UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-KSB
(Mark One)
[X]   ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934
For the fiscal year ended December 31, 2006

[ ]   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
      OF 1934
For the transition period from              to
                              -------------    -----------------

                        Commission file number: 333-49388

                               [GRAPHIC OMITTED]

                       CHINA WIRELESS COMMUNICATIONS, INC.
                 (Name of small business issuer in its charter)

               NEVADA                                    91-1966948
   (State or other jurisdiction of                   (I.R.S. Employer
    incorporation or organization)                   Identification No.)

              1746 COLE BOULEVARD, SUITE 225, GOLDEN, CO 80401-3210
               (Address of principal executive offices) (Zip Code)

                     Issuer's telephone number: 303-277-9968

       Securities registered under Section 12(b) of the Exchange Act: NONE
       Securities registered under Section 12(g) of the Exchange Act: NONE

Check whether the issuer is not required to file reports  pursuant to Section 13
or 15(d) of the Exchange Act. [ ]

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 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: [ ]

Check  if no  disclosure  of  delinquent  filers  in  response  to  Item  405 of
Regulation S-B is contained in this form,  and no disclosure  will be contained,
to the best of  registrant's  knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in Part III of this Form  10-KSB or any
amendment to this Form 10-KSB. [ ] (NOT APPLICABLE.  THE ISSUER'S SECURITIES ARE
NOT REGISTERED UNDER SECTION 12 OF THE EXCHANGE ACT.)

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

State issuer's revenues for its most recent fiscal year:  $478,139

State the aggregate market value of the voting and non-voting common equity held
by non-affiliates  computed by reference to the price at which the common equity
was sold,  or the average bid and asked  price of such  common  equity,  as of a
specified date within the past 60 days: $3,578,659 AS OF FEBRUARY 28, 2007

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 170,412,340 AS OF FEBRUARY 28, 2007.

Transitional Small Business Disclosure Format (Check one):   Yes: [ ]   No: [x]


<PAGE>


                 DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

         We caution readers regarding  forward looking  statements found in this
report and in any other  statement made by, or on our behalf,  whether or not in
future  filings with the  Securities  and Exchange  Commission.  Forward-looking
statements are statements not based on historical  information  and which relate
to future  operations,  strategies,  financial  results  or other  developments.
Forward looking  statements are necessarily based upon estimates and assumptions
that are inherently  subject to significant  business,  economic and competitive
uncertainties and  contingencies,  many of which are beyond our control and many
of which,  with  respect to future  business  decisions,  are subject to change.
These  uncertainties and contingencies can affect actual results and could cause
actual results to differ materially from those expressed in any  forward-looking
statements  made by or on our  behalf.  We  disclaim  any  obligation  to update
forward-looking statements.


                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS.

         BUSINESS  DEVELOPMENT.  We were  originally  incorporated  in Nevada on
March 8, 1999 under the name AVL SYS  International Inc ("AVL SYS"). On March 9,
2000, AVL SYS changed its name to I-Track, Inc ("ITI").

         On March 22,  2003,  ITI  acquired  all of the issued  and  outstanding
shares  of  Strategic  Communications  Partners,  Inc.,  a  Wyoming  corporation
("SCP"),  pursuant  to the  terms  of a Share  Exchange  Agreement.  A total  of
19,000,000   restricted  shares  of  ITI's  common  stock  were  issued  to  the
shareholders  of SCP,  resulting  in the  SCP  shareholders  as a  group  owning
approximately 88.4% of the outstanding shares of common stock. At this time, SCP
became a wholly owned  subsidiary.  On March 24, 2003,  in  connection  with our
acquisition  of SCP,  ITI's name was changed to China  Wireless  Communications,
Inc.

         BUSINESS OF ISSUER.  Our business plan is to evaluate  opportunities to
acquire  companies in the  information  technology  industry and to provide both
wireless  and  wired  high-speed  data  and  telecommunication  systems  to  our
customers.   In  addition,   we  and  our   subsidiaries  can  provide  wireless
connectivity for data and video surveillance networks.

         On May 24, 2005, the Company entered into a letter agreement to acquire
51% of the stock of Tianjin  Create IT Company  Ltd..,  a People's  Republic  of
China  company  ("Create  Co."),  for  total  consideration  of  $53,840,  to be
comprised of (i) cash in the amount of $40,379.61 and (ii) 448,665 shares of the
Company's  common stock valued at $0.03 per share, for a total of $13,460 in the
Company's  common stock.  On September 6, 2005, the Company paid $21,460 towards
the  acquisition  price  ($13,460 in the Company's  common stock and cash in the
amount of $8,000).

         On May 18, 2006, the Company  entered into an amended letter  agreement
with the 49% owner of Create Co.,  whereby the  parties  agreed to increase  the
acquisition  cost of Create Co. to $126,767.  Because the Company had previously
made a payment of $21,460, the remaining purchase amount owing was $105,307,  as
of the May 18, 2006 amendment.  The Company agreed to pay the remaining purchase
amount owing of $105,307 in cash no later than August 31, 2006.

         On  October  25,  2006,  the  Company  and the 49% owner of Create  Co.
further  amended the purchase  agreement  whereby the Company  agreed to a final
payment of  $105,307,  payable  in (i) cash in the  amount of  $10,531  and (ii)
6,318,404 shares of the Company's common stock valued at $94,776,  to take place
on December 31, 2006.  The parties have agreed to further extend the date of the
final  payment and expect the final  payment to be made by the end of June 2007.
The Company has recorded the $105,307  additional purchase price for Create Co.,
in accounts payable and accrued expenses as of December 31, 2006.

         Create Co.  provides  information  technology  systems  integration and
internet protocol  services to customers.  It also provides IP routing equipment
and network cabling and its customers are  principally in the People's  Republic
of China.  We acquired  Create Co. in part because of its strategic  location in
Tianjin  City,  the third  largest  city in China.  Also,  as a  forward-looking
company with a customer base in the education, oil and gas, banking,  brokerage,
commercial  and  government  sectors,  Create Co.  provides  an  opportunity  to
establish a presence in China.


                                       2
<PAGE>

         Additionally,  during the 3rd quarter of 2006, we formed a wholly owned
subsidiary,    CW   Communications,    Inc.,   a   Colorado   corporation   ("CW
Communications"),  which operates in north Texas. Through CW Communications,  we
intend  to  leverage  technical  and  sales   opportunities   presented  by  the
information  technology side of our business in the areas of video  surveillance
design, engineering and installation.

         We will market the products and services of China Wireless,  Create Co,
and CW  Communications  together where possible in order to provide the customer
with options in information technology,  systems engineering, low voltage power,
backup  systems for data  network  equipment,  data and video  cabling and video
surveillance equipment.

         During the 4th quarter of 2006, we began to investigate  other business
opportunities   within  the  United   States  and  China.   Included   in  these
opportunities  are the  importation of consumer  products and the development of
electronic products to fill a need in the law enforcement and security market.

         INDUSTRY BACKGROUND. With over 130 million users, the People's Republic
of China (the "PRC" or "China") has surpassed Japan to become the world's second
largest Internet market.  Many enterprises have installed  high-speed local area
networks to support  bandwidth-intensive  applications,  and the large  monopoly
carriers have invested  hundreds of millions of dollars in fiber optic  networks
to provide massive backbone network capacity.

         The opportunity to provide high-speed  wireless broadband for customers
utilizing  existing carrier  transport as well as broadband radio transport will
now be  part  of our  overall  strategy  to  become  an  information  technology
provider. We will utilize proven information technology to complete and meet end
users'  business  objectives.  Our focus on  potential  customers  will  include
commercial business, universities and government enterprises.

         The  communications  and  information  services  industries  are highly
competitive.  Many of our existing and  potential  competitors  have  financial,
personnel,  marketing and other resources  significantly greater than ours. Many
of these competitors have the added  competitive  advantage of a larger existing
customer base. In addition,  significant new competitors could arise as a result
of:

         -the recent increased consolidation in the industry;
         -further technological advances; and
         -further deregulation and other regulatory initiatives.

If we are unable to  compete  successfully,  our  business  could be  materially
adversely affected.

         COMPLIANCE   WITH   GOVERNMENTAL   REGULATIONS.   Our   operations  and
partnerships   are  subject  to  various  levels  of  government   controls  and
regulations  in the  PRC.  As a  result,  we may be  exposed  to  certain  risks
associated with, among others, the political, economic and legal environment and
foreign currency  exchange.  Our results may be adversely  affected by change in
the political and social  conditions in the PRC, and by changes in  governmental
policies  with  respect  to laws and  regulations,  anti-inflationary  measures,
currency  conversion,  and remittance abroad, and rates and methods of taxation,
among  others.  We  cannot  assure  you that  changes  in  political  and  other
conditions will not result in any adverse impact.

         EMPLOYEES.  As of  March  31,  2007,  we have 13  full-time  employees,
including employees of Create Co.

ITEM 2.  DESCRIPTION OF PROPERTY.

         Our  principal  executive  offices are located at 1746 Cole  Boulevard,
Suite 225, Golden,  Colorado,  where we lease  approximately  800 square feet of
space pursuant to a written lease which expires in August 2007.

         Create Co.  leases  space under an operating  lease in Tianjin,  China.
Rental expenses under the operating lease were $6,656 in 2006. The lease expires
in August 2007.

ITEM 3.  LEGAL PROCEEDINGS.

         None.

                                       3
<PAGE>

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

         None.


                                     PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS AND SMALL
         BUSINESS ISSUER PURCHASES OF EQUITY SECURITIES.

         Our common  stock was  approved  for  trading  on the  over-the-counter
bulletin board  ("OTCBB") under the symbol "ITRK" on August 7, 2001. On December
2, 2002, the symbol was changed to "ITCK" when we implemented a 1-for-20 reverse
stock split.  On March 28, 2003, our trading  symbol was changed to "CWLC".  The
following  table sets forth the range of high and low closing bid  quotations of
our common stock for each fiscal quarter shown:

                                                           BID OR TRADE PRICES
    2005 FISCAL YEAR                                       HIGH            LOW
    ----------------                                       ----            ---

    Quarter Ending 03/31/05...........................    $ 0.06          $ 0.06
    Quarter Ending 06/30/05...........................    $ 0.03          $ 0.02
    Quarter Ending 09/30/05...........................    $ 0.04          $ 0.04
    Quarter Ending 12/31/05...........................    $ 0.02          $ 0.02

    2006 FISCAL YEAR                                       HIGH            LOW
    ----------------                                       ----            ---

    Quarter Ending 03/31/06...........................    $ 0.18          $ 0.02
    Quarter Ending 06/30/06...........................    $ 0.15          $ 0.04
    Quarter Ending 09/30/06...........................    $ 0.04          $ 0.03
    Quarter Ending 12/31/06...........................    $ 0.03          $ 0.02


         The  above  quotations  reflect  inter-dealer  prices,  without  retail
mark-up,  mark-down,  or commission  and may not  necessarily  represent  actual
transactions.

As of December 31, 2006, there were 259 registered shareholders of record of our
common stock

         During  the last  three  fiscal  years,  no cash  dividends  have  been
declared on our common stock and we do not  anticipate  that  dividends  will be
paid in the foreseeable future.

During quarter ended December 31, 2006,  there were no  unregistered  securities
issued.


ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

         OVERVIEW.  We are an  information  technology  company  providing  both
wireless  and  wired  high-speed  data  and  telecommunication  systems  to  our
customers.  In addition,  we provide  wireless  connectivity  for data and video
surveillance  networks.  In  furtherance  of our business  plan,  we acquired an
interest in Create Co., a systems integration and information technology company
located in Tianjin, China in 2005. Additionally, during the 3rd quarter of 2006,
we  formed a wholly  owned  subsidiary,  CW  Communications,  Inc.,  a  Colorado
corporation  ("CW  Communications"),  which operates in north Texas.  Through CW
Communications,   we  intend  to  leverage  technical  and  sales  opportunities
presented  by the  information  technology  side of our business in the areas of
video surveillance design, engineering and installation. We intend to market the
products  and  services  of China  Wireless,  Create Co,  and CW  Communications


                                       4
<PAGE>

together  where  possible  in order to  provide  the  customer  with  options in
information technology,  systems engineering,  low voltage power, backup systems
for data  network  equipment,  data and video  cabling  and  video  surveillance
equipment.

         GOING CONCERN. In Note 2 of the Company's Financial  Statements for the
year ended  December 31,  2006,  the  Company's  independent  registered  public
accounting  firm noted  that  there is  substantial  doubt  about the  Company's
ability to continue as a going concern. The accompanying  consolidated financial
statements have been prepared in conformity with accounting principles generally
accepted in the United States of America,  which contemplate  continuation of us
as a going concern. We incurred net losses for the years ended December 31, 2006
and 2005 of $3,226,744 and  $2,013,513,  respectively,  and at December 31, 2006
had an  accumulated  deficit of  $13,820,485  and a working  capital  deficit of
$362,158. These conditions raise substantial doubt as to our ability to continue
as a going concern.  Our  consolidated  financial  statements do not include any
adjustments  that  might  result  from  the  outcome  of this  uncertainty.  Our
consolidated 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 be  necessary  should the Company be
unable to continue as a going concern.

         Our  ability  to  continue  as a going  concern is  dependent  upon the
successful   implementation  of  our  business  plan  and  ultimately  achieving
profitable  operations.  However,  there is no assurance that we will be able to
raise the necessary capital to execute our business  strategy.  Our inability to
raise the required capital or implement our business strategy successfully could
adversely impact our business and prospects.

         CRITICAL ACCOUNTING POLICIES AND ESTIMATES. Our discussion and analysis
of our  financial  condition  and  results  of  operations  are  based  upon our
consolidated  financial statements,  which have been prepared in accordance with
accounting  principles  generally accepted in the United States of America.  The
preparation  of these  financial  statements  requires us to make  estimates and
judgments that affect the reported amounts of assets, liabilities,  revenues and
expenses,  and related  disclosures of contingent assets and liabilities.  On an
ongoing basis,  we evaluate our  estimates.  We base our estimates on historical
experience  and on various  other  assumptions  that we believe to be reasonable
under  the  circumstances,  the  results  of which  form the  basis  for  making
judgments  about the  carrying  value of  assets  and  liabilities  that are not
readily  apparent  from other  sources.  Actual  results  may differ  from these
estimates under different  assumptions or conditions;  however,  we believe that
our estimates, including those for the above-described items, are reasonable.

         MINORITY INTEREST.  Under generally accepted accounting principles when
losses  applicable to the minority  interest in a subsidiary exceed the minority
interest in the equity capital of the  subsidiary,  the excess is not charged to
the majority  interest since there is no obligation of the minority  interest to
make good on such losses. The Company, therefore, has included losses applicable
to the minority  interest against its interest since the minority owners have no
obligation to make good on the losses.  If future earnings do  materialize,  the
Company shall be credited to the extent of such losses previously  absorbed.  As
previously  stated,  we closed the  acquisition  of a 51%  majority  interest of
Create Co. on May 24, 2005.

         STOCK-BASED COMPENSATION.  Stock-based compensation.  Effective January
1,  2006,  WE  adopted  Statement  of  Financial  Accounting  Standards  No. 123
(revised),  "Share-Based Payment" (SFAS No. 123R), which requires the use of the
fair value method of  accounting  for all  stock-based  compensation,  including
stock options.  The statement was adopted using the modified  prospective method
of  application.  Under this  method,  in  addition to  reflecting  compensation
expense for new  share-based  awards,  expense is also recognized to reflect the
remaining  vesting  period  of  awards  that  had  been  included  in  pro-forma
disclosures  in prior  periods.  WE did not have any stock  based  compensation,
including options that would have required expensing under SFAS No. 123R for the
year ended December 31, 2006.

         FOREIGN  CURRENCIES.  Transactions in foreign currencies are translated
at the rates of  exchange  on the dates of  transactions.  Monetary  assets  and
liabilities  denominated in foreign currencies at year-end are translated at the
approximate  rates  ruling at the balance  sheet date.  Non-monetary  assets and
liabilities  are translated at the rates of exchange  prevailing at the time the
asset or liability was acquired.

         RESULTS OF  OPERATIONS.  Our net loss for the year ended  December  31,
2006 was  $3,226,744  compared with


                                       5
<PAGE>

$2,013,513  for the year ended  December  31, 2005,  an increase of  $1,213,231.
Operating  expenses  for the year ended  December  31,  2006,  were  $2,381,542,
compared with  $2,081,184  for the year ended  December 31, 2005, an increase of
$300,358.  The increases in our net loss and operating  expenses were  primarily
due  to a loss  on  payment  of  expenses  in  our  common  stock  of  $854,900;
additionally  we  incurred a $341,433  increase  in general  and  administrative
expenses in the year ended  December 31, 2006 as we are  integrating  Create Co.
into our operations, and as we further expand our business plan.

         During the year ended December 31, 2006, we generated sales revenues of
$478,139,  compared  with  $338,215 for the year ended  December  31,  2005,  an
increase of $139,924.

         LIQUIDITY AND CAPITAL  RESOURCES.  At December 31, 2006, we had current
assets of $126,099 as compared  to $101,623 at December  31,  2005,  and current
liabilities  of  $488,257  at  December  31,  2006,  as  compared to $497,544 at
December  31,  2005,  resulting  in working  capital  deficits of  $362,158  and
$395,921 at December 31, 2006 and December 31, 2005, respectively.

         During the year ended  December 31, 2006,  we used $250,042 of cash for
operating  activities  and  $260,963 was  provided by  investing  and  financing
activities.  Financing  activities consisted of borrowings from our officers and
directors.  By comparison for the year ended December 31, 2005, we used $160,025
of cash for our operating  activities,  while financing activities consisting of
proceeds from the issuance of our common stock and borrowings, providing cash of
$190,267. Investing activities during the year ended December 31, 2005 used cash
of $20,252,  which  consisted  of the  acquisition  of fixed  assets.  We had no
investing activities during the year ended December 31, 2006.

         We have been largely  reliant upon loans from related  parties in order
to meet our cash  requirements  and as of  January  1,  2007,  we  entered  into
individual  Revolving  Lines of Credit  ("Revolver")  agreements with two of our
directors, Henry Zaks and Pedro E. Racelis III. Each Revolver provides a $30,000
line of credit to the Company at 10% interest.

         PLAN OF OPERATION.  Our business plan is to evaluate  opportunities  to
acquire  companies in the  information  technology  industry and to provide both
wireless  and  wired  high-speed  data  and  telecommunication  systems  to  our
customers.  In addition,  we provide  wireless  connectivity  for data and video
surveillance networks.

         We are focusing our efforts on becoming a viable information technology
company.  We believe  that the  information  technology  business is  developing
quickly  in China and that  there are North  American  technologies  that can be
marketed  to  business  customers  in China.  Create  Co. is the  foundation  to
building our broad base information technology,  products and services in China.
As we execute our business  plan, we intend to utilize the  leadership of Create
Co. to oversee  and manage  our  operations  in China.  Create Co.  operates  in
Tianjin,  the  third  largest  city  in  China.  Tianjin  has  a  population  of
approximately  ten million  people and is a major  import and export  center for
China.  Major  industries and markets  located in Tianjin  include  educational,
industrial,  international shipping port, medical, manufacturing and government.
Tianjin is also  Beijing's  gateway to the sea and has over 25  10,000-ton  ship
berths. Tianjin's harbor is geographically the second largest in China. Further,
Tianjin is home to 31 of China's  universities,  including  Tianjin  University,
China's  first  modern  university.  The Tianjin  area also  includes the Tanggu
Economic Development Area, located where the Haihe River meets the Bohai Sea.

         Create Co.'s  customer base  includes  Nankai  University,  Tianjin Sea
Transportation Company,  Tianjin Gas Company, DaGang Oil Field and Tianjin North
Food  Company.  Additionally,  20 of  Tianjin  City's  31  universities  utilize
products or  services  provided by Create Co. We intend to expand our Create Co.
operation  by adding to the sales  force in order to better  take  advantage  of
system integration opportunities available. The focus of our systems integration
efforts  has  been  in  the   educational,   transportation,   natural  gas  and
manufacturing  markets  and our goal is to  expand  into  other  industries.  In
addition,  the  pool  of  highly  skilled  engineering,  marketing,  sales,  and
operations personnel in China is key to our success in growing our business.

         Our wholly owned subsidiary, CW Communications, Inc., will focus on the
design and  installation  of video  surveillance  systems.  Its current  area of
operation is in the north Texas area around Dallas - Fort Worth. We believe that
there  are  business  opportunities  in the  design  and  installation  of video
surveillance that are complementary to our information  technology business.  We
believe that CW  Communications,  Inc.'s  business model can also be employed in
the Chinese market by Create Co. as an additional service.


                                       6
<PAGE>

         As of December 31, 2006, our working  capital  deficit was $362,158 and
our accumulated  deficit was $13,820,485.  Cash provided from our operations and
Revolving Lines of Credit are  insufficient  to cover the costs  associated with
our plan of operation and our working capital  requirements  and we will need to
obtain additional funding to cover our cash  requirements.  We believe that such
additional  funding will be in the form of equity financing from the sale of our
common stock or further debt  financing.  However,  we cannot provide  investors
with any assurance that we will be able to raise sufficient funding to cover our
cash requirements and we do not presently have any arrangements in place for any
future equity or debt financing.

         OFF-BALANCE  SHEET  ARRANGEMENTS.    We  had   no   off-balance   sheet
arrangements as of December 31, 2006.

         NEW ACCOUNTING PRONOUNCEMENTS.

         In February  2006,  the Financial  Accounting  Standard  Board ("FASB")
issued SFAS No. 155,  "Accounting for Certain Hybrid Financial  Instruments - An
amendment of FASB  Statements No. 133 and 140." This Statement  resolves  issues
addressed in SFAS No. 133 Implementation Issue No. D1, "Application of Statement
133 to Beneficial Interest in Securitized  Financial Assets." This pronouncement
is  effective  for all  financial  instruments  acquired  or  issued  after  the
beginning of an entity's first fiscal year that begins after September 15, 2006.
Currently,  the Company does not have any publicly traded derivative instruments
or participate in any hedging  activities and,  therefore,  the adoption of SFAS
No. 155 is not  expected to have a material  impact on the  Company's  financial
position or results of operations.

         In February 2006, the FASB issued Staff Position (FSP) No. FAS 123(R)-4
(As  Amended)  "Classification  of Options  and  Similar  Instruments  Issued as
Employee  Compensation  That Allow for Cash  Settlement upon the Occurrence of a
Contingent Event".  This FSP addresses the classification of options and similar
instruments issued as employee  compensation that allow for cash settlement upon
the  occurrence of a contingent  event,  which amends  paragraphs 32 and A229 of
FASB Statement No. 123 (revised 2004),  "Share-Based  Payment".  The adoption of
FSP No. FAS 123(R)-4 did not have a material  impact on the Company's  financial
position or results of operations.

         In March 2006, the FASB issued SFAS No. 156:  "Accounting For Servicing
of Certain Financial  Instruments- an amendment of SFAS No. 140." This statement
establishes,  among other things,  the accounting for all separately  recognized
servicing assets and servicing  liabilities.  This statement amends SFAS No. 140
to  require  that all  separately  recognized  servicing  assets  and  servicing
liabilities be initially  measured at fair value, if  practicable.  SFAS No. 156
permits,  but  does  not  require,  the  subsequent  measurement  of  separately
recognized  servicing assets and servicing  liabilities at fair value. An entity
that uses  derivative  instruments  to mitigate the risks  inherent in servicing
assets and  servicing  liabilities  is required to account for those  derivative
instruments  at fair value.  Under SFAS No. 156, an entity can elect  subsequent
fair value  measurement  to account  for it's  separately  recognized  servicing
assets  and  servicing  liabilities.  By  electing  that  option,  an entity may
simplify  its  accounting   because  this  statement  permits  income  statement
recognition of the potential offsetting changes in fair value of those servicing
assets  and  servicing  liabilities  and  derivative  instruments  in  the  same
accounting period. SFAS No. 156 is effective for financial statements for fiscal
years beginning after  September 15, 2006.  Earlier  adoption of SFAS No. 156 is
permitted as of the  beginning of an entity's  fiscal year,  provided the entity
has not yet issued any financial  statements  for that fiscal year. The adoption
of  SFAS No 156 is not  expected  have a  significant  impact  on the  Company's
consolidated financial statements.

         In June  2006,  the  FASB  issued  FASB  Interpretation  (FIN)  No.  48
"Accounting  for  Uncertainty  in  Income  Taxes,"  an  interpretation  of  FASB
Statement No. 109. FIN 48 is effective for fiscal years beginning after December
15,  2006.  Differences  between the amounts  recognized  in the  statements  of
financial  position  prior to the adoption of FIN 48 and the amounts  recognized
after the adoption  should be accounted  for as a  cumulative-effect  adjustment
recorded to the beginning balance of retained earnings. Since the effective date
falls within the Company's fiscal year 2007, the Company did not adopt FIN 48 in
fiscal 2006.

         In  September   2006,  the  FASB  issued  SFAS  No.  157,  "Fair  Value
Measurements".  SFAS  157  defines  fair  value,  establishes  a  framework  for
measuring  fair value in generally  accepted  accounting  principles and expands
disclosures  about  fair  value  measurements.  SFAS  157  applies  under  other
accounting  pronouncements that require or permit fair value  measurements,  the
FASB having previously  concluded in those accounting  pronouncements  that fair

                                       7
<PAGE>

value is the  relevant  measurement  attribute.  Accordingly,  SFAS 157 does not
require any new fair value measurements.  SFAS 157 is effective for fiscal years
beginning  after  November 15,  2007,  and interim  periods  within those fiscal
years,  with earlier  adoption  permitted.  The provisions of SFAS 157 should be
applied  prospectively  as of the  beginning  of the fiscal  year in which it is
initially applied, with limited exceptions.  The Company is currently evaluating
the provisions of SFAS 157.

         In  September   2006,  the  Staff  of  the  SEC  issued  SAB  No.  108:
"Considering   the  Effects  of  Prior  Year   Misstatements   when  Quantifying
Misstatements  in Current  Year  Financial  Statements".  SAB No.  108  provides
guidance  on the  consideration  of the effects of prior year  misstatements  in
quantifying  current year  misstatements for the purpose of determining  whether
the current year's financial statements are materially misstated.  The SEC staff
believes  registrants must quantify errors using both a balance sheet and income
statement approach and evaluate whether either approach results in quantifying a
misstatement  that, when all relevant  quantitative and qualitative  factors are
considered,  is material.  This  Statement is effective  for fiscal years ending
after  November 15, 2006. The adoption of SAB No. 108 did not have a significant
impact on the Company's consolidated financial statements.

         In July 2006,  the  Emerging  Issues  Task Force  ("EITF")  of the FASB
reached a consensus  and ratified  Issue No. 06-2:  "Accounting  for  Sabbatical
Leave and Other Similar Benefits  Pursuant to FASB Statement No. 43,  Accounting
for  Compensated  Absences".  SFAS No. 43 provides  guidance for  accounting for
compensated  absences and states that an employer  shall accrue a liability  for
employees'  compensation  for future  absences  if certain  conditions  are met.
However,  since certain  compensated  absences  such as sabbatical  leave do not
typically  accrue  until  fully  vested,  there was  uncertainty  as to  whether
employee rights to the compensated absence accumulate and meet the conditions of
SFAS No. 43. The consensus  reached by the EITF has determined  that  sabbatical
and other  similar  benefits  do  accumulate  and should be accrued for over the
requisite  service  period.  Further,  the EITF has called for  adoption  of the
consensus  for fiscal years  beginning  after  December 15, 2006.  EITF 06-2 was
effective beginning January 1, 2007. The adoption of SAB No. 108 is not expected
to have a significant impact on the Company's consolidated financial statements.

         In February  2007, the FASB issued SFAS No. 159, "The Fair Value Option
for  Financial  Assets and Financial  Liabilities-including  an amendment of FAS
115" (SFAS 159).  SFAS 159 allows  entities  to choose,  at  specified  election
dates, to measure  eligible  financial assets and liabilities at fair value that
are not otherwise required to be measured at fair value. If a company elects the
fair value  option for an  eligible  item,  changes in that item's fair value in
subsequent reporting periods must be recognized in current earnings. SFAS 159 is
effective for fiscal years  beginning  after  November 15, 2007. The adoption of
SFAS  No 159 is not  expected  to have a  significant  impact  on the  Company's
consolidated financial statements.


ITEM 7.  FINANCIAL STATEMENTS.

See pages beginning with page F1.


ITEM  8.  CHANGES  IN AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING  AND
          FINANCIAL DISCLOSURE.

         On January 3, 2007,  Sherb & Co., LLP  ("Sherb")  was  appointed as our
registered  independent  public accountant for the year ended December 31, 2006.
On January 3, 2007 Bongiovanni and Associates ("Bongiovanni"),  was dismissed as
our registered independent public accountant. The decisions to appoint Sherb and
dismiss Bongiovanni were approved by our board of directors on December 6, 2006.

         During  the  fiscal  years  ended  December  31,  2005 and 2004 and the
subsequent  interim  period up through the date of dismissal  (January 3, 2007),
there  were no  disagreements  with  Bongiovanni  on any  matter  of  accounting
principles or practices,  financial  statement  disclosure or auditing  scope or
procedure,  which  disagreements,   if  not  resolved  to  the  satisfaction  of
Bongiovanni,  would have caused  Bongiovanni  to make  reference  thereto in its
report on the our financial  statements for such years.  Further,  there were no
reportable  events as  described  in Item  304(a)(1)(iv)(B)  of  Regulation  S-B
occurring  within our two most recent  fiscal years and the  subsequent  interim
period up through the date of dismissal (January 3, 2007).


                                       8
<PAGE>

         The audit report of  Bongiovanni  for our  financial  statements  as of
December 31, 2005, contained a separate paragraph stating:

                  "The accompanying  consolidated financial statements have been
         prepared assuming that the Company will continue as a going concern. As
         discussed  in  note 2 to the  consolidated  financial  statements,  the
         Company  has  suffered  losses  from  operations,  has a  stockholders'
         deficit,  has  discontinued  operations,  has a negative cash flow from
         operations,  and has a negative working capital that raise  substantial
         doubt about its ability to  continue as a going  concern.  Management's
         plans  in  regard  to  these  matters  are  described  in note 2 to the
         consolidated   financial   statements.   The   consolidated   financial
         statements  do not include any  adjustments  that might result from the
         outcome of this uncertainty."

         The audit report of  Bongiovanni  for our  financial  statements  as of
December 31, 2004, contained a separate paragraph stating:

                  "The accompanying  consolidated financial statements have been
         prepared assuming that the Company will continue as a going concern. As
         discussed  in  note 2 to the  consolidated  financial  statements,  the
         Company  has  suffered  losses  from  operations,  has a  stockholders'
         deficit,  has  discontinued  operations,  and  has a  negative  working
         capital that raise substantial doubt about its ability to continue as a
         going  concern.  Management's  plans in  regard  to these  matters  are
         described  in  note 2 to the  consolidated  financial  statements.  The
         consolidated  financial  statements do not include any adjustments that
         might result from the outcome of this uncertainty."

         During our two most  recent  fiscal  years and the  subsequent  interim
period up through the date of engagement of Sherb (January 3, 2007), neither our
company nor anyone on its behalf  consulted  Sherb  regarding the application of
accounting  principles to a specific completed or contemplated  transaction,  or
the type of audit  opinion that might be rendered on our  financial  statements.
Further,  Sherb has not  provided  us with  written or oral  advice  that was an
important  factor  considered  us in reaching a decision  as to any  accounting,
auditing or financial reporting issues.


ITEM 8A. CONTROLS AND PROCEDURES

         EVALUATION OF DISCLOSURE  CONTROLS AND PROCEDURES.  Our Chief Executive
Officer / Chief Financial  Officer  conducted an evaluation of the effectiveness
of  our  disclosure  controls  and  procedures  as  defined  in  Rule  15d-15(e)
promulgated  under  the  Securities  Exchange  Act of  1934 as of the end of the
period covered by this report.  Based on this  evaluation,  our Chief  Executive
Officer / Chief Financial Officer concluded that the design and operation of our
disclosure  controls  and  procedures  were  effective  as of  the  date  of the
evaluation.

         CHANGES IN INTERNAL  CONTROLS OVER FINANCIAL  REPORTING.  In connection
with the evaluation of our internal controls,  our management has concluded that
there were no changes in our internal  control  over  financial  reporting  that
occurred  during the fiscal quarter ended December 31, 2006 that have materially
affected,  or are reasonably likely to materially  affect,  our internal control
over financial reporting.


ITEM 8A(T).       CONTROLS AND PROCEDURES

Not applicable.


ITEM 8B. OTHER INFORMATION.

         None.

                                       9
<PAGE>
                                    PART III

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS, CONTROL PERSONS, AND
         CORPORATE GOVERNANCE; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE
         ACT.

         As of the date of this filing,  our  executive  officers and  directors
are:

    NAME                          AGE       POSITION

    Pedro E. Racelis III           56       President, Chief Executive Officer,
                                            Chief Financial Officer and Director

    Michael A. Bowden              57       Director

    Henry Zaks                     63       Director

    Brad Woods                     47       Director

    Robert McElhinney              48       Director

    Iouri Onoufrienko              37       Director

         Our  Bylaws  provide  for a board  of  directors  ranging  from 1 to 12
members,  with the exact number to be specified by the board. At present, we are
authorized to have a seven-member board and we presently have one vacancy on the
board,  which we intend to fill  during  the  second  calendar  quarter of 2007.
Vacancies in our board are filled by the board itself. Set forth below are brief
descriptions of the recent  employment and business  experience of our executive
officers and directors.

         PETE RACELIS,  PRESIDENT,  CHIEF  EXECUTIVE  OFFICER,  CHIEF  FINANCIAL
OFFICER AND  DIRECTOR.  Mr.  Racelis  has been our  President,  Chief  Executive
Officer,  Chief  Financial  Officer and a director since June 2004. A veteran of
direct sales and management in multi-national  companies for more than 21 years,
Mr.  Racelis  has  extensive  experience  with  telecommunications,  operations,
management and  organizational  skills.  Prior to joining the company in October
2002,  Mr.  Racelis sold hardware and software  solutions to  telecommunications
carriers, financial institutions,  and commercial businesses both nationally and
internationally in North America. Mr. Racelis has held executive level positions
as Vice President/GM at Winstar Wireless (1995-1997), Director of Sales at Amati
Corporation (1997-1998), and Vice President at Stox.com (1998 - 2001).

         MICHAEL A. BOWDEN, DIRECTOR. Mr. Bowden was our Chief Operating Officer
from February  2005 to January 2007 and has been a director  since January 2005.
He has over 25 years of  telecommunications  experience in both highly technical
and major account sales environments. His experience includes supporting complex
projects  ranging  from  $100K  to $58M in  annual  revenue.  Mr.  Bowden  was a
telecommunications  consultant  from August 2002 to February 2003. From December
2000 to August  2002,  he was a senior sales  engineer  for  Net.com,  a Denver,
Colorado,  company that provided  telecommunications  equipment to carriers. Mr.
Bowden was a technical  support manager for Qwest  Communications  International
Inc. (formerly US West Communications),  Denver,  Colorado, from October 1998 to
December 2000.

         HENRY ZAKS, DIRECTOR.  Mr. Zaks has been a director since October 2003.
Since  March  1973,  he has been the  President  of  Zaks-Shane,  LTD and Health
Insurance   Services,   Inc.  since  December  1988.  Both  are  Wisconsin-based
organizations  that  specialize in marketing  business-to-business  solutions to
both  corporations  and small companies.  He has over 35 years'  experience as a
sales professional.

         BRAD WOODS,  DIRECTOR.  Mr. Woods served as our Interim President & CEO
from August  2003 to June 2004,  and chief  financial  officer,  secretary,  and
treasurer  from  March  2003  to  June  2004.  He has  extensive  experience  in
international  investments,  acquisitions,  taxation,  and computer applications
with both public and  private  companies.

                                       10
<PAGE>

Mr. Woods has also worked for Arthur Andersen & Co., where he executed  projects
for and on behalf of clients in the oil and gas,  financial  services,  leasing,
lodging,  retail and light  manufacturing  industries.  His experience  includes
practicing  before the  Securities and Exchange  Commission,  both with existing
public companies and initial public offerings.  He has also served as an advisor
to numerous companies.

         ROBERT MCELHINNEY,  DIRECTOR.  Mr. McElhinney was appointed as a member
of our board of directors on January 19, 2007.  Mr.  McElhinney  has 18 years of
experience in the manufacturing of commercial  packaging and retail products and
has been involved in material  resources  planning,  standard process  controls,
operations  and cost  reduction  projects.  From  1986 to  2003,  he  served  as
inventory  control  manager for Metal Packaging  International,  a manufacturing
company based in  Northglenn,  Colorado.  During 2003 and 2004,  Mr.  McElhinney
served as operations  manager for Amsco Windows,  at their  distribution  center
based in  Aurora,  Colorado.  He  currently  serves in a  supervisory  role with
Skywest  Airlines,  located in Denver,  Colorado.  Mr.  McElhinney brings to our
board  manufacturing and quality control experience to assist us with building a
program to manage our vendors and quality control.  He earned a Bachelors degree
in Marketing from the University of Northern Colorado.

         IOURI ONOUFRIENKO,  DIRECTOR. Mr. Onoufrienko was appointed as a member
of our board of directors on January 19, 2007. Mr.  Onoufrienko  has 16 years of
international business experience, beginning as a trading manager in 1991 with a
Russian  timber and paper  manufacturing  firm,  where he managed the import and
export of commercial  products in the European and North  American  markets.  In
1996, Mr. Onoufrienko  operated several service and support businesses that sold
products and services to major retail,  educational  institutions,  and regional
hospitals in North  America.  Since 1999,  he has been the owner of the regional
commercial flooring construction company,  Onuffer Flooring,  based in Thornton,
Colorado.

         Our board members are paid $1,000 for each board meeting attended.

         CONFLICTS OF INTEREST.  Our officers and directors are, so long as they
are our officers or directors, subject to the restriction that all opportunities
contemplated by our plan of operation which come to their  attention,  either in
the  performance  of their  duties or in any other  manner,  will be  considered
opportunities  of, and be made  available to us and the companies  that they are
affiliated with on an equal basis. A breach of this requirement will be a breach
of the fiduciary duties of the officer or director.  If we or the companies with
which the officers and directors are affiliated both desire to take advantage of
an opportunity,  then said officers and directors would abstain from negotiating
and voting upon the opportunity.  However,  all directors may still individually
take  advantage of  opportunities  if we should  decline to do so. Except as set
forth  above,  we have not  adopted any other  conflict of interest  policy with
respect to such transactions.

         COMMITTEES.  In  fiscal  2006,  the board of  directors  did not have a
standing  nominating  or  compensation  committee,  rather the  entire  board of
directors acted in such capacity.  Additionally,  Mr. Henry Zaks is the Chairman
of the Audit Committee. We do not have an audit committee financial expert.

         CODE OF ETHICS.  In February 2007, our board adopted our Code of Ethics
that applies to our  directors  and all of our  employees,  including  our Chief
Executive Officer and our Chief Financial  Officer. A copy of our Code of Ethics
may be obtained from the company without charge, upon written request to:

         China Wireless Communications, Inc.
         1746 Cole Boulevard, Suite 225
         Golden, Co 80401-3210
         Attention: Investor Relations

         SECTION 16(a)  BENEFICIAL  OWNERSHIP REPORTING  COMPLIANCE.  We are not
subject to Section 16(a) of the Securities Exchange Act of 1934.



                                       11
<PAGE>

ITEM 10. EXECUTIVE COMPENSATION.

         The following  table sets forth  information  the  remuneration  of our
chief executive  officers and our executive  officers or directors who earned in
excess of $100,000 per annum during any part of our last two fiscal years:

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------

        Name and principal position           Year   Salary ($)    Stock Awards ($)       Total ($)
--------------------------------------------------------------------------------------------------------
<S>                                           <C>      <C>           <C>                   <C>
Pedro E. Racelis, III                         2005     144,000         128,000             272,000
President, Chief Executive Officer, Chief     2006     144,000         145,000             289,000
Financial Officer and Director (1)<F1>
--------------------------------------------------------------------------------------------------------
Michael Bowden
Director and former Chief Operating           2005     120,000         500,000             620,000
Officer  (2)<F2>                              2006     120,000         116,000             236,000
--------------------------------------------------------------------------------------------------------
<FN>
(1)<F1>  Mr. Racelis  became  our  President,  Chief  Executive  Officer,  Chief
         Financial Officer  and a director  in June 2004.
(2)<F2>  Mr.  Bowden was our Chief  Operating  Officer  from February 2005 until
         January 2007, and has served as a director since January 2005.
</FN>
</TABLE>

         There  have  been no grants of stock  appreciation  rights or  benefits
under long-term  incentive  plans or other forms of  compensation  involving our
officers, through December 31, 2006.

         We  reimburse  our  officers  and  directors  for  reasonable  expenses
incurred  in the  performance  of their  duties.  The  members  of our  board of
directors are compensated at $1,000 per meeting.

         EMPLOYMENT AGREEMENTS. In June 2004, Pedro E. Racelis III was appointed
as President and Chief  Executive  Officer of the Company and we entered into an
employment  agreement with Mr.  Racelis at that time.  Salary for Mr. Racelis in
2005 was $144,000.  On March 1, 2006, we entered into a new employment agreement
with Mr.  Racelis  for a term of six  years  renewable  for one year  after  the
original  term expires.  Under the terms of the new  employment  agreement,  Mr.
Racelis  will be paid an  annual  salary  of  $250,000,  with  increases  of 10%
annually. Mr. Racelis did not accept the increase in salary in 2006.

         STOCK PLAN.  On January 31,  2003,  our  shareholders  adopted the 2003
Stock Plan,  which provides for the granting of both incentive stock options and
nonstatutory  stock options and stock  purchase  rights to officers,  directors,
employees,  and  independent  contractors.  The total number of shares of common
stock  that may be  issued  under  this  plan  shall  not  exceed  15% of shares
outstanding.

         The board of  directors  or one or more  committees  designated  by the
board  administers  this plan,  and has the authority  and  discretion to do the
following:

    o   determine the fair market value;
    o   select the  employees,  directors,  or  consultants  to whom options and
        stock purchase rights may be granted;
    o   determine the number of shares of common stock  to  be  covered  by each
        option and stock purchase right granted under the Plan;
    o   approve forms of agreement for use under the Plan;
    o   determine the terms and conditions of an option or stock purchase  right
        granted under the Plan;
    o   construe  and  interpret  the terms of the Plan and awards granted under
        the Plan;
    o   prescribe,  amend,  and  rescind  rules and regulations relating  to the
        Plan;
    o   modify or amend each option or stock purchase right;
    o   allow optionees to satisfy  withholding  tax  obligations by electing to
        have the company withhold from the shares to be issued upon  exercise of
        an option or stock  purchase  right that  number of shares having a fair

                                       12
<PAGE>

        market value equal to the minimum amount required to be withheld;
    o   authorize any person to execute on behalf of the company any  instrument
        required  to effect the grant of an option or stock purchase right; and
    o   make  all  other  determinations  deemed  necessary  or  advisable   for
        administering the Plan.

         We may grant incentive stock options with the exercise price being 100%
of the bid price on the date of grant, and  nonstatutory  stock options with the
exercise  price  being  not less than 85% of the bid price on the date of grant.
The options are subject to any vesting, special forfeiture conditions, rights of
repurchase,  rights of first refusal, and other transfer  restrictions as may be
determined by the board or committee.  Options  granted  cannot exceed a term of
ten years,  except in the case of incentive  stock options granted to holders of
10% of more of our total  combined  voting power of all classes of stock,  which
cannot exceed a term of five years.  The options  terminate upon the earliest of
(1) the  stated  expiration  date,  (2) 30 days  after  the  termination  of the
optionee's service for any reason other than total and permanent disability, (3)
six months after the  termination of the  optionee's  service by reason of total
and permanent disability, or (4) six months after the optionee's death.

         Unless  earlier  terminated by the board of  directors,  this plan will
terminate January 30, 2013.

         As of December 31, 2006, there were no outstanding  options to purchase
shares of our common stock.


ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
         MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

         The following table provides certain information as to the officers and
directors  individually  and as a group,  and the holders of more than 5% of the
Common Stock of the Company, as of February 28, 2007:

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------
                                                               AMOUNT AND NATURE OF
NAME AND ADDRESS OF BENEFICIAL OWNER (1)<F1>                   BENEFICIAL OWNERSHIP           PERCENT OF CLASS (2)<F2>
---------------------------------------------------------------------------------------------------------------------
<S>                                                                  <C>                            <C>
Pedro E. Racelis III (3)<F3>
1746 Cole Boulevard, Suite 225
Golden, Colorado 80401                                               11,126,188                      6.5%
---------------------------------------------------------------------------------------------------------------------
Michael A Bowden (4)<F4>
1746 Cole Boulevard, Suite 225                                       8,560,365                       5.0%
Golden, Colorado 80401
---------------------------------------------------------------------------------------------------------------------
Brad Woods
1746 Cole Boulevard, Suite 225                                          -0-                          0.0%
Golden, Colorado 80401
---------------------------------------------------------------------------------------------------------------------
Henry Zaks (5)<F5>
1746 Cole Boulevard, Suite 225                                        8,041,424                      4.7%
Golden, Colorado 80401
---------------------------------------------------------------------------------------------------------------------
Robert McElhinney
1746 Cole Boulevard, Suite 225                                          -0-                           0%
Golden, Colorado 80401
---------------------------------------------------------------------------------------------------------------------
Iouri Onoufrienko
1746 Cole Boulevard, Suite 225                                          -0-                           0%
Golden, Colorado 80401
---------------------------------------------------------------------------------------------------------------------
All officers and directors as a Group (6 persons)                    27,727,977                     16.2%
---------------------------------------------------------------------------------------------------------------------

                                       13
<PAGE>
-----------
<FN>
(1)>F1>  To our  knowledge,  except as set forth in the  footnotes to this table
         and subject to applicable community property laws, each person named in
         the table has sole  voting and  investment  power  with  respect to the
         shares set forth opposite such person's name.

(2)<F2>  This  table is based on  170,412,340 shares of Common Stock outstanding
         as of February 28, 2007. If a person listed on this table has the right
         to obtain additional shares of Common Stock within sixty (60) days from
         February 28, 2007, the  additional  shares are deemed to be outstanding
         for the  purpose of  computing  the  percentage  of class owned by such
         person,  but are not  deemed  to be  outstanding  for  the  purpose  of
         computing the percentage of any other person.

(3)<F3>  11,126,188  shares  are  held  in  the name of Global Sales  Strategies
         Inc.,  a Colorado  corporation  100% owned and  controlled  by Pedro E.
         Racelis III.

(4)<F4>  2,260,365 of  these shares are  held in the  name of  Michael A. Bowden
         individually;  6,250,000  shares  are held in the name of MBE  Ltd.,  a
         Colorado corporation 100% owned and controlled by Michael A. Bowden; an
         additional  50,000 shares are 100% vested  warrants,  exercisable  at a
         price of $0.50.  On January 19, 2007, Mr. Bowden resigned as an officer
         of the Company,  and on March 12, 2007 Mr.  Bowden  returned  6,000,000
         shares of Common Stock to the Company which had been paid to Mr. Bowden
         as compensation. The shares were then cancelled by the Company.

(5)<F5>  7,804,582  of  these  shares  are  held  in  the name of Henry Zaks; an
         additional   236,842  of  these   shares  are  100%  vested   warrants,
         exercisable at a price of $0.40.
</FN>
</TABLE>

     CHANGES IN CONTROL.  There are no agreements  known to management  that may
result in a change of control of our company.

     EQUITY COMPENSATION PLANS. As of December 31, 2006, our equity compensation
plan information is as follows:

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------
                                Number of securities to be    Weighted-average exercise
                                  issued upon exercise of       price of outstanding         Number of securities
                                   outstanding options,         options, warrants and       remaining available for
    Plan Category                   warrants and rights                rights                   future issuance
-------------------------------------------------------------------------------------------------------------------
<S>                                        <C>                          <C>                       <C>
Equity compensation plans                  None                         None                      25,561,851
approved by securities holders
-------------------------------------------------------------------------------------------------------------------
Equity compensation plans not              None                         None                         None
approved by securities holders
-------------------------------------------------------------------------------------------------------------------
Total                                      None                         None                      25,561,851
-------------------------------------------------------------------------------------------------------------------
</TABLE>


ITEM 12. CERTAIN  RELATIONSHIPS   AND   RELATED   TRANSACTIONS,   AND   DIRECTOR
         INDEPENDENCE.

         RELATED PARTY TRANSACTIONS.  Other than as disclosed below, none of our
present directors, officers or principal shareholders,  nor any family member of
the foregoing, nor, to the best of our information and belief, any of our former
directors,  officers or principal  shareholders,  nor any family  member of such
former directors,  officers or principal  shareholders,  has or had any material
interest, direct or indirect, in any transaction, or in any proposed transaction
which has materially affected or will materially affect us.

         a.   PEDRO E. RACELIS,  III (PRESIDENT AND CEO). During May 2006, Pedro
E.  Racelis,  III, the  Company's  President  and CEO, made loan advances to the
Company of $15,500 and $3,612.  These  loans  accrued  interest at 8% per annum,
were  unsecured  and were due on July 2,  2006 and  December  1,  2006,  for the
$15,500 and $3,612  advance,  respectively.  At the request of the President and
CEO, the note in the amount of $15,500, plus accrued interest,  was approved for
conversion  into  310,000  shares of the  Company's  restricted  common stock on
October 5, 2006. This note

                                       14
<PAGE>

payable was converted at the market price on the date of conversion.  The $3,612
advance remains unpaid as of December 31, 2006.

         In the fourth quarter of the year ended December 31, 2006, Mr. Racelis,
made loan advances to the Company totaling $21,038. These loans were received in
three advances,  they are unsecured and accrue  interest at 8% per annum.  These
advances  are payable  upon demand until such time as the Company has drawn up a
formal loan payable document.

         b.   HENRY ZAKS (DIRECTOR).  Prior to joining the Company  Board, Henry
Zaks was  compensated  as a consultant to review  administration  and accounting
functions of the  Company.  During the year ended  December  31, 2005,  Mr. Zaks
converted  notes  payable of $30,000 into shares of common stock at a conversion
price of $0.05 per share, and he converted notes payable of $20,000 into 857,085
shares of common stock at a conversion price of $0.029 per share. The conversion
rate for both these  conversions  was at the market  price on the dates of their
conversion.

         During the year ended December 31, 2006, Mr. Zaks made loan advances of
$76,742 to the Company. All loan advances payable from Mr. Zaks accrued interest
at 8% per annum, prior to conversion,  and were due at various dates, except for
the last loan advance,  which was not formalized into a note payable.  All loans
were unsecured.  On November 7, 2006 all loan advances,  plus accrued  interest,
were approved for  conversion  into  1,810,837  shares of the  Company's  common
stock,  except for the last loan advance  made on November  11, 2006,  which was
forgiven,  along with accrued  interest,  on December 31, 2006. All  conversions
were at the market rate on the date of conversion.  The  forgiveness of the note
payable  has been  accounted  for as a capital  contribution,  as Mr. Zaks is an
officer of the Company

         The  following  is a list of loans  payable  made from Mr.  Zaks to the
Company.

<TABLE>
<CAPTION>
                                                                 Amount
                                                               Converted
                                                                  With
                                Date             Date           Accrued                           Date            Date
             Amount            Issued             Due           Interest         Shares        Converted        Forgiven
           ------------    -------------     ------------    -------------    ------------    -----------    -------------
<S>                         <C>               <C>            <C>              <C>              <C>             <C>
           $    10,000       3/22/2006        10/31/2006     $     10,546         458,520      11/7/2006
                 4,137       4/13/2006        10/31/2006            4,324         187,998      11/7/2006
                 1,400       4/27/2006        10/31/2006            1,462          63,557      11/7/2006
                 7,680        5/1/2006         12/1/2006            7,939         198,486      11/7/2006
                23,217        5/3/2006         10/2/2006           24,127         482,542      11/7/2006
                 3,600       5/15/2006        10/31/2006            3,722         161,810      11/7/2006
                 2,000       6/14/2006         12/1/2006            2,047          51,177      11/7/2006
                 4,708       9/28/2006          3/1/2007            4,755         206,747      11/7/2006
                20,000      11/13/2006            n/a                                                          12/31/2006
           ------------                                       ------------    ------------
           $    76,742                                        $    58,922       1,810,837
</TABLE>

         c.   MICHAEL  BOWDEN  (DIRECTOR).  During  the years ended December 31,
2006 and 2005 Michael Bowden,  a director and former Chief Operating  Officer of
the Company,  made loan advances to the Company at various dates of $149,071 and
$12,698, respectively. These loans payable accrued interest at 8% per annum, and
unsecured), and were due on various repayments date, except for the last advance
of $3,200 on December 27, 2006. On November 13, 2006,  the Company  approved the
conversion  of $24,310 in loan  advances,  plus $940 of accrued  interest,  into
564,903 shares of the Company's common stock at  approximately  $0.04 per share.
The conversion  rate for this  conversion was at the market price on the date of
conversion.  All other loan  advances  from the year ended  December  31,  2006,
including the last advance on December 27, 2006, which was not formalized into a
note payable,  were forgiven by Mr. Bowden.  The forgiveness of the note payable
has been accounted for as a capital contribution, as Mr. Bowden is an officer of
the Company.


                                       15
<PAGE>

         The following  table  reconciles  the loans payable for Mr. Bowden that
were received,  converted into Common stock and forgiven  during the years ended
December 31, 2006 and 2005:

<TABLE>
<CAPTION>
                                                                 Amount
                                                                Converted
                                                                  With
                                 Date             Date           Accrued                            Date              Date
              Amount            Issued             Due          Converted         Shares          Converted         Forgiven
           ------------     -------------     ------------    -------------    ------------    --------------    -------------
<S>                           <C>              <C>            <C>              <C>                <C>              <C>
           $    12,698          8/1/2005         7/2/2006     $     13,270         265,401        11/13/2006
                73,059          5/3/2006        10/2/2006                                                            7/5/2006
                 1,612         6/15/2006        12/1/2006            1,666          41,656        11/13/2006
                10,000         6/26/2006       12/31/2006           10,314         257,846        11/13/2006
                 6,300         7/27/2006        1/31/2007                                                          11/17/2006
                 5,000         9/26/2006         3/1/2007                                                          11/17/2006
                30,000         11/8/2006        12/1/2006                                                           11/8/2006
                 6,000         11/8/2006        12/1/2006                                                          11/17/2006
                 3,900        11/14/2006        12/1/2006                                                          11/30/2006
                 4,800        12/11/2006       12/31/2007                                                          12/15/2006
                 5,200        12/27/2006        1/31/2007                                                          12/29/2006
                 3,200        12/27/2006        2/15/2007                                                          12/31/2006
           ------------                                       -------------    ------------
           $   161,769                                        $     25,250         564,903
</TABLE>

         As of December 31, 2006, there were no outstanding notes payable to Mr.
Bowden. On January 19, 2007, Mr. Bowden resigned as an officer of the Company.

         On January 1, 2007, the Company entered into individual Revolving Lines
of Credit ("Revolver") agreements with Henry Zaks and Pedro E. Racelis III. Each
Revolver provides a $30,000 line of credit to the Company at 10% interest.

FUTURE TRANSACTIONS

         All future  affiliated  transactions  will be made or  entered  into on
terms that are no less  favorable to us than those that can be obtained from any
unaffiliated third party.

DIRECTOR INDEPENDENCE

         Our common stock trades on the OTC Bulletin  Board. As such, we are not
currently subject to corporate governance  standards of listed companies,  which
require,  among other  things,  that the  majority of the board of  directors be
independent.  Since  we  are  not  currently  subject  to  corporate  governance
standards relating to the independence of our directors,  we choose to define an
"independent"   director  in  accordance   with  the  NASDAQ   Global   Market's
requirements  for independent  directors  (NASDAQ  Marketplace  Rule 4200).  The
NASDAQ  independence  definition  includes a series of objective tests,  such as
that the  director  is not an  employee  of the  company  and has not engaged in
various types of business dealings with the company. We believe that Henry Zaks,
Robert McElhinney and Iouri Onoufrienko each qualify as an independent  director
under  the above  definition.  We do not list that  definition  on our  Internet
website.








                                       16
<PAGE>
ITEM 13. EXHIBITS

(a)      EXHIBITS:

--------------------------------------------------------------------------------
REGULATION
S-B NUMBER                             EXHIBIT
--------------------------------------------------------------------------------
   2.1         Share Exchange Agreement dated as of March 17, 2003 by and
               between i-Track, Inc. and Strategic Communications Partners, Inc.
               (1)
--------------------------------------------------------------------------------
   3.1         Articles of Incorporation (2)
--------------------------------------------------------------------------------
   3.2         Bylaws (2)
--------------------------------------------------------------------------------
   3.3         Certificate of Amendment to Articles of Incorporation (3)
--------------------------------------------------------------------------------
   3.4         Certificate of Amendment to Articles of Incorporation (4)
--------------------------------------------------------------------------------
  10.1         2003 Stock Plan, as amended (5)
--------------------------------------------------------------------------------
  10.2         Employment Agreement dated April 23, 2004 with Pedro E. Racelis
               III (6)
--------------------------------------------------------------------------------
  10.3         Consulting Agreement with Jiaxin Consulting Group, Inc. dated
               December 8, 2004 (8)
--------------------------------------------------------------------------------
  10.4         Letter agreement with Tianjin Create IT Company Ltd. dated May
               24, 2005 (9)
--------------------------------------------------------------------------------
  10.5         Employment Agreement dated July 20, 2005 with Michael A. Bowden
               (10)
--------------------------------------------------------------------------------
  10.6         Promissory Note, dated August 1, 2005 in the amount of $12,698
               payable to Michael Bowden (10)
--------------------------------------------------------------------------------
  10.7         Employment Agreement dated March 1, 2006 with Michael A. Bowden
               (10)
--------------------------------------------------------------------------------
  10.8         Employment Agreement dated March 1, 2006 with Pedro E. Racelis
               III (10)
--------------------------------------------------------------------------------
  10.9         Amendment to Letter agreement with Tianjin Create IT Company Ltd.
               dated May 18, 2006 (10)
--------------------------------------------------------------------------------
  10.10        Promissory Note, dated May 3, 2006 in the amount of  $15,500
               payable to Pedro E. Racelis III (10)
--------------------------------------------------------------------------------
  10.11        Promissory Note, dated May 3, 2006 in the amount of $23,217
               payable to Henry Zaks (10)
--------------------------------------------------------------------------------
  10.12        Promissory  Note, dated May 3, 2006 in the amount of $73,059
               payable to Michael Bowden (10)
--------------------------------------------------------------------------------
  10.13        Promissory Note, dated May 30, 2006 in the amount of $3,612
               payable to Pedro E. Racelis III (11)
--------------------------------------------------------------------------------
  10.14        Promissory Note, dated June 16, 2006 in the amount of $2,000
               payable to Henry Zaks (11)
--------------------------------------------------------------------------------
  10.15        Promissory Note, dated June 16, 2006 in the amount of $1,612
               payable to Michael A. Bowden (11)
--------------------------------------------------------------------------------
  10.16        Promissory Note, dated June 26, 2006 in the amount of $10,000
               payable to Michael A. Bowden (11)
--------------------------------------------------------------------------------
  10.17        Promissory Note, dated June 27, 2006 in the amount of $7,680
               payable to Henry Zaks (11)
--------------------------------------------------------------------------------
  10.18        Forgiveness of Promissory Note, dated July 5, 2006 in the amount
               of $73,059 payable to Michael A. Bowden (12)
--------------------------------------------------------------------------------


                                       17
<PAGE>
--------------------------------------------------------------------------------
REGULATION
S-B NUMBER                             EXHIBIT
--------------------------------------------------------------------------------
  10.19        Promissory Note, dated July 27, 2006 in the amount of $6,300
               payable to Michael A. Bowden (12)
--------------------------------------------------------------------------------
  10.20        Promissory Note, dated September 26, 2006 in the amount of $5,000
               payable to Michael A. Bowden (12)
--------------------------------------------------------------------------------
  10.21        Promissory Note, dated September 28, 2006 in the amount of $4,708
               payable to Henry Zaks (12)
--------------------------------------------------------------------------------
  10.22        Conversion Election Letter dated October 5, 2006 from Pedro E.
               Racelis III (12)
--------------------------------------------------------------------------------
  10.23        Conversion Election Letter dated October 30, 2006 from Henry Zaks
               (12)
--------------------------------------------------------------------------------
  10.24        Amendment to Letter Agreement Tianjin Create IT Company Ltd.
               dated November 7, 2006 (12)
--------------------------------------------------------------------------------
  10.25        Conversion Election Letter dated November 7, 2006 from Henry Zaks
--------------------------------------------------------------------------------
  10.26        Conversion Election Letter dated November 7, 2006 from Henry Zaks
--------------------------------------------------------------------------------
  10.27        Promissory Note, dated November 8, 2006 in the amount of $30,000
               payable to Michael A. Bowden
--------------------------------------------------------------------------------
  10.28        Promissory Note, dated November 8, 2006 in the amount of $6,000
               payable to Michael A. Bowden
--------------------------------------------------------------------------------
  10.29        Forgiveness of Promissory Note, dated November 8, 2006 in the
               amount of $30,000 payable to Michael A. Bowden
--------------------------------------------------------------------------------
  10.30        Promissory Note, dated November 10, 2006 in the amount of $20,000
               payable to Henry K. Zaks
--------------------------------------------------------------------------------
  10.31        Conversion Election Letter dated November 13, 2006 from Michael
               A. Bowden
--------------------------------------------------------------------------------
  10.32        Conversion Election Letter dated November 13, 2006 from Michael
               A. Bowden
--------------------------------------------------------------------------------
  10.33        Conversion Election Letter dated November 13, 2006 from Michael
               A. Bowden
--------------------------------------------------------------------------------
  10.34        Promissory Note, dated November 14, 2006 in the amount of $3,900
               payable to Michael A. Bowden
--------------------------------------------------------------------------------
  10.35        Forgiveness of Promissory Note, dated November 17, 2006 in the
               amount of $6,300 payable to Michael A. Bowden
--------------------------------------------------------------------------------
  10.36        Forgiveness of Promissory Note, dated November 17, 2006 in the
               amount of $5,000 payable to Michael A. Bowden
--------------------------------------------------------------------------------
  10.37        Forgiveness of Promissory Note, dated November 17, 2006 in the
               amount of $6,000 payable to Michael A. Bowden
--------------------------------------------------------------------------------
  10.38        Forgiveness of Promissory Note, dated November 30, 2006 in the
               amount of $3,900 payable to Michael A. Bowden
--------------------------------------------------------------------------------
  10.39        Promissory Note, dated December 11, 2006 in the amount of $4,800
               payable to Michael A. Bowden
-------------------------------------------------------------------------------
  10.40        Forgiveness of Promissory Note, dated December 15, 2006 in the
               amount of $4,800 payable to Michael A. Bowden
--------------------------------------------------------------------------------
  10.41        Promissory Note, dated December 27, 2006 in the amount of $5,200
               payable to Michael A. Bowden
--------------------------------------------------------------------------------

                                       18
<PAGE>
--------------------------------------------------------------------------------
REGULATION
S-B NUMBER                             EXHIBIT
--------------------------------------------------------------------------------
  10.42        Promissory Note, dated December 2, 2006 in the amount of $3,200
               payable to Michael A. Bowden
--------------------------------------------------------------------------------
  10.43        Forgiveness of Promissory Note, dated December 29, 2006 in the
               amount of $5,200 payable to Michael A. Bowden
--------------------------------------------------------------------------------
  10.44        Forgiveness of Promissory Note, dated December 31, 2006 in the
               amount of $20,000 payable to Henry Zaks
--------------------------------------------------------------------------------
  10.45        Forgiveness of Promissory Note, dated December 31, 2006 in the
               amount of $3,200 payable to Michael A. Bowden
--------------------------------------------------------------------------------
  10.46        Revolving Line of Credit Agreement and Promissory Note, dated
               January 1, 2007 in the amount of $30,000 payable to Pedro E.
               Racelis III
--------------------------------------------------------------------------------
  10.47        Revolving Line of Credit Agreement and Promissory Note, dated
               January 1, 2007 in the amount of $30,000 payable to Henry Zaks
--------------------------------------------------------------------------------
  16.1         Letter from Bongiovanni and Associates, dated January 11, 2007
               (13)
--------------------------------------------------------------------------------
  21.1         Subsidiaries of the registrant
--------------------------------------------------------------------------------
  31.1         Rule 15d-14(a) Certification
--------------------------------------------------------------------------------
  32.1         Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
               Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
--------------------------------------------------------------------------------

(1)      Incorporated by reference to the exhibits to the  registrant's  current
         report on Form 8-K dated March 17, 2003 filed March 18, 2003.
(2)      Incorporated  by  reference  from  the  exhibits  to  the  Registration
         Statement on Form SB-1 filed on November 6, 2000, File No. 333-49388.
(3)      Incorporated by reference to the exhibits to the  registrant's  current
         report on Form 8-K dated March 22, 2003, filed March 31, 2003.
(4)      Incorporated by reference to the exhibits to the  registrant's  current
         report on Form 8-K dated November 22, 2004, filed November 24, 2004.
(5)      Incorporated  by reference to the exhibits to the  registrant's  annual
         report on Form 10-KSB for the year ended December 31, 2002, filed April
         9, 2003.
(6)      Incorporated   by  reference  to  the  exhibits  to  the   registrant's
         registration  statement on Form S-8, File No.  333-104457,  filed April
         27, 2004.
(7)      Incorporated by reference to the exhibits to the  registrant's  current
         report on Form 8-K dated April 15, 2003, filed April 22, 2003.
(8)      Incorporated  by reference to the exhibits to the  registrant's  annual
         report on Form 10-KSB for the year ended December 31, 2004, filed April
         15, 2005.
(9)      Incorporated by reference to the exhibits to the  registrant's  amended
         current report on Form 8-K dated May 24, 2005, filed June 6, 2005.
(10)     Incorporated  by reference to the exhibits to the  registrant's  annual
         report on Form 10-KSB for the year ended  December 31, 2005,  filed May
         22, 2006.
(11)     Incorporated by reference to the exhibits to the registrant's quarterly
         report on Form 10-QSB for the quarter ended June 30, 2006, filed August
         4, 2006.
(12)     Incorporated by reference to the exhibits to the registrant's quarterly
         report on Form 10-QSB for the quarter ended  September 30, 2006,  filed
         November 14, 2006.
(13)     Incorporated by reference to the exhibits to the  registrant's  current
         report on Form 8-K/A dated January 3, 2007, filed January 11, 2007.


                                       19
<PAGE>

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

         On January 3, 2006,  Bongiovanni & Associates  C.P.A.  was dismissed as
our  independent  public  accountants.  Our  board  of  directors  approved  the
dismissal of Bongiovanni & Associates C.P.A. Bongiovanni & Associates C.P.A. had
audited our  consolidated  balance sheet as of December 31, 2005 and the related
consolidated  statements of operations,  stockholders' equity and cash flows for
the year ended  December  31,  2005 and for the period  from  January 1, 2004 to
December 31, 2004.

         On January 3, 2007,  we engaged Sherb and Co., LLP based in Boca Raton,
Florida, as our principal  accountant to audit our financial  statements for the
year ending December 31, 2006. Our board of directors approved the engagement of
Sherb and Co.

AUDIT FEES

         For the fiscal year ended  December  31,  2006,  Sherb and Co.,  LLP is
expected to bill  approximately  $28,000  for the audit of our annual  financial
statements.  For  the  fiscal  year  ended  December  31,  2005,  Bongiovanni  &
Associates  C.P.A.  billed  $58,397  for  the  audit  of  our  annual  financial
statements.

         For the fiscal year ended  December  31,  2007,  Sherb and Co.,  LLP is
expected to bill approximately $4,000 for the review of our Form 10-QSB filings.
For the fiscal year ended  December 31, 2006,  Bongiovanni  & Associates  C.P.A.
billed  $4,750 for the review of our Form  10-QSB  filings.  For the fiscal year
ended December 31, 2005,  Bongiovanni & Associates C.P.A. billed $18,000 for the
review of our Form 10-QSB filings.

AUDIT-RELATED FEES

         There  were no fees  billed  for  services  reasonably  related  to the
performance of the audit or review of our financial  statements outside of those
fees disclosed above under "Audit Fees" for fiscal years 2006 and 2005.

TAX FEES

         For the fiscal year ended  December  31,  2006,  Sherb and Co.,  LLP is
expected  to bill  $7,500  for tax  compliance,  tax  advice,  and tax  planning
services.  For the fiscal year ended December 31, 2005, Bongiovanni & Associates
C.P.A. billed $8,000 for tax compliance,  tax advice, and tax planning services,
respectively.

ALL OTHER FEES

         There were no other fees, other than those described above.

PRE-APPROVAL POLICIES AND PROCEDURES

         Prior to engaging our accountants to perform a particular service,  our
board of  directors  obtains an estimate  for the service to be  performed.  The
board of directors in accordance with procedures for the company approved all of
the services described above.










                                       20
<PAGE>
                                   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.

                               CHINA WIRELESS COMMUNICATIONS, INC.



Date:  April 12, 2007          By: /s/ PEDRO E. RACELIS III
                                  ----------------------------------------------
                                  Pedro E. Racelis III, President, Chief
                                  Executive Officer and Chief Financial Officer


         In accordance  with the Exchange Act, this report has been signed below
by the following  persons on behalf of the  registrant and in the capacities and
on the dates indicated.

<TABLE>
<CAPTION>
               SIGNATURE                                 TITLE                                  DATE
<S>                                      <C>                                               <C>

                                         President, Chief Executive Officer
                                         (Principal Executive Officer) and
/s/ PEDRO E. RACELIS III                 Chief Financial Officer (Principal                April 12, 2007
----------------------------------       Financial and Accounting Officer)
Pedro E. Racelis III




/s/ HENRY ZAKS                                         Director                            April 12, 2007
----------------------------------
Henry Zaks




/s/ ROBERT MCELHINNEY                                  Director                            April 12, 2007
----------------------------------
Robert McElhinney




/s/ IOURI ONOUFRIENKO                                  Director                            April 12, 2007
----------------------------------
Iouri Onoufrienko




/s/ MICHAEL A. BOWDEN                                  Director                            April 12, 2007
----------------------------------
Michael A. Bowden




                                                       Director
----------------------------------
Brad Woods
</TABLE>




                                       21
<PAGE>


CONTENTS
================================================================================
REPORTS OF INDEPENDENT REGISTERED PUBLIC
  ACCOUNTING FIRMS...............................................F-1-3
CONSOLIDATED STATEMENTS OF OPERATIONS............................F-4
CONSOLIDATED BALANCE SHEET.......................................F-5
CONSOLIDATED STATEMENTS OF CASH FLOWS............................F-6
CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIT..................F-7
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.......................F-8
================================================================================





























                                      F-1
<PAGE>




             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


China Wireless Communications, Inc.
1746 Cole Boulevard, Suite 225
Golden, Colorado 80401-3208

To the Board of Directors and Stockholders of China Wireless Communications,
Inc.

We have audited the accompanying consolidated balance sheet of China Wireless
Communications, Inc. (the "Company") and subsidiaries as of December 31, 2006
and the related consolidated statements of operations, stockholders' deficit and
cash flows for the year ended December 31, 2006. These consolidated financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these consolidated financial
statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the
consolidated financial statements are free of material misstatement. The Company
is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Company's internal control
over financial reporting. Accordingly we express no such opinion. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall consolidated financial statements presentation. We
believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of the Company and
subsidiaries as of December 31, 2006 and the consolidated results of their
operations and cash flows for the year ended December 31, 2006 in conformity
with accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in note 2 to the
consolidated financial statements, the Company has suffered losses from
operations, has a stockholders' deficit, has discontinued operations, and has a
negative working capital that raise substantial doubt about its ability to
continue as a going concern. Management's plans in regard to these matters are
described in note 2 to the consolidated financial statements. The consolidated
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.



/s/ Sherb and Co., LLP,

Certified Public Accountants
Boca Raton, Florida
February 17, 2007




                                      F-2
<PAGE>


BONGIOVANNI & ASSOCIATES, P.A.
17111 KENTON DRIVE, SUITE 100-B
CORNELIUS, NORTH CAROLINA 28031
PHONE (704) 892-8733
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


China Wireless Communications, Inc.
1746 Cole Boulevard, Suite 225
Golden, Colorado 80401-3208

To the Board of Directors and Stockholders of China Wireless Communications,
Inc.

We have audited the  accompanying  consolidated  balance sheet of China Wireless
Communications,  Inc. (the  "Company") and  subsidiaries as of December 31, 2005
and the related consolidated statements of operations, stockholders' deficit and
cash flows for the year ended December 31, 2005.  These  consolidated  financial
statements   are  the   responsibility   of  the   Company's   management.   Our
responsibility  is  to  express  an  opinion  on  these  consolidated  financial
statements based on our audit.

We conducted  our audit in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audit  to  obtain  reasonable  assurance  about  whether  the
consolidated  financial statements are free of material  misstatement.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements.  An audit also includes  assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall  consolidated  financial statements  presentation.  We
believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly,  in all material  respects,  the  financial  position of the Company and
subsidiaries  as of  December  31,  2005 and the  consolidated  results of their
operations  and cash flows for the year ended  December  31, 2005 in  conformity
with accounting principles generally accepted in the United States of America.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in note 2 to the
consolidated  financial  statements,   the  Company  has  suffered  losses  from
operations,  has a stockholders' deficit, has discontinued operations, and has a
negative  working  capital  that raise  substantial  doubt  about its ability to
continue as a going concern.  Management's  plans in regard to these matters are
described in note 2 to the consolidated  financial statements.  The consolidated
financial  statements do not include any adjustments  that might result from the
outcome of this uncertainty.



/s/ BONGIOVANNI & ASSOCIATES, CPA'S

Bongiovanni & Associates, CPA's
Charlotte, North Carolina
May 22,2006




                                      F-3
<PAGE>
                       China Wireless Communications, Inc.
                      Consolidated Statements of Operations

<TABLE>
<CAPTION>
                                                                      Year ended December 31,
                                                             -------------------------------------------
                                                                    2006                    2005
                                                             --------------------    -------------------
<S>                                                          <C>                     <C>

Sales                                                        $           478,139     $          338,215
Cost of Sales                                                            454,587                383,162
                                                             --------------------    -------------------
      Gross profit (Loss)                                                 23,552                (44,947)
                                                             --------------------    -------------------

Operating expenses:
      Consulting expense                                               1,886,801              1,927,876
      General and administrative expenses                                494,741                153,308
                                                             --------------------    -------------------
          Total operating expenses                                     2,381,542              2,081,184
                                                             --------------------    -------------------

Loss from operations                                                  (2,357,990)            (2,126,131)

Other income (expense)
      Other income                                                        28,403                132,783
      Loss on payment of expenses in common stock                       (854,900)                     -
      Interest expense                                                   (42,257)               (20,165)
                                                             --------------------    -------------------
          Total non-operating income                                    (868,754)               112,618
                                                             --------------------    -------------------

Net Loss                                                     $        (3,226,744)    $       (2,013,513)
                                                             ====================    ===================

Other Comprehensive income:
      Foreign currency exchange gain                                       2,514                      0
                                                             --------------------    -------------------

Comprehensive Loss                                           $        (3,224,230)    $       (2,013,513)
                                                             ====================    ===================

Net loss per share, basic and diluted                        $            (0.025)    $           (0.028)
                                                             ====================    ===================

Weighted average common shares outstanding,
      basic and fully diluted                                        128,712,765             71,618,722
                                                             ====================    ===================

</TABLE>



         The financial statements should be read in conjunction with the
                              accompanying notes.

                                      F-4
<PAGE>
                       China Wireless Communications, Inc.
                           Consolidated Balance Sheet
                                December 31, 2006

<TABLE>
<CAPTION>
<S>                                                                              <C>
                                     ASSETS
Current assets
     Cash and cash equivalents                                                   $      28,214
     Accounts receivable                                                                33,849
     Prepaid expenses                                                                   13,559
     Other receivables                                                                  50,477
                                                                                 --------------
        Total current assets                                                           126,099

Fixed assets, net                                                                        7,693
                                                                                 --------------

                                                                                 $     133,792
                                                                                 ==============

                      LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
     Accounts payable and accrued expenses                                       $     261,676
     Interest payable                                                                   49,456
     Loans payable                                                                     139,600
     Loans payable - related parties                                                    37,525
                                                                                 --------------
        Total current liabilities                                                      488,257
                                                                                 --------------

Stockholders' deficit:
     Preferred stock, par value $0.01 per share, 1,000,000 shares of preferred
        stock authorized, none issued and outstanding                                        -
     Common stock, par value  $0.001 per share, 250,000,000  shares of common
        stock authorized, 148,038,284 shares of stock issued and outstanding           148,038
     Additional paid-in capital                                                     13,315,468
     Accumulated deficit                                                           (13,820,485)
     Accumulated other comprehensive income                                              2,514
                                                                                 --------------
           Total stockholders' deficit                                                (354,465)
                                                                                 --------------

                                                                                 $     133,792
                                                                                 ==============
</TABLE>


         The financial statements should be read in conjunction with the
                              accompanying notes.


                                      F-5
<PAGE>
                       China Wireless Communications, Inc.
                      Consolidated Statements of Cash Flows

<TABLE>
<CAPTION>
                                                                                                 Year ended December 31,
                                                                                        ----------------------------------------
                                                                                                2006                  2005
                                                                                        -------------------    -----------------
<S>                                                                                     <C>                    <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss                                                                                $       (3,226,744)    $     (2,013,513)
Adjustments to reconcile net loss to net cash provided by operating activities:
        Depreciation                                                                                 2,070               10,488
        Common stock issued for compensation                                                     2,997,305            1,927,876
        Forgiveness of loans payable                                                                   -               (220,831)
        (Increase) decrease in operating assets: Accounts receivable                               (21,362)                 -
        Prepayments and other receivables and Inventory                                            (29,068)             (47,454)
        Due from related party                                                                         -                (39,389)
        Accounts payables and accrued expenses                                                      16,754              167,110
        Advances from customers                                                                    (56,930)              56,930
        Interest payable                                                                            28,544               (1,242)
                                                                                        -------------------    -----------------
NET CASH USED IN OPERATING ACTIVITIES                                                             (289,431)            (160,025)
                                                                                        -------------------    -----------------

CASH FLOWS FROM INVESTING ACTIVITIES:
        Acquisition of fixed assets                                                                    -                (20,252)
        Due from related party                                                                      39,389                  -
                                                                                        -------------------    -----------------
NET CASH FLOWS PROVIDED BY (USED IN) INVESTING ACTIVITIES:                                          39,389              (20,252)

CASH FLOWS FROM FINANCING ACTIVITIES:
        Net proceeds from sale of common stock                                                         -                143,694
        Proceeds from loans payable - related parties                                              265,963               46,573
        Repayments of loans payable - related parties                                                  -                    -
        Repayments of loans payable - unrelated party                                               (5,000)                 -
                                                                                        -------------------    -----------------
NET CASH PROVIDED BY FINANCING ACTIVITIES                                                          260,963              190,267
                                                                                        -------------------    -----------------

Effect of exchange rate on cash                                                                      2,514                  -
                                                                                        -------------------    -----------------

NET INCREASE IN CASH AND CASH EQUIVALENTS                                                           13,435                9,990

CASH AND CASH EQUIVALENTS - beginning of year                                                       14,779                4,789
                                                                                        -------------------    -----------------

CASH AND CASH EQUIVALENTS - end of year                                                 $           28,214     $         14,779
                                                                                        ===================    =================

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
        Interest paid                                                                   $              -       $            -
                                                                                        ===================    =================
        Income taxed paid                                                               $              -       $            -
                                                                                        ===================    =================

NON-CASH OPERATING, INVESTING AND FINANCING ACTIVITIES:
        Conversion of convertible debt into notes payable                               $              -       $            -
                                                                                        ===================    =================
        Conversion of notes and interest payable into common stock                      $           99,672     $         71,644
                                                                                        ===================    =================
        Forgiveness of debt                                                             $          158,947     $            -
                                                                                        ===================    =================

</TABLE>

             The financial statements should be read in conjunction
                          with the accompanying notes.

                                      F-6
<PAGE>
                       China Wireless Communications, Inc.
                 Consolidated Statement of Stockholders' Deficit


<TABLE>
<CAPTION>
                                                     Common stock          Additional                       Other
                                            --------------------------      Paid-in      Accumulated    Comprehensive
                                                Number        Amount        Capital        Deficit          Income         Total
                                            -------------  -----------   ------------   --------------  -------------  -------------
<S>                                         <C>            <C>           <C>            <C>             <C>             <C>

Balances at December 31, 2004                  47,167,569  $    47,167   $  8,088,846   $  (8,580,228)  $           -   $  (444,215)

  Common stock issued for services             38,926,923       38,927      1,888,949               -               -     1,927,876
  Common stock issued for cash                  3,692,526        3,693        140,001               -               -       143,694
  Net loss for year ended December 31, 2005             -            -              -      (2,013,513)              -    (2,013,513)
                                             ------------  -----------   ------------   --------------  -------------  -------------


Balances at December 31, 2005                  89,787,018       89,787     10,117,796     (10,593,741)              -      (386,158)

  Common stock issued for services             55,565,526       55,565      2,941,739                                     2,997,304
  Common stock issued for conversion
    of loans payable                            2,685,740        2,686         96,986                                        99,672
  Forgiveness of notes payable and
    accrued interest - directors                                              158,947                                       158,947
  Net loss for year ended December 31, 2006                                                (3,226,744)                   (3,226,744)
  Foreign currency translation adjustment                                                                       2,514         2,514
                                             ------------  -----------   ------------   --------------  -------------  -------------

Balances at December 31, 2006                 148,038,284  $   148,038   $ 13,315,468   $ (13,820,485)   $      2,514  $   (354,465)
                                             ============  ===========   ============   ==============   ============  =============
</TABLE>











             The financial statements should be read in conjunction
                          with the accompanying notes.


                                      F-7
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.       ORGANIZATION AND PRINCIPAL ACTIVITIES

         China Wireless  Communications,  Inc.  ("China  Wireless" or "CWC") was
         originally  incorporated under the laws of the State of Nevada on March
         8, 1999  under the name of  i-Track,  Inc.  On March  21,  2003,  China
         Wireless  entered into an agreement with AVL  Information  Systems Ltd.
         ("AVL"),  a related entity,  whereby China Wireless  distributed to AVL
         all its assets and the related  entity  assumed all  liabilities of the
         China  Wireless.  Accordingly,  as of March 21,  2003,  China  Wireless
         entirely ceased its prior business operations.

         Pursuant to a share exchange agreement effective on March 22, 2003, the
         China  Wireless  acquired SCP, a Wyoming  corporation  incorporated  on
         August 13, 2002,  by issuance of  19,000,000  restricted  shares of the
         China Wireless common stock to the  shareholders  of SCP,  resulting in
         the SCP  shareholders  as a group  owning  approximately  88.4%  of the
         outstanding shares of common stock of China Wireless.  As a result, SCP
         became a wholly-owned subsidiary of China Wireless.

         For  financial  reporting  purposes,  the  acquisition  of SCP by China
         Wireless  was  treated  as  a  reverse   acquisition  whereby  SCP  was
         considered as the acquirer,  i.e. the surviving  entity,  for financial
         reporting purposes.  On this basis, the historical financial statements
         prior to March 22, 2003 represent the financial  statements of SCP. The
         historical  shareholders'  equity  accounts of China Wireless have been
         retroactively  restated in 2003 and prior years to reflect the issuance
         of  19,000,000  shares of common stock since  inception of SCP plus the
         original  2,500,000 shares of common stock of China Wireless just prior
         to  the  reverse   acquisition,   with  corresponding   adjustments  to
         additional paid-in capital.

         On March  24,  2003,  China  Wireless  formally  changed  its name from
         i-Track,  Inc. to China Wireless  Communications,  Inc. China Wireless,
         CWC,  SCP or any other  subsidiary  of China  Wireless  are referred to
         hereafter as the  "Company",  unless  reference is made to a respective
         company for reference to events surrounding that company.

         On May 24, 2005, the Company entered into a letter agreement to acquire
         51% of the stock of Tianjin Create IT Company Ltd., a People's Republic
         of China company ("Create Co."), for total consideration of $53,840, to
         be comprised of (i) cash in the amount of  $40,379.61  and (ii) 448,665
         shares of the Company's  common stock valued at $0.03 per share,  for a
         total of $13,460 in the Company's  common stock.  On September 6, 2005,
         the Company paid $21,460 towards the acquisition  price ($13,460 in the
         Company's common stock and cash in the amount of $8,000).

         On May 18, 2006, the Company  entered into an amended letter  agreement
         with the 49%  owner of  Create  Co.,  whereby  the  parties  agreed  to
         increase the  acquisition  cost of Create Co. to $126,767.  Because the
         Company  had  previously  made a  payment  of  $21,460,  the  remaining
         purchase  amount owing was $105,307,  as of the May 18, 2006 amendment.
         The  Company  agreed  to pay the  remaining  purchase  amount  owing of
         $105,307 in cash no later than August 31, 2006.

         On  October  25,  2006,  the  Company  and the 49% owner of Create  Co.
         further amended the purchase  agreement whereby the Company agreed to a
         final payment of $105,307, payable in (i) cash in the amount of $10,531
         and (ii)  6,318,404  shares of the  Company's  common  stock  valued at
         $94,776, to take place on December 31, 2006. The parties have agreed to
         further  extend  the date of the final  payment  and  expect  the final
         payment to be made by the end of June 2007.

         The Company has recorded the  $105,307  additional  amount owing of the
         $126,767 purchase price for Create Co., in accounts payable and accrued
         expenses as of December 31, 2006.

         Create Co.  provides  information  technology  systems  integration and
         internet  protocol  services to customers.  It also provides IP routing
         equipment and network  cabling and its customers are principally in the
         People's Republic of China.

         During the year ended  December 31, 2006,  the Company  formed a wholly
         owned subsidiary, CW Communications,  Inc., a Colorado corporation ("CW
         Communications"),   which   operates   in  north   Texas.   Through  CW
         Communications,  the Company  intends to leverage  technical  and sales
         opportunities  presented by the

                                      F-8
<PAGE>
         information  technology  side of their  business  in the areas of video
         surveillance design, engineering and installation.

2.       BASIS OF PRESENTATION

         These   consolidated   financial   statements  have  been  prepared  in
         accordance with accounting  principles generally accepted in the United
         States of America ("USGAAP").

         Going  concern  -  The  Company  has  suffered  recurring  losses  from
         operations, has negative working capital, has a negative cash flow from
         operations, and has a stockholders' deficit as of December 31, 2006. In
         addition,  the Company  has yet to generate an internal  cash flow from
         its business  operations and has generated  operating  losses since its
         inception.  These factors raise  substantial doubt as to the ability of
         the  Company to continue as a going  concern.  Management's  plans with
         regard to these  matters  encompass the  following  actions:  1) obtain
         funding  from  new  investors  to  alleviate   the  Company's   working
         deficiency,  and 2)  implement  a plan  to  increase  cash  flows.  The
         Company's  continued existence is dependent upon its ability to resolve
         its  liquidity  problems  and  increase  profitability  in its  current
         business operations.  However, the outcome of management's plans cannot
         be  ascertained   with  any  degree  of  certainty.   The  accompanying
         consolidated  financial  statements do not include any adjustments that
         might result from the outcome of these risks and uncertainties.

3.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a)      Basis of accounting.  The consolidated  financial  statements have been
         prepared at historical cost under the accrual basis of accounting. Cost
         in relation to assets represents the cash paid or the fair value of the
         assets, as appropriate.

(b)      Principles of  consolidation.  The  consolidated  financial  statements
         include the financial  information of the Company and its subsidiaries.
         The results of  subsidiaries  acquired or disposed of during the period
         are  consolidated  from or to their  effective  dates of acquisition or
         disposal,   respectively.   All  material   intercompany  balances  and
         transactions have been eliminated on consolidation.

         Comprehensive  Income (Loss) - The Company adopted Financial Accounting
         Standards  Board Statement of Financial  Accounting  Standards No. 130,
         "Reporting  Comprehensive  Income", which establishes standards for the
         reporting and display of comprehensive income and its components in the
         consolidated financial statements.

(c)      Revenue recognition.  The Company follows SEC Staff Accounting Bulletin
         number 104 which establishes guidance on revenue  recognition.  Revenue
         is recognized when it is probable that the economic  benefits will flow
         to the Company and when the revenue  and cost,  if  applicable,  can be
         measured reliably.

         Service  revenue is recognized in the period when services are rendered
         and that revenues on delivered  items cannot be recognized if remaining
         services  to be  performed  are  "essential  to the  functionality"  of
         delivered items.

(d)      Income  taxes.  Provision  for income and other related taxes have been
         provided in accordance with the tax rates and laws in effect in various
         countries of operations.

         Deferred  taxes  are  provided  using  the  liability  method  for  all
         significant  temporary  differences  between  the  financial  statement
         carrying   amounts  of  existing   assets  and  liabilities  and  their
         respective  tax bases and net operating  loss carry  forwards.  The tax
         consequences  of  those   differences  are  classified  as  current  or
         non-current  based  on the  classification  of the  related  assets  or
         liabilities in the financial statements.

(e)      Operating  leases.  Leases where  substantially  all of the rewards and
         risks of  ownership  of assets  remain  with the  leasing  company  are
         accounted for as operating  leases.  Rentals  payable  under  operating
         leases are  recorded  in the  accompanying  consolidated  statement  of
         operations on a straight-line basis over the lease term.

(f)      Earnings  (Loss) per share.  Basic earnings (loss) per common share are
         computed by dividing  earnings (loss) available to common  stockholders
         by the weighted  average  number of common shares  outstanding  for the
         periods.  The calculation of diluted earnings (loss) per share is based
         on earnings (loss) available to common shareholders and on the weighted
         average  number  of  common  shares  outstanding  adjusted  to  reflect
         potentially dilutive securities. The Company's stock warrants and stock
         options are anti-dilutive due to the net loss per share.  There were no
         adjustments  required  to net loss  for the  periods  presented  in the
         computation of diluted earnings per share.  There were 2,497,954 common
         stock  equivalents  (CSE) excluded from the computation of diluted loss
         per share.

                                      F-9
<PAGE>
(g)      Foreign  currencies.  Transactions in currencies  other than functional
         currencies  during  the  period  are  translated  into  the  respective
         functional currencies at the applicable rates of exchange prevailing at
         the  time  of  the   transactions.   Monetary  assets  and  liabilities
         denominated  in  currencies   other  than  functional   currencies  are
         translated  into  respective  functional  currencies at the  applicable
         rates of exchange in effect at the balance sheet date.

         On consolidation, assets and liabilities of subsidiaries denominated in
         respective  functional  currencies  are  translated  into United States
         Dollars at the exchange  rate as of the balance  sheet date.  The share
         capital  and  retained   earnings  are  translated  at  exchange  rates
         prevailing  at  the  time  of the  transactions.  Revenues,  costs  and
         expenses denominated in respective functional currencies are translated
         into United States  Dollars at the weighted  average  exchange rate for
         the period. The effects of foreign currencies  translation  adjustments
         are included as a separate component of accumulated other comprehensive
         income.

(h)      Management's   use  of  estimates.   The  preparation  of  consolidated
         financial  statements in conformity with USGAAP requires  management to
         make  estimates  and  assumptions  that affect the reported  amounts of
         assets and  liabilities  and the  disclosure of  contingent  assets and
         liabilities at the date of the  consolidated  financial  statements and
         the  reported  amounts of revenues and  expenses  during the  reporting
         period.  Such  estimates  are not  limited to  depreciation,  taxes and
         contingencies. Actual results could differ from those estimates.

(i)      Fair value of  financial  instruments.  The  estimated  fair values for
         financial instruments under SFAS No. 107, "Disclosures about Fair Value
         of Financial  Instruments",  are determined at discrete  points in time
         based  on  relevant  market   information.   These  estimates   involve
         uncertainties  and cannot be determined with  precision.  The estimated
         fair values of the Company's financial instruments, which include cash,
         accounts  receivable,  prepaid expenses,  advances to suppliers,  other
         receivables,  accounts payable and accrued expenses,  interest payable,
         advances from customers and notes payable,  approximate  their carrying
         values in the consolidated financial statements.

(j)      Cash and cash equivalents.  Cash equivalents  include all highly liquid
         investments, generally with original maturities of three months or less
         that are  readily  convertible  to known  amount  of cash and which are
         subject to an insignificant risk of changes in value.

(k)      Fixed assets and  depreciation.  Fixed assets are recorded at cost less
         accumulated  depreciation  and  impairment.   Repairs  and  maintenance
         expenditures,  which are not considered  improvements and do not extend
         the useful  life of  property,  plant and  equipment,  are  expensed as
         incurred. The cost and related accumulated  depreciation  applicable to
         fixed  assets  sold or no longer in  service  are  eliminated  from the
         accounts and any gain or loss is included in the consolidated statement
         of operations.

         Depreciation  is  calculated to write off the cost of fixed assets over
         their  estimated  useful lives from the date on which they become fully
         operational and after taking into account of their  estimated  residual
         values,  using the  straight-line  method,  at the following  rates per
         annum:

                  Vehicles 20%
                  Office equipment 20%

         The Company has recorded depreciation expense of $2,070 and $10,488 for
         the years ended December 31, 2006 and 2005, respectively.

         When  assets  are  sold  or  retired,   their  costs  and   accumulated
         depreciation  are  eliminated  from the  accounts  and any gain or loss
         resulting from their disposal is included in the consolidated statement
         of operations.

         The  Company  recognizes  an  impairment  loss  on  fixed  assets  when
         evidence,  such as the sum of expected future cash flows  (undiscounted
         and without interest  charges),  indicates that future  operations will
         not  produce  sufficient  revenue to cover the  related  future  costs,
         including depreciation, and when the carrying amount of asset cannot be
         realized  through sale.  Measurement of the impairment loss is based on
         the fair value of the assets.

         Impairment of long lived assets - In accordance  with SFAS No. 144, the
         Company  reviews and evaluates  its  long-lived  assets for  impairment
         whenever  events or changes in  circumstances  indicate  that their net
         book value may not be recoverable.  When such factors and circumstances
         exist,  including those noted above,  the Company  compares the assets'
         carrying  amounts against the estimated  undiscounted  cash flows to be
         generated by those

                                      F-10
<PAGE>
         assets over their estimated  useful lives. If the carrying  amounts are
         greater  than the  undiscounted  cash  flows,  the fair values of those
         assets are  estimated by  discounting  the  projected  cash flows.  Any
         excess of the  carrying  amounts  over the fair values are  recorded as
         impairments in that fiscal period.  No impairment exists as of December
         31, 2006.

(n)      Accounts receivable.  Accounts receivable are generally reported net of
         an allowance for uncollectible  accounts.  As of December 31, 2006, the
         Company has not recorded an allowance as all the receivables are deemed
         collectable at this time.

(o)      Minority interest.  Under generally accepted accounting principles when
         losses  applicable to the minority  interest in a subsidiary exceed the
         minority  interest in the equity capital of the subsidiary,  the excess
         is not charged to the majority interest since there is no obligation of
         the  minority  interest  to  make  good on such  losses.  The  Company,
         therefore,  has included  losses  applicable  to the minority  interest
         against its interest  since the minority  owners have no  obligation to
         make good on the losses. If future earnings do materialize, the Company
         shall be credited to the extent of such losses previously absorbed.  As
         previously stated, we closed the acquisition of a 51% majority interest
         of Create Co. on May 24, 2005.

 (p)     Stock-based  compensation.  Effective  January  1,  2006,  the  Company
         adopted Statement of Financial  Accounting Standards No. 123 (revised),
         "Share-Based  Payment"  (SFAS No. 123R),  which requires the use of the
         fair  value  method of  accounting  for all  stock-based  compensation,
         including  stock options.  The statement was adopted using the modified
         prospective  method of application.  Under this method,  in addition to
         reflecting  compensation expense for new share-based awards, expense is
         also recognized to reflect the remaining  vesting period of awards that
         had been  included  in  pro-forma  disclosures  in prior  periods.  The
         Company did not have any stock based  compensation,  including  options
         that would have  required  expensing  under SFAS No.  123R for the year
         ended December 31, 2006.

(q)      New Accounting Pronouncements:

         -        In February  2006,  the Financial  Accounting  Standard  Board
                  ("FASB")  issued SFAS No. 155,  "Accounting for Certain Hybrid
                  Financial  Instruments - An amendment of FASB  Statements  No.
                  133 and 140." This Statement resolves issues addressed in SFAS
                  No. 133 Implementation Issue No. D1, "Application of Statement
                  133 to Beneficial  Interest in Securitized  Financial Assets."
                  This pronouncement is effective for all financial  instruments
                  acquired or issued after the  beginning  of an entity's  first
                  fiscal year that begins after  September 15, 2006.  Currently,
                  the  Company  does  not have any  publicly  traded  derivative
                  instruments  or  participate  in any hedging  activities  and,
                  therefore,  the  adoption  of SFAS No. 155 is not  expected to
                  have a material impact on the Company's  financial position or
                  results of operations.

         -        In February 2006, the FASB issued Staff Position (FSP) No. FAS
                  123(R)-4 (As Amended)  "Classification  of Options and Similar
                  Instruments  Issued as  Employee  Compensation  That Allow for
                  Cash  Settlement  upon the Occurrence of a Contingent  Event".
                  This FSP addresses the  classification  of options and similar
                  instruments  issued as  employee  compensation  that allow for
                  cash  settlement  upon the  occurrence of a contingent  event,
                  which amends  paragraphs 32 and A229 of FASB Statement No. 123
                  (revised 2004), "Share-Based Payment". The adoption of FSP No.
                  FAS 123(R)-4 did not have a material  impact on the  Company's
                  financial position or results of operations.

         -        In March 2006, the FASB issued SFAS No. 156:  "Accounting  For
                  Servicing of Certain  Financial  Instruments-  an amendment of
                  SFAS No. 140." This statement establishes, among other things,
                  the accounting for all separately  recognized servicing assets
                  and servicing liabilities.  This statement amends SFAS No. 140
                  to require that all separately recognized servicing assets and
                  servicing  liabilities be initially measured at fair value, if
                  practicable.  SFAS No. 156 permits,  but does not require, the
                  subsequent  measurement  of  separately  recognized  servicing
                  assets and servicing liabilities at fair value. An entity that
                  uses derivative  instruments to mitigate the risks inherent in
                  servicing  assets and  servicing  liabilities  is  required to
                  account for those derivative  instruments at fair value. Under
                  SFAS No.  156,  an entity  can  elect  subsequent  fair  value
                  measurement   to  account  for  it's   separately   recognized
                  servicing assets and servicing  liabilities.  By electing that
                  option,  an entity may  simplify its  accounting  because this
                  statement   permits  income   statement   recognition  of  the
                  potential  offsetting changes in fair value of those servicing
                  assets and servicing liabilities and derivative instruments in
                  the same  accounting  period.  SFAS No. 156 is  effective  for
                  financial   statements  for  fiscal  years   beginning   after
                  September  15,  2006.  Earlier  adoption  of

                                      F-11
<PAGE>
                  SFAS No. 156 is permitted as of the  beginning  of an entity's
                  fiscal  year, provided   the entity  has  not yet  issued  any
                  financial  statements  for  that fiscal year.  The adoption of
                  SFAS No 156 is not expected have a  significant  impact on the
                  Company's consolidated financial statements.

         -        In June 2006, the FASB issued FASB Interpretation (FIN) No. 48
                  "Accounting    for    Uncertainty   in   Income   Taxes,"   an
                  interpretation  of FASB Statement No. 109. FIN 48 is effective
                  for  fiscal   years   beginning   after   December  15,  2006.
                  Differences  between the amounts  recognized in the statements
                  of financial  position prior to the adoption of FIN 48 and the
                  amounts  recognized after the adoption should be accounted for
                  as a  cumulative-effect  adjustment  recorded to the beginning
                  balance of retained  earnings.  Since the effective date falls
                  within the  Company's  fiscal  year 2007,  the Company did not
                  adopt FIN 48 in fiscal 2006.

         -        In September  2006,  the FASB issued SFAS No. 157, "Fair Value
                  Measurements".  SFAS 157  defines  fair value,  establishes  a
                  framework  for  measuring  fair  value in  generally  accepted
                  accounting principles and expands disclosures about fair value
                  measurements.   SFAS  157  applies   under  other   accounting
                  pronouncements that require or permit fair value measurements,
                  the FASB  having  previously  concluded  in  those  accounting
                  pronouncements  that fair  value is the  relevant  measurement
                  attribute. Accordingly, SFAS 157 does not require any new fair
                  value  measurements.  SFAS 157 is  effective  for fiscal years
                  beginning  after November 15, 2007, and interim periods within
                  those fiscal  years,  with  earlier  adoption  permitted.  The
                  provisions of SFAS 157 should be applied  prospectively  as of
                  the  beginning  of the  fiscal  year in which it is  initially
                  applied,  with  limited  exceptions.  The Company is currently
                  evaluating the provisions of SFAS 157.

         -        In  September  2006,  the Staff of the SEC issued SAB No. 108:
                  "Considering  the  Effects  of Prior Year  Misstatements  when
                  Quantifying    Misstatements   in   Current   Year   Financial
                  Statements".   SAB   No.   108   provides   guidance   on  the
                  consideration  of the effects of prior year  misstatements  in
                  quantifying  current  year  misstatements  for the  purpose of
                  determining  whether the current year's  financial  statements
                  are materially  misstated.  The SEC staff believes registrants
                  must  quantify  errors  using both a balance  sheet and income
                  statement   approach  and  evaluate  whether  either  approach
                  results in quantifying a misstatement  that, when all relevant
                  quantitative  and  qualitative  factors  are  considered,   is
                  material.  This Statement is effective for fiscal years ending
                  after  November 15, 2006.  The adoption of SAB No. 108 did not
                  have  a  significant  impact  on  the  Company's  consolidated
                  financial statements.

         -        In July 2006,  the Emerging  Issues Task Force ("EITF") of the
                  FASB  reached  a  consensus  and  ratified   Issue  No.  06-2:
                  "Accounting  for Sabbatical  Leave and Other Similar  Benefits
                  Pursuant to FASB Statement No. 43,  Accounting for Compensated
                  Absences".  SFAS No. 43 provides  guidance for  accounting for
                  compensated  absences and states that an employer shall accrue
                  a liability for employees' compensation for future absences if
                  certain conditions are met. However, since certain compensated
                  absences  such as  sabbatical  leave do not  typically  accrue
                  until  fully  vested,  there  was  uncertainty  as to  whether
                  employee rights to the compensated absence accumulate and meet
                  the  conditions of SFAS No. 43. The  consensus  reached by the
                  EITF has determined that sabbatical and other similar benefits
                  do  accumulate  and should be accrued  for over the  requisite
                  service period.  Further,  the EITF has called for adoption of
                  the consensus for fiscal years  beginning  after  December 15,
                  2006. EITF 06-2 was effective  beginning  January 1, 2007. The
                  adoption of SAB No. 108 is not expected to have a  significant
                  impact on the Company's consolidated financial statements.

         -        In February  2007,  the FASB  issued  SFAS No. 159,  "The Fair
                  Value   Option   for    Financial    Assets   and    Financial
                  Liabilities-including  an  amendment  of FAS 115" (SFAS  159).
                  SFAS 159 allows  entities  to choose,  at  specified  election
                  dates, to measure eligible financial assets and liabilities at
                  fair value that are not  otherwise  required to be measured at
                  fair value.  If a company  elects the fair value option for an
                  eligible item, changes in that item's fair value in subsequent
                  reporting periods must be recognized in current earnings. SFAS
                  159 is effective for fiscal years beginning after November 15,
                  2007.  The  adoption of SFAS No 159 is not  expected to have a
                  significant  impact on the  Company's  consolidated  financial
                  statements.

4.       INCOME TAXES

         The Company's  parent and their US subsidiaries  are subject to the top
         applicable  Federal,   State  and  Local  tax  statues.  The  Company's
         subsidiaries in China are governed by the Income Tax Law of the Peoples
         Republic of

                                      F-12
<PAGE>
         China concerning Foreign Investment Enterprises and Foreign Enterprises
         and local income tax laws (the "PRC Income Tax Law").

         The  components  of  loss  for  income  tax  purposes  consist  of  the
         following:

                                                 Year Ended December 31,
                                            ----------------------------------
                                                2006                2005
                                            --------------      --------------
         US Operations                      $  (3,190,000)      $   (2,011,000)
         Chinese Operations                       (37,000)              (3,000)
                                            --------------      --------------
                                            $  (3,227,000)      $   (2,014,000)
                                            ==============      ==============

         The table below summarizes the  reconciliation  of the Company's income
         tax benefits  computed at the Federal  statutory  rate,  netted against
         reconciling  items  and a  valuation  allowance.  The  Company  has not
         provided a provision  for income  taxes,  as the  Company has  incurred
         losses  for both  its US and  Chinese  operations.  Any  benefit  to be
         derived  from  these  losses has been fully  reserved,  as the  Company
         cannot reasonably  estimate the future benefit from these net operating
         losses.

<TABLE>
<CAPTION>
                                                                                 Year Ended December 31,
                                                                           ------------------------------------
                                                                                2006                 2005
                                                                           ----------------      --------------
<S>                                                                        <C>                   <C>
         Income tax benefit at Federal statutory rate                      $    (1,097,000)      $    (685,000)
         State income tax benefit, net of Federal benefit                         (107,000)            (66,000)
         Permanent Differences                                                   1,118,000             719,000
         US operating loss not available against foreign                             2,000                   -
         Foreign operating loss not available against for US tax
                  purposes                                                          12,000               1,000
         Increase in valuation allowance                                            72,000              31,000
                                                                           ----------------      --------------
                                                                           $             -       $           -
                                                                           ================      ==============
</TABLE>

         Deferred  income  taxes  reflect  the  net  tax  effects  of  temporary
         differences  between the carrying amounts of assets and liabilities for
         financial  reporting  purposes  and the  amounts  used for  income  tax
         purposes.  The Company  accounts  for income  taxes under  Statement of
         Financial  Accounting  Standards No. 109, "Accounting for Income Taxes"
         "SFAS 109".  SFAS 109 requires the  recognition  of deferred tax assets
         and liabilities for both the expected impact of differences between the
         financial  statements and the tax basis of assets and liabilities,  and
         for the  expected  future tax benefit to be derived from tax losses and
         tax  credit  carry  forwards.   SFAS  109  additionally   requires  the
         establishment  of a valuation  allowance to reflect the  likelihood  of
         realization of deferred tax assets.

         For their US Operations,  the Company has not recorded any net deferred
         tax assets,  due to the uncertainty of  recoverability  on such assets.
         The Company's Chinese  Operations are governed by the Income Tax Law of
         the Peoples Republic of China concerning Foreign Investment Enterprises
         and Foreign  Enterprises and local income tax laws (the "PRC Income Tax
         Law").  Pursuant to the PRC Income Tax Law,  foreign owned  enterprises
         are subject to tax at a statutory rate of approximately  33% (30% state
         income tax plus 3% local  income  tax).  Pursuant to the PRC Income Tax
         Law, the  Company's  wholly  owned  subsidiary  was  exempted  from PRC
         enterprise  income tax for the year ended  December 31,  2005.  For the
         year ended December 31, 2006 the wholly owned subsidiary was subject to
         a 50% PRC  enterprise  rate. The Company's  Chinese  operations did not
         achieve  income for tax  purposes,  accordingly a tax provision was not
         provided for the Chinese  operations  for the years ended  December 31,
         2006 and 2005.  Net  operating  tax losses for  Chinese  companies  are
         generally  allowed to be used to offset future income,  generally these
         net operating losses expire after five years.

         The Company has net  operating  loss ("NOL")  carryforwards  for United
         States  income tax purposes at December 31, 2006  expiring  through the
         year 2026.  Management  estimates the NOL as of December 31, 2006 to be
         approximately $1,393,000. The utilization of the Company's NOL's may be
         limited  because of a possible  change in  ownership  as defined  under
         Section  382 of Internal  Revenue  Code.  The  Company  has  recorded a
         valuation  allowance for benefit  available from these NOL's,  as it is
         more likely than not that realization will not occur.

         NOL carryforwards                                           $  520,000
         Valuation allowance                                           (520,000)
                                                                     -----------
         Deferred tax asset, net of allowance with regards to NOL's  $        -
                                                                     ===========
                                      F-13

<PAGE>

5.       LOANS PAYABLE

         a.)      During the year ended December 31, 2005 a total of $220,831 in
                  loans and  interest  payable  were  forgiven by three  Chinese
                  companies. This forgiveness is included in other income.

         b.)      Between the years ended December 31, 2003 through December 31,
                  2005,  the Company  received loan advances of $139,600.  These
                  loan advances accrue  interest at 8% per annum,  are unsecured
                  and were due to be repaid at various  dates  between the years
                  end December 31, 2003  through  December 31, 2005.  These loan
                  advances,  and accrued interest of approximately  $49,500 were
                  settled in January 2007 with the issuance of 9,452,811  shares
                  of the  Company's  common  stock.  These  loan  advances  were
                  converted  at the market price on the date of  conversion.  In
                  addition,  the Company granted warrants to purchase  2,000,000
                  shares of the Company's common stock at $0.06 per share to the
                  loan holders. These warrants expire on January 12, 2009. These
                  warrants  will be  valued  using the  Black-Scholes  valuation
                  method.  These  warrants  will be expensed as a settlement  of
                  debt  charge.  There were a total of four loan  holders;  each
                  loan holder  received  500,000  warrants,  irrespective of the
                  total loan advances payable balance due to the loan holder.

6.       LOANS PAYABLE - RELATED PARTIES

         a.)      PEDRO E. RACELIS, III (COMPANY PRESIDENT AND CEO) -

                  During May 2006, Pedro E. Racelis,  III, the Company President
                  and CEO,  made loan  advances  to the  Company of $15,500  and
                  $3,612.  These loans  accrued  interest  at 8% per annum,  are
                  unsecured  and is were  due on July 2,  2006 and  December  1,
                  2006, for the $15,500 and $3,612 advance, respectively. At the
                  request of the  President  and CEO,  the note in the amount of
                  $15,500,  plus accrued  interest,  was approved for conversion
                  into the 310,000  shares of the  Company's  restricted  common
                  stock on October 5, 2006.  This note payable was  converted at
                  the market price on the date of conversion. The $3,612 advance
                  remains unpaid as of December 31, 2006.

                  In the fourth quarter of the year ended December 31, 2006, Mr.
                  Racelis,  made loan advances to the Company totaling  $21,038.
                  These  loans  were  received  in  three  advances,   they  are
                  unsecured and accrue interest at 8% per annum.  These advances
                  are  payable  upon  demand  until such time as the Company has
                  drawn up a formal loan payable document.

         b.)      HENRY ZAKS (DIRECTOR) -

                  Prior to joining the Company Board, Henry Zaks was compensated
                  as  a  consultant  to  review  administration  and  accounting
                  functions of the Company.  During the year ended  December 31,
                  2005, Mr. Zaks converted notes payable of $30,000 into 600,000
                  shares  of  common  stock at a  conversion  price of $0.05 per
                  share,  and he converted notes payable of $20,000 into 857,085
                  shares of common  stock at a  conversion  price of $0.029  per
                  share.  The conversion rate for both these  conversions was at
                  the market price on the dates of their conversion.

                  During the year ended  December  31,  2006 Mr.  Zaks made loan
                  advances of $76,742 to the Company.  All loan advances payable
                  from Mr.  Zaks  accrued  interest  at 8% per  annum,  prior to
                  conversion, and were due at various dates, except for the last
                  loan advance which was not formalized into a note payable. All
                  loans were  unsecured.  On November 7, 2006 all loan advances,
                  plus  accrued  interest,  were  approved for  conversion  into
                  1,810,837 shares of the Company's common stock, except for the
                  last  loan  advance  made on  November  11,  2006,  which  was
                  forgiven,  along with accrued interest,  on December 31, 2006.
                  All  conversions  were  at the  market  rate  on the  date  of
                  conversion.  The  forgiveness  of the  note  payable  has been
                  accounted  for as a capital  contribution,  as Mr.  Zaks is an
                  officer of the Company.

                                      F-14
<PAGE>
                  The following is a list of loans payable made from Mr. Zaks to
                  the Company.

<TABLE>
<CAPTION>
                                                                Amount
                                                               Converted
                                                                 With
                                Date             Date           Accrued                           Date            Date
             Amount            Issued             Due           Interest         Shares        Converted        Forgiven
           ------------     -------------     ------------    -------------    ------------    -----------    -------------
<S>                         <C>               <C>             <C>              <C>             <C>            <C>
           $    10,000       3/22/2006        10/31/2006      $     10,546         458,520     11/7/2006
                 4,137       4/13/2006        10/31/2006             4,324         187,998     11/7/2006
                 1,400       4/27/2006        10/31/2006             1,462          63,557     11/7/2006
                 7,680        5/1/2006         12/1/2006             7,939         198,486     11/7/2006
                23,217        5/3/2006         10/2/2006            24,127         482,542     11/7/2006
                 3,600       5/15/2006        10/31/2006             3,722         161,810     11/7/2006
                 2,000       6/14/2006         12/1/2006             2,047          51,177     11/7/2006

                 4,708       9/28/2006          3/1/2007             4,755         206,747     11/7/2006
                20,000      11/13/2006            n/a                                                          12/31/2006
           ------------                                       ------------     -----------
           $    76,742                                        $     58,922       1,810,837
</TABLE>

                  MICHAEL BOWDEN (DIRECTOR) -

                  During the years  ended  December  31,  2006 and 2005  Michael
                  Bowden,  a director and former Chief Operating  Officer of the
                  Company, made loan advances to the Company at various dates of
                  $149,071  and  $12,698,  respectively.   These  loans  payable
                  accrued interest at 8% per annum, and unsecured), and were due
                  on various  repayments  date,  except for the last  advance of
                  $3,200 on December 27, 2006. On November 13, 2006, the Company
                  approved the conversion of $24,310 in loan advances, plus $940
                  of accrued  interest,  into  564,903  shares of the  Company's
                  common stock at approximately  $0.04 per share. The conversion
                  rate for this  conversion  was at the market price on the date
                  of  conversion.  All other loan  advances  from the year ended
                  December 31, 2006,  including the last advance on December 27,
                  2006,  which  was not  formalized  into a note  payable,  were
                  forgiven by Mr.  Bowden.  The  forgiveness of the note payable
                  has  been  accounted  for as a  capital  contribution,  as Mr.
                  Bowden is an officer of the Company

                  The  following  table  reconciles  the loans  payable  for Mr.
                  Bowden that were  received,  converted  into Common  stock and
                  forgiven during the years ended December 31, 2006 and 2005:

<TABLE>
<CAPTION>
                                                                Amount
                                                               Converted
                                                                 With
                                Date             Date           Accrued                           Date            Date
             Amount            Issued             Due           Interest         Shares        Converted        Forgiven
           ------------     -------------     ------------    -------------    ------------    -----------    -------------
<S>                         <C>               <C>             <C>              <C>             <C>            <C>
           $    12,698          8/1/2005         7/2/2006     $     13,270         265,401      11/13/2006
                73,059          5/3/2006        10/2/2006                                                          7/5/2006
                 1,612         6/15/2006        12/1/2006            1,666          41,656      11/13/2006

                10,000         6/26/2006       12/31/2006           10,314         257,846      11/13/2006
                 6,300         7/27/2006        1/31/2007                                                        11/17/2006
                 5,000         9/26/2006         3/1/2007                                                        11/17/2006
                30,000         11/8/2006        12/1/2006                                                         11/8/2006
                 6,000         11/8/2006        12/1/2006                                                        11/17/2006
                 3,900        11/14/2006        12/1/2006                                                        11/30/2006
                 4,800        12/11/2006       12/31/2007                                                        12/15/2006
                 5,200        12/27/2006        1/31/2007                                                        12/29/2006
                 3,200        12/27/2006          n/a                                                            12/31/2006
           ------------                                       ------------     -----------
           $   161,769                                        $     25,250         564,903
</TABLE>

         As of December 31, 2006, there were no outstanding notes payable to Mr.
         Bowden.  On January 19, 2007, Mr. Bowden  resigned as an officer of the
         Company.

                                      F-15
<PAGE>

8.       COMMITMENTS AND CONTINGENCIES

         On March 1, 2006, the Company  entered into a new employment  agreement
         with Mr. Racelis as President and Chief Executive Officer for a term of
         six years renewable for one year after the original term expires. Under
         the terms of the new employment agreement,  Mr. Racelis will be paid an
         annual salary of $250,000,  with increases of 10% annually. Mr. Racelis
         did not accept the increase in salary in 2006.

         The  Company  leases  certain  office  premises  under   non-cancelable
         operating  leases.  All  leases  are for a term of less  than one year.
         Rental expenses under  operating  leases were $2,700 and $7,214 for the
         years ended December 31, 2006 and 2005, respectively.

         Create Co. leases office space under an operating  lease in the city of
         Tianjin,   People's  Republic  of  China.  Rental  expenses  under  the
         operating  lease was $6,656 for the year ended December 31, 2006.  This
         lease expires in August, 2007.

9.       EMPLOYEE RETIREMENT BENEFIT PLANS

         As stipulated by the rules and  regulations  in the PRC, the Company is
         required to contribute to a  state-sponsored  social insurance plan for
         all of its  employees  who are  residents of PRC at a rate of 20% of an
         agreed amount with each of its  employee,  subject to limits set out by
         the PRC  government.  The  Company has no further  obligations  for the
         actual pension payments or  post-retirement  benefits beyond the annual
         contributions.  The state sponsored  retirement plan is responsible for
         the entire pension obligations payable to all employees.

         The pension expense for the years ended December 31, 2006 and 2005, was
         $-0- and $-0-, respectively.

10.      REPORT ON SEGMENT INFORMATION

         The Company  adopted SFAS No. 131,  "Disclosures  About  Segments of an
         Enterprise  and  Related  Information",  in  respect  of its  operating
         segments.  The  Company's  income  is  substantially  derived  from the
         operation  in a  single  business  segment  which is the  provision  of
         broadband data, video and voice communications  services.  In addition,
         the  Company's  services  are only  provided to  customers  in the PRC.
         Therefore, no geographical segment information is presented.

11.      OPERATING RISKS

         (a)      Country risks:

                  The  Company  may be  exposed  to the risks as a result of its
                  operations  being carried out in the PRC.  These include risks
                  associated  with,  among others,  the political,  economic and
                  legal environment and foreign currency exchange. The Company's
                  results may be adversely  affected by change in the  political
                  and  social   conditions   in  the  PRC,  and  by  changes  in
                  governmental  policies  with respect to laws and  regulations,
                  anti-inflationary measures, currency conversion and remittance
                  abroad, and rates and methods of taxation, among other things.
                  The  Company's  management  does not believe these risks to be
                  significant. There can be no assurance, however, those changes
                  in  political  and  other  conditions  will not  result in any
                  adverse impact.

         (b)      Cash balances

                  The Company maintains its cash balances with various banks and
                  trust  companies  located  in the PRC.  In common  with  local
                  practice,  such amounts are not insured or otherwise protected
                  should the amounts  placed with the banks and trust  companies
                  be non-recoverable. The Company has not experienced any losses
                  with regards to their cash  accounts,  and believes  that they
                  are not exposed to any significant risk for cash on deposit.

12.      STOCK WARRANTS

         Upon completion of the reverse  acquisition of SCP by China Wireless on
         March 22, 2003, as detailed in Note #1, the Company exchanged  existing
         warrants  of 670,000  into  1,953,125  warrants.  These  warrants  were
         originally

                                      F-16
<PAGE>

         issued to  non-employees.  Each warrant entitles the holder to purchase
         one share of the  Company's  common  stock at $1.00 per share.  None of
         these warrants have been exercised.  All these warrants expired on July
         1, 2006.

         In June 2004, the Company issued 261,112  warrants to  non-employees in
         connection with a private placement sale of the Company's common stock.
         Each warrant entitles its holder to purchase one share of the Company's
         common stock at $0.45 to $0.50 per share.  Michael  Bowden,  the former
         COO and a director of the Company holds 50,000 of these warrants,  that
         where were issued to him prior to his employment as an officer with the
         Company. None of these warrants has been exercised.  These warrants are
         exercisable until and prior to June 25, 2007.

         Henry Zaks, a director of the Company  holds  236,842  warrants  issued
         July 8,  2004  exercisable  at $0.40  per  share.  These  warrants  are
         exercisable until and prior to July 8, 2007.

         The following  table sets forth the Company's  stock warrant and option
         activity during the years ended December 31, 2006 and 2005:

<TABLE>
<CAPTION>
                                                                 Weighted                             Weighted
                                                Shares            average            Shares            average
                                              underlying         exercise          underlying         exercise
                                               warrants            price            options             price
                                              ------------     ------------------------------------------------
<S>                                           <C>              <C>                <C>               <C>
Outstanding at January 1, 2005                  2,451,079      $        0.94                        $
      Granted                                           -                  -
      Exercised                                         -                  -
      Expired or cancelled                              -                  -
                                              ------------     ------------------------------------------------
Outstanding at December 31, 2006                2,451,079      $        0.94                        $
      Granted                                           -                  -
      Exercised                                         -                  -
      Expired or cancelled                      1,953,125               1.00
                                              ------------     ------------------------------------------------
Outstanding at December 31, 2006                  497,954      $        0.44                        $
                                              ============     ================================================
Exercisable at December 31, 2006                  497,954      $        0.44                        $
                                              ============     ================================================
</TABLE>

<TABLE>
<CAPTION>
                                                                      Weighted
                                                                       average            Weighted
                                  Range of          Number of         remaining           average
                                  exercise           options         contractual          exercise
                                   prices          outstanding          life               price
                              ----------------    -------------    ----------------     -------------
<S>                                                  <C>              <C>               <C>
                              $   0.40 - 0.50        497,954          1/2  years        $       0.44
</TABLE>


13. STOCKHOLDERS' EQUITY

         At various  times  during the year ended  December 31, 2006 the Company
         issued  55,565,526  shares  of  common  stock  for  services  valued at
         $2,142,405.  These shares were issued at the market prices on the dates
         of issuance ranging from $0.02 to $0.125 per share.  Total compensation
         for the year ended December 31, 2006 amounted to $2,962,750. The excess
         value of the common stock over the market price has been  accounted for
         as a loss on payment of expenses.

         At various  times  during the year ended  December 31, 2005 the Company
         issued  38,926,923  shares of common stock for  services.  These shares
         were issued at the market prices on the dates of issuance  ranging from
         $0.02  to $0.10  per  share.  Total  compensation  for the  year  ended
         December 31, 2005 amounted to $1,927,876.

         At various  times  during the year ended  December 31, 2005 the Company
         sold 3,692,526  shares of common stock for cash. These shares were sold
         at the market  prices on the dates of sale  ranging from $0.02 to $0.10
         per share.  Total  proceeds  from these sales to $143,694  for the year
         ended December 31, 2005.

         On November 22, 2004, the Company amended it Articles of  Incorporation
         to  increase  its  authorized  common  shares  to  250,000,000  with  a
         continued par value of $.001 per share.

                                      F-17
<PAGE>

14.      SUBSEQUENT EVENTS

         On January 19, 2007 the board of directors of the  registrant  approved
         compensation  for the members of the Board of  Directors  at $1,000 per
         meeting.

         Mr.  Henry  Zaks,  already a member of the  board of  directors  of the
         Company,  was appointed  Chairman of the Audit Committee of the Company
         effective January 19, 2007.

         In the first quarter of 2007,  the Company issued  6,318,404  shares of
         common  stock  to  the  shareholders  of  Create  Co.  as  part  of our
         acquisition price.
























                                      F-18