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

                               AMENDMENT NO. 2 TO
                                   FORM 10-QSB

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

               For the quarterly period ended: DECEMBER 31, 2004

                                       or

[ ]  TRANSITION  REPORT  PURSUANT  TO  SECTION  13 0R  15(d)  OF THE  SECURITIES
     EXCHANGE ACT OF 1934

          For the transition period from _____________ to ____________


                         Commission File Number: 0-31047

                      CHINA ENERGY SAVINGS TECHNOLOGY, INC.
--------------------------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)

          Nevada                                                  86-0995730
--------------------------------------------------------------------------------
(State or other jurisdiction of                                 (IRS Employer
incorporation or organization)                               Identification No.)

                         Central Plaza, 18 Harbour Road,
                             Suite 3203A, 32nd Floor
                                Hong Kong, China
--------------------------------------------------------------------------------
(Address of principal executive offices)                              (Zip Code)

                                 (852) 2588-1228
--------------------------------------------------------------------------------
                 (Issuer's telephone number including area code)

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

State the number of shares outstanding of each of the issuer's classes of common
stock, as of the latest practicable date.

       Common Stock Outstanding as of February 11, 2005: 24,599,753 shares

         Transitional Small Business Disclosure Format: Yes [ ] No [X]

<PAGE>

                                EXPLANATORY NOTE

     We have amended and restated  our  Quarterly  Report on Form 10-QSB for the
quarter  ended  December  31, 2004 in order to: (i) correct  earnings  per share
calculations related to the acquisition of Starway;  (ii) add disclosure in Note
1 of our financial statements regarding the consideration for the acquisition of
Starway; (iii) add disclosure in Note 2 regarding revenue recognition accounting
policies;  (iv) add disclosure in Note 12 regarding Chinese taxes the Company is
subject to; (v) add  disclosure in new Note 18 regarding the  restatement of the
financial  statements;  (vi) add disclosure in the  Management's  Discussion and
Analysis  section  regarding the  restatement of the financial  statements;  and
(vii) add and revise  disclosure  regarding  internal  controls and  procedures.
Except as required to reflect the changes  noted above,  this Form 10-QSB/A does
not attempt to modify or update any other  disclosures set forth in the original
filing.  Additionally,  this Form 10-QSB/A does not purport to provide a general
update or discussion of any other  developments of the Company subsequent to the
original  filing.  The  filing  of this  Form  10-QSB/A  shall  not be deemed an
admission that the original filing,  when made, included any untrue statement of
material fact or omitted to state a material fact  necessary to make a statement
not misleading.

                                        2
<PAGE>

                      CHINA ENERGY SAVINGS TECHNOLOGY, INC.

                               INDEX TO FORM 10QSB

                                                                            PAGE
PART I  FINANCIAL INFORMATION

Item 1. Financial Statements

        Consolidated Balance Sheets as of December 31, 2004
        and September 30, 2004                                                4

        Consolidated Statements of Income and Other Comprehensive
        Income (Loss) for the Three Months Ended December 31, 2004
        and 2003                                                              5

        Consolidated Statements of Shareholders' Equity
        for the Period Ended December 31, 2004                                6

        Consolidated Statements of Cash Flows for the
        Three Months Ended December 31, 2004 and 2003                         7

        Notes to Financial Statements                                         8

Item 2. Management's Discussion and Analysis of Financial
        Condition and Results of Operations                                  25

Item 3. Controls and Procedures                                              29


PART II OTHER INFORMATION

Item 1. Legal Proceedings                                                    30

Item 2. Changes in Securities                                                30

Item 3. Defaults Upon Senior Securities                                      30

Item 4. Submission of Matters to a Vote of Security Holders                  30

Item 5. Other Information                                                    30

Item 6. Exhibits and Reports on Form 8-K                                     31

Signatures                                                                   32

                                        3
<PAGE>

                         PART I - FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

                  CHINA ENERGY SAVINGS TECHNOLOGY, INC. AND SUBSIDIARIES

                              CONSOLIDATED BALANCE SHEETS
                    AS OF DECEMBER 31, 2004 AND SEPTEMBER 30, 2004

<TABLE>
<CAPTION>
                                     ASSETS
                                                             December 31   September 30
                                                                2004           2004
                                                              Unaudited      Audited
                                                              Restated
                                                            ------------   -------------
<S>                                                         <C>            <C>
CURRENT ASSETS:
   Cash                                                     $ 26,826,870   $  18,442,862
   Accounts receivable, trade, net of allowance
      for doubtful accounts of $768,151 as of
      December 31, 2004 and September 30, 2004,
      respectively                                             7,067,840       6,580,525
   Current maturities of notes receivable, net                 3,727,540       3,727,540
   Inventories                                                 4,319,805       4,329,552
   Prepaid expenses                                            1,141,899       1,529,955
   Due from related party                                      1,155,840       1,257,130
                                                            ------------   -------------
      Total current assets                                    44,239,794      35,867,564
                                                            ------------   -------------
PLANT AND EQUIPMENT, net                                         515,549         528,344
                                                            ------------   -------------
OTHER ASSETS:
   Long-term notes receivable, net                             6,310,727       7,087,692
   Other receivables                                             973,668         778,880
                                                            ------------   -------------
      Total other assets                                       7,284,395       7,866,572
                                                            ------------   -------------
         Total assets                                        $52,039,738   $  44,262,480
                                                            ============   =============

                      LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:
   Accounts payable and accrued expenses                     $ 2,190,181   $   2,719,554
   Current portion note payable                                    4,584          12,799
   Other payables                                                761,950         551,528
   Customer deposits                                           2,868,711       1,752,216
   Taxes payable                                               2,524,599       1,892,676
                                                            ------------   -------------
      Total current liabilities                                8,350,025       6,928,773
                                                            ------------   -------------
LONG-TERM LIABILITIES:
   Note payable, net                                              12,975           7,895
                                                            ------------   -------------
      Total liabilities                                        8,363,000       6,936,668
                                                            ------------   -------------
MINORITY INTEREST                                             15,286,858      18,662,906
                                                            ------------   -------------
SHAREHOLDERS' EQUITY:
   Preferred stock, $0.001 par value, 10,000,000
     shares authorized, none issued and outstanding
   Common stock, $0.001 par value, 50,000,000 shares
     authorized, 16,792,184 and 12,968,401 shares
     issued and outstanding as of December 31, 2004
     and September 30, 2004, respectively                         16,792          12,968
   Additional paid-in capital                                 20,075,156       8,655,339
   Statutory reserves                                            324,583         324,583
   Deferred compensation                                      (4,554,945)             --
   Retained earnings                                          12,524,954       9,666,676
   Accumulated other comprehensive income                          3,340           3,340
                                                            ------------   -------------
      Total shareholders' equity                              28,389,880      18,662,906
                                                            ------------   -------------
         Total liabilities and shareholders' equity          $52,039,738    $ 44,262,480
                                                            ============   =============
</TABLE>

            See accompanying notes to condensed financial statements.

                                        4
<PAGE>

             CHINA ENERGY SAVINGS TECHNOLOGY, INC. AND SUBSIDIARIES

     CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME (LOSS)
              FOR THE THREE MONTHS ENDED DECEMBER 31, 2004 AND 2003

                                                   Three Months    Three Months
                                                      Ended           Ended
                                                   December 31     December 31
                                                       2004            2003
                                                   ------------    ------------
                                                    Unaudited       Unaudited
                                                     Restated        Restated
                                                   ------------    ------------

REVENUES                                           $ 11,708,690    $ 11,501,465

COST OF GOODS SOLD                                    4,891,408       7,447,746
                                                   ------------    ------------
GROSS PROFIT                                          6,817,282       4,053,719

OPERATING EXPENSES
   Operating expense                                    612,700         812,093
   Selling, general and administrative expenses         971,839          54,854
                                                   ------------    ------------
       Total Operating Expenses                       1,584,539         866,947
                                                   ------------    ------------
INCOME  FROM OPERATIONS                               5,232,743       3,186,772
                                                   ------------    ------------
OTHER INCOME (EXPENSE)
   Interest income                                      348,179         777,692
   Interest expense                                        (514)           (169)
   Other income (expense)                                (2,277)             --
   Other income                                              --           5,537
                                                   ------------    ------------
       Total Other Income                               345,388         783,060
                                                   ------------    ------------
INCOME BEFORE INCOME TAXES AND MINORITY INTEREST      5,578,131       3,969,832

LESS PROVISION FOR INCOME TAXES                              --         678,971
                                                   ------------    ------------
INCOME BEFORE MINORITY INTEREST                       5,578,131       3,290,861

MINORITY INTEREST                                     2,719,853       1,645,431
                                                   ------------    ------------
NET INCOME                                            2,858,278       1,645,430

OTHER COMPREHENSIVE INCOME (LOSS):
   Foreign currency translation adjustment                   --         (13,215)
                                                   ------------    ------------
COMPREHENSIVE INCOME                               $  2,858,278    $  1,632,215
                                                   ============    ============
Net income per share - basic and diluted           $       0.19    $       0.15
                                                   ============    ============
Weighted average number of shares outstanding -
basic and diluted                                    14,881,540      11,153,669
                                                   ============    ============

            See accompanying notes to condensed financial statements.

                                        5
<PAGE>

             CHINA ENERGY SAVINGS TECHNOLOGY, INC. AND SUBSIDIARIES

                 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                     FOR THE PERIOD ENDED DECEMBER 31, 2004


<TABLE>
<CAPTION>
                                                                                           Unappro-      Accumulated
                                                 Additional                                priated          other
                           Number      Common     Paid-in      Statutory     Deferred      Retained     comprehensive
                         of shares     stock      capital      Reserves    Compensation    Earnings     income (loss)    Totals
                          Restated    Restated    Restated                   Restated      Restated                     Restated
                         ----------   --------   -----------   ---------   ------------   -----------   -------------  -----------
<S>                      <C>          <C>        <C>           <C>         <C>            <C>           <C>            <C>
BALANCE,
  September 30, 2003,
    unaudited                   100   $     11  $    666,666   $ 329,489   $              $ 3,996,754   $      (1,142) $ 4,991,778
  Net income                                                                                1,645,430                    1,645,430
  Foreign currency
    translation
    adjustments                                                                                               (13,215)     (13,215)
  Change in
    statutory
    reserves                                                      (4,906)                                                   (4,906)
                         ----------   --------   -----------   ---------   ------------   -----------   -------------  -----------
BALANCE,
  December 31, 2003,
    audited                     100         11       666,666     324,583                    5,642,184         (14,357)   6,619,087
  Net income                                                                                4,024,492                    4,024,492
  Foreign currency
    translation
    adjustments                                                                                                17,697       17,697
  Shares issued in
    connection with the
    recapitalization     12,338,301     12,327       (12,327)
  Shares issued for
    employee
    compensation            630,000        630     8,001,000                                                             8,001,630
                         ----------   --------   -----------   ---------   ------------   -----------   -------------  -----------
BALANCE,
  September 30, 2004,
    audited              12,968,401     12,968     8,655,339     324,583                    9,666,676           3,340   18,662,906
  Net income                                                                                2,858,278                    2,858,278
  Stock issued for
    the acquisition
    of additional
    investment in
    Starway Management
    Limited               3,346,100      3,346     6,092,555                                                             6,095,901
  Stock issued for
    services                477,683        478     5,327,262                 (4,554,945)                                   772,795
                         ----------   --------   -----------   ---------   ------------   -----------   -------------  -----------
BALANCE,
  December 31, 2004,
    unaudited            16,792,184   $ 16,792   $20,075,156   $ 324,583   $ (4,554,945)  $12,524,954   $       3,340  $28,389,880
                         ==========   ========   ===========   =========   ============   ===========   =============  ===========
</TABLE>

            See accompanying notes to condensed financial statements.

                                        6
<PAGE>

             CHINA ENERGY SAVINGS TECHNOLOGY, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
              FOR THE THREE MONTHS ENDED DECEMBER 31, 2004 AND 2003

<TABLE>
<CAPTION>
                                                                December 31     December 31
                                                                    2004            2003
                                                               ------------    ------------
                                                                 Unaudited       Unaudited
                                                                 Restated
                                                               ------------    ------------
<S>                                                            <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net income                                                  $  2,858,278     $ 1,645,430
   Adjustments to reconcile net income to cash
     provided by (used in) operating activities:
       Minority interest income                                   2,719,853       1,641,673
       Depreciation and amortization                                 15,808          44,705
       Decrease in statutory reserve                                                 (4,910)
       Stock issued for services                                    772,795
   Change in operating assets and liabilities:
     (Increase) decrease in assets:
       Intangible assets                                                              6,050
       Accounts receivable                                         (487,315)     (1,755,491)
       Long-term notes receivable - Current Portion, net                            (70,189)
       Long-term notes receivable, net                              776,965      (2,300,333)
       Amount due from related parties                              101,290
       Inventories                                                    9,747         193,530
       Prepaid expenses                                             388,056         (71,582)
       Other receivables                                           (194,788)        (62,224)
       Other assets                                                                  64,617
     Increase (decrease) in liabilities:
       Accounts payable and accrued expenses                       (529,373)       (316,603)
       Other payable                                                210,422
       Customer deposits                                          1,116,495        (231,109)
       Tax payable                                                  631,923       1,242,460
                                                               ------------    ------------
         Net cash provided by (used in) operating activities      8,390,156          26,024
                                                               ------------    ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
   Purchase of equipment                                             (3,013)        (33,020)
                                                               ------------    ------------
        Net cash used in investing activities                        (3,013)        (33,020)
                                                               ------------    ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
   Proceeds (payments) on loans payable - related parties                          (142,243)
   Proceeds from notes payable                                       (8,215)         12,536
   Payments on notes payable                                          5,080         (10,200)
                                                               ------------    ------------
        Net cash (used in) provided by financing activities          (3,135)       (139,907)
                                                               ------------    ------------
EFFECT OF EXCHANGE RATE ON CASH                                                     (13,215)
                                                               ------------    ------------
INCREASE (DECREASE) IN CASH                                       8,384,008        (160,118)

CASH, beginning of period                                        18,442,862         181,283
                                                               ------------    ------------
CASH, end of period                                            $ 26,826,870    $     21,165
                                                               ============    ============
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest expense                                 $        514    $        169
                                                               ============    ============
NON-CASH TRANSACTIONS:
Stock issued to acquire additional interest in
   Starway Management Limited                                  $  6,095,901    $
                                                               ============    ============

Stock issued for services                                      $  5,327,740    $
                                                               ============    ============
</TABLE>

            See accompanying notes to condensed financial statements.

                                        7
<PAGE>

                      CHINA ENERGY SAVINGS TECHNOLOGY, INC.
                                AND SUBSIDIARIES

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1 - ORGANIZATION

ORGANIZATION

On August 23, 2004, China Energy Savings Technology, Inc. (the Company) formally
changed its name from Rim Holdings Inc. to China Energy Savings Technology, Inc.

On June 30, 2004 ("the Closing  Date") Rim Holdings  Inc., a Nevada  corporation
(Rim) and  Eurofaith  Holdings,  Inc.,  a  British  Virgin  Islands  Corporation
("Eurofaith),  entered a Stock Purchase  Agreement (the Eurofaith Stock Purchase
Agreement).  Pursuant to the Stock purchase  agreement,  Rim acquired 50% of the
outstanding  shares of Starway Management Ltd., a British Virgin Islands company
("Starway")  from  Eurofaith  (the  "Acquisition").  The purchase price for such
stock was  $120,000,000  payable by Rim's  issuance of a convertible  promissory
note on the Closing Date. The note may be convertible into 223,073,380 shares of
the Rim's common stock upon  maturity at the  discretion  of Rim.  Eurofaith may
also convert at any time prior to the maturity. On June 30, 2004, the fair value
of the  convertible  note payable was discounted to the fair value of the equity
interest  acquired of $6,633,440,  which is 50% of the net book value of Starway
as December 31, 2003. On August 26, 2004 this note was converted into 11,153,669
shares  post-split of 20 to 1 (223,073,380 pre split).  New Solomon  Consultants
Limited acquired 6.9 million shares of common stock from Eurofaith Holdings upon
conversion.  The  shareholders of New Solomon  Consultants  Limited are also the
shareholders of Eurofaith (see Note 15).

Immediately after the closing of this transaction, Rim redeemed 1,000,000 shares
of its common stock from  Christina M. Strauch in exchange for all of the shares
of Rimmer Computer, Inc., an Arizona corporation ("Rimmer").

Prior to the transaction, Rim was a holding company holding all of the shares of
Rimmer.  Rimmer is an approved  technical service provider for computer hardware
and software  system  manufacturers.  All of Rimmer's  customers  are  currently
located  in  the  Phoenix,  Arizona  area.  Since  the  closing,  Rim's  primary
operations consist of the operations of Starway.

As  a  result,  the  transaction  was  treated  for  accounting  purposes  as  a
recapitalization  by the accounting  acquirer Starway Management  Limited.  This
stock  issuance  represents 50% of the issued and  outstanding  stock of Starway
Management  Limited  at  the  time  of  issuance.  The  acquisition  of  Starway
Management  Limited by the Company was  accounted for as a  recapitalization  of
Starway  Management  Limited,  pursuant to which the accounting basis of Starway
Management  Limited  continued  unchanged  subsequent to the  transaction  date.
Starway  Management Limited will be the historical  financial  statements of the
Company and its subsidiaries Shenzhen Dicken Industrial  Development Limited and
Shenzhen Dicken Technology  Development  Limited.  The financial statements have
been restated to reflect the  recapitalization as if the transaction happened as
of January 1, 2002.

On  November  17,  2004,  the  Company  acquired  an  additional  15% of Starway
Management  Limited to bring its stock ownership to 65% as of December 31, 2004,
as further  described in note 16. On February 1, 2005, the Company  acquired the

                                        8
<PAGE>

                      CHINA ENERGY SAVINGS TECHNOLOGY, INC.
                                AND SUBSIDIARIES

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1 - ORGANIZATION, (CONTINUED)

remaining  35% of  Starway  Management  Limited,  as  described  in note 17, and
Starway  Management  Limited became a wholly owned  subsidiary of the Company at
that time.

Starway was  incorporated  in the British  Virgin Islands on September 15, 1998.
Starway  owns  all  of  the  equity  interests  in  Shenzhen  Dicken  Industrial
Development Limited, a company incorporated in the People's Republic of China on
November  20,  1996  (SDID)  which in turn owns all of the  equity  interest  in
Shenzhen Dicken Technology  Development  Limited, a company  incorporated in the
People's Republic of China on November 9, 1999 (SDTD). In 2003,  Eurofaith,  the
shareholder  of SDID  exchanged 100% of the common shares of SDID for 100 shares
of Starway.

ACTIVITIES

Starway  through its two  subsidiaries  SDTD and SDID is a People's  Republic of
China based marketer, distributor and manufacturer of energy saving products for
use in commercial and industrial  settings.  SDID is a foreign-owned  enterprise
and  responsible  for  the  operation  and  sales  of its  products.  SDTD  is a
wholly-owned  subsidiary of SDID and is a limited liability company incorporated
in the PRC and is responsible  for the  development of energy saving projects of
Shenzhen Dicken Group. The Company through its  subsidiaries  mainly sells their
products within the People's Republic of China.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

The  accompanying  financial  statements  have been prepared in accordance  with
accounting  principles  generally accepted in the United States of America.  The
accompany  consolidated  financial  statements  include the  accounts of Starway
Management Limited,  Shenzhen Dicken Technology Development Limited and Shenzhen
Dicken  Industrial  Development  Limited,   (collectively  the  "Company").  All
material  intercompany  transactions  and balances  have been  eliminated in the
consolidation.

USE OF ESTIMATES

In  preparing  financial   statements  in  conformity  with  generally  accepted
accounting principles,  management is required 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 financial  statements and
revenues and expenses  during the reported  period.  Actual results could differ
from those estimates.

CASH AND CASH EQUIVALENTS

For  purposes  of the cash flow  statements,  the Company  considers  all highly
liquid investments with original  maturities of three months or less at the time
of purchase to be cash equivalents.

                                        9
<PAGE>

                      CHINA ENERGY SAVINGS TECHNOLOGY, INC.
                                AND SUBSIDIARIES

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICES, (CONTINUED)

NOTES RECEIVABLE

The Company carries its notes  receivable at the net present value of the notes,
net of allowance for doubtful accounts.

INVENTORY

Inventory is stated at the lower of cost or market value,  cost being determined
on a first-in, first-out (FIFO) method.

PLANT AND EQUIPMENT

The Company's  plant and equipment are stated at cost.  Depreciation is provided
over the  estimated  useful lives of the  respective  assets on a  straight-line
basis from five to fifteen years.

INTANGIBLES

Under the  Statement of  Accounting  Standards  ("SFAS") No. 142,  "Goodwill and
Other Intangible Assets",  all goodwill and certain intangible assets determined
to have indefinite lives will not be amortized but will be tested for impairment
at least annually.  Intangible assets other than goodwill will be amortized over
their useful lives of 10 years and reviewed for  impairment in  accordance  with
SFAS No. 144, "Accounting for Impairment or Disposal of Long-Lived Assets".

IMPAIRMENT OF LONG-LIVED ASSETS

Per SFAS No. 144, long-lived assets will be analyzed annually for indications of
impairment.  Impairment of long-lived assets is assessed by the Company whenever
there  is an  indication  that  the  carrying  amount  of the  asset  may not be
recovered.  Recoverability  if these  assets are  determined  by  comparing  the
forecasted  undiscounted cash flows generated by those assets to the assets' net
carrying  value.  The amount of  impairment  loss,  if any,  is  measured as the
difference between the net book value of the assets and the estimated fair value
of the related assets.

The Company  evaluates the  recoverability of long-lived assets by measuring the
carrying  amount of the assets  against the estimated  undiscounted  future cash
flows associated with them. At the time such flows of certain  long-lived assets
are not sufficient to recover the carrying value of such assets,  the assets are
adjusted to their fair values.

REVENUE AND DEFERRED REVENUE RECOGNITION

The Company  recognizes revenue when all four of the following criteria are met:
(1)  persuasive  evidence has been  received  that an  arrangement  exists;  (2)
delivery of the products and/or services has occurred;  (3) the selling price is
fixed or determinable; and (4) collectibility is reasonably assured. The Company
follows the provisions of SAB No. 104 which sets forth  guidelines in the timing

                                       10
<PAGE>

                      CHINA ENERGY SAVINGS TECHNOLOGY, INC.
                                AND SUBSIDIARIES

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICES, (CONTINUED)

REVENUE AND DEFERRED REVENUE RECOGNITION, (CONTINUED)

of  revenue   recognition   based  upon   factors  such  as  passage  of  title,
installation,  payments and customer  acceptance.  Any amounts received prior to
satisfying the Company's  revenue  recognition  criteria is recorded as deferred
revenue.

The Company has two types of contracts  for its product  sales:  energy  savings
sharing contracts and equipment sales contracts.

(a)  ENERGY SAVINGS SHARING

Under this  arrangement,  the  customers do not need to bear the initial cost of
the energy saving equipments. They have to make energy savings sharing contracts
with the Company which is entitled to receive a share of the  aggregated  amount
of estimated energy saving within a specified period of the arrangement.

The Company's revenue arising from sales of energy savings  equipments and notes
receivable under this arrangement are recognized when:

1.   the agreement of energy savings sharing is signed by both parties;
2.   the original estimated cost savings can be ascertained; and
3.   the  equipment  is  installed  and  tested  for an  average  rate of energy
     savings.

The receipt of each  installment  made by the customer  during the period of the
contract  will  be  recognized  as  the  repayments  of  the  outstanding  notes
receivable  when the amount of energy  savings can be  quantified  and agreed by
both parties.  The excess of original  estimated  savings stated in the contract
will be recognized as the interest income by the Company.

(b)  OUTRIGHT EQUIPMENT SALES

Under this arrangement, the Company's customer has to pay the cost of the energy
saving equipments and they can keep all benefits of energy saving to them.

Revenue  arising from the sales of the energy  saving  equipment to customers is
recognized  when goods are taken to be the point in time when the  customer  has
accepted  the goods and the  related  risks and  rewards of  ownership.  Revenue
represents  the sales value of goods to  customers  after  allowances  for goods
returned,  excludes value added tax ("VAT") and is after  deduction of any trade
discounts.

Under all energy savings  contracts,  the customer  cannot  terminate a contract
once the  contract is signed by both  parties and the goods have been tested and
delivered and accepted by the customers. There are no product returns permitted.
Any default or breach of the terms  stated in the  contract by the  customer can
lead to the return of the energy savings equipments to the Company.

                                       11
<PAGE>

                      CHINA ENERGY SAVINGS TECHNOLOGY, INC.
                                AND SUBSIDIARIES

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICES, (CONTINUED)

PRODUCT DEVELOPMENT COSTS

Product  development  costs  incurred  in  the  process  of  developing  product
improvements  and  enhancements  or new  products  are  charged  to  expense  as
incurred.   Statement  of  Financial   Accounting  Standards  ("SFAS")  No.  86,
Accounting  for the Costs of Computer  Software to be Sold,  Leased or Otherwise
Marketed,   requires   capitalization  of  certain  software  development  costs
subsequent  to the  establishment  of  technological  feasibility.  Based on the
Company's product development process,  technological feasibility is established
upon the  completion of a working model.  Costs incurred by the Company  between
the  completion of the working model and the point at which the product is ready
for general release have been insignificant.

FOREIGN CURRENCY TRANSLATION

The functional  currency of the Company is the Chinese  Renminbi.  The financial
statements of the Company are translated to United States dollars using year-end
exchange  rates as to assets and  liabilities  and average  exchange rates as to
revenues and  expenses.  Capital  accounts are  translated  at their  historical
exchange  rates  when the  capital  transaction  occurred.  Net gains and losses
resulting from foreign  exchange  translations are included in the statements of
operations and stockholders' equity as other comprehensive income.

COMPREHENSIVE INCOME (LOSS)

The foreign currency  translation gain or loss resulting from the translation of
the financial  statements expressed in Chinese Renminbi to United States dollars
is reported as other comprehensive  income (loss) in the statement of income and
stockholders' equity.

INCOME TAXES

The  Company  accounts  for  income  taxes  under  the  Statement  of  Financial
Accounting Standards No. 109, "Accounting for Income Taxes" ("Statement 109").
Under Statement 109,  deferred tax assets and liabilities are recognized for the
future tax  consequences  attributable  to  differences  between  the  financial
statement  carrying  amounts  of  existing  assets  and  liabilities  and  their
respective  tax bases.  Deferred tax assets and  liabilities  are measured using
enacted  tax rates  expected  to apply to  taxable  income in the years in which
those  temporary  differences  are expected to be  recovered  or settled.  Under
Statement 109, the effect on deferred tax assets and  liabilities of a change in
tax rates is  recognized  in income in the period that  includes  the  enactment
date.  The Company is organized in the British  Virgin  Islands and the People's
Republic  of China and no tax  benefit is  expected  from the tax credits in the
future. The Company located its factories in a special economic region in China.
This economic region allows foreign  enterprises a two-year income tax exemption
and a 50% income tax reduction for the  following  three years.  The Company was

                                       12
<PAGE>

                      CHINA ENERGY SAVINGS TECHNOLOGY, INC.
                                AND SUBSIDIARIES

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICES, (CONTINUED)

INCOME TAXES (CONTINUED)

approved as a wholly owned foreign  enterprise  in 2004.  The Company has income
tax  exemption  for the  year  ending  September  30,  2005 and 50%  income  tax
reduction for years ending September 30, 2006, 2007 and 2008.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying amounts of the Company's financial  instruments  including accounts
receivable,  stockholder  loans and notes payable  approximate fair value due to
the relatively short period to maturity of these instruments.

The fair value of short-term and long-term notes receivable was determined using
a discounted  cash flow  analysis  based on the  Company's  borrowing  rate.  At
December  31, 2004 and  September  30, 2004,  the carrying  value of these notes
approximated their fair value.

EARNINGS PER SHARE

The Company reports earnings per share in accordance with the provisions of SFAS
No. 128,  "Earnings Per Share." SFAS No. 128 requires  presentation of basic and
diluted earnings per share in conjunction with the disclosure of the methodology
used in computing  such earnings per share.  Basic  earnings per share  excludes
dilution and is computed by dividing income available to common  stockholders by
the  weighted  average  common  shares  outstanding  during the period.  Diluted
earnings per share takes into account the potential dilution that could occur if
securities or other contracts to issue common stock were exercised and converted
into common stock.

Effective  August 25, 2004, the Company  concluded a reverse split at a ratio of
20 to 1. In accordance  with U.S. SEC SAB Topic 4C., the shares on the financial
statements  and notes to financial  statements  including  per share amounts are
presented  after applying  retroactively  to reflect the reverse stock split and
the merger acquisition on June 30, 2004.

CONCENTRATIONS AND CREDIT RISKS

During 2004 and 2003, 100% of the Company's  sales were to companies  located in
the PRC. At December 31, 2004 and September  30, 2004 all the  Company's  assets
were located in the PRC.

The Company's  operations may be adversely  affected by  significant  political,
economic and social uncertainties in China.  Although the Chinese government has
pursued  economic  reform  policies in the past,  there is no assurance that the
Chinese  government  will continue to pursue such policies or that such policies
may not be  significantly  altered,  especially  in the  event  of a  change  in
leadership,  social or political  disruption or unforeseen  circumstances affect

                                       13
<PAGE>

                      CHINA ENERGY SAVINGS TECHNOLOGY, INC.
                                AND SUBSIDIARIES

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICES, (CONTINUED)

CONCENTRATIONS AND CREDIT RISKS, (CONTINUED)

China's political,  economic and social  conditions.  There is also no guarantee
that the Chinese  government's pursuit of economic reforms will be consistent or
effective.

CASH IN BANK ACCOUNTS

Cash  includes  cash on hand and demand  deposits  in accounts  maintained  with
state-owned  banks within the People's Republic of China. The total cash balance
in  state-owned  banks at December 31, 2004 and  September  30, 2004 amounted to
$26,766,964  and  $18,269,919,  respectively of which no deposits are covered by
insurance.  The  Company has not  experienced  any losses in such  accounts  and
believes it is not exposed to any risks on its cash in bank accounts.

NEW ACCOUNTING PRONOUNCEMENTS

In  March  2004,   the  FASB  issued  EITF  Issue  No.  03-1,   THE  MEANING  OF
OTHER-THAN-TEMPORARY IMPAIRMENT AND ITS APPLICATION TO CERTAIN INVESTMENTS. EITF
03-1 includes new guidance for  evaluating  and recording  impairment  losses on
debt  and  equity  investments,  as  well  as new  disclosure  requirements  for
investments that are deemed to be temporarily  impaired.  In September 2004, the
FASB issued Staff  Position EITF 03-1-1,  which delays the effective  date until
additional  guidance  is  issued  for the  application  of the  recognition  and
measurement  provisions  of EITF  03-1 to  investments  in  securities  that are
impaired;  however, the disclosure requirements are effective for annual periods
ending after June 15, 2004.  Although the Company will  continue to evaluate the
application of EITF 03-1,  management does not currently  believe  adoption will
have a  material  impact on the  Company's  financial  position  or  results  of
operations.

In November 2004, the FASB issued SFAS No. 151, INVENTORY COSTS, an amendment of
ARB No. 43, Chapter 4. This statement amends the guidance in ARB No. 43, Chapter
4, Inventory  Pricing,  to clarify the  accounting for abnormal  amounts of idle
facility  expense,  freight,  handling costs,  and wasted  material  (spoilage).
Paragraph 5 of ARB No. 43,  Chapter 4,  previously  stated that  "...under  some
circumstances,  items such as idle facility expense,  excessive spoilage, double
freight,  and  rehandling  costs may be so abnormal as to require  treatment  as
current period  charges..." SFAS No. 151 requires that those items be recognized
as current-period  charges  regardless of whether they meet the criterion of "so
abnormal."  In  addition,  this  statement  requires  that  allocation  of fixed
production  overhead to the costs of conversion be based on the normal  capacity
of the production facilities.

The provisions of SFAS 151 shall be applied  prospectively and are effective for
inventory costs incurred during fiscal years beginning after June 15, 2005, with
earlier  application  permitted for inventory costs incurred during fiscal years
beginning  after the date this Statement was issued.  The Company's  adoption of

                                       14
<PAGE>

                      CHINA ENERGY SAVINGS TECHNOLOGY, INC.
                                AND SUBSIDIARIES

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICES, (CONTINUED)

NEW ACCOUNTING PRONOUNCEMENTS (CONTINUED)

SFAS  No.  151 is not  currently  expected  to  have a  material  impact  on the
Company's financial position or results of operations.

In December 2004, the FASB issued SFAS No. 123(R) (revised  2004),  "Share-Based
Payment",  which amends FASB  Statement No. 123 and will be effective for public
companies  for interim or annual  periods  beginning  after June 15,  2005.  The
revised  standard  requires,  among  other  things  that  compensation  cost for
employee  stock  options be measured at fair value on the grant date and charged
to expense over the employee's  requisite service period for the option.  Due to
the absence of observable market prices for employee stock options, the standard
indicates that the fair value of most stock options will be determined  using an
option-pricing model. The Company's adoption of SFAS No. 123(R) is not currently
expected  to have a  material  impact on the  Company's  financial  position  or
results of operations.

In December 2004, the FASB issued SFAS No. 153, EXCHANGES OF NONMONETARY ASSETS,
AN  AMENDMENT  OF APB  OPINION  NO.  29. The  guidance  in APB  Opinion  No. 29,
ACCOUNTING  FOR  NONMONETARY  TRANSACTIONS,  is  based  on  the  principle  that
exchanges of  nonmonetary  assets should be measured  based on the fair value of
assets  exchanged.  The  guidance in that  Opinion,  however,  included  certain
exceptions to that principle.  This Statement amends Opinion 29 to eliminate the
exception for  nonmonetary  exchanges of similar  productive  assets that do not
have commercial  substance.  A nonmonetary  exchange has commercial substance if
the future cash flows of the entity are  expected to change  significantly  as a
result of the  exchange.  SFAS No. 153 is effective  for  nonmonetary  exchanges
occurring  in fiscal  periods  beginning  after  June 15,  2005.  The  Company's
adoption  of SFAS No.  153 is not  expected  to have a  material  impact  on the
Company's financial position or results of operations.

NOTE 3 - CONDENSED FINANCIAL STATEMENTS AND FOOTNOTES

The interim condensed  consolidated  financial  statements presented herein have
been prepared by the Company and include the  unaudited  accounts of the Company
and its subsidiaries.  All significant  inter-company  accounts and transactions
have been eliminated in the consolidation.

These  condensed   consolidated  financial  statements  have  been  prepared  in
accordance with generally  accepted  accounting  principles in the United States
for  interim  financial  information  and the  instructions  to Form  10-QSB and
Article 10 of  Regulation  S-X.  Certain  information  and footnote  disclosures
normally included in financial statements presented in accordance with generally
accepted accounting principles have been condensed or omitted. Management of the
Company  believes  the  disclosures  made are  adequate to make the  information
presented not misleading.

                                       15
<PAGE>

                      CHINA ENERGY SAVINGS TECHNOLOGY, INC.
                                AND SUBSIDIARIES

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 3 - CONDENSED FINANCIAL STATEMENTS AND FOOTNOTES (CONTINUED)

The condensed  consolidated  financial  statements should be read in conjunction
with the Company's audited  financial  statements for the period ended September
30, 2004  and notes thereto  included in the  Company's  Form 10-KSB/A Amendment
No. 2, dated June 15, 2005.

In the opinion of management,  the unaudited  condensed  consolidated  financial
statements   reflect  all  adjustments  (which  include  only  normal  recurring
adjustments)  necessary to present fairly the financial  position of the Company
as of December 31, 2004 and the results of operations for the three months ended
December 31, 2004 and 2003,  respectively.  Interim  results are not necessarily
indicative  of full year  performance  because  of the  impact of  seasonal  and
short-term variations.

NOTE 4 - ACCOUNTS RECEIVABLE

Accounts  receivable as of December 31, 2004 and September 30, 2004 consisted of
the following:

                                       December 31,     September 30,
                                           2004             2004
                                       ------------     -------------

Accounts receivable                    $  7,835,991     $   7,348,676
Less: allowance for
      doubtful accounts                     768,151           768,151
                                       ------------     -------------
Totals                                 $  7,067,840     $   6,580,525
                                       ============     =============

NOTE 5 - NOTES RECEIVABLE

The notes receivable  represent amounts due on Energy Savings Sharing contracts.
The  Company  carries  its  notes  receivable  at the net  present  value of the
discounted  contract  price.  The notes  receivable  are  secured by the related
equipment. The notes receivable amounted to the following:

                                         December 31,     September 30,
                                             2004             2004
                                         ------------     -------------

Notes receivable                         $ 10,038,267     $  10,815,232
Less:
   Current portion of notes receivable      3,727,540         3,727,540
                                         ------------     -------------
Totals                                   $  6,310,727     $   7,087,692
                                         ============     =============

                                       16
<PAGE>

                      CHINA ENERGY SAVINGS TECHNOLOGY, INC.
                                AND SUBSIDIARIES

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 5 - NOTES RECEIVABLE, (CONTINUED)

The following table  represents as of December 31, 2004 the estimated  principal
collections on notes receivable:

        Period Ending December 31,                          Amount
        --------------------------                        ----------

                  2005                                    $3,727,540
                  2006                                     3,407,370
                  2007                                     3,199,932
                  2008                                       296,575

NOTE 6 - INVENTORIES

Inventories  as of December  31, 2004 and  September  30, 2004  consisted of the
following:

                                         December 31,     September 30,
                                             2004             2004
                                         ------------     -------------

Raw materials                            $  1,040,690     $   1,013,976
Work in progress                              982,813           869,059
Finished goods                              2,296,302         2,446,517
                                         ------------     -------------
Totals                                   $  4,319,805     $   4,329,552
                                         ============     =============

NOTE 7 - PREPAID EXPENSES

Prepaid  expenses  at  December  31, 2004 and  September  30,  2004  amounted to
$1,141,899 and $1,529,955,  respectively. Prepaid expenses represent advances to
suppliers on inventory purchases.

NOTE 8 - PLANT AND EQUIPMENT

Plant  and  equipment  as of  December  31,  2004  and  September  30,  2004 are
summarized as follows:

                                       17
<PAGE>

                      CHINA ENERGY SAVINGS TECHNOLOGY, INC.
                                AND SUBSIDIARIES

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 8 - PLANT AND EQUIPMENT, (CONTINUED)

                                         December 31,     September 30,
                                             2004             2004
                                         ------------     -------------

Building                                 $    409,888     $     409,888
Office equipment                               83,316            80,100
Furniture and fixtures                         41,371            41,574
Plant, machinery and equipment                 80,127            80,126
Vehicle                                       148,586           148,586
                                         ------------     -------------
                                              763,288           760,274
Less: accumulated depreciation                247,738           231,930
                                         ------------     -------------
Plant and equipment, net                 $    515,550     $     528,344
                                         ============     =============

Depreciation  expense for the three  months  ending  December  31, 2004 and 2003
amounted to $15,808 and $44,705, respectively.

NOTE 9 - NOTES PAYABLE, NET

Long-term obligations consisted of the following:

Note payable to finance company, secured by automobile,
interest at 5.44% per annum. Monthly payments of $1,067
due through April 2006                                           $    17,559
Less current maturities                                               12,975
                                                                 -----------
Total                                                            $     4,584
                                                                 ===========

Principal payments for the next five years are as follows:

        Year Ending September 30,
        -------------------------

                  2005                                           $    12,975
                  2006                                                 4,584

NOTE 10 - RELATED PARTY TRANSACTIONS

As of December 31, 2004, the due from related party  amounted to  $1,155,840.  A
majority  of  this  amount  was  generated  from  making  cash  advances  to the
shareholders for ordinary business expenses.  In addition,  certain shareholders
had collected payments on receivables on the Company's behalf from the customers
and those  payments  had not been repaid to the Company by  December  31,  2004.
These amounts are unsecured, interest free and have no fixed terms of repayment.

                                       18
<PAGE>

                      CHINA ENERGY SAVINGS TECHNOLOGY, INC.
                                AND SUBSIDIARIES

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 11 - CUSTOMER DEPOSITS

The Company  requires  their  customers to deposit  monies with the Company when
they place an order for their  products.  The Company  does not pay  interest on
these amounts in customer  deposits  amounted to $2,868,711 and $1,752,216 as of
December 31, 2004 and September 30, 2004, respectively.

NOTE 12 - TAXES PAYABLE

Taxes  payable at  December  31,  2004 and  September  30,  2004  consist of the
following:

                                         December 31,     September 30,
                                             2004             2004
                                         ------------     -------------
Urban maintenance and
  construction tax                       $     23,030     $      21,104
Education tax                                     895             1,058
Value added tax                             2,500,674         1,870,514
                                         ------------     -------------
Totals                                   $  2,524,599     $   1,892,676
                                         ============     =============

On July 22, 2004, the local Chinese tax authority waived the previously  accrued
tax accumulated  prior to January 1, 2004 in the amount of $4,853,332  which was
recorded as a credit  during  2004 for  previously  accrued  income  taxes.  The
Company has  elected to record the entire  credit for  Chinese  income  taxes in
2004.

The credit (provision) for income taxes consisted of the following:

                                                        Year Ended
                                                        December 31
                                                -------------------------
                                                    2004          2003
                                                -----------   -----------

Provision for China income taxes                $        --   $   678,971
                                                -----------   -----------
Total provision for income taxes                $        --   $   678,971
                                                ===========   ===========

The  following  table  reconciles  the U.S.  Statutory  rates  to the  Company's
effective tax rate:


                                       19
<PAGE>

                      CHINA ENERGY SAVINGS TECHNOLOGY, INC.
                                AND SUBSIDIARIES

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 12 - TAXES PAYABLE (CONTINUED)

                                                        December 31
                                                -------------------------
                                                    2004          2003
                                                -----------   -----------

U.S. Statutory rates                                34.0%         34.0%
Foreign income not recognized in USA               (34.0)        (34.0)
China income taxes                                    --          17.0
                                                -----------   -----------
               Totals                                 --%         17.0%
                                                ===========   ===========

The Company located its factories in a special  economic  region in China.  This
economic region allows foreign enterprises a two-year income tax exemption and a
50% income tax reduction for the following three years. The Company was approved
as a wholly  owned  foreign  enterprise  in 2004.  The  Company  has  income tax
exemption  for years ending  September 30, 2005 and 50% income tax reduction for
the years ending September 30, 2006, 2007 and 2008.

The estimated tax savings for the three months ending December 31, 2004 amounted
$1,198,254.  The net  effect on  earnings  per share if the  income tax had been
applied would decrease earnings per share from $0.19 to $0.11.

The Value  Added Tax (VAT tax) in China is similar to state sales tax charged in
the United  States on retail goods sold in the US. The VAT tax varies  depending
upon the product or service being sold.

The VAT tax is not  subject to the tax  holiday  and the  Company is required to
charge the customer for this amount.

NOTE 13 - COMMITMENTS AND CONTINGENCIES

OPERATING LEASES

The Company  leases its  facilities  under long term,  non-cancelable  operating
lease agreements expiring through June 2009. The non-cancelable  operating lease
agreements provide that the Company pays certain operating  expenses  applicable
to the leased premises.

Total  rent  expense  for the three  months  ended  December  31,  2004 and 2003
amounted to $36,719 and $35,929 respectively.

As of December 31, 2004, the future minimum annual lease payments required under
the operating leases for the next five years are as follows:

                                       20
<PAGE>

                      CHINA ENERGY SAVINGS TECHNOLOGY, INC.
                                AND SUBSIDIARIES

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 13 - COMMITMENTS AND CONTINGENCIES, (CONTINUED)

OPERATING LEASES, (CONTINUED)

        Period Ending December 31,                          Amount
        --------------------------                        ----------

                  2005                                    $   59,270
                  2006                                        58,000
                  2007                                        58,000
                  2008                                        87,000
               Thereafter                                         --

NOTE 14 - MINORITY INTEREST

Minority  interest  represents  the outside  shareholder's  35% ownership of the
common  stock of Starway  Management  Limited.  Due to common  control  over the
entities the  financial  statements of the Company have been restated to reflect
the  minority's  shareholder's  interest  as if the  transaction  was  effective
January 1, 2003.

NOTE 15 - EQUITY INCENTIVE PLAN

On September 8, 2004, the Company adopted an Equity  Incentive Plan. The purpose
of this plan is to attract,  retain and motivate  eligible persons whose current
and  potential  contributions  are  important  to the  success of the Company by
offering them an opportunity to participate in the Company's future  performance
through awards of Options, the right to purchase common stock and stock bonuses.
A total of  1,200,000  shares of common  stock  have  been  registered  with the
Securities and Exchange Commission under this plan.

On  September  16,  2004,  the  Company  issued  10,000  shares to  non-employee
consultants  and  620,000  shares  of its  common  stock to  certain  qualifying
employees  at US$12.70  per share.  The total  shares were valued at  $8,001,000
($12.70 per share),  the closing  price of the stock at the date the shares were
issued. The 630,000 shares are fully vested at the time of issuance.

The Company accounts for its employee stock option grants in accordance with the
fair value  provisions of Statement of Financial  Accounting  Standards No. 123,
"Accounting  for  Stock-Based  Compensation"  (SFAS 123). SFAS 123 established a
fair-value-based  method  of  accounting  for  stock-based  compensation  plans.
Pursuant to the transition  provisions of SFAS 148,  "Accounting for Stock-Based
Compensation  - Transition and  Disclosure"  (SFAS 148), the Company has elected
the prospective method and will apply the fair value method of accounting to all
equity  instruments  issued to employees.  As of September 30, 2004, total stock
based  compensation  expense  recorded  in  the  accompanying  income  statement
amounted to $7,874,000.

                                       21
<PAGE>

                      CHINA ENERGY SAVINGS TECHNOLOGY, INC.
                                AND SUBSIDIARIES

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 15 - EQUITY INCENTIVE PLAN, (CONTINUED)

Compensation  expense  related  to stock  options  granted to  non-employees  is
accounted for under Statement of Financial  Accounting Standards No. (SFAS) 123,
"Accounting for Stock-Based Compensation" and Emerging Issues Task Force ( EITF)
96-18,  "Accounting  for  Equity  Instruments  that are  Issued  to  Other  than
Employees for Acquiring,  or in conjunction  with Selling,  Goods, or Services,"
which require  entities to recognize an expense,  based on the fair value of the
related  awards.  As  of  September  30,  2004,  total  stock   compensation  to
non-employees amounted to $127,000.

During October and November 2004,  the Company  signed  agreements  with various
consultants for future  consulting  services to be provided to the Company.  The
agreements range between three to five years. As compensation for the consulting
services the Company  issued  470,000 shares of its common stock at US$11.00 and
US$13.15  per share.  The total  shares were valued at  $5,256,000,  the closing
price of the stock at the date the  shares  were  issued.  This  amount is being
amortized  over  the  life  of the  agreements  on a  straight  line  basis  and
consulting  expense  amounted to $732,555 for the three month ended December 31,
2004.  The balance of the  unamortized  cost of the stock has been recorded as a
reduction to shareholders' equity.

NOTE 16 - SHAREHOLDERS' EQUITY

STOCK ISSUANCES

On November 17, 2004, the Company  completed an acquisition of an additional 15%
interest  in Starway.  Prior to the  acquisition,  the Company  owned 50% of the
outstanding  shares of capital  stock of  Starway.  After the  acquisition,  the
Company  will own a total of 65% of the  outstanding  shares of Starway  capital
stock.  The  Company  acquired  the  additional  15%  interest  in Starway  from
Eurofaith.  The sole  director of  Eurofaith  is also a director  and  Corporate
Secretary of the Company.

The Company acquired the 15% interest in Starway by issuing a total of 3,346,100
shares of common stock of the Company.  The amount of consideration given by the
Company for the  acquisition was determined with reference to the acquisition of
shares of Starway  capital stock as reported in the Company's  Current Report on
Form 8-K filed on June 30, 2004. The closing of the Acquisition  (the "Closing")
occurred on November 17, 2004 (the "Closing Date").  The sole  consideration for
the Acquisition is common stock of the Company.

In accordance  with SFAS 141, the Company is required to record the  acquisition
of the  minority  interest  in  accordance  with  purchase  accounting.  However
entities that are under common control are required to record the acquisition of
the assets and  liabilities  transferred at their carrying  amounts.  Due to the
common majority ownership in the Company and Eurofaith the Company and Eurofaith
are deemed in common  control in  accordance  with SAB No. 47. Due to the common
control  element in  accordance  with SFAS 141 the Company has  recorded the 15%
acquisition from Eurofaith at historical costs value of $6,095,901.

                                       22
<PAGE>

                      CHINA ENERGY SAVINGS TECHNOLOGY, INC.
                                AND SUBSIDIARIES

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 16 - SHAREHOLDERS' EQUITY, (CONTINUED)

STOCK ISSUANCES, (CONTINUED)

During  November and December  2004,  the Company  issued 7,683 shares of common
stock for legal  services  and  director  fees.  The total shares were valued at
$71,740. The director fees of $42,000 are being amortized over a one year period
and the  director  fee expense  amounted to $10,500 for the three  months  ended
December 31,  2004.  The balance of the  unamortized  cost of the stock has been
recorded as a reduction to shareholders' equity.

STATUTORY RESERVES AND RESTRICTED RETAINED EARNINGS

The laws and  regulations  of the PRC require that before a wholly owned foreign
investment  enterprise  ("WOFIE")  distributes profits to its partners,  it must
first satisfy all tax liabilities, provide for losses in previous years and make
allocations,  in  proportions  determined  at the  discretion  of the  board  of
directors, after the statutory reserve.

The Company is required to make appropriations to reserve funds,  comprising the
statutory  surplus  reserve,  statutory  public  welfare fund and  discretionary
surplus  reserve,  based on after-tax net income  determined in accordance  with
generally accepted accounting  principles of the People's Republic of China (the
"PRC GAAP").  Appropriation to the statutory  surplus reserve should be at least
10% of the after tax net income determined in accordance with the PRC GAAP until
the reserve is equal to 50% of the entities' registered capital.  Appropriations
to the  statutory  public  welfare  fund are at 5% to 10% of the  after  tax net
income determined in accordance with the PRC GAAP.

The statutory  public welfare fund is  established  for the purpose of providing
employee  facilities  and other  collective  benefits  to the  employees  and is
non-distributable other than in liquidation. Appropriations to the discretionary
surplus reserve are made at the discretion of the Board of Directors.

NOTE 17 - SUBSEQUENT EVENT

On February 1, 2005,  the Company  completed an acquisition of the remaining 35%
interest (the "Acquisition") in Starway Management Limited.  ("Starway").  Prior
to the Acquisition,  the Company owned 65% of the outstanding  shares of capital
stock of  Starway.  After  the  Acquisition,  the  Company  will own 100% of the
outstanding  shares of capital  stock of Starway.  The  Registrant  acquired the
remaining 35% interest in Starway from Sky Beyond Investments Limited, a British
Virgin Islands corporation ("Sky Beyond").

The Company acquired the 35% interest in Starway by issuing a total of 7,807,569
shares of common stock of the Company.  The amount of consideration given by the
Company for the Acquisition was determined with reference to the acquisitions of
the  50% and  subsequently  the 15%  interest  in  Starway  as  reported  in the
Company's  Current  Report on Form 8-K filed on June 30, 2004 and  November  18,
2004  respectively.  The closing of the Acquisition (the "Closing")  occurred on

                                       23
<PAGE>

                      CHINA ENERGY SAVINGS TECHNOLOGY, INC.
                                AND SUBSIDIARIES

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 17 - SUBSEQUENT EVENT, (CONTINUED)

February  1,  2005  (the  "Closing  Date").   The  sole  consideration  for  the
Acquisition is common stock of the Company.

NOTE 18 - RESTATEMENT

The Company has restated the financial statements for the period ending December
31, 2004 in order to include information regarding the stock issuance of 470,000
shares in the amount of $5,256,000 to  consultants  and other service  providers
which is further disclosed in note 15 to the financial statements. The effect of
the restatement on the Company's previously released consolidated  statements of
income is a  reduction  of net income of  $772,795  for the three  months  ended
December  31, 2004.  The effect on earnings per share is to reduce  earnings per
share from $0.25 as previously reported to $0.19.

The Company has also  restated the  financial  statements  for the period ending
December  31,  2003 in order to restate  the  earnings  per share to reflect the
merger  acquisition on June 30, 2004.  Earnings per share have been reduced from
$0.24 as previously reported to $0.15.

                                       24
<PAGE>

ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS.

The following  discussion  of our financial  condition and results of operations
should be read in  conjunction  with the financial  statements and related notes
thereto.  The following discussion contains certain  forward-looking  statements
that involve risks and uncertainties. Our actual results could differ materially
from those discussed herein. We undertake no obligation  publicly to release the
results of any revisions to these forward-looking statements that may be made to
reflect any future events or circumstances.

OVERVIEW

We are a Nevada  corporation  headquartered in Hong Kong, China that invests in,
develops,  markets,  distributes and manufactures energy saving products for use
in commercial and industrial  settings.  As of December 31, 2004, we owned a 65%
interest in Starway  Management  Limited,  a British Virgin Islands  corporation
("Starway") which owns all of the equity interests in Shenzhen Dicken Industrial
Development Limited, a company incorporated in the Republic of China on November
20,  1996  ("SDID")  which in turns owns all of the equity  interest in Shenzhen
Dicken Technology Development Limited, a company incorporated in the Republic of
China on November 9, 1999 ("SDTD"). SDID and SDTD develops,  markets distributes
and  manufactures  energy saving  products for use in commercial  and industrial
settings in China.  Subsequently,  in  February,  2005,  we acquired  all of the
remaining interest in Starway bringing out total ownership of Starway to 100%.

Our  financial  statements  are  consolidated  with  those  of  Starway  and its
subsidiaries  with an adjustment to take into account the 35% of Starway that is
not owned by us as of the end of this quarter. Starway's subsidiaries,  SDID and
SDTD develops,  markets  distributes and manufactures energy saving products for
use in commercial and industrial settings in China.

RESTATEMENT

The Company has restated the financial statements for the period ending December
31, 2004 in order to include information regarding the stock issuance of 470,000
shares in the amount of $5,256,000 to  consultants  and other service  providers
which is further disclosed in note 15 to the financial statements. The effect of
the restatement on the Company's previously released consolidated  statements of
income is a  reduction  of net income of  $772,795  for the three  months  ended
December  31, 2004.  The effect on earnings per share is to reduce  earnings per
share from $0.25 as previously reported to $0.19.

The Company has also  restated the  financial  statements  for the period ending
December  31, 2003 in order to restated  the  earnings  per share to reflect the
merger  acquisition  on June 30, 2004.  Earnings per share has been reduced from
$0.24 as previously reported to $0.15.


                                       25
<PAGE>

RESULTS OF OPERATIONS

QUARTER ENDED DECEMBER 31, 2004 COMPARED TO THE QUARTER ENDED DECEMBER 31, 2003.

        Quarter
        Ended December 31              2004             2003           Change
        ---------------------       ----------       ----------     ------------

        Revenues                    11,708,690       11,501,465         1.8%
        Cost of goods sold           4,891,408        7,447,746       (34.3%)
        Gross profit                 6,817,282        4,053,719        68.2%
        Operating expenses           1,584,539          866,947        82.7%
        Other income                   345,388          783,060       (55.9%)
        Income before
          minority interest          5,578,131        3,290,861        69.5%
        Net Income (After
          Minority Interest)         2,858,278        1,632,215        75%


INCOME BEFORE MINORITY INTEREST AND NET INCOME

Our net income before minority  interest for the three months ended December 31,
2004 and December 31, 2003 was $5,578,131 and $3,290,861,  respectively. Our net
income  before  minority  interest for the three months ended  December 31, 2004
increased by approximately 69.5% when compared to our net income before minority
interest for the three months ended December 31, 2003. Such significant increase
in net income before minority  interest was due to a slight increase in revenues
coupled  with a  significant  decrease in cost of goods sold during such periods
offset by an increase in operating expenses as further discussed below.

As of December 31,  2004,  we held a 65%  interest in Starway  which  incurred a
minority  interest charge to our profit and loss statement of $2,719,853 for the
period ended  December 31, 2004 and  $1,645,431  for 2003. As a result,  our net
income after minority  interest for the three months ended December 31, 2004 and
December 31, 2003 was $2,858,278 and $1,632,215, respectively.

REVENUES

Our  revenues  are derived  primarily  from SDID's  sales of its energy  savings
products and entering into energy savings  sharing  contracts.  Revenues for the
three  months  ended  December  31,  2004 were  $11,708,690,  a net  increase of
approximately  1.8% compared with revenues of  $11,501,465  for the three months
ended December 31, 2003. The increase in revenues reflect sales growth in SDID's
energy  savings  products,  and were the result of  increased  unit  sales.  Our
management  expects that  revenue  will  continue to grow in 2005 because of our
marketing  and  sales  efforts  and  strong  demand  for  our  products  due  to
electricity  shortages in many parts of China.  Further, our management believes
that we will be able to  maintain  our price  levels due to strong  demand and a
lack  of  strong   competitive   products.   While  our  products  may  be  used
internationally, we currently have focused our sales efforts in China, targeting
large businesses and local governments. Management hopes to continue to increase
our market share in China.

                                       26
<PAGE>

GROSS PROFIT

We had a gross profit of $6,817,282  and  $4,053,719  for the three months ended
December  31,  2004 and  December  31,  2003,  respectively,  achieving  a 68.2%
increase.  This increase is principally  due to a substantial  34.3% decrease in
our cost of goods  sold.  The  decrease in our cost of goods sold is a result of
our increased use of energy savings sharing  contracts  which  generally  yields
much higher margins.

The  significant  decrease  in cost of goods sold is a result of better  control
over production  costs.  Because of our increase in sales volume, we are able to
buy our production  materials in mass quantities so we are able to leverage more
buying  power to get  better  prices for  supplies  and  materials  used for the
production of our products.  Additionally, we have seen an increase in suppliers
for the supplies and materials  used for the  production  of our products  which
results in more  competitive  pricing  for such  supplies  and  materials.  As a
result,  the cost of materials  such as chipsets and other  hardware used in the
production of our products has decreased  substantially  (approximately by 300%)
which in turn produces better profit margins for us. Such a decrease is expected
to continue in the short term but we expect it to be minimized in the future.

OPERATING EXPENSES

Below is a breakdown  comparison of the operating  expenses for the Three Months
Ended December 31, 2004 and December 31, 2003:

        Three Months
        Ended December 31                2004           2003           Change
        -------------------------     ----------     ----------     ------------

        Operating expenses               612,700        812,093        (24.6%)
        Sales, marketing and
          administrative expenses        971,839         54,854        1,671%

        Total Operating expenses       1,584,539        866,947         82.7%

There  was a 82.7%  increase  in  total  operating  expenses  from  $866,947  to
$1,584,539  for the three months ended  December 31, 2003 and December 31, 2004,
respectively.  In general,  there was significant increases in sales,  marketing
and administrative  expenses offset by a decrease in our operating  expenses.  A
large part of the increase is  attributable  to the fact that during October and
November  2004, we signed  agreements  with various  consultants  for consulting
services.  The agreements range between three to five years. As compensation for
the consulting services we issued 470,000 shares of our common stock at US$11.00
and US$13.15 per share. The total shares were valued at $5,256,000,  the closing
price of the stock at the date the  shares  were  issued.  This  amount is being
amortized  over  the  life  of the  agreements  on a  straight  line  basis  and
consulting  expense  amounted to $732,555 for the three month ended December 31,
2004. We believe  expenses  related to the marketing and selling of our products
will  continue to increase  substantially  to handle our growing  sales  volume.
During  November and December  2004, we also issued 7,683 shares of common stock
for legal  services and director  fees. The total shares were valued at $71,740.
We expect that  professional  fees and expenses to ensure  compliance  with U.S.
securities  laws, the  Sarbanes-Oxley  Act and marketplace  rules for the NASDAQ
National Market will increase substantially.

                                       27
<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

        Three Months
        Ended December 31                 2004          2003           Change
        --------------------------     ----------    ----------     ------------

        Net cash provided by (used
          in) operating activities      8,390,156       26,024       8,364,132

        Net cash used in
          investing activities             (3,013)     (33,020)         30,007

        Net cash (used in) provided
          by financing activities          (3,135)    (139,907)        136,772

The  increase  of  $8,364,132  in net  cash  provided  by  operating  activities
primarily  reflects cash generated  from profits,  collection on notes and other
receivables  and the  collection  of deposits  from  customers  on future  sales
contracts.

The  decrease  of $30,007 in net cash used in  investing  activities  was due to
purchasing less equipment during the quarter.

The decrease of $136,772 in net cash provided by financing activities was due to
the  loans  from  related  parties  that were paid off  during  the year  ending
September 30, 2004.

We believe that we have adequate  capital  resources to continue our  operations
and will not need to raise  capital  in the near  future.  We  believe  that our
current  cash  balance  and the  revenues  that  will be  generated  will  cover
anticipated  operating  expenses  for a  period  of at least  one  year  without
supplementing our cash reserves.  We may, however,  raise additional  capital to
further develop our other products.

EFFECT OF FLUCTUATION IN FOREIGN EXCHANGE RATES

Our operating  subsidiaries  are located in China,  and our Company buys all raw
materials in China and sells all our products in China using Chinese Renminbi as
the  functional  currency.  Based on China  government  regulation,  all foreign
currencies  under the  category  of current  accounts  are  allowed to be freely
exchanged with hard  currencies.  During the past two years of operation,  there
were no significant changes in exchange rates; however,  unforeseen developments
may cause a significant change in exchange rates.

INVESTMENT IN SUBSIDIARIES

As of December  31, 2004,  we owned a 65%  interest in Starway and  subsequently
increased our share in Starway to 100% by acquiring an  additional  35% interest
in Starway in February, 2005.

Starway holds 100% interest in Shenzhen Dicken  Industrial  Development  Limited
("SDID"),  which subsequently holds 100% interest in the energy savings project,
Shenzhen  Dicken  Technology  Development  Limited  ("SDTD") as well as owns the
intellectual property of their energy savings products in China.

                                       28
<PAGE>

OFF-BALANCE SHEET ARRANGEMENTS

We do not have any off-balance sheet arrangements.

ITEM 3. CONTROLS AND PROCEDURES

     (a) EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES.

The Company maintains disclosure controls and procedures designed to ensure that
information  required to be disclosed  in the reports that the Company  files or
submits  under the  Securities  Exchange Act of 1934,  is  recorded,  processed,
summarized and reported within the time period  specified in the rules and forms
of the Securities and Exchange  Commission.  In connection  with the Form 10-QSB
for the fiscal quarter ended December 31, 2004 originally  filed by the Company,
as required under Rule 13a-15(e) of the Exchange Act, the Company's  management,
including its Chief Executive Officer and Chief Financial Officer,  conducted an
evaluation  of  the  effectiveness  of the  Company's  disclosure  controls  and
procedures.  Based on this evaluation, the Company's Chief Executive Officer and
Chief Financial  Officer  concluded that the Company's  disclosure  controls and
procedures were effective as of December 31, 2004.

In  March,  2005,  the  Company's  management  and the  Audit  Committee  of the
Company's  Board of  Directors  concluded  that the  Company  needed to  restate
certain of the  Company's  financial  statements  to  correct  errors to include
information regarding stock issuances to consultants and other service providers
that are more accurately reflected and accounted for in such quarter's Quarterly
Report.  Such stock issuances are reflected as additional expenses as more fully
set forth in this report.

The above  restatements are described in more detail in Note 18 to the condensed
consolidated financial statements included in this Form 10-QSB/A.

Controls over  financial  reporting of expenses  related to stock  issuances are
within the scope of internal controls. Therefore,  management has concluded that
there were material weaknesses in the Company's internal controls, as defined by
the Public Company  Accounting  Oversight  Board.  The Company  expects that the
material  weakness related to the issues described above will be remediated as a
result of processes that have been implemented subsequent to December 31, 2004.

In connection with the filing of this Form 10-QSB/A,  the Company's  management,
including  the  Chief  Executive  Officer  and  Chief  Financial  Officer,   has
re-evaluated  the  effectiveness  of  the  Company's   disclosure  controls  and
procedures as of December 31, 2004.  Because of the issues  discussed above, the
Company's Chief Executive Officer and Chief Financial Officer have now concluded
that the Company's  disclosure  controls and procedures were not effective as of
December 31, 2004.

The Company implemented additional processes that are designed to prevent errors
that  caused  the  restatement  as  described  in more  detain in Note 18 to the
condensed  consolidated  financial  statements  included in this Form  10-QSB/A.
There were no other changes in the Company's  internal  controls over  financial
reporting  that  materially  affected,  or are  reasonably  likely to materially
affect the Company's internal control over financial reporting during the fiscal
quarter ended December 31, 2004.


                                       29
<PAGE>

It should be noted  that a control  system,  no  matter  how well  designed  and
operated,  can  provide  only  reasonable,  not  absolute,  assurance  that  the
objectives of the control system are met. As a result, there can be no assurance
that a control system will succeed in preventing all possible instances of error
and fraud.  The Company's  disclosure  controls and  procedures  are designed to
provide reasonable assurance of achieving their objectives,  and the conclusions
of our Chief  Executive  Officer  and Chief  Financial  Officer  are made at the
"reasonable assurance" level.


                           PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

     The  management of China Energy Savings  Technology,  Inc. are not aware of
any material legal proceedings pending against it, Starway or its subsidiaries.

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS

     On November 16, 2004,  the  Registrant  issued  3,346,100  shares of common
stock to Eurofaith which represented that it is an accredited  investors as part
of the acquisition of a 15% interest in Starway.  This  transaction was effected
under an exemption to  registration  pursuant to Section 4(2) of the  Securities
Act of 1933, as amended.  The recipient of the securities in the above-described
transaction represented their intention to acquire the securities for investment
only  and not  with a view to or for sale in  connection  with any  distribution
thereof and appropriate  legends were affixed to the share certificate and other
instruments issued in such transaction.

     During  November and December 2004,  the Registrant  issued 7,683 shares of
common stock for legal services and director fees. This transaction was effected
under an exemption to  registration  pursuant to Section 4(2) of the  Securities
Act of 1933, as amended.  The recipient of the securities in the above-described
transaction represented their intention to acquire the securities for investment
only  and not  with a view to or for sale in  connection  with any  distribution
thereof and appropriate  legends were affixed to the share certificate and other
instruments issued in such transactions.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

     Not Applicable

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

     Not Applicable

ITEM 5. OTHER INFORMATION

     Not Applicable



                                       30
<PAGE>

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

     (a)  Exhibits

          Exhibit
          Number                           Description
          -------                          -----------

            2.1     Agreement and Plan of Share Exchange dated November 16, 2004
                    by and between  Eurofaith  Holdings,  Inc.  and China Energy
                    Savings Technology, Inc. (1)
            3.1     Certificate of Incorporation (2)
            3.2     Bylaws (2)
           31.1     Certification of Chief Executive  Officer Pursuant to 302 of
                    the Sarbanes-Oxley Act of 2002 (3)
           31.2     Certification of Chief Financial  Officer Pursuant to 302 of
                    the Sarbanes-Oxley Act of 2002 (3)
           32.1     Certification of Chief Executive  Officer Pursuant to 906 of
                    the Sarbanes-Oxley Act of 2002 (3)
           32.2     Certification of Chief Financial  Officer Pursuant to 906 of
                    the Sarbanes-Oxley Act of 2002 (3)

------------------
(1)  Previously  filed with the  Securities  and Exchange  Commission as Exhibit
     10.1 to the Company's  Current Report on Form 8K filed on November 18, 2004
     and incorporated herein by reference.
(2)  Previously filed with the Securities and Exchange  Commission as an exhibit
     to the  Registration  Statement  on Form 10  filed  on July  11,  2000  and
     incorporated herein by reference.
(3)  Filed herewith.

     (b)  Reports on Form 8-K

          1.   8K/A, October 15, 2004, Adding auditor letter regarding change in
               auditors.
          2.   8K, November 12, 2004, Change in Accountants.
          3.   8K, November 18, 2004, Acquisition of 15% of Starway.
          4.   8K/A,  November 23, 2004,  Adding auditor letter regarding change
               in auditors.
          5.   8K, December 3, 2004, Appointment of Directors
          6.   8K, December 9, 2004, Results of Operations
          7.   8K, December 14, 2004,  Appointment of Directors,  Resignation of
               Directors
          8.   8K, December 17, 2004,  Appointment of Directors,  Resignation of
               Directors

                                       31
<PAGE>

                                   SIGNATURES

In accordance  with Section 13 or 15(d) of the Securities  Exchange Act of 1934,
as amended,  the registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                                    CHINA ENERGY SAVINGS TECHNOLOGY, INC.


                                    By:     /s/ Sun Li
                                        ----------------------------------------
                                            Sun Li
                                            Chief Executive Officer
                                    Dated:  June 15, 2005


In accordance with the Securities Exchange Act of 1934, as amended,  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>
            /s/ Sun Li                      Chief Executive Officer & Director            June 15, 2005
----------------------------------            (Principal Executive Officer)
              Sun Li

        /s/ Kam Wah Poon                         Chief Financial Officer                  June 15, 2005
----------------------------------     (Principal Financial & Accounting Officer)
           Kam Wah Poon

         /s/ Lai Fun Sim                      Corporate Secretary & Director              June 15, 2005
----------------------------------
           Lai Fun Sim

      /s/ Dennis Won Kong Yu                             Director                         June 15, 2005
----------------------------------
        Dennis Won Kong Yu

          /s/ Kam Man Lee                                Director                         June 15, 2005
----------------------------------
            Kam Man Lee

         /s/ Shao-Guang Tan                              Director                         June 15, 2005
----------------------------------
           Shao-Guang Tan

          /s/ Wing See Yau                               Director                         June 15, 2005
----------------------------------
            Wing See Yau

</TABLE>

                                       32