an asset may not be recovered.  The Company assesses recoverability of the carrying value of an asset by estimating the fair value of the asset.  If the fair value is less than the carrying value of the asset, an impairment loss is recorded equal to the difference between the asset's carrying value and fair value.  

Goodwill and Other Intangible Assets

Goodwill and other intangible assets arising from an acquisition of a business are periodically assessed for impairment rather than amortized on a straight-line basis.  Accordingly, the Company annually reviews the carrying value of this goodwill and other intangible assets to determine whether impairment, as measured by fair market value, may exist.  Specifically, goodwill and other intangible asset impairment is determined using a two-step process.  The first step of the goodwill and other intangible asset impairment test is used to identify potential impairment by comparing the fair value of a reporting unit with its carrying amount.  If the fair value of a reporting unit exceeds its carrying amount, then the goodwill and other intangible assets of the reporting unit are not considered to be impaired and the second step of the impairment test is unnecessary.  If the carrying amount of a reporting unit exceeds its fair value, the second step of the impairment test is performed to measure the amount of impairment loss, if any.  The second step of the impairment test compares the implied fair value of the reporting unit's goodwill and other intangible assets with their carrying amount.  If the carrying amount of the reporting unit's goodwill and other intangible assets exceeds their implied fair value, then an impairment loss is recognized in an amount equal to that excess. Goodwill consisted of $767,873 as of June 30, 2012 and December 31, 2011 as a result of the IBFA purchase as disclosed in the Company’s December 31, 2011 Form 10-K.

Accounting for Share-Based Compensation

The Company records stock based compensation in accordance with the guidance in ASC Topic 505 and 718 which requires the Company to recognize expenses related to the fair value of its employee stock option awards.  This eliminates accounting for share-based compensation transactions using the intrinsic value and requires instead that such transactions be accounted for using a fair-value-based method. The Company recognizes the cost of all share-based awards on a graded vesting basis over the vesting period of the award.  

The Company accounts for equity instruments issued in exchange for the receipt of goods or services from other than employees in accordance with FASB ASC 718-10 and the conclusions reached by the FASB ASC 505-50. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment or completion of performance by the provider of goods or services as defined by FASB ASC 505-50.

Revenue Recognition

Telava NV and LIP : The Company’s revenue is generated by customer subscriptions of directory and advertising services.  Revenue is billed and recognized monthly for services subscribed in that specific month.  The Company utilizes outside billing companies to transmit billing data, much of which is forwarded to Local Exchange Carriers (“LEC’s”) that provide local telephone service.

LEC Billing :   When a customer subscribes to the Company’s service, an electronic customer file is created which is the basis for the billing.  The Company submits gross billings electronically to third party billing aggregators. These billing aggregators compile and format electronic customer files and forward the billing records to the appropriate LEC’s.  The billing for our service flows through to monthly bills of the individual LEC customers.  The LEC’s collect the Company’s billing and remit amounts to the billing aggregators, which in turn remit funds to the Company.  The following are significant accounting estimates and assumptions used in the revenue recognition process with respect to these billings.

Customer refunds :   The Company’s customer refund policy allows the customer to request a refund if they are not satisfied with the service within the first 30 days of the subscription.  The Company accrues for refunds based on historical experience of refunds as a percentage of new billings in that 30-day period.  Customer refunds historically have been insignificant and therefore there is no reserve against gross revenue.

Non-paying customers :   There are customers who may not pay the fee for our services even though the Company believes they are valid subscribers.  Included in cost of services is an accrual for estimated non-paying customers that are recorded at the time of billing.

Dilution :   The Company recognizes revenue during the month for which the service is provided based on net billings accepted by the billing aggregators and recognizes revenue only for accepted records.  However, subsequent to this acceptance, there are instances in the LEC billing process where a customer cannot be billed due to changes in telephone numbers, telephone carriers, data synchronization issues, etc.  These amounts that ultimately cannot be billed, as well as certain minor billing adjustments by the LEC’s, are commonly referred to as “dilution.”  Such unbillable accounts and chargebacks are estimated at the time of billing and charged against net revenues.

Fees :  Both the billing aggregator and the LEC charge processing fees.  Additionally, the LEC charges fees for responding to billing inquiries by its customers, processing refunds, and other customer-related services.  Such fees are estimated at the time of billing and charged to cost of services.

Revenue for billings to certain customers are billed directly by the Company and not through the LEC’s, is recognized based on estimated future collections.   The Company continuously reviews this estimate for reasonableness based on its collection experience. 

Telava Wireless :   Leasing revenue for towers are recognized on a monthly basis based on the terms and conditions of the lease agreements. 

LIP :   Printing revenue for coupon books are recognized as services are performed.

IBFA:   Wireless services and wireline voice and data communication services. Revenue is recognized at the time of delivery of the products or services, and the collectibility is reasonably assured. The Group assesses its revenue arrangements against specific criteria in order to determine if it is acting as principal or agent.

Service revenue includes the value of all telecommunications services provided, net of free usage allocations and discounts. Revenue is recognized when earned, and are net of the share of other foreign and local carriers and content providers, if any, under existing correspondence and interconnection and settlement agreements.

Revenue is stated at amounts billed or invoiced and accrued to subscribers or other carriers and content providers, taking into consideration the bill cycle cut-off (for postpaid subscribers), and charges against preloaded airtime value (for prepaid subscribers), and excludes value-added tax (VAT) and overseas communication tax.

Advertising Costs

The Company incurs advertising costs that are not considered direct response advertising and are expensed when incurred.  For the three months ended June 30, 2012 and 2011, the Company incurred approximately $66 and $1,840, respectively, in marketing and advertising expense.  For the six months ended June 30, 2012 and 2011, the Company incurred approximately $804 and $3,044, respectively, in marketing and advertising expense. 

Income Taxes

The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements.  Under this method, deferred tax assets and liabilities are determined based on differences between financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.  The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.

The Company records net deferred tax assets to the extent the Company believes these assets will more likely than not be realized.  In making such determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies and recent financial operations.  A valuation allowance is established against deferred tax assets that do not meet the criteria for recognition.  In the event the Company were to determine that it would be able to realize deferred income tax assets in the future in excess of their net recorded amount, we would make an adjustment to the valuation allowance which would reduce the provision for income taxes.

The Company follows the accounting guidance which provides that a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits.  Income tax provisions must meet a more-likely-than-not recognition threshold at the effective date to be recognized initially and in subsequent periods.

Also included is guidance on measurement, derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition.

Earnings Per Common Share

The Company reports both basic and diluted earnings per share.  Basic earnings per share are calculated using the weighted average number of common shares outstanding in the period.  Diluted earnings per share includes potentially dilutive securities such as outstanding options and warrants using the “treasury stock” method and convertible securities using the “if-converted” method.   For the six  months  ended June 30, 2012 and 2011,  there were no potential common  equivalent  shares used in the  calculation of dilutive weighted  average  common shares  outstanding as the effect would be anti-dilutive because of the net loss.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period.  Actual results could differ from those estimates.

Significant estimates made in connection with the accompanying financial statements include the estimate of dilution and fees associated with LEC billings and the estimated reserve for doubtful accounts receivable.

Other Comprehensive Income (Loss)

Comprehensive income(loss) consists of net income and other gains and losses affecting stockholders’ equity that, under generally accepted accounting principles are excluded from net income.  For the Company, such items consist solely of foreign currency translation gains and losses.

Recent Accounting Pronouncements

The Company has evaluated the recent accounting pronouncements through August 2012 and believes that none of them will have a material effect on the Company’s financial statements.

Concentrations of Credit Risk

The Company has maintained balances in excess of federally insured limits from time to time during the fiscal year.  Management periodically reviews the adequacy and strength of the financial institutions and deems this to be an acceptable risk.

For the three months ended June 30, 2012 and 2011, approximately 4.8% and 5.3% of the Company's net sales were made to customers outside the United States. For the six months ended June 30, 2012 and 2011, approximately 4.9% and 5.4% of the Company's net sales were made to customers outside the United States. 

Reclassification

Certain reclassifications have been made to prior years’ financial statements to conform to the current year presentation.  These reclassifications had no effect on previously reported results of operations or accumulated deficit.  The Company reclassified $141,001 accounts payable to accounts payable – related party.

XML

Stockholders Equity (Deficit) (Details Narrative)			12 Months Ended
	Jun. 30, 2012	Dec. 31, 2011	Dec. 31, 2009 CommonStock [Member]	Dec. 31, 2009 PreferredStock [Member]
Preferred stock Outstanding	0	0
Common stock issued	100,052,888	100,052,888
Common Stock Outstanding	100,051,107	100,051,107
Treasury Stock	1,781	1,781
Stock Issued for Reverse Merger			52,888	3,644,880

XML

CONSOLIDATED BALANCE SHEETS (Unaudited) (USD $)	Jun. 30, 2012	Dec. 31, 2011
ASSETS
Cash	$ 5,785	$ 51,704
Certificates of deposit - current	28,101	28,078
Accounts receivable, net	285,060	320,587
Other current assets	1,686	5,409
Total current assets	320,632	405,778
Fixed assets, net	1,580,533	1,651,953
Goodwill	767,873	767,873
Other assets	127,347	95,306
TOTAL ASSETS	2,796,385	2,920,910
LIABILITIES AND STOCKHOLDERS DEFICIT
Accounts payable and accrued expenses	3,012,792	2,718,824
Accounts payable and acrued expenses - related party	187,987	141,001
Deferred rent - current	64,720	47,099
Line of credit	1,507,176	1,507,176
Notes payable	2,037,117	1,694,075
Notes payable - related party	835,805	699,477
TOTAL CURRENT LIABILITIES	7,645,597	6,807,652
Deferred rent - non current	941	40,684
TOTAL LIABILITIES	7,646,538	6,848,336
STOCKHOLDERS DEFICIT
Preferred stock, no par value 5,000,000 shares authorized; issued and outstanding 0 and 0 outstanding at June 30, 2012 and December 31, 2011, respectively.	0	0
Common stock, no par value 120,000,000 shares authorized; issued but not outstanding 100,052,888 and 100,052,888, respectively; issued and outstanding 100,051,107 and 100,051,107 at June 30, 2012 and December 31, 2011, respectively.	1,519,074	1,519,074
Common stock payable	35,000
Treasury stock, 1,781 and 1,781 shares at June 30, 2012 and December 31, 2011, respectively	0	0
Accumulated deficit	(6,306,094)	(5,370,761)
Accumulated other comprehensive loss (Foreign translation adjustment)	(64,292)	(63,974)
STOCKHOLDERS' DEFICIT OF UNILAVA	(4,816,312)	(3,915,661)
Non-controlling interest	(33,841)	(11,765)
TOTAL STOCKHOLDERS' DEFICIT	(4,850,153)	(3,927,426)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$ 2,796,385	$ 2,920,910

XML

Organization

6 Months Ended

Jun. 30, 2012

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization

Unilava Corporation, a Wyoming corporation, was formerly known as IWI Holding Limited (“IWI”), and was engaged in the international jewelry business through a US subsidiary.  IWI went public via an initial public offering in 1994, and disposed of the subsidiary on December 31, 2007. On September 21, 2009, IWI entered into an Agreement pursuant to which IWI acquired all of the outstanding shares of Telava Networks, Inc., a Nevada corporation (“TelavaNV”), in exchange for 55 million shares of common stock. In addition, preferred stock of IWI which had been issued in 1994 totaling 3,644,880 shares were converted into 45 million shares of common stock.  In connection with the closing of the acquisition, the TelavaNV management was appointed as the members of IWI management, the name of IWI was changed to Unilava, Corporation (“Unilava or the “Company””) and the corporation was reincorporated from the British Virgin Islands to Wyoming via Articles of Continuation.

The Company consists of several subsidiaries which make up the consolidated financial statements.  The parent company is Unilava Corporation which is a holding company for the operating subsidiaries.  Local Area Yellow Pages has significant operating revenue.  Telava Wireless has significant assets.  Local Info Pages has overseas operations in Korea.  Telava Acquisitions is insignificant to the Company financial position and operating results.  Telava Mobile has minimal assets and operations.  IBFA has significant assets, liabilities and revenue.

TelavaNV, a privately owned company, was incorporated in Nevada on July 23, 2003 as Local Area Yellow Pages to provide advertising and directory listings for small and medium sized businesses on its internet website in a “Yellow Pages” format.  The Company provides those services to its subscribers for a monthly fee.  These services are provided primarily to small and medium sized businesses throughout the United States.  On July 10, 2007, Local Area Yellow Pages amended its Articles of Incorporation to change the name of the corporation to Telava Networks, Inc. (“TelavaNV”) for the purpose of launching its network to provide the next generation fixed and mobile WiMAX broad band solutions to small and medium businesses, public safety organizations, and others in various markets through its network.  TelavaNV continues its Yellow Pages operations while, at the same time, expanding its WiMAX network.  During the six months ended June 30, 2012, nearly 5% of the Company’s revenues have been generated by its Yellow Pages business.

On January 19, 2006, TelavaNV formed Local Info Pages, Inc. (“LIP”), headquartered in Seoul, South Korea, as a wholly owned subsidiary of TelavaNV. LIP is one of the leading direct marketing and business service companies in Korea. LIP connects advertisers to targeted audiences through its network advertising products and services. On January 3, 2007, the Company acquired a website which brings value to the Company because of its large customer base which enables the Company to target and market its products to those customers.  Another division of LIP is the second largest coupon company in South Korea which enables advertisers to directly reach consumers with branded media products, coupons and other advertisements. Many consumers depend on the Company to deliver the best values in town via direct and online coupons. For advertisers, LIP offers business advertising solutions by enabling them to sell their products and services in person, online or through the mail.

On May 17, 2006, TelavaNV formed Telava Wireless, Inc. (“Telava Wireless”) as a subsidiary for the purpose of entering the mobile WiMAX broad band solutions market.  On November 6, 2006, the Company acquired 40 microwave towers in exchange for 25% of Telava Wireless.

On September 11, 2007, TelavaNV formed Telava Acquisitions, Inc. as a wholly owned subsidiary for the purpose of acquiring other related businesses.

On January 16, 2008, Telava Acquisitions, Inc. (“Telava”) a Delaware corporation and IBFA Acquisition Company, LLC (“IBFA”) a Michigan corporation and James Grabowski and Casimir Wojciechowski (the “Members”) entered into a Membership Interest Purchase Agreement (“MIPA”) whereby Telava agreed to purchase (the “Acquisition”) 100% of IBFA member interests from the Members for a purchase price of $2,250,000 subject to certain conditions such as a Management Agreement described below.  An initial $1,750,000 was paid in fiscal year 2008 with $500,000 deferred and payable at the rate of $25,000 to $50,000 per month based on a specific calculation.  During 2009, the Company paid $272,750 of deferred payments.  The remaining $227,750 was subject to “True-up” provisions as of the effective date of the Acquisition on January 11, 2009 (See discussion below).  Upon final settlement, the Company received concessions totaling $177,578 and made final payments totaling $95,172. Payment made related to the organization totaled $2,117,922.  The cost of acquisition totaling $1,835,873 has been entirely allocated to Goodwill which represents the overall cost of acquisition in excess of the fair value of tangible assets and identifiable intangible assets.

On November 12, 2008, TelavaNV formed Telava Mobile, Inc. (“TM”) as a 80% majority-owned subsidiary for the purpose of entering the mobile services businesses offering prepaid mobile calling cards and unlimited mobile services throughout the United States of America.

XML

Commitments (Details) (USD $)	Jun. 30, 2012
Commitments Details
2012	$ 280,109
2013	221,352
2014 and Thereafter	7,763
Total	$ 509,224

XML

Segment Reporting (Tables)

6 Months Ended

Jun. 30, 2012

Segment Reporting Tables

Segment Reporting

 For the three months ended June 30, 2012

	Advertising Solutions			Wireless			Wireline		Other			Elimination			Consolidated
Revenue from external customers	$	191,806		$	68,894		$	475,210	$	-		$	-		$	735,910
Cost of revenue		68,784			81,309			249,660		-			-			399,753
Gross profit		123,022			(12,415)			225,550		-			-			336,157
Operations and support expenses		456,221			21,068			194,848		5,391			1			642,530
Depreciation and amortization		15,577			19,322			372		-			-			35,271
Total segment operating expenses		471,798			40,390			195,220		5,391			1			712,800
Segment operating income		(348,776	)		(52,805	)		30,330		(5,391	)		(1	)		(376,643	)
Total other income (expense)		(97,178	)		1,237			-		-			-			(95,941	)
Net loss allocable to minority interest		-			13,442			-		-			-			13,442
Segment income before income taxes	$	(445,954	)	$	(38,126	)	$	30,330	$	(5,391	)	$	(1	)	$	(459,142	)
Segment assets	$	2,564,739		$	1,526,627		$	1,031,261	$	44		$	(2,326,286	)	$	2,796,385

For the three months ended June 30, 2011

	Advertising Solutions			Wireless			Wireline		Other			Elimination			Consolidated
Revenue from external customers	$	258,767		$	53,483		$	575,006	$	-		$	-		$	887,256
Cost of revenue		66,963			67,752			290,325		-			-			425,040
Gross profit		191,804			(14,269)			284,681		-			-			462,216
Operations and support expenses		481,201			17,484			234,006		7,233			-			739,924
Depreciation and amortization		18,486			19,987			372		-			-			38,845
Total segment operating expenses		499,687			37,471			234,378		7,233			-			778,769
Segment operating income		(307,883	)		(51,740	)		50,303		(7,233	)		-			(316,553	)
Total other income (expense)		(102,208	)		(16,221)			-		-			-			(118,429	)
Net loss allocable to minority interest		-			17,062			-		-			-			17,062
Segment income before income taxes	$	(410,091	)	$	(50,899	)	$	50,303	$	(7,233	)	$	-		$	(417,920	)
Segment assets	$	2,815,984		$	1,676,083		$	2,133,155	$	56		$	(2,462,239	)	$	4,163,039

For the six months ended June 30, 2012

	Advertising Solutions			Wireless			Wireline		Other			Elimination			Consolidated
Revenue from external customers	$	404,903		$	153,360		$	998,534	$	-		$	-		$	1,556,797
Cost of revenue		132,879			141,980			513,956		-			-			788,815
Gross profit		272,024			11,380			484,578		-			-			767,982
Operations and support expenses		960,297			34,024			452,574		7,509			(2	)		1,454,402
Depreciation and amortization		32,600			38,645			743		-			-			71,988
Total segment operating expenses		992,897			72,669			453,317		7,509			(2	)		1,526,390
Segment operating income		(720,873	)		(61,289	)		31,261		(7,509	)		2			(758,408	)
Total other income (expense)		(184,105	)		(14,931)			35		-			-			(199,001	)
Net loss allocable to minority interest		-			22,076			-		-			-			22,076
Segment income before income taxes	$	(904,978	)	$	(54,144	)	$	31,296	$	(7,509	)	$	2		$	(935,333	)
Segment assets	$	2,564,739		$	1,526,627		$	1,031,261	$	44		$	(2,326,286	)	$	2,796,385

For the six months ended June 30, 2011

	Advertising Solutions			Wireless			Wireline		Other			Elimination		Consolidated
Revenue from external customers	$	550,920		$	73,645		$	1,200,748	$	-		$	-	$	1,825,313
Cost of revenue		193,895			101,358			600,721		-			-		895,974
Gross profit		357,025			(27,713			600,027		-			-		929,339
Operations and support expenses		974,993			39,348			483,949		9,902			-		1,508,192
Depreciation and amortization		37,962			39,975			743		-			-		78,680
Total segment operating expenses		1,012,955			79,323			484,692		9,902			-		1,586,872
Segment operating income		(655,930	)		(107,036	)		115,335		(9,902	)		-		(657,533	)
Total other income (expense)		(188,322	)		(32,259	)

XML

Commitments (Details Narrative) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Commitments Details Narrative
Rent expense	$ 138,705	$ 135,360	$ 287,892	$ 271,182

XML

Organization (Details Narrative) (USD $)	6 Months Ended
	Jun. 30, 2012
Organization Details Narrative
Percentage of Revenue generated	0.50%
Concessions	$ 177,578
Final payments total	95,172
Payment made related to the organization	2,117,922
Cost of acquisition	$ 1,835,873

XML

Going Concern

6 Months Ended

Jun. 30, 2012

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Going Concern

The accompanying financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America, which contemplate continuation of the Company as a going concern.  The Company has recently sustained operating losses and has an accumulated deficit of $6,306,094 at June 30, 2012.  In addition, the Company has negative working capital of $7,324,965 at June 30, 2012.

The Company has and will continue to use significant capital to grow and acquire market share.    These factors raise substantial doubt about the ability of the Company to continue as a going concern.  In this regard, management is proposing to raise any necessary additional funds not provided by operations through loans or through sales of their common stock.  There is no assurance that the Company will be successful in raising this additional capital or in achieving profitable operations.  The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might result from this uncertainty.

XML

CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	Jun. 30, 2012	Dec. 31, 2011
STOCKHOLDERS DEFICIT
Preferred stock No par value	$ 0	$ 0
Preferred stock shares authorized	5,000,000	5,000,000
Preferred stock shares issued	0	0
Preferred stock shares outstanding	0	0
Common stock No par value	$ 0	$ 0
Common stock shares authorized	120,000,000	120,000,000
Common stock shares issued	100,052,888	100,052,888
Common stock shares outstanding	100,051,107	100,051,107
Treasury stock	1,781	1,781

XML

Subsequent Events

6 Months Ended

Jun. 30, 2012

Subsequent Events [Abstract]

Subsequent Events

The Company has an outstanding line of credit facility with Thermo Credit LLC (“Thermo Credit”) which is currently in default.  

The Company signed a Memorandum of Understanding on December 7, 2009 to acquire an 80% interest in China Dragon Telecom Limited ("China Dragon Telecom") and its affiliates based in Hong Kong, China. The negotiations and execution of definitive agreements, regulatory approval and the performance of other customary conditions is expected to be completed by the end of 2012 due to additional audit procedures that are needed to issue the audited financials of China Dragon Telecom. As of June 30, 2012, China Dragon Telecom was still being audited by an accounting firm.

XML

Document and Entity Information	6 Months Ended
	Jun. 30, 2012	Aug. 15, 2012
Document And Entity Information
Entity Registrant Name	Unilava Corp
Entity Central Index Key	0000923168
Document Type	10-Q
Document Period End Date	Jun. 30, 2012
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		100,051,107
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2012

XML

Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2012

Notes to Financial Statements

Fair Value of Financial Instruments

Accounting Standards Codification (“ASC”) 820, Fair Value Measurements and Disclosures , requires disclosing fair value to the extent practicable for financial instruments that are recognized or unrecognized in the balance sheet. Fair value of financial instruments is the amount at which the instruments could be exchanged in a current transaction between willing parties. The Company considers the carrying amounts of cash, restricted cash, accounts receivable, related party and other receivables, accounts payable, notes payable, related party and other payables, customer deposits, and short term loans approximate their fair values because of the short period of time between the origination of such instruments and their expected realization. The Company considers the carrying amount of long term bank loans to approximate their fair values based on the interest rates of the instruments and the current market rate of interest.

Level 1   The preferred inputs to valuation efforts are “quoted prices in active markets for identical assets or liabilities,” with the caveat that the reporting entity must have access to that market.  Information at this level is based on direct observations of transactions involving the same assets and liabilities, not assumptions, and thus offers superior reliability. However, relatively few items, especially physical assets, actually trade in active markets.

Level 2   FASB acknowledged that active markets for identical assets and liabilities are relatively uncommon and, even when they do exist, they may be too thin to provide reliable information. To deal with this shortage of direct data, the board provided a second level of inputs that can be applied in three situations.

Level 3   If inputs from levels 1 and 2 are not available, FASB acknowledges that fair value measures of many assets and liabilities are less precise. The board describes Level 3 inputs as “unobservable,” and limits their use by saying they “shall be used to measure fair value to the extent that observable inputs are not available.” This category allows “for situations in which there is little, if any, market activity for the asset or liability at the measurement date”. Earlier in the standard, FASB explains that “observable inputs” are gathered from sources other than the reporting company and that they are expected to reflect assumptions made by market participants.

Foreign Currency Adjustments

The financial position and results of operations of the Company’s foreign subsidiary, LIP, is measured using the foreign subsidiary’s local currency as the functional currency.  Revenues and expenses of the subsidiary have been translated into U.S. dollars at average exchange rates prevailing during the period.  Assets and liabilities have been translated at the rates of exchange on the balance sheet date.  The resulting translation gain and loss adjustments are recorded as a separate component of stockholders’ equity, unless there is a sale or complete liquidation of the underlying foreign investments. 

Cash and Cash Equivalents

This includes all short-term highly liquid investments that are readily convertible to known amounts of cash and have original maturities of three months or less.  The Company has a restricted cash balance of $28,101 and $28,078 on June 30, 2012 and December 31, 2011, respectively, which is comprised of Certificates of Deposit.   The restricted cash is held in certificates of deposit at various banking institutions.  The Company is expected to maintain the amounts in the certificates of deposit per agreements with certain vendors.

Accounts Receivable

Accounts receivable are reported at the customers' outstanding balances less any allowance for doubtful accounts. Interest is not accrued on overdue accounts receivable.  The Company evaluates receivables on a regular basis for potential reserve.

Fixed Assets

Fixed assets are stated at cost.  Major renewals and improvements are charged to the asset accounts while replacements, maintenance and repairs, which do not improve or extend the lives of the respective assets, are expensed.  At the time property and equipment are retired or otherwise disposed of, the asset and related accumulated depreciation accounts are relieved of the applicable amounts.  Gains or losses from retirements or sales are credited or charged to income.

Long-lived Assets

Accounting for the Impairment or Disposal of Long-Lived Assets requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that the historical cost-carrying value of an asset may not be recovered.  The Company assesses recoverability of the carrying value of an asset by estimating the fair value of the asset.  If the fair value is less than the carrying value of the asset, an impairment loss is recorded equal to the difference between the asset's carrying value and fair value.  

Goodwill and Other Intangible Assets

Goodwill and other intangible assets arising from an acquisition of a business are periodically assessed for impairment rather than amortized on a straight-line basis.  Accordingly, the Company annually reviews the carrying value of this goodwill and other intangible assets to determine whether impairment, as measured by fair market value, may exist.  Specifically, goodwill and other intangible asset impairment is determined using a two-step process.  The first step of the goodwill and other intangible asset impairment test is used to identify potential impairment by comparing the fair value of a reporting unit with its carrying amount.  If the fair value of a reporting unit exceeds its carrying amount, then the goodwill and other intangible assets of the reporting unit are not considered to be impaired and the second step of the impairment test is unnecessary.  If the carrying amount of a reporting unit exceeds its fair value, the second step of the impairment test is performed to measure the amount of impairment loss, if any.  The second step of the impairment test compares the implied fair value of the reporting unit's goodwill and other intangible assets with their carrying amount.  If the carrying amount of the reporting unit's goodwill and other intangible assets exceeds their implied fair value, then an impairment loss is recognized in an amount equal to that excess. Goodwill consisted of $767,873 as of June 30, 2012 and December 31, 2011 as a result of the IBFA purchase as disclosed in the Company’s December 31, 2011 Form 10-K.

Accounting for Share-Based Compensation

The Company records stock based compensation in accordance with the guidance in ASC Topic 505 and 718 which requires the Company to recognize expenses related to the fair value of its employee stock option awards.  This eliminates accounting for share-based compensation transactions using the intrinsic value and requires instead that such transactions be accounted for using a fair-value-based method. The Company recognizes the cost of all share-based awards on a graded vesting basis over the vesting period of the award.  

The Company accounts for equity instruments issued in exchange for the receipt of goods or services from other than employees in accordance with FASB ASC 718-10 and the conclusions reached by the FASB ASC 505-50. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment or completion of performance by the provider of goods or services as defined by FASB ASC 505-50.

Revenue Recognition

Telava NV and LIP : The Company’s revenue is generated by customer subscriptions of directory and advertising services.  Revenue is billed and recognized monthly for services subscribed in that specific month.  The Company utilizes outside billing companies to transmit billing data, much of which is forwarded to Local Exchange Carriers (“LEC’s”) that provide local telephone service.

LEC Billing :   When a customer subscribes to the Company’s service, an electronic customer file is created which is the basis for the billing.  The Company submits gross billings electronically to third party billing aggregators. These billing aggregators compile and format electronic customer files and forward the billing records to the appropriate LEC’s.  The billing for our service flows through to monthly bills of the individual LEC customers.  The LEC’s collect the Company’s billing and remit amounts to the billing aggregators, which in turn remit funds to the Company.  The following are significant accounting estimates and assumptions used in the revenue recognition process with respect to these billings.

Customer refunds :   The Company’s customer refund policy allows the customer to request a refund if they are not satisfied with the service within the first 30 days of the subscription.  The Company accrues for refunds based on historical experience of refunds as a percentage of new billings in that 30-day period.  Customer refunds historically have been insignificant and therefore there is no reserve against gross revenue.

Non-paying customers :   There are customers who may not pay the fee for our services even though the Company believes they are valid subscribers.  Included in cost of services is an accrual for estimated non-paying customers that are recorded at the time of billing.

Dilution :   The Company recognizes revenue during the month for which the service is provided based on net billings accepted by the billing aggregators and recognizes revenue only for accepted records.  However, subsequent to this acceptance, there are instances in the LEC billing process where a customer cannot be billed due to changes in telephone numbers, telephone carriers, data synchronization issues, etc.  These amounts that ultimately cannot be billed, as well as certain minor billing adjustments by the LEC’s, are commonly referred to as “dilution.”  Such unbillable accounts and chargebacks are estimated at the time of billing and charged against net revenues.

Fees :  Both the billing aggregator and the LEC charge processing fees.  Additionally, the LEC charges fees for responding to billing inquiries by its customers, processing refunds, and other customer-related services.  Such fees are estimated at the time of billing and charged to cost of services.

Revenue for billings to certain customers are billed directly by the Company and not through the LEC’s, is recognized based on estimated future collections.   The Company continuously reviews this estimate for reasonableness based on its collection experience. 

Telava Wireless :   Leasing revenue for towers are recognized on a monthly basis based on the terms and conditions of the lease agreements. 

LIP :   Printing revenue for coupon books are recognized as services are performed.

IBFA:   Wireless services and wireline voice and data communication services. Revenue is recognized at the time of delivery of the products or services, and the collectibility is reasonably assured. The Group assesses its revenue arrangements against specific criteria in order to determine if it is acting as principal or agent.

Service revenue includes the value of all telecommunications services provided, net of free usage allocations and discounts. Revenue is recognized when earned, and are net of the share of other foreign and local carriers and content providers, if any, under existing correspondence and interconnection and settlement agreements.

Revenue is stated at amounts billed or invoiced and accrued to subscribers or other carriers and content providers, taking into consideration the bill cycle cut-off (for postpaid subscribers), and charges against preloaded airtime value (for prepaid subscribers), and excludes value-added tax (VAT) and overseas communication tax.

Advertising Costs

The Company incurs advertising costs that are not considered direct response advertising and are expensed when incurred.  For the three months ended June 30, 2012 and 2011, the Company incurred approximately $66 and $1,840, respectively, in marketing and advertising expense.  For the six months ended June 30, 2012 and 2011, the Company incurred approximately $804 and $3,044, respectively, in marketing and advertising expense. 

Income Taxes

The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements.  Under this method, deferred tax assets and liabilities are determined based on differences between financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.  The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.

The Company records net deferred tax assets to the extent the Company believes these assets will more likely than not be realized.  In making such determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies and recent financial operations.  A valuation allowance is established against deferred tax assets that do not meet the criteria for recognition.  In the event the Company were to determine that it would be able to realize deferred income tax assets in the future in excess of their net recorded amount, we would make an adjustment to the valuation allowance which would reduce the provision for income taxes.

The Company follows the accounting guidance which provides that a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits.  Income tax provisions must meet a more-likely-than-not recognition threshold at the effective date to be recognized initially and in subsequent periods.

Also included is guidance on measurement, derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition.

Earnings Per Common Share

The Company reports both basic and diluted earnings per share.  Basic earnings per share are calculated using the weighted average number of common shares outstanding in the period.  Diluted earnings per share includes potentially dilutive securities such as outstanding options and warrants using the “treasury stock” method and convertible securities using the “if-converted” method.   For the six  months  ended June 30, 2012 and 2011,  there were no potential common  equivalent  shares used in the  calculation of dilutive weighted  average  common shares  outstanding as the effect would be anti-dilutive because of the net loss.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period.  Actual results could differ from those estimates.

Significant estimates made in connection with the accompanying financial statements include the estimate of dilution and fees associated with LEC billings and the estimated reserve for doubtful accounts receivable.

Other Comprehensive Income (Loss)

Comprehensive income(loss) consists of net income and other gains and losses affecting stockholders’ equity that, under generally accepted accounting principles are excluded from net income. For the Company, such items consist solely of foreign currency translation gains and losses.

Recent Accounting Pronouncements

The Company has evaluated the recent accounting pronouncements through August 2012 and believes that none of them will have a material effect on the Company’s financial statements.

Concentrations of Credit Risk

The Company has maintained balances in excess of federally insured limits from time to time during the fiscal year.  Management periodically reviews the adequacy and strength of the financial institutions and deems this to be an acceptable risk.

For the three months ended June 30, 2012 and 2011, approximately 4.8% and 5.3% of the Company's net sales were made to customers outside the United States. For the six months ended June 30, 2012 and 2011, approximately 4.9% and 5.4% of the Company's net sales were made to customers outside the United States. 

Reclassification

Certain reclassifications have been made to prior years’ financial statements to conform to the current year presentation.  These reclassifications had no effect on previously reported results of operations or accumulated deficit.  The Company reclassified $141,001 accounts payable to accounts payable – related party.

XML

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Income Statement [Abstract]
Revenue	$ 735,910	$ 887,256	$ 1,556,797	$ 1,825,313
Cost of revenue	399,753	425,040	788,815	895,974
Gross profit	336,157	462,216	767,982	929,339
Costs and Expenses
Salaries and payroll taxes	315,333	387,770	647,388	759,639
Selling, general & administrative	362,196	352,154	807,015	748,553
Depreciation and amortization	35,271	38,845	71,987	78,680
Total costs and expenses	712,800	778,769	1,526,390	1,586,872
Loss from operations	(376,643)	(316,553)	(758,408)	(657,533)
Other Income (Expense)
Interest income	22	20	39	48
Other income	21,050	101	63,170	197
Interest expense	(127,013)	(118,550)	(262,210)	(220,826)
Other expense	10,000	0	0	0
Total other income (expense)	(95,941)	(118,429)	(199,001)	(220,581)
Loss before non-controlling interest	(472,584)	(434,982)	(957,409)	(878,114)
Net loss allocable to non-controlling interest	13,442	17,062	22,076	34,440
Net loss	(459,142)	(417,920)	(935,333)	(843,674)
Comprehensive loss:
Foreign currency translation adjustment	1,765	(179)	318	772
Total comprehensive loss	$ (457,377)	$ (418,099)	$ (935,015)	$ (842,902)
Net loss per common share:
Basic	$ 0.00	$ 0.00	$ (0.01)	$ (0.01)
Weighted average common shares outstanding:
Basic	100,051,107	100,051,107	100,051,107	100,051,107

XML

Stockholders' Equity (Deficit)

6 Months Ended

Jun. 30, 2012

Equity [Abstract]

Stockholders' Equity (Deficit)

Preferred Stock

The Company has authorized 5,000,000 shares of no par value preferred stock available for issuance.  No shares of preferred stock are outstanding as of June 30, 2012.  Commensurate with the merger, the Company converted the former IWI Holdings outstanding Preferred Stock of 3,664,880 shares into 45,000,000 shares of common stock.

Common Stock

The authorized common stock is 120,000,000 shares at no par value.  As of June 30, 2012 and December 31, 2011, the Company had 100,052,888 and 100,052,888 shares of common stock issued but not outstanding, respectively.  The Company had 100,051,107 and 100,051,107 shares of common stock issued and outstanding, respectively.  As of June 30, 2012 and December 31, 2011, the Company had 1,781 and 1,781 shares of treasury stock. 

During the year ended December 31, 2009, the Company issued 52,888 shares of common stock and 3,644,880 shares of preferred related to the reverse merger with IWI Holding Limited.

On September 8, 2011, the Company agreed to issue 3,500,000 shares of common stock to the directors of the Company valued at the fair market value of the shares totaling $35,000.  As of June 30, 2012, the shares have not been issued.

XML

Line of Credit and Notes Payable

6 Months Ended

Jun. 30, 2012

Notes to Financial Statements

Line of Credit and Notes Payable

As of June 30, 2012, the amount, maturity date and term of each of our loans were as follows:

Lender	Principal Amount		Interest Rate			Maturity Date
Thermo Credit LLC	$	1,507,176		17.00	%	January 17, 2011
AHAP		40,000	Various			Upon Demand
Brilliant Capital		868,941		8.00	%	Upon Demand
InfoCity, LLC and Others		1,128,176		8.00	%	Upon Demand
Dr. Dicken Yung (related party)		190,536		0.00	%	Upon Demand
Baldwin Yung (related party)		387,000		0.00	%	Upon Demand
Boaz Yung (related party)		1,125		0.00	%	Upon Demand
Cherie Yung (related party)		257,144		0.00	%	Upon Demand
	$	4,380,098

As of December 31, 2011, the amount, maturity date and term of each of our loans were as follows:

Lender	Principal Amount		Interest Rate			Maturity Date
Thermo Credit LLC	$	1,507,176		17.00	%	January 17, 2011
AHAP		40,000		8.00	%	Upon Demand
Brilliant Capital		574,899		8.00	%	Upon Demand
InfoCity, LLC and Others		1,079,176		8.00	%	Upon Demand
Dr. Dicken Yung (related party)		176,352		0.00	%	Upon Demand
Baldwin Yung (related party)		387,000		0.00	%	Upon Demand
Boaz Yung (related party)		1,125		0.00	%	Upon Demand
Cherie Yung (related party)		135,000		0.00	%	Upon Demand
	$	3,900,728

We have a $2,000,000 revolving line of credit with the Thermo Credit LLC, pursuant to a credit agreement, dated July 17, 2010, between the Company and the bank. This revolving line of credit is guaranteed/secured by the all of the assets of the Company including cash, accounts receivable and fixed assets (See Note 4 Accounts Receivable and Note 5 Fixed Assets). The credit agreement had certain debt covenants that the Company did not comply with during the quarter ended June 30, 2012 and the year ended December 31, 2011.  The first covenant was that the Company must maintain a ratio of cash flow to scheduled principal payments plus all accrued interest payments on funded debt of not less than 1 to 1 as of the end of each fiscal quarter.  The second covenant was that the Company must maintain a tangible net worth of not less than $0 as of the last day of each fiscal quarter.  The credit agreement terminated on January 17, 2011, the line is in default and as such cash proceeds from the Company’s receivables and sale of assets have been directed to serve as collateral. (See Note 12, Subsequent Events)

XML

Commitments (Tables)

6 Months Ended

Jun. 30, 2012

Commitments Tables

Minimum rental commitments under all non-cancelable leases

Minimum rental commitments under all non-cancelable leases with an initial term in excess of one year were as follows as of June 30, 2012:

Year Payable	Amount
2012		$	280,109
2013			221,352
2014 and Thereafter			7,763
Total		$	509,224

XML

Summary of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 30, 2012

Notes to Financial Statements

Useful life of Fixed Assets

The Company depreciates its fixed assets on a straight line basis at the following rates:

Microwave towers	25 years
Computer equipment	5 years
Furniture and equipment	7 years
Software	3 years
Leasehold improvements	5 years

XML

Litigation

6 Months Ended

Jun. 30, 2012

Notes to Financial Statements

Litigation

Telava Networks v. Pacific EIH

On April 26, 2012, Pacific EIH Sacramento Corporation (“The Company’s Landlord at 353 Sacramento in San Francisco) and the Company, entered into a Stipulation of Entry for Judgment and Order thereon at the Superior Court of California, County of San Francisco to stipulate and agree to settle lease payments owed in the amount of $136,528 and $1,150 in attorney fees. As of June 30, 2012, the Company is current on its rental payments and in good terms with the Landlord.

Vermont Attorney General Investigation v. Local Area Yellow Pages (“LAYP”)

The Vermont Attorney General has an active investigation into the business practices of LAYP focusing on whether certain notices and a three day right to cancel were provided to customers.  The Vermont Attorney General has proposed to settle if, LAYP will agree to issue a full refund to all Vermont customers whose telephone bills were charged and a payment of $10,000 in civil penalties and injunctive relief.  The amount for the full refund to all Vermont customers is estimated at approximately $65,000.  The suit was filed in the Superior Court of Vermont.  The Company has accrued for the contingent liability.

Illinois Agricultural Association v. IBFA Acquisition Co. LLC (“IBFA”) and Telava Acquisitions, LLC

The Illinois Agricultural Association (IAA) claimed that IBFA and Telava Acquisitions, LLC had past due referral fees in the amount of approximately $95,000.  We denied the allegations and defended our position in arbitration.  The matter was in the discovery stage and a hearing was set for June 2011.  The suit was filed with the American Arbitration Association – Commercial Dispute Unit of Illinois.  On September 8, 2011, the AAA granted the award to IAA in the amount of $118,971.11 in full settlement of the case. The Company has accrued for the contingent liability.

Chen v. Unilava Corporation, et al.

In June 2010, Chris Chen, former Executive Vice President of Sales, filed a lawsuit against Unilava Corporation and Local Area Yellow Pages, Inc. (“LAYP”)  Mr. Chen seeks $49,613 in unpaid wages, $12,000 in statutory waiting time penalties and 4,300,000 shares of common stock or the fair market value of the common stock and attorneys’ fees.  In July 2010, Unilava and LAYP filed a cross-complaint seeking compensatory damages of no less than $3,000,000, punitive damages and attorneys’ fees.  The Court has ordered the parties to participate in mediation.  In September 2011, both parties entered into an agreement to settle the case for $50,000 with prejudice.

McLane v. Unilava Corporation, et al.

In February 2011, Caron McLane, former employee, filed a lawsuit against Unilava Corporation and Local Area Yellow Pages, Inc. (“LAYP”) and claimes that she was wrongly terminated by the company.  Ms. McLane seeks for damages for the wrongly termination claims. The company intends to vigorously defend the case and does not intend to settle the case with Ms. McLane. The Company has not accrued for the contingent liability.  On June 11, 2012, the Superior Court of the State of California- County of San Francisco ruled in favor of the Company and had ordered to dismiss the case with prejudice.

XML

Segment Reporting

6 Months Ended

Jun. 30, 2012

Segment Reporting [Abstract]

Segment Reporting

Our segments are various subsidiaries that offer different products and services over various technology platforms and are managed accordingly.  We analyze our various operating segments based on segment income before income taxes.  The customers and assets of our reportable segments are predominantly in the United States.  We have four reportable segments: (1) Advertising Solutions, (2) Wireless, (3) Wireline, and (4) Other.

The Advertising Solutions segment includes the operations of Telava Networks, Inc. (100% owned) and Local Info Pages, Inc. (100% owned Korea-based entity).

The Wireless segment includes the operations of Telava Wireless, Inc. (75% owned) and Telava Mobile, Inc. (80% owned).

The Wireline segment includes the operations of IBFA Acquisitions (100% owned).

The Other segment includes results from all corporate operations.

In the following tables, we show how our segment results are reconciled to our consolidated results reported in accordance with GAAP.  The Advertising Solutions, Wireless and Wireline and Other columns represent the segment results of each such operating segment.  The consolidation and elimination column adds in those line items that we manage on a consolidated basis only.  This column also eliminates any intercompany transactions included in each segment’s results.  In the Segment assets line item, we have eliminated the value of our investments in our fully consolidated subsidiaries and the intercompany financing assets as these have no impact to the segments’ operations.

For the three months ended June 30, 2012

	Advertising Solutions			Wireless			Wireline		Other			Elimination			Consolidated
Revenue from external customers	$	191,806		$	68,894		$	475,210	$	-		$	-		$	735,910
Cost of revenue		68,784			81,309			249,660		-			-			399,753
Gross profit		123,022			(12,415)			225,550		-			-			336,157
Operations and support expenses		456,221			21,068			194,848		5,391			1			642,530
Depreciation and amortization		15,577			19,322			372		-			-			35,271
Total segment operating expenses		471,798			40,390			195,220		5,391			1			712,800
Segment operating income		(348,776	)		(52,805	)		30,330		(5,391	)		(1	)		(376,643	)
Total other income (expense)		(97,178	)		1,237			-		-			-			(95,941	)
Net loss allocable to minority interest		-			13,442			-		-			-			13,442
Segment income before income taxes	$	(445,954	)	$	(38,126	)	$	30,330	$	(5,391	)	$	(1	)	$	(459,142	)
Segment assets	$	2,564,739		$	1,526,627		$	1,031,261	$	44		$	(2,326,286	)	$	2,796,385

For the three months ended June 30, 2011

	Advertising Solutions			Wireless			Wireline		Other			Elimination			Consolidated
Revenue from external customers	$	258,767		$	53,483		$	575,006	$	-		$	-		$	887,256
Cost of revenue		66,963			67,752			290,325		-			-			425,040
Gross profit		191,804			(14,269)			284,681		-			-			462,216
Operations and support expenses		481,201			17,484			234,006		7,233			-			739,924
Depreciation and amortization		18,486			19,987			372		-			-			38,845
Total segment operating expenses		499,687			37,471			234,378		7,233			-			778,769
Segment operating income		(307,883	)		(51,740	)		50,303		(7,233	)		-			(316,553	)
Total other income (expense)		(102,208	)		(16,221)			-		-			-			(118,429	)
Net loss allocable to minority interest		-			17,062			-		-			-			17,062
Segment income before income taxes	$	(410,091	)	$	(50,899	)	$	50,303	$	(7,233	)	$	-		$	(417,920	)
Segment assets	$	2,815,984		$	1,676,083		$	2,133,155	$	56		$	(2,462,239	)	$	4,163,039

For the six months ended June 30, 2012

	Advertising Solutions			Wireless			Wireline		Other			Elimination			Consolidated
Revenue from external customers	$	404,903		$	153,360		$	998,534	$	-		$	-		$	1,556,797
Cost of revenue		132,879			141,980			513,956		-			-			788,815
Gross profit		272,024			11,380			484,578		-			-			767,982
Operations and support expenses		960,297			34,024			452,574		7,509			(2	)		1,454,402
Depreciation and amortization		32,600			38,645			743		-			-			71,988
Total segment operating expenses		992,897			72,669			453,317		7,509			(2	)		1,526,390
Segment operating income		(720,873	)		(61,289	)		31,261		(7,509	)		2			(758,408	)
Total other income (expense)		(184,105	)		(14,931)			35		-			-			(199,001	)
Net loss allocable to minority interest		-			22,076			-		-			-			22,076
Segment income before income taxes	$	(904,978	)	$	(54,144	)	$	31,296	$	(7,509	)	$	2		$	(935,333	)
Segment assets	$	2,564,739		$	1,526,627		$	1,031,261	$	44		$	(2,326,286	)	$	2,796,385

For the six months ended June 30, 2011

	Advertising Solutions			Wireless			Wireline		Other			Elimination			Consolidated
Revenue from external customers	$	550,920		$	73,645		$	1,200,748	$	-		$	-		$	1,825,313
Cost of revenue		193,895			101,358			600,721		-			-			895,974
Gross profit		357,025			(27,713			600,027		-			-			929,339
Operations and support expenses		974,993			39,348			483,949		9,902			-			1,508,192
Depreciation and amortization		37,962			39,975			743		-			-			78,680
Total segment operating expenses		1,012,955			79,323			484,692		9,902			-			1,586,872
Segment operating income		(655,930	)		(107,036	)		115,335		(9,902	)		-			(657,533	)
Total other income (expense)		(188,322	)		(32,259	)		-		-			-			(220,581	)
Net loss allocable to minority interest		-			34,440			-		-			-			34,440
Segment income before income taxes		(844,252	)		(104,855	)		115,335		(9,902	)		-			(843,674	)
Segment assets	$	2,815,984		$	1,676,083		$	2,133,155	$	56		$	(2,462,239	)	$	4,163,039

XML

Commitments

6 Months Ended

Jun. 30, 2012

Commitments and Contingencies Disclosure [Abstract]

Commitments

A portion of our facilities are under operating leases that expire at various dates through 2014.  Rent expense was $138,705 and $135,360 for the three months ended June 30, 2012 and 2011, respectively. Rent expense was $287,892 and $271,182 for the six months ended June 30, 2012 and 2011, respectively.

Minimum rental commitments under all non-cancelable leases with an initial term in excess of one year were as follows as of June 30, 2012:

Year Payable	Amount
2012		$	280,109
2013			221,352
2014 and Thereafter			7,763
Total		$	509,224

XML

Related Party Transactions

6 Months Ended

Jun. 30, 2012

Related Party Transactions [Abstract]

Related Party Transactions

As of December 31, 2011, Dicken Yung, Chairman, had a loan balance of $176,352 and $7,689 as outstanding accounts payable which is still owed by the Company. The amounts are due on demand and bear no interest.  During the six months ended June 30, 2012, the Company received additional financing of $25,000 and repaid $11,214.  As of June 30, 2012, the balance owed was $190,536 and $30,812.

As of December 31, 2011, Baldwin Yung, CEO, had a loan balance of $387,000 and $65,049 as outstanding accounts payable which is still owed by the Company.  The amounts are due on demand and bear no interest.  As of June 30, 2012, the balance owed was $387,000 and $66,135.

As of December 31, 2011, Boaz Yung, EVP, had a loan balance of $1,125 and $13,691 as outstanding accounts payable which is still owed by the Company.  The amounts are due on demand and bear no interest.  As of June 30, 2012, the balance owed was $1,125 and $14,431.

As of December 31, 2011, Cherie Yung, Director, had a loan balance of $135,000 and $54,572, as outstanding accounts payable which is still owed by the Company.   The amounts are due on demand and bear no interest.  As of June 30, 2012, the balance owed was $257,144 and $76,609.

There were no other related party transactions in 2012.

XML

Segment Reporting (Details Narrative)	6 Months Ended
	Jun. 30, 2012
Segment Reporting Details Narrative
Number of reportable segment	4

XML

Line of Credit and Notes Payable (Tables)

6 Months Ended

Jun. 30, 2012

Line Of Credit And Notes Payable Tables

Maturity date and term of each of our loans

As of June 30, 2012, the amount, maturity date and term of each of our loans were as follows:

Lender	Principal Amount		Interest Rate			Maturity Date
Thermo Credit LLC	$	1,507,176		17.00	%	January 17, 2011
AHAP		40,000	Various			Upon Demand
Brilliant Capital		868,941		8.00	%	Upon Demand
InfoCity, LLC and Others		1,128,176		8.00	%	Upon Demand
Dr. Dicken Yung (related party)		190,536		0.00	%	Upon Demand
Baldwin Yung (related party)		387,000		0.00	%	Upon Demand
Boaz Yung (related party)		1,125		0.00	%	Upon Demand
Cherie Yung (related party)		257,144		0.00	%	Upon Demand
	$	4,380,098

As of December 31, 2011, the amount, maturity date and term of each of our loans were as follows:

Lender	Principal Amount		Interest Rate			Maturity Date
Thermo Credit LLC	$	1,507,176		17.00	%	January 17, 2011
AHAP		40,000		8.00	%	Upon Demand
Brilliant Capital		574,899		8.00	%	Upon Demand
InfoCity, LLC and Others		1,079,176		8.00	%	Upon Demand
Dr. Dicken Yung (related party)		176,352		0.00	%	Upon Demand
Baldwin Yung (related party)		387,000		0.00	%	Upon Demand
Boaz Yung (related party)		1,125		0.00	%	Upon Demand
Cherie Yung (related party)		135,000		0.00	%	Upon Demand
	$	3,900,728

XML

Summary of Significant Accounting Policies (Details)	6 Months Ended
	Jun. 30, 2012
MicrowaveTowers [Member]
Depreciation Period	25 years
ComputerEquipment [Member]
Depreciation Period	5 years
FurnitureAndEquipmentMember
Depreciation Period	7 years
Software [Member]
Depreciation Period	3 years
LeaseholdImprovements [Member]
Depreciation Period	5 years

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $)	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (935,333)	$ (843,674)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Shares to be issued for services	35,000	0
Depreciation and amortization	71,987	78,680
Change in deferred rent	(22,122)	(18,461)
Net loss allocated to non-controlling interest	(22,076)	(34,440)
CHANGES IN OPERATING ASSETS AND LIABILITIES:
Accounts receivable	35,527	152,337
Other current assets	3,723	12,046
Other assets	(32,041)	2,895
Accounts payable and accrued expenses	293,968	184,073
Accounts payable and accrued expenses - related party	46,986	21,760
CASH USED IN OPERATING ACTIVITIES	(524,381)	(444,784)
CASH FLOWS FROM INVESTING ACTIVITIES:
Interest earned on certificates of deposit	(23)	0
Redemption of certificates of deposit	0	50,822
Purchase of furniture and equipment	(567)	(199)
CASH USED IN (PROVIDED BY) INVESTING ACTIVITIES	(590)	50,623
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from notes payable	343,042	319,930
Proceeds from line of credit	0	48
Repayment of line of credit	0	(174,340)
Proceeds from related party notes payable	147,542	212,000
Repayment of related party notes payable	(11,214)	(9,000)
CASH PROVIDED BY FINANCING ACTIVITIES	479,370	348,638
EFFECT OF EXCHANGE RATE CHANGES ON CASH	(318)	707
NET DECREASE IN CASH	(45,919)	(44,816)
CASH, beginning of period	51,704	89,822
CASH, end of period	5,785	45,006
Interest paid	165,782	172,020
Taxes paid	$ 0	$ 0

XML

Fixed Assets

6 Months Ended

Jun. 30, 2012

Notes to Financial Statements

Fixed Assets

Property and equipment consisted of the following at June 30, 2012 and December 31, 2011: 

	June 30, 2012			December 31, 2011
Microwave towers	$	1,949,019		$	1,949,019
Computer equipment		226,265			226,265
Furniture & equipment		117,446			117,106
Software		35,858			35,858
Tenant improvements		186,949			186,949
		2,515,537			2,515,197
Accumulated depreciation		(935,004	)		(863,304	)
Fixed assets, net	$	1,580,533		$	1,651,953

Depreciation expense for the three months ended June 30, 2012 and 2011 was $35,271 and $38,845, respectively.

Depreciation expense for the six months ended June 30, 2012 and 2011 was $71,987 and $78,680, respectively.

XML

Summary of Significant Accounting Policies (Details Narrative) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011	Dec. 31, 2011
Summary Of Significant Accounting Policies Details Narrative
Restricted cash balance	$ 28,101		$ 28,101		$ 28,078
Goodwill	767,873		767,873		767,873
Marketing and advertising expense	66	1,840	804	3,044
Percent of net sales	0.48%	0.53%	0.49%	0.54%
Accounts payable to related party	$ 141,001		$ 141,001

XML

Fixed Assets (Tables)

6 Months Ended

Jun. 30, 2012

Fixed Assets Tables

Property and equipment

Property and equipment consisted of the following at June 30, 2012 and December 31, 2011: 

	June 30, 2012			December 31, 2011
Microwave towers	$	1,949,019		$	1,949,019
Computer equipment		226,265			226,265
Furniture & equipment		117,446			117,106
Software		35,858			35,858
Tenant improvements		186,949			186,949
		2,515,537			2,515,197
Accumulated depreciation		(935,004	)		(863,304	)
Fixed assets, net	$	1,580,533		$	1,651,953