UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549  FORM 10-QSB  (Mark One)  x
        QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE OF 1934
  For the quarterly period ended September 30, 2007  o
        TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE OF 1934
  For the transition period from _______ to _________  Commission file number: 000-30311  GOLD HORSE INTERNATIONAL, INC. (Name of Small Business Issuer in Its Charter)  Florida
        22-3719165(State or Other Jurisdiction of Incorporation or Organization)
        (I.R.S. Employer Identification No.)
  No. 31 Tongdao South Road Hohhot, Inner Mongolia, China (Address of Principal Executive Offices and Zip Code)  86 (471) 339 7999 (Issuers telephone number)  Speedhaul Holdings, Inc. (Former name, former address and former fiscal year, if changed since last report)  Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes
        x
        No
        o
  Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)  YesoNox  State the number of shares outstanding of each of the issuers classes of common equity, as of the latest practicable date: 50,624,461 shares at November 10, 2007.  Transitional Small Business Disclosure Format (Check one): Yeso
        No
        x
    GOLD HORSE INTERNATIONAL, INC. AND SUBSIDIARIES

FORM 10-QSB

QUARTERLY PERIOD ENDED SEPTEMBER 30, 2007



INDEX




PagePART I - FINANCIAL INFORMATIONItem 1. Consolidated Financial StatementsConsolidated Balance Sheet (Unaudited) As of September 30, 2007
        3Consolidated Statements of Operations (Unaudited)For the Three Months Ended September 30, 2007 and 2006
        4Consolidated Statements of Cash Flows (Unaudited)For the Three Months Ended September 30, 2007 and 2006
        5Notes to Unaudited Consolidated Financial Statements
        6Item 2. Managements Discussion and Analysis or Plan of Operation
        20Item 3. Controls and Procedures
        28PART II - OTHER INFORMATIONItem 1. Legal Proceedings
        29Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
        29Item 3. Default Upon Senior Securities
        29Item 4. Submission of Matters to a Vote of Security Holders
        29Item 5. Other Information
        29Item 6. Exhibits
        29



CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION



Certain statements in this quarterly report contain or may contain forward-looking statements that are subject to known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements were based on various factors and were derived utilizing numerous assumptions and other factors that could cause our actual results to differ materially from those in the forward-looking statements. These factors include, but are not limited to, our ability to increase our revenues, develop our brands, implement our strategic initiatives, economic, political and market conditions and fluctuations, government and industry regulation, Chinese, U.S. and global competition, and other factors. Most
of these factors are difficult to predict accurately and are generally beyond our control.



You should consider the areas of risk described in connection with any forward-looking statements that may be made in our annual report as filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements and readers should carefully review this quarterly report in its entirety, Except for our ongoing obligations to disclose material information under the Federal securities laws, we undertake no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events. These forward-looking statements speak only as of the date of this quarterly report, and you should not rely on these statements without also considering the risks and uncertainties associated with these statements and our business.



When used in this quarterly report, the terms the Gold Horse International, the Company,  we, and us refers to Gold Horse International, Inc., formerly known as Speedhaul Holdings, Inc. and our wholly-owned subsidiaries and controlled companies.



2


GOLD HORSE INTERNATIONAL, INC. AND SUBSIDIARIES

(FORMERLY SPEEDHAUL HOLDINGS, INC.)

CONSOLIDATED BALANCE SHEET

September 30, 2007

(Unaudited)




ASSETSCash and cash equivalents
        
        $
        806,186Accounts receivable, net
        
        
        6,832,470Inventories
        
        
        49,231Advance to supplier
        
        
        372,936Other receivable, net
        
        
        227,599Real estate held for sale
        
        
        668,541Deposit on land use rights
        
        
        2,321,280Cost and estimated earnings in excess of billings
        
        
        1,908Deposit
        
        
        133,021Total Current Assets
        
        
        11,413,172Due from related parties, net
        
        
        1,001,314Accounts receivable, net
        
        
        512,180Property and equipment, net
        
        
        6,226,781Intangible asset
        
        
        162,775Total Assets
        
        $
        19,316,222LIABILITIES AND STOCKHOLDERS EQUITYLiabilities:Loans payable
        
        $
        133,021Accounts payable
        
        
        3,101,574Accrued expenses
        
        
        963,500Taxes payable
        
        
        378,509Advances from customers
        
        
        755,814Billings in excess of costs and estimated earnings
        
        
        173,315Total Current Liabilities
        
        
        5,505,733Loans payable, long-term, net of current portion
        
        
        1,577,099Total Liabilities
        
        
        7,082,832CommitmentsStockholders equity:Preferred stock ($.0001 par vale; 20,000,000 shares authorized; none issued and outstanding)
        
        
        Common stock ($.0001 par vale; 100,000,000 shares authorized; 50,000,002 shares issued and outstanding)
        
        
        5,000Non controlling Interest in Variable Interest Entities
        
        
        5,954,807Shares to be issued (624,459 shares)
        
        
        624,459Statutory reserve
        
        
        674,423Retained earnings
        
        
        4,270,749Other comprehensive gain - foreign currency
        
        
        703,952Total Stockholders Equity
        
        
        12,233,390Total Liabilities and Stockholders Equity
        
        $
        19,316,222



See accompanying notes to unaudited consolidated financial statements

3


GOLD HORSE INTERNATIONAL, INC. AND SUBSIDIARIES

(FORMERLY SPEEDHAUL HOLDINGS, INC.)

CONSOLIDATED STATEMENTS OF OPERATIONS




For the Three Months EndedSeptember 30,2007
        
        2006(Unaudited)
        
        (Unaudited)NET REVENUESConstruction
        
        $
        7,883,769
        
        $
        6,120,011Hotel
        
        
        856,186
        
        
        687,865Real estate
        
        
        930,814
        
        
        Total Revenues
        
        
        9,670,769
        
        
        6,807,876COST OF SALESConstruction
        
        
        6,690,373
        
        
        5,150,450Hotel
        
        
        482,379
        
        
        359,769Real estate
        
        
        564,654
        
        
        Total Cost of Sales
        
        
        7,737,406
        
        
        5,510,219GROSS PROFIT
        
        
        1,933,363
        
        
        1,297,657OPERATING EXPENSES:Hotel operating expenses
        
        
        35,176
        
        
        69,561Bad debt expense
        
        
        300,894
        
        
        543,883Salaries and employee benefits
        
        
        134,201
        
        
        46,796Depreciation and amortization
        
        
        99,426
        
        
        53,132General and administrative
        
        
        165,471
        
        
        402,701Total Operating Expenses
        
        
        735,168
        
        
        1,116,073INCOME FROM OPERATIONS
        
        
        1,198,195
        
        
        181,584OTHER INCOME (EXPENSE):Other expense
        
        
        
        
        
        (1,697
        )Interest income
        
        
        87
        
        
        5,032Interest expense
        
        
        (64,713
        )
        
        (61,168
        )Total Other Expense
        
        
        (64,626
        )
        
        (57,833
        )INCOME BEFORE INCOME TAX
        
        
        1,133,569
        
        
        123,751INCOME TAX
        
        
        398,699
        
        
        201,860NET INCOME  (LOSS)
        
        
        734,870
        
        
        (78,109
        )COMPREHENSIVE INCOME:Unrealized foreign currency translation gain
        
        
        159,074
        
        
        86,277COMPREHENSIVE INCOME
        
        $
        893,944
        
        $
        8,168NET INCOME PER COMMON SHARE:Basic
        
        $
        0.01
        
        $
        Diluted
        
        $
        0.01
        
        $
        WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:Basic
        
        
        50,000,002
        
        
        48,500,000Diluted
        
        
        50,000,002
        
        
        48,500,000



See accompanying notes to unaudited consolidated financial statements

4


GOLD HORSE INTERNATIONAL, INC. AND SUBSIDIARIES

(FORMERLY SPEEDHAUL HOLDINGS, INC.)

CONSOLIDATED STATEMENTS OF CASH FLOWS




For the Three Months EndedSeptember 30,2007
        
        2006(Unaudited)
        
        (Unaudited)CASH FLOWS FROM OPERATING ACTIVITIES:Net income  (loss)
        
        $
        734,870
        
        $
        (78,109
        )Adjustments to reconcile net income (loss) from operations to net cash provided by operating activities:Depreciation
        
        
        99,426
        
        
        53,132Bad debt expense
        
        
        300,894
        
        
        543,883Changes in assets and liabilities:Accounts receivable
        
        
        (2,251,612
        )
        
        (6,408,883
        )Inventories
        
        
        (28,269
        )
        
        (92,420
        )Other receivables
        
        
        (30,808
        )
        
        24,360Advance to suppliers
        
        
        (170,828
        )
        
        695,835Costs and estimated earnings in excess of billings
        
        
        13,454
        
        
        Real estate held for sale
        
        
        494,377
        
        
        Deposit
        
        
        
        
        
        (125,359
        )Accounts payable and accrued expenses
        
        
        2,322,996
        
        
        4,330,948Income tax payable
        
        
        (160,241
        )
        
        255,875Advances from customers
        
        
        136,612
        
        
        897,662Billings in excess of costs and estimated earnings
        
        
        47,203
        
        
        NET CASH PROVIDED BY OPERATING ACTIVITIES
        
        
        1,508,074
        
        
        96,924CASH FLOWS FROM INVESTING ACTIVITIES:Decrease in amounts due from related parties
        
        
        2,677
        
        
        Increase in construction in progress
        
        
        
        
        
        (26,125
        )Payment of deposit for land use rights
        
        
        (66,058
        )
        
        Purchase of property and equipment
        
        
        (1,517,860
        )
        
        (107,132
        )NET CASH USED IN INVESTING ACTIVITIES
        
        
        (1,581,241
        )
        
        (133,257
        )CASH FLOWS FROM FINANCING ACTIVITIES:Proceeds from related party advances
        
        
        
        
        
        71,196Repayments on related party advances
        
        
        
        
        
        (102,244
        )Proceeds from sale of common stock
        
        
        624,459
        
        
        NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES
        
        
        624,459
        
        
        (31,048
        )EFFECT OF EXCHANGE RATE ON CASH
        
        
        3,850
        
        
        1,537NET INCREASE (DECREASE) IN CASH
        
        
        555,142
        
        
        (65,844
        )CASH - beginning of year
        
        
        251,044
        
        
        180,924CASH - end of the period
        
        $
        806,186
        
        $
        115,080SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:Cash paid for:Interest
        
        $
        
        
        $
        61,168Income taxes
        
        $
        534,451
        
        $
        201,860



See accompanying notes to unaudited consolidated financial statements.

5


GOLD HORSE INTERNATIONAL, INC. AND SUBSIDIARIES

(FORMERLY SPEEDHAUL HOLDINGS, INC.)

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2007




NOTE 1 ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES



Organization



The Company was incorporated on March 21, 2000 under the laws of the State of New Jersey under its former name Segway III. Prior to June 29, 2007, the Company was a development stage company attempting to implement our business plan to become a fully integrated online provider that links the supply and demand sides of the ground trucking industry. In November 2007, the Company filed a Certificate of Domestication in the State of Florida whereby the Company domesticated as a Florida corporation under the name Gold Horse International, Inc.



On June 29, 2007, the Company executed a Share Exchange Agreement (Share Exchange Agreement) with Gold Horse International, Inc. (Gold Horse Nevada), a Nevada corporation, whereby the Company acquired all of the outstanding common stock of Gold Horse Nevada in exchange for newly-issued stock of the Company to Gold Horse Nevada shareholders. Gold Horse Nevada was incorporated on August 14, 2006 in the State of Nevada.



Under the Share Exchange Agreement, on June 29, 2007, the Company issued 48,500,000 shares of its common stock to the Gold Horse Nevada Stockholders and their assignees in exchange for 100% of the common stock of Gold Horse International. Additionally, the Companys prior President, CEO and sole director, cancelled 9,655,050 of the Companys common stock he owned immediately prior to the closing. After giving effect to the cancellation of shares, the Company had a total of 1,500,002 shares of common stock outstanding immediately prior to Closing. After the Closing, the Company had a total of 50,000,002 shares of common stock outstanding, with the Gold Horse Nevada Stockholders and their assignees owning 97% of the total issued and outstanding shares of the Companys common stock.



Gold Horse Nevada became a wholly-owned subsidiary of the Company and Gold Horse Nevadas former shareholders own the majority of the Companys voting stock.



Gold Horse Nevada owns 100% of Global Rise International, Limited (Global Rise), a Cayman Islands corporation incorporated on May 9, 2007. Through Global Rise, Gold Horse Nevada  operates, controls and beneficially owns the construction, hotel and real estate development businesses in China under a series of contractual arrangements (the Contractual Arrangements) with Inner Mongolia Jin Ma Real Estate Development Co., Ltd. (Jin Ma Real Estate), Inner Mongolia Jin Ma Construction Co., Ltd. (Jin Ma Construction) and Inner Mongolia Jin Ma Hotel Co., Ltd. (Jin Ma Hotel), (collectively referred to as the Jin Ma Companies). Other than the Contractual Arrangements with the Jin Ma Companies, the Company, Gold Horse Nevada or Global Rise has no business or operations. The Contractual Arrangements are discussed below.



The relationship among the above companies as follows:







6


GOLD HORSE INTERNATIONAL, INC. AND SUBSIDIARIES

(FORMERLY SPEEDHAUL HOLDINGS, INC.)

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2007



As a result of these Contractual Agreements, the acquisition of Gold Horse Nevada and the Jin Ma Companies by the Company was accounted for as a reverse merger because on a post-merger basis, the former shareholders of Gold Horse Nevada held a majority of the outstanding common stock of the Company on a voting and fully-diluted basis. As a result, Gold Horse Nevada is deemed to be the acquirer for accounting purposes. Accordingly, the consolidated financial statement data presented are those of the Jin Ma Companies for all periods prior to the Companys acquisition of Gold Horse Nevada on June 29, 2007, and the financial statements of the consolidated companies from the acquisition date forward.



PRC law currently places certain limitations on foreign ownership of Chinese companies. To comply with these foreign ownership restrictions, the Company operates its business in China through the Jin Ma Companies, each of which is a limited liability company headquartered in Hohhot, the capital city of the Autonomous Region of Inner Mongolia in China, and organized under PRC laws. Each of the Jin Ma Companies has the relevant licenses and approvals necessary to operate the Companys businesses in China. The Company has Contractual Arrangements with each of the Jin Ma Companies and their shareholders (collectively the Jin Ma Companies Shareholders) pursuant to which the Company provides business consulting and other general business operation services to the Jin Ma Companies. Through these Contractual Arrangements, the Company also has the ability to control the daily operations and financial
affairs of the Jin Ma Companies, appoint each of their senior executives and approve all matters requiring shareholder approval. As a result of these Contractual Arrangements, which enable the Company to control the Jin Ma Companies, the Company is considered the primary beneficiary of the Jin Ma Companies. Accordingly, the Company consolidates the Jin Ma Companies results, assets and liabilities in its financial statements



The Contractual Arrangements are comprised of a series of agreements, including a Consulting Services Agreement and an Operating Agreement, through which the Company has the right to advise, consult, manage and operate each of the Jin Ma Companies, and collect and own all of their respective net profits. Additionally, under a Shareholders Voting Rights Proxy Agreement, the Jin Ma Companies Shareholders have vested their voting control over the Jin Ma Companies to the Company. In order to further reinforce the Companys rights to control and operate the Jin Ma Companies, these companies and their shareholders have granted the Company, under an Option Agreement, the exclusive right and option to acquire all of their equity interests in the Jin Ma Companies or, alternatively, all of the assets of the Jin Ma Companies. Further the Jin Ma Companies Shareholders have pledged all of their rights, titles
and interests in the Jin Ma Companies to the Company under an Equity Pledge Agreement.



Gold Horse Nevada entered into the Contractual Arrangements with each of the Jin Ma Companies and their respective shareholders on August 31, 2006. On June 29, 2007, concurrently with the closing of the Share Exchange Transaction, the Contractual Arrangements were amended and restated by and among Gold Horse Nevada, Global Rise, the Companys wholly-owned subsidiary, and the Company on the one hand, and each of the Jin Ma Companies and their respective shareholders on the other hand, under which the Company was made a party to the Contractual Arrangements.



The Companys relationships with the Jin Ma Companies and their respective shareholders are governed by the Contractual Arrangements. Under PRC laws, each of Gold Horse International, Gold Horse Nevada, Global Rise, Jin Ma Real Estate, Jin Ma Construction and Jin Ma Hotel is an independent legal person and none of them is exposed to liabilities incurred by the other party. Other than pursuant to the Contractual Arrangements, the Jin Ma Companies do not transfer any other funds generated from their respective operations to the Company. The Company has entered into the following Contractual Arrangements with each of the Jin Ma Companies:



7


GOLD HORSE INTERNATIONAL, INC. AND SUBSIDIARIES

(FORMERLY SPEEDHAUL HOLDINGS, INC.)

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2007



Consulting Services Agreements.Pursuant to the exclusive Consulting Services Agreements with each of the Jin Ma Companies, the Company exclusively provide to the Jin Ma Companies general business operations services and consulting services as well as general business operation advice and strategic planning (the Services). Each of the Jin Ma Companies shall pay a quarterly consulting service fees in Renminbi (RMB) to us that is equal to all of its net profit for such quarter.



Operating Agreements.Pursuant to the Operating Agreements with the Jin Ma Companies and their respective shareholders, the Company provides guidance and instructions on the Jin Ma Companies daily operations, financial management and employment issues. The Jin Ma Companies Shareholders must designate the candidates recommended by the Company as their representatives on each of the Jin Ma Companies board of directors. The Company has the right to appoint senior executives of the Jin Ma Companies. In addition, the Company agreed to guarantee the Jin Ma Companies performance under any agreements or arrangements relating to the Jin Ma Companies business arrangements with any third party. Each of the Jin Ma Companies, in return, agrees to pledge its accounts receivable and all of its assets to the Company. Moreover, each of the Jin Ma
Companies agrees that without the Companys prior consent, it will not engage in any transactions that could materially affect its assets, liabilities, rights or operations, including, without limitation, incurrence or assumption of any indebtedness, sale or purchase of any assets or rights, incurrence of any encumbrance on any of its assets or intellectual property rights in favor of a third party or transfer of any agreements relating to its business operation to any third party. The term of this agreement is ten (10) years and may be extended only upon our written confirmation prior to the expiration of this agreement, with the extended term to be mutually agreed upon by the parties.



Equity Pledge Agreements.Under the Equity Pledge Agreements, the shareholders of the Jin Ma Companies pledged all of their equity interests in the Jin Ma Companies to the Company to guarantee the Jin Ma Companies performance of their obligations under the exclusive consulting services agreements. If the Jin Ma Companies or its shareholders breach their respective contractual obligations, the Company, as pledgee, will be entitled to certain rights, including the right to sell the pledged equity interests. The shareholders of the Jin Ma Companies also agreed that upon occurrence of any event of default, we shall be granted an exclusive, irrevocable power of attorney to take actions in the place and stead of the shareholders of the Jin Ma Companies to carry out the security provisions of the equity pledge agreement and take any action
and execute any instrument that we may deem necessary or advisable to accomplish the purposes of the equity pledge agreement. The shareholders of the Jin Ma Companies agreed not to dispose of the pledged equity interests or take any actions that would prejudice our interest. The equity pledge agreement will expire two (2) years after the Jin Ma Companies obligations under the exclusive consulting services agreements have been fulfilled.



Option Agreements.Under the Option Agreements, the shareholders of the Jin Ma Companies irrevocably granted us or our designee an exclusive option to purchase, to the extent permitted under PRC law, all or part of the equity interests in the Jin Ma Companies for the cost of the initial contributions to the registered capital or the minimum amount of consideration permitted by applicable PRC law. We, or our designee, have sole discretion to decide when to exercise the option, whether in part or in full. The term of this agreement is ten (10) years and may be extended prior to its expiration by written agreement of the parties.



Proxy Agreements.Pursuant to the Proxy Agreements, the shareholders of the Jin Ma Companies agreed to irrevocably grant a person to be designated by us with the right to exercise their voting rights and their other rights, in accordance with applicable laws and their respective Article of Association, including but not limited to the rights to sell or transfer all or any of their equity interests of the Jin Ma Companies, and appoint and vote for the directors and chairman as the authorized representative of the shareholders of the Jin Ma Companies.



8


GOLD HORSE INTERNATIONAL, INC. AND SUBSIDIARIES

(FORMERLY SPEEDHAUL HOLDINGS, INC.)

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2007



Inner Mongolia Jin Ma Construction Company Ltd.



Inner Mongolia Jin Ma Construction Co., Ltd. (Jin Ma Construction) is an engineering and construction company that offers general contracting, construction management and building design services primarily in Hohhot City, in the Autonomous Region of Inner Mongolia in China. In operation since 1980, Jin Ma Construction was formally registered as a limited liability company in Hohhot City in March 2002.



Inner Mongolia Jin Ma Hotel Co. Ltd.



Mongolia Jin Ma Hotel Co., Ltd. (Jin Ma Hotel) was founded in 1999 and formally registered in April 2004 as a limited liability company in Hohhot City. Jin Ma Hotel presently owns, operates and manages the Inner Mongolia Jin Ma Hotel (the Hotel), a 22-room full service hotel situated in Hohhot City approximately 15 kilometers from the Hohhot Baita Airport.



Inner Mongolia Jin Ma Real Estate Development Co. Ltd.



Inner Mongolia Jin Ma Real Estate Development Co., Ltd. (Jin Ma Real Estate), established in 1999, was formally registered as a limited liability company in Hohhot City in February 2004.



Basis of presentation



The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America. The Companys functional currency is the Chinese Renminbi; however the accompanying consolidated financial statements have been translated and presented in United States Dollars ($).



Principles of consolidation



The consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States of America and present the financial statements of the Company and its wholly owned and majority-owned subsidiaries including variable interest entities (VIEs) for which the Company is the primary beneficiary.



The accompanying consolidated financial statements include the accounts of Speedhaul Holdings, Inc. and its wholly owned subsidiaries Gold Horse Nevada and Global Rise, and its variable interest entities Jin Ma Construction, Jin Ma Hotel and Jin Ma Real Estate. All significant inter-company accounts and transactions have been eliminated in consolidation.



The Company has adopted FASB Interpretation No. 46R Consolidation of Variable Interest Entities (FIN 46R), an Interpretation of Accounting Research Bulletin No. 51. FIN 46R requires a Variable Interest Entity (VIE) to be consolidated by a company if that company is subject to a majority of the risk of loss for the VIE or is entitled to receive a majority of the VIEs residual returns. VIEs are those entities in which the Company, through contractual arrangements, bears the risks of, and enjoys the rewards normally associated with ownership of the entities, and therefore the Company is the primary beneficiary of these entities.



9


GOLD HORSE INTERNATIONAL, INC. AND SUBSIDIARIES

(FORMERLY SPEEDHAUL HOLDINGS, INC.)

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2007



Use of estimates



The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. Significant estimates for the three months ended September 30, 2007 and 2006 include the allowance for doubtful accounts and the useful life of property and equipment, costs and estimated earnings in excess of billings, and billings in excess of costs and estimated earnings.



Accounts and other receivables



The Company has a policy of reserving for uncollectible accounts based on its best estimate of the amount of probable credit losses in its existing accounts receivable. The Company periodically reviews its accounts receivable and other receivables to determine whether an allowance is necessary based on an analysis of past due accounts and other factors that may indicate that the realization of an account may be in doubt. Account balances deemed to be uncollectible are charged to the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. At September 30, 2007, the Company has established, based on a review of its outstanding accounts receivable balances, an allowance for doubtful accounts in the amount of $172,449 on its current accounts receivable and $822,634 on its long-term accounts receivable. Additionally, at September 30, 2007, the Company has
established, based on a review of its outstanding other receivable balances, an allowance for doubtful accounts in the amount of $816,140.



Inventories



Inventories, consisting of construction materials and consumable goods related to the Companys operations are stated at the lower of cost or market utilizing the first-in, first-out method.



Advances to suppliers



The Company advances to certain vendors for purchase of its material. The advances to suppliers are interest free and unsecured. The advances to suppliers amounted to $372,936 as at September 30, 2007.



Property and equipment



Property and equipment are carried at cost. The cost of repairs and maintenance is expensed as incurred; major replacements and improvements are capitalized. When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in income in the year of disposition. Depreciation is computed using straight line method over the estimated useful lives of the assets, ranging from five to forty years.



Real estate held for sale



The Company capitalizes as real estate held for sale the direct construction and development costs, property taxes, interest incurred on costs related to land under development and other related costs (i.e. engineering, surveying, landscaping, etc.) until the property reaches its intended use. At September 30, 2007, real estate held for sale amounted to $668,541.



10


GOLD HORSE INTERNATIONAL, INC. AND SUBSIDIARIES

(FORMERLY SPEEDHAUL HOLDINGS, INC.)

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2007



Costs in excess of billings



Costs in excess of billings are stated at cost, unless events or circumstances indicate that cost cannot be recovered, in which case the carrying value is reduced to estimated fair value. Estimated fair value: (i) is based on the Companys plans for the development of each property; and (ii) considers the cost to complete and the estimated fair value of the completed projects.

Direct construction, development costs, property taxes and other related costs to the construction projects are capitalized during periods those activities which are necessary to get the projects ready for its intended use. The capitalization ends when the construction is substantially completed and the projects are ready for its intended use.



Advances from customers



Advances from customers at September 30, 2007 of $755,814 consist of prepayments from third party customers to the Company for construction and real estate transactions to ensure sufficient funds are available to complete the real estate and construction projects. The Company will recognize the deposits as revenue upon transfer of title to the buyer, in compliance with its revenue recognition policy.



Impairment of long-lived assets



In accordance with Statement of Financial Accounting Standards (SFAS) No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets, The Company periodically reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment is measured as the difference between the assets estimated fair value and its book value. The Company did not consider it necessary to record any impairment charges during the three months ended September 30, 2007.



Income taxes



The Company is governed by the Income Tax Law of the Peoples Republic of China and the United States. The Company utilizes SFAS No. 109, Accounting for Income Taxes, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. At September 30, 2007, there were no significant book and tax basis differences.








Pursuant to the PRC Income Tax Laws, the Company is subject to Enterprise Income Taxes (EIT) at a statutory rate of 33%, which comprises 30% national income tax and 3% local income tax.



11


GOLD HORSE INTERNATIONAL, INC. AND SUBSIDIARIES

(FORMERLY SPEEDHAUL HOLDINGS, INC.)

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2007



Earnings and diluted earnings per common share



Earnings per share is calculated in accordance with the Statement of financial accounting standards No. 128 (SFAS No. 128), Earnings per share. SFAS No. 128 superseded Accounting Principles Board Opinion No.15 (APB 15). Net loss per share for all periods presented has been restated to reflect the adoption of SFAS No. 128. Basic earnings per share is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period. Diluted income per share is computed by dividing net income by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during each period. At September 30, 2007 and 2006, the Company did not have any common stock equivalents.



Revenue recognition



The Company follows the guidance of the Securities and Exchange Commissions Staff Accounting Bulletin 104 for revenue recognition. In general, the Company records revenue when persuasive evidence of an arrangement exists, services have been rendered or product delivery has occurred, the sales price to the customer is fixed or determinable, and collectability is reasonably assured. The following policies reflect specific criteria for the various revenues streams of the Company:



Real estate sales which primarily involve the sale of multi-family homes and community environments are reported in accordance with the provisions of Statement of Financial Accounting Standard No. 66, Accounting for Sales of Real Estate. Profit from the sales of development properties, less 5% business tax, is recognized by the full accrual method when the sale is consummated. A sale is not considered consummated until (1) the parties are bound by the terms of a contract, (2) all consideration has been exchanged, (3) any permanent financing of which the seller is responsible has been arranged, (4) all conditions precedent to closing have been performed, (5) the seller does not have substantial continuing involvement with the property, and (6) the usual risks and rewards of ownership have been transferred to the buyer. Sales transactions not meeting all the conditions of the full accrual method
are accounted for using the deposit method of accounting. Under the deposit method, all costs are capitalized as incurred, and payments received from the buyer are recorded as a deposit liability (reflected as advances from customers in the Companys consolidated balance sheets).



Revenue from the performance of general contracting, construction management and design-building services is recognized upon completion of the service.



Revenue primarily derived from hotel operations, including the rental of rooms and food and beverage sales, is recognized when rooms are occupied and services have been rendered.



In accounting for long-term engineering and construction-type contracts, the Company follows the provisions of the AICPAs Statement of Position 81-1Accounting for Performance of Construction-Type and Certain Production-Type Contracts. The Company recognizes revenues using the percentage of completion method of accounting by relating contract costs incurred to date to the total estimated costs at completion. Contract price and cost estimates are reviewed periodically as work progresses and adjustments proportionate to the percentage of completion are reflected in contract revenues and gross profit in the reporting period when such estimates are revised. This method of revenue recognition requires the Company to prepare estimates of costs to complete contracts in progress. In making such estimates, judgments are required to evaluate contingencies such
as potential variances in schedule, the cost of materials and labor, and productivity; and the impact of change orders, liability claims, contract disputes, and achievement of contractual performance standards which may result in revisions to costs and income and are recognized in the period in which the revisions are determined. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined.



12


GOLD HORSE INTERNATIONAL, INC. AND SUBSIDIARIES

(FORMERLY SPEEDHAUL HOLDINGS, INC.)

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2007



The asset, costs and estimated earnings in excess of billings, represents revenues recognized in excess of amounts billed. The liability, billings in excess of costs and estimated earnings, represents billings in excess of revenues recognized.



Concentrations of credit risk



Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of cash and trade accounts receivable. The Company places its cash with high credit quality financial institutions in China. Total cash in state-owned banks at September 30, 2007 amounted to $806,186, 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. A portion of the Companys sales are credit sales which are primarily to customers whose ability to pay is dependent upon the industry economics prevailing in these areas; however,  concentrations of credit risk with respect to trade accounts receivables is limited due to generally short payment terms. The Company also performs ongoing credit evaluations of its customers to help further reduce credit risk.



Stock-based compensation



The Company adopted SFAS 123(R) using the modified prospective transition method. In accordance with the modified prospective transition method, the Companys financial statements for prior periods have not been restated to reflect, and do not include, the impact of SFAS 123(R). There were no options outstanding as of September 30, 2007 and 2006.



Foreign currency translation and comprehensive income



The reporting currency is the U.S. dollar. The functional currency of the Company is the local currency, the Chinese Renminbi (RMB). The financial statements of the Company are translated into United States dollars in accordance with Statement of Financial Accounts Standards (SFAS) No. 52, Foreign Currency Translation, using year-end rates of exchange for assets and liabilities, and average rates of exchange for the period for revenues, costs, and expenses and historical rates for the equity. Translation adjustments resulting from the process of translating the local currency financial statements into U.S. dollars are included in determining comprehensive income. At September 30, 2007, the cumulative translation adjustment of $705,343 was classified as an item of other comprehensive income in the stockholders equity section of the consolidated balance sheet. For the
three months ended September 30, 2007 and 2006, accumulated other comprehensive income was $160,465 and $86,277, respectively.



Segment reporting



Statement of Financial Accounting Standards No. 131 (SFAS 131), Disclosure About Segments of an Enterprise and Related Information requires use of the management approach model for segment reporting. The management approach model is based on the way a companys management organizes segments within the company for making operating decisions and assessing performance. Reportable segments are based on products and services, geography, legal structure, management structure, or any other manner in which management disaggregates a company. During the three months ended September 30, 2007 and 2006, the Company operated in three reportable business segments - (1) the Construction segment (2) Hotel segment and (3) Real estate development segment (Refer to Note 10).



13


GOLD HORSE INTERNATIONAL, INC. AND SUBSIDIARIES

(FORMERLY SPEEDHAUL HOLDINGS, INC.)

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2007



Recent accounting pronouncements



In September 2006, the FASB issued SFAS No. 157,Fair Value Measurements(SFAS 157), which provides guidance for how companies should measure fair value when required to use a fair value measurement for recognition or disclosure purposes under generally accepted accounting principle (GAAP). SFAS 157 is effective for fiscal years beginning after November 15, 2007. The Company is currently assessing the impact, if any, the adoption of SFAS 157 will have on its financial statements.



In September 2006, the FASB issued SFAS 158 (SFAS 158),Employers Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements No.87, 88, 106, and 132(R).This statement requires an employer to recognize the over funded or under funded status of a defined benefit postretirement plan as an asset or liability in its statement of financial position and to recognize changes in that funded status in the year in which the changes occur through comprehensive income of a business entity. This statement also requires an employer to measure the funded status of a plan as of the date of its year end statement of financial position, with limited exceptions. The Company will be required to initially recognize the funded status of a defined
benefit postretirement plan and to provide the required disclosures as of the end of the fiscal year ending after December 15, 2006. The requirement to measure plan assets and benefit obligations as of the date of the employers fiscal year end statement of financial position is effective for fiscal years ending after December 15, 2008, or fiscal 2009 for the Company. The Company is currently assessing the impact, if any, the adoption of SFAS 157 will have on its financial statements.



In February 2007, the FASB issued SFAS No. 159,The Fair Value Option for Financial Assets and Financial Liabilities, Including an Amendment of FASB Statement No.115, under which entities will now be permitted to measure many financial instruments and certain other assets and liabilities at fair value on an instrument-by-instrument basis. This Statement is effective as of the beginning of an entitys first fiscal year that begins after November 15, 2007. Early adoption is permitted as of the beginning of a fiscal year that begins on or before November 15, 2007, provided the entity also elects to apply the provisions of SFAS 157. The Company is currently assessing the impact, if any, the adoption of SFAS 159 will have on its financial statements.



NOTE 2 INVENTORIES



At September 30, 2007, inventories consisted of the following:




Construction materials
        
        $
        14,288Consumable goods
        
        
        34,943$
        49,231



NOTE 3 COSTS AND ESTIMATED EARNINGS IN EXCESS OF BILLINGS



Costs in excess of billings at September 30, 2007 consisted of:




Costs incurred on uncompleted contracts
        
        $
        9,335,526Estimated earnings
        
        
        2,049,94711,385,473Less billings to date
        
        
        (11,556,880
        )$
        (171,407
        )





14


GOLD HORSE INTERNATIONAL, INC. AND SUBSIDIARIES

(FORMERLY SPEEDHAUL HOLDINGS, INC.)

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2007



Amounts are included in the accompanying balance sheet under the following captions:




Costs and estimated earnings in excess of billings
        
        $
        1,908Billings in excess of costs and estimated earnings
        
        
        (173,315
        )$
        (171,407
        )



NOTE 4 DEPOSIT ON LAND USE RIGHTS



The Company has recorded as a deposit on land use rights the costs paid to a local government agency to acquire a long-term interest to utilize certain land to construct real property for sale. In order to obtain the provincial governments permission to build on top on the land, the Company will need to make additional payments to the higher level government. The Company has not received the final license to build on the land. Additionally, during the three months ended September 30, 2007, the Company deposited funds to obtained land use rights on additional land. Accordingly, the Company has reflected amounts paid as of September 30, 2007 of $2,321,280 as a deposit on land use rights on the accompanying consolidated balance sheet.



NOTE 5 PROPERTY AND EQUIPMENT



At September 30, 2007, property and equipment consist of the following:




Useful LifeOffice equipment
        5 Years
        
        $
        54,482Machinery equipment
        5-15 Years
        
        
        3,980,313Vehicles
        10 Years
        
        
        108,571Building and building improvements
        20  40 Years
        
        
        3,812,0137,955,379Less: accumulated depreciation
        
        
        
        (1,728,598)$
        6,226,781



Depreciation of property and equipment is provided using the straight-line method. For the three months ended September 30, 2007 and 2006, depreciation expense amounted to $99,426 and $53,132, respectively.



NOTE 6 INTANGIBLE ASSET



All land in the Peoples Republic of China is owned by the government and cannot be sold to any individual or company. The Company has recorded the costs paid to a local government agency to acquire a long-term interest to utilize certain land to construct real property for sale. This type of arrangement is common for the use of land in the PRC. The land use rights are valued at a fixed amount RMB 1,223,679, fluctuated by the exchange rate. At September 30, 2007, the land use rights are valued at $162,775. Under the terms of the agreement, the Company has rights to use certain land for a period to be specified when the land is put into use. As of September 30, 2007, this land has not been entered into service. The Company will amortize these land use rights over the contract period when determined.



15


GOLD HORSE INTERNATIONAL, INC. AND SUBSIDIARIES

(FORMERLY SPEEDHAUL HOLDINGS, INC.)

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2007



NOTE 7 ACCRUED EXPENSES



At September 30, 2007, accrued expenses consist of the following:




Accrued interest expenses
        
        $
        751,391Employees benefit
        
        
        144,872Accrued payroll
        
        
        61,238Other accounts payable
        
        
        5,999$
        963,500



NOTE 8 LOANS PAYABLE



Loans payable are for working capital purposes and consisted of the following at September 30, 2007:




Loans to various unrelated parties, due in January 2010 with annual interest of 14.4% and unsecured.
        
        $
        1,007,768Loans to various unrelated parties, due in December 2009 with annual interest of 14.4% and unsecured.
        
        
        170,267Loans to various unrelated parties, due in January 2010 with annual interest of 18% and unsecured.
        
        
        86,464Loans to various unrelated parties, due in April 2012 with annual interest of 18% and unsecured
        
        
        172,928Loans to various unrelated parties, due in August 2008 with annual interest of 14.4% and unsecured
        
        
        133,021Loans to various unrelated parties, due in August 2011 with annual interest of 18% and unsecured
        
        
        33,255Loans to various unrelated parties, due in September 2012 with annual interest of 18% and unsecured
        
        
        106,417Total loans payable
        
        
        1,710,120Less : Current portion
        
        
        (133,021
        )Long term liability
        
        $
        1,577,099



For the three months ended September 30, 2007 and 2006, interest expense amount to $64,713 and $61,168, respectively. Future maturities of long-term debt are as follows:




Period ended September,2008 (current liability)
        
        $
        133,0212010
        
        $
        1,264,4992011
        
        $
        33,2552012
        
        $
        279,345





16


GOLD HORSE INTERNATIONAL, INC. AND SUBSIDIARIES

(FORMERLY SPEEDHAUL HOLDINGS, INC.)

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2007



NOTE 9 RELATED PARTY TRANSACTIONS



Due from related parties:



From time to time, the Company advanced funds to companies related through common ownership for working capital purposes. These advances are non interest bearing, unsecured and payable on demand. At September 30, 2007, the Company had a net receivable from these related entities of $1,001,314. At September 30, 2007, due from related parties was due from the following;




Name
        
        Relationship
        
        
        AmountInner Mongolia Jin Ma Group Ltd and its subsidiaries
        
        Owned by Yang Liankuan
        
        $
        952,783Yang Liankuan (a)
        
        Officer and director
        
        
        48,531$
        1,001,314




(a)
        The amount due from the officer and director was an advance.




NOTE 10 SEGMENT INFORMATION



Statement of Financial Accounting Standards No. 131 (SFAS 131), Disclosure About Segments of an Enterprise and Related Information requires use of the management approach model for segment reporting. The management approach model is based on the way a companys management organizes segments within the company for making operating decisions and assessing performance. Reportable segments are based on products and services, geography, legal structure, management structure, or any other manner in which management disaggregates a company.



During the three months ended September 30, 2007 and 2006, the Company operated in three reportable business segments - (1) the Construction segment (2) Hotel segment and (3) Real estate development segment. The Companys reportable segments are strategic business units that offer different products.The Companys reportable segments, although integral to the success of the others, offer distinctly different products and services and require different types of management focus. As such, these segments are managed separately.



Condensed information with respect to these reportable business segments for the three months ended September 30, 2007 and 2006 is as follows:




Three Months Ended September 30, 2007:
        
        ConstructionSegment
        
        HotelSegment
        
        Real estatedevelopmentsegment
        
        Unallocated
        
        ConsolidatedNet revenues from unaffiliated customers
        
        $
        7,883,769
        
        $
        856,186
        
        $
        930,814
        
        $
        
        
        $
        9,670,769Cost of sales
        
        
        6,690,373
        
        
        482,379
        
        
        564,654
        
        
        
        
        
        7,737,406Operating expenses (excluding depreciation)
        
        
        383,046
        
        
        114,940
        
        
        68,451
        
        
        69,305
        
        
        635,742Depreciation
        
        
        35,030
        
        
        61,964
        
        
        2,432
        
        
        
        
        
        99,426Interest expense
        
        
        64,713
        
        
        
        
        
        
        
        
        
        
        
        64,713Net income (loss)
        
        
        474,372
        
        
        131,926
        
        
        197,877
        
        
        (69,305
        )
        
        734,870Identifiable assets
        
        
        12,392,112
        
        
        3,616,891
        
        
        3,307,219
        
        
        
        
        
        19,316,222





17


GOLD HORSE INTERNATIONAL, INC. AND SUBSIDIARIES

(FORMERLY SPEEDHAUL HOLDINGS, INC.)

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2007






Three Months Ended September 30, 2006:
        
        ConstructionSegment
        
        HotelSegment
        
        Real estatedevelopmentsegment
        
        ConsolidatedNet revenues from unaffiliated customers
        
        $
        6,120,011
        
        $
        687,865
        
        $
        
        
        $
        6,807,876Cost of sales
        
        
        5,150,450
        
        
        359,769
        
        
        
        
        
        5,510,219Operating expenses (excluding depreciation)
        
        
        891,862
        
        
        170,997
        
        
        82
        
        
        1,062,941Depreciation
        
        
        29,999
        
        
        20,717
        
        
        2,416
        
        
        53,132Interest expense
        
        
        61,168
        
        
        
        
        
        
        
        
        61,168Net income (loss)
        
        
        (157,379
        )
        
        81,553
        
        
        (2,283
        )
        
        (78,109
        )Identifiable assets
        
        
        20,813,508
        
        
        3,153,791
        
        
        1,920,798
        
        
        25,888,097



NOTE 11 STOCKHOLDERS EQUITY



During the three months ended September 30, 2007, the Company sold 624,459 shares of common stock to 36 individuals residing in China for net proceeds of $624,459. As of September 30, 2007, these shares had not been issued and are reflected as common stock issuable on the accompanying consolidated balance sheet.



NOTE 12 STATUTORY RESERVES



As stipulated by the Company Law of the Peoples Republic of China (PRC), net income after taxation can only be distributed as dividends after appropriation has been made for the following:




1.
        Making up cumulative prior years losses, if any;





2.
        Allocations to the Statutory surplus reserve of at least 10% of income after tax, as determined under PRC accounting rules and regulations, until the fund amounts to 50% of the Companys registered capital;





3.
        Through December 31, 2005, allocations of 5-10% of income after tax, as determined under PRC accounting rules and regulations, to the Companys Statutory common welfare fund, which is established for the purpose of providing employee facilities and other collective benefits to the Companys employees; and





4.
        Allocations to the discretionary surplus reserve, if approved in the shareholders general meeting.




In accordance with the Chinese Company Law, the Company allocated 10% of income after taxes to the statutory surplus reserve for the three months ended September 30, 2007 and 2006. . The amount included in the statutory reserves as of September 30, 2007 amounted to $674,423.



NOTE 13 OPERATING RISK



(a) Country risk



Currently, the Companys revenues are primarily derived from construction projects, real estate and hotel revenues to customers in the Peoples Republic of China (PRC). The Company hopes to expand its operations to countries outside the PRC, however, such expansion has not been commenced and there are no assurances that the Company will be able to achieve such an expansion successfully. Therefore, a downturn or stagnation in the economic environment of the PRC could have a material adverse effect on the Companys financial condition.



18


GOLD HORSE INTERNATIONAL, INC. AND SUBSIDIARIES

(FORMERLY SPEEDHAUL HOLDINGS, INC.)

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2007



(b) Products risk



In addition to competing with other construction companies, real estate companies, and hotel operations, the Company competes with larger Chinese and international companies who may have greater funds available for expansion, marketing, buying power, resources, and the ability to attract more qualified personnel. These Chinese companies may be able to offer products at a lower price. There can be no assurance that the Company will remain competitive should this occur.



(c) Political risk



Currently, PRC is in a period of growth and is openly promoting business development in order to bring more business into PRC. Additionally PRC allows a Chinese corporation to be owned by a United States corporation. If the laws or regulations are changed by the PRC government, the Companys ability to operate the PRC subsidiaries could be affected.



(d) Exchange risk



The Company can not guarantee that the current exchange rate will remain steady, therefore there is a possibility that the Company could post the same amount of profit for two comparable periods and because of a fluctuating exchange rate actually post higher or lower profit depending on exchange rate of Chinese Renminbi (RMB) converted to U.S. dollars on that date. The exchange rate could fluctuate depending on changes in the political and economic environments without notice.



NOTE 14 MAJOR CUSTOMERS & VENDORS



One customer provided 73% of the Companys revenue for the three months ended September 30, 2007 for an aggregate percentage of 73%. At September 30, 2007, the Company had $ 5.395.005 of accounts receivable due from this customer.



The Company uses five to seven subcontractors to perform its construction services and to develop its real estate projects. Management is aware of similar subcontractors that are available to perform construction services if required and management has plans to engage their services if necessary.



NOTE 16 SUBSEQUENT EVENT



In October 2007, the Company sold 1,594,793 shares of common stock to 99 individuals residing in China for net proceeds of $1,594,793.



19


ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN OF OPERATION



Overview



Prior to June 29, 2007, the Company was a development stage company attempting to implement our business plan to become a fully integrated online provider that linked the supply and demand sides of the ground trucking industry. On June 29, 2007, the Company executed the Share Exchange Agreement with Gold Horse Nevada whereby the Company acquired all of the outstanding common stock of Gold Horse Nevada in exchange for newly-issued stock of the Company to the Gold Horse Nevada shareholders. Gold Horse Nevada conducts its business operations through its wholly owned subsidiary Global Rise and three operating companies based in the PRC. The acquisition of Gold Horse Nevada was accounted for as a reverse merger because on a post-merger basis, the members of Gold Horse Nevada held a majority of the outstanding common stock of the Company on a voting and fully-diluted basis. As a result of
the share exchanges, Gold Horse Nevada was deemed to be the acquirer for accounting purposes. Accordingly, the financial statement data presented are those of Gold Horse Nevada for all periods prior to our acquisition of Gold Horse Nevada on June 29, 2007, and the financial statements of the consolidated companies from the acquisition date forward.



Neither the Company nor its subsidiaries Gold Horse Nevada or Global Rise are engaged in any business or operations other than pursuant to the terms of the various Contractual Arrangements with the Jin Ma Companies as described elsewhere in this report. As such, we are completely dependent on the Contractual Arrangements. We do not generate any revenues and have no assets. As described in the financial statements included in this report, the assets and liabilities at September 30, 2007 and the results of operations for the three months ended September 30, 2007 and 2006 are those of the Jin Ma Companies. All of those assets and operations are located in the PRC and the Contractual Arrangements are subject to enforcement under the laws of the PRC. If we are unable to enforce any legal rights we may have under these contracts or otherwise, our ability to continue as a going concern is in
jeopardy. In addition, the terms of these contracts expire in August 2016 and there are no assurances these agreements will be renewed. If the Contractual Arrangements are not renewed or are significantly modified, unless we have expanded our business and operations, of which there are no assurances, we will in all likelihood be forced to cease our operations.



Critical Accounting Policies and Estimates



While our significant accounting policies are more fully described in Note 1 to our consolidated financial statements appearing elsewhere herein, we believe that the following accounting policies are the most critical to aid you in fully understanding and evaluating this management discussion and analysis.



Principles of consolidation



The consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States of America and present the financial statements of the Company and our wholly-owned and majority-owned subsidiaries including variable interest entities (VIEs) for which we are the primary beneficiary.



The accompanying consolidated financial statements include the accounts of Gold Horse International and our wholly owned subsidiaries Gold Horse Nevada and Global Rise, and our variable interest entities Jin Ma Construction, Jin Ma Hotel and Jin Ma Real Estate. All significant inter-company accounts and transactions have been eliminated in consolidation.



We have adopted FASB Interpretation No. 46R Consolidation of Variable Interest Entities (FIN 46R), an Interpretation of Accounting Research Bulletin No. 51. FIN 46R requires a Variable Interest Entity (VIE) to be consolidated by a company if that company is subject to a majority of the risk of loss for the VIE or is entitled to receive a majority of the VIEs residual returns. VIEs are those entities in which we, through contractual arrangements, bear the risks of, and enjoy the rewards normally associated with ownership of the entities, and therefore we are the primary beneficiary of these entities.



20


Use of estimates



The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. Significant estimates in 2007 and 2006 include the allowance for doubtful accounts and the useful life of property and equipment, costs and estimated earnings in excess of billings, and billings in excess of costs and estimated earnings.



Accounts and other receivables



We have a policy of reserving for uncollectible accounts based on our best estimate of the amount of probable credit losses in our existing accounts receivable. We periodically review our accounts receivable and other receivables to determine whether an allowance is necessary based on an analysis of past due accounts and other factors that may indicate that the realization of an account may be in doubt. Account balances deemed to be uncollectible are charged to the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. On September 30, 2007, the Company has established, based on a review of its outstanding accounts receivable balances, an allowance for doubtful accounts in the amount of $172,449 on its current accounts receivable and $822,634 on its long-term accounts receivable. Additionally, at September 30, 2007, we established,
based on a review of our outstanding other receivable balances, an allowance for doubtful accounts in the amount of $816,140.



Inventories



Inventories, consisting of construction materials and consumable goods related to our operations are stated at the lower of cost or market utilizing the first-in, first-out method.



Real estate held for sale



We capitalize as real estate held for sale the direct construction and development costs, property taxes, interest incurred on costs related to land under development and other related costs (i.e. engineering, surveying, landscaping, etc.) until the property reaches its intended use. At September 30, 2007, real estate held for sale amounted to $668,541.



Advances from customers



Advances from customers at September 30, 2007 of $755,814 consist of prepayments from third party customers to the Company for construction and real estate transactions to ensure sufficient funds are available to complete the real estate and construction projects. The Company will recognize the deposits as revenue upon transfer of title to the buyer, in compliance with its revenue recognition policy.



Revenue recognition



We follow the guidance of the Securities and Exchange Commissions Staff Accounting Bulletin 104 for revenue recognition. In general, we record revenue when persuasive evidence of an arrangement exists, services have been rendered or product delivery has occurred, the sales price to the customer is fixed or determinable, and collectability is reasonably assured. The following policies reflect specific criteria for the various revenues streams of the Company:



21


Real estate sales which primarily involve the sale of multi-family homes and community environments are reported in accordance with the provisions of Statement of Financial Accounting Standard No. 66, Accounting for Sales of Real Estate. Profit from the sales of development properties, less 5% business tax, is recognized by the full accrual method when the sale is consummated. A sale is not considered consummated until (1) the parties are bound by the terms of a contract, (2) all consideration has been exchanged, (3) any permanent financing of which the seller is responsible has been arranged, (4) all conditions precedent to closing have been performed, (5) the seller does not have substantial continuing involvement with the property, and (6) the usual risks and rewards of ownership have been transferred to the buyer. Sales transactions not meeting all the conditions of the
full accrual method are accounted for using the deposit method of accounting. Under the deposit method, all costs are capitalized as incurred, and payments received from the buyer are recorded as a deposit liability (reflected as advances from customers in our consolidated balance sheets).



Revenue from the performance of general contracting, construction management and design-building services is recognized upon completion of the service.



Revenue primarily derived from hotel operations, including the rental of rooms and food and beverage sales, is recognized when rooms are occupied and services have been rendered.



In accounting for long-term engineering and construction-type contracts, we follow the provisions of the AICPAs Statement of Position 81-1Accounting for Performance of Construction-Type and Certain Production-Type Contracts. The Company recognizes revenues using the percentage of completion method of accounting by relating contract costs incurred to date to the total estimated costs at completion. Contract price and cost estimates are reviewed periodically as work progresses and adjustments proportionate to the percentage of completion are reflected in contract revenues and gross profit in the reporting period when such estimates are revised. This method of revenue recognition requires the Company to prepare estimates of costs to complete contracts in progress. In making such estimates, judgments are required to evaluate
contingencies such as potential variances in schedule, the cost of materials and labor, and productivity; and the impact of change orders, liability claims, contract disputes, and achievement of contractual performance standards which may result in revisions to costs and income and are recognized in the period in which the revisions are determined. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. The asset, costs and estimated earnings in excess of billings, represents revenues recognized in excess of amounts billed. The liability, billings in excess of costs and estimated earnings, represents billings in excess of revenues recognized.



Recent Accounting Pronouncements



In July 2006, the Financial Accounting Standards Board (FASB) issued FASB Interpretation No. 48 (FIN 48),Accounting for Uncertainty in Income Taxes,an interpretation of FASB Statement No. 109 (SFAS 109). The interpretation clarifies the accounting for uncertainty in income taxes recognized in an entitys financial statements in accordance with SFAS 109,Accounting for Income Taxes.It prescribes a recognition threshold and measurement attribute for financial statement recognition and measurement of a tax position taken or expected to be taken on a tax return. FIN 48 is effective for fiscal years beginning after December 15, 2006. The adoption of this interpretation did not have an
impact on our consolidated financial statements.



In September 2006, the FASB issued SFAS No. 157,Fair Value Measurements(SFAS 157), which provides guidance for how companies should measure fair value when required to use a fair value measurement for recognition or disclosure purposes under generally accepted accounting principle (GAAP). SFAS 157 is effective for fiscal years beginning after November 15, 2007. We are currently assessing the impact, if any, the adoption of SFAS 157 will have on its financial statements.



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In September 2006, the FASB issued SFAS 158 (SFAS 158),Employers Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements No.87, 88, 106, and 132(R).This statement requires an employer to recognize the overfunded or underfunded status of a defined benefit postretirement plan as an asset or liability in its statement of financial position and to recognize changes in that funded status in the year in which the changes occur through comprehensive income of a business entity. This statement also requires an employer to measure the funded status of a plan as of the date of its year end statement of financial position, with limited exceptions. We will be required to initially recognize the funded status of a
defined benefit postretirement plan and to provide the required disclosures as of the end of the fiscal year ending after December 15, 2006. The requirement to measure plan assets and benefit obligations as of the date of the employers fiscal year end statement of financial position is effective for fiscal years ending after December 15, 2008, or fiscal 2009 for us. We are currently assessing the impact, if any, the adoption of SFAS 157 will have on our financial statements.



In December 2006, FASB Staff Position No. EITF 00-19-2,Accounting for Registration Payment Arrangements,was issued. The FSP specifies that the contingent obligation to make future payments or otherwise transfer consideration under a registration payment arrangement, whether issued as a separate agreement or included as a provision of a financial instrument or other agreement, should be separately recognized and measured in accordance with SFAS No. 5,Accounting for Contingencies.We believe that our current accounting is consistent with the FSP.



In February 2007, the FASB issued SFAS No. 159,The Fair Value Option for Financial Assets and Financial Liabilities, Including an Amendment of FASB Statement No.115, under which entities will now be permitted to measure many financial instruments and certain other assets and liabilities at fair value on an instrument-by-instrument basis. This Statement is effective as of the beginning of an entitys first fiscal year that begins after November 15, 2007. Early adoption is permitted as of the beginning of a fiscal year that begins on or before November 15, 2007, provided the entity also elects to apply the provisions of SFAS 157. We are currently assessing the impact, if any, the adoption of SFAS 159 will have on our financial statements.



23


Comparison of Three Months Ended September 30, 2007 and September 30, 2006.



The following table sets forth the results of our operations for the periods indicated:




For the Three MonthsEnded September 30,2007
        
        2006(Unaudited)
        
        (Unaudited)NET REVENUES:Construction
        
        $
        7,883,769
        
        $
        6,120,011Hotel
        
        
        856,186
        
        
        687,865Real Estate
        
        
        930,814
        
        
        Total Revenues
        
        
        9,670,769
        
        
        6,807,876COST OF SALES:Construction
        
        
        6,690,373
        
        
        5,150,450Hotel
        
        
        482,379
        
        
        359,769Real Estate
        
        
        564,654
        
        
        Total Cost of sales
        
        
        7,737,406
        
        
        5,510,219GROSS PROFIT
        
        
        1,933,363
        
        
        1,297,657OPERATING EXPENSES:Hotel operating expenses
        
        
        35,176
        
        
        69,561Bad debt expense
        
        
        300,894
        
        
        543,883Salaries and employee benefits
        
        
        134,201
        
        
        46,796Depreciation and amortization
        
        
        99,426
        
        
        53,132General and administrative
        
        
        165,471
        
        
        402,701Total Operating Expenses
        
        
        735,168
        
        
        1,116,073INCOME FROM OPERATIONS
        
        
        1,198,195
        
        
        181,584OTHER INCOME (EXPENSE):Other income
        
        
        
        
        
        Other expense
        
        
        
        
        
        (1,697
        )Interest income
        
        
        87
        
        
        5,032Interest expense
        
        
        (64,713
        )
        
        (61,168
        )Total Other Income (Expense)
        
        
        (64,626
        )
        
        (57,833
        )INCOME BEFORE INCOME TAX
        
        
        1,133,569
        
        
        123,751INCOME TAX
        
        
        398,699
        
        
        201,860NET INCOME
        
        $
        734,870
        
        $
        (78,109
        )





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Net Revenues.For the three months ended September 30, 2007, our net revenues increased $2,862,893 or approximately 42% from the comparable period in fiscal 2007. The increase in revenues was mainly due to increased activity in our construction operations. Jin Ma Construction completed the Xiao Kang Xin residential apartment project during the three months ended September 30, 2007 and began two new projects during the period, which translated into an increase in revenues for our construction operation of approximately 28.9%. Revenues for our hotel operations increased $168,321 or approximately 24.5%, because of an increase in tourism resulting from the completion of the Muslim Scenic Route through Hohhot City. Finally, we reported revenues for our real estate development operation increased for the three months ended
September 30, 2007 of  $930,814 due to the sale of apartments from our inventory of completed projects. We did not have any comparable revenues from this segment during the three months ended September 30, 2006.



Cost of Sales.Overall, cost of sales increased slightly from approximately 81% of net revenues for the three months ended September 30, 2006 to approximately 80% of net revenues for the three months ended September 30, 2007. The increase in cost of sales is in line with the increase in revenues from all three of our operating segments as noted above. Cost of sales from our construction operation increased from $5,150,450 to $6,690,373, an increase of 29.9%, in line with the increased revenue from the increased construction activities in conjunction with the additional projects that Jin Ma Construction added to its roster during fiscal 2006. For this segment, cost of sales as a percentage of net revenues was approximately 85% for the three months ended September 30, 2007 as compared to approximately 16% for the comparable period in
fiscal 2007. Additionally, increases in cost of sales from our construction operation were partly attributable to increases in costs for building supplies, labor costs, and other costs incurred on our projects. Cost of sales for our hotel operation increased from $359,769 to $482,379, an increase of 34% rising in proportion to our increase in revenues. As a percentage of net revenues for this segment, cost of sales was approximately 56% for the three months ended September 30, 2007 as compared to approximately 52% for the three months ended September 30, 2006 relating to an increase in food costs. Cost of sales for our real estate development operation as a percentage of net revenues was approximately 61% for the three months ended September 30, 2007. As set forth above, as we did not have revenues from this segment in the fiscal 2007 period there is no comparative data available.



Gross Profit.Overall, gross profit increased approximately 49% from $1,297,657 for the three months ended September 30, 2006 to $1,933,363 for the three months ended September 30, 2007.



Operating Expenses. For the three months ended September 30, 2007, overall operating expenses decreased approximately 61% for the three months ended September 30, 2007 as compared to the three months ended September 30, 2006. This decrease was mainly due to a decrease in hotel operating expenses, bad debt and general and administrative expenses offset by the increases in salaries and employee benefits and depreciation expense as discussed below.



Hotel Operating Expenses.Hotel operating expenses decreased by approximately 49% for the three months ended September 30, 2006 to $35,176 for the three months ended September 30, 2007. Hotel operating expenses were approximately 4% of revenues from this segment for the three months ended September 30, 2007 as compared to approximately 10% for the three months ended September 30, 2006 due to the write off of supply inventory in the 2006 period.



Bad Debt Expense.For the three months ended September 30, 2007, bad debt expense amounted to $300,894 as compared to $543,883 for the three months ended September 30, 2006, a decrease of $242,989 or 45%. We have a policy of reserving for uncollectible accounts based on our best estimate of the amount of probable credit losses in our existing accounts and other receivables. We periodically review our accounts receivable and other receivables to determine whether an allowance is necessary based on an analysis of past due accounts and other factors that may indicate that the realization of an account may be in doubt. Account balances deemed to be uncollectible are charged to the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. We are currently reviewing our credit policies and
began aggressively pursuing overdue accounts.



25


Salaries and Employee Benefits. For the three months ended September 30, 2007 salaries and employee benefits increased approximately 187% as compared from the comparable period in fiscal 2007, as we increased the number of our employees.  These increases included increases in our accounting staff and administrative staff to meet the needs of becoming a public entity as well as increases in real estate sales staff as our sales in this segment increased.



Depreciation and Amortization. For the three months ended September 30, 2007, depreciation and amortization amounted to $99,426 as compared to $53,132 for the three months ended September 30, 2006, an increase of $46,294 or 87% relating to the acquisition of construction equipment in the current period.



General and Administrative Expenses. General and administrative expenses consist of office expenses and supplies, utilities, telephone and communications, maintenance, automobile expense. General and administrative expenses decreased approximately 59% for the three months ended September 30, 2007 as compared to the three months ended September 30, 2006. The decrease was attributable to a decrease in office supplies and expenses and other general and administrative expenses.



Net Income.Net income increased 1,040% from a net loss of $(78,109) for the three months ended September 30, 2006 to net income of $734,870 for the three months ended September 30, 2007. This increase in net income was due primarily to revenues and gross profits and the overall decrease in operating expenses as described above. This translates to basic and diluted net income per common share of $0.01 and $0.00 for the three months ended September 30, 2007 and 2006, respectively.



Comprehensive Income.For the three months ended September 30, 2007 we reported unrealized gain on foreign currency translation of $159,074, as compared to $86,277 for the three months ended September 30, 2006. This gain is a non-cash item. As described elsewhere herein, our functional currency is the Chinese Renminbi; however the accompanying consolidated financial statements have been translated and presented in U.S. dollars using period-end rates of exchange for assets and liabilities, and average rates of exchange for the period for revenues, costs, and expenses. Net gains and losses resulting from foreign exchange transactions are included in the consolidated statements of operations and can have a significant effect on our financial statements. As a result of this non-cash gain, we reported comprehensive income of $893,944 for the three months ended
September 30, 2007 as compared to $8,168 for comparable fiscal 2007 period.



Liquidity and Capital Resources



Liquidity is the ability of a company to generate funds to support its current and future operations, satisfy its obligations and otherwise operate on an ongoing basis.



At September 30, 2007, we had a cash balance of $806,186. These funds are located in financial institutions located as China.



We are subject to the regulations of the PRC which restricts the transfer of cash from that country, except under certain specific circumstances. Accordingly, such funds may not be readily available to us to satisfy obligations which have been incurred outside the PRC.



Our working capital position decreased $116,265 to $5,907,439 at September 30, 2007 from $7,509,409 at June 30, 2007. This decrease in working capital is primarily attributable to a reclassification of related party receivables and certain accounts receivable to a long-term asset.



At September 30, 2007 current portion of accounts receivable, net of allowance for doubtful accounts, was $6,832,470 as compared to $5,246,986 at June 30, 2007, an increase of $1,585,484 and was attributable to our construction segment. We anticipate that the balance of these accounts receivable will be paid in accordance with each of their terms.



26


Our inventory of real estate held for sale at September 30, 2007 was $668,541 as compared to $1,149,906 at June 30, 2007, a decrease of $481,365. We will continue to sell our current inventory of real estate. If we sell our remaining inventory of real estate and have no additional units in our inventory, our cash flows from the sale of real estate inventory may decrease.



Our balance sheet at September 30, 2007 also reflects notes payable to third parties of approximately $133,000 due through September 2012 which was a working capital loan made to us by these third parties. These loans bear annual interest rates ranging from 14.4% to 18% and are unsecured.



Our balance sheet at September 30, 2007 reflects a due from related parties of $1,004,314 which represents advances to a related party for working capital. These advances could also be deemed to be in violation of Section 402 of the Sarbanes Oxley Act of 2002 which prohibits a public company from extending or maintaining credit or arranging for the extension of credit in the form of a personal loan to an officer or director. If it is determined that these working capital advances violated Section 402 of the Sarbanes Oxley Act of 2002, we could become subject to SEC investigations and/or litigation, which may not be resolved favorably and will require significant management time and attention, and we could incur costs, which could negatively affect our business, results of operations and cash flows.



Cash Flows



Three Months ended September 30, 2007 and 2006



Net cash flow provided by operating activities was $1,508,074 for the three months ended September 30, 2007 as compared to $96,924 for the three months ended September 30, 2006, an increase of $1,411,150. The increase of net cash flow provided by operating activities in the 2007 period as compared to the 2006 period was mainly due to an increase in net income of $812,979. For the three months ended September 30, 2007, we received cash from the sale of real state of $494,377 as compared to $0 for the three months ended September 30, 2006.



Net cash flow used in investing activities was $1,581,241 for the three months ended September 30, 2007 as compared to cash used in investing activities of $133,257 for the three months ended September 30, 2006. For the three months ended September 30, 2007, cash used in investing activities consisted of cash used for the purchase of property and equipment of $1,517,860 which included heavy equipment for our construction segment and the payments of a deposit on land use rights of $66,058 offset by a decrease in amounts advanced from related parties of $2,677. For the three months ended September 30, 2006, cash used in investing activities consisted of a decrease in construction in progress of $26,125 and cash used for the purchase of property and equipment of $107,132.



Net cash flow provided by financing activities was $624,459 for the three months ended September 30, 2007 which represented proceeds from the sale of our common stock as compared to net cash flow used in financing activities of $31,048 for the three months ended September 30, 2006. For the three months ended September 30, 2006, we used cash for the repayment of related party advances of 102,244 off set by cash received for related party advances of $71,196.



Contractual Obligations and Off-Balance Sheet Arrangements



Contractual Obligations



We have certain fixed contractual obligations and commitments that include future estimated payments. Changes in our business needs, cancellation provisions, changing interest rates, and other factors may result in actual payments differing from the estimates. We cannot provide certainty regarding the timing and amounts of payments. We have presented below a summary of the most significant assumptions used in our determination of amounts presented in the tables, in order to assist in the review of this information within the context of our consolidated financial position, results of operations, and cash flows.



27


The following tables summarize our contractual obligations as of September 30, 2007, and the effect these obligations are expected to have on our liquidity and cash flows in future periods.




Payments Due by PeriodTotal
        
        
        Less than 1 year
        
        
        1-3 Years
        
        
        4-5 Years
        
        
        5 Years +Contractual Obligations :Other Indebtedness
        
        $
        1,710,120
        
        
        
        133,021
        
        
        
        1,264,499
        
        
        
        312,600
        
        
        
        --Operating Leases
        
        $
        --
        
        
        
        --
        
        
        
        -
        
        
        
        --
        
        
        
        --Purchase Obligations
        
        $
        --
        
        
        
        --
        
        
        
        -
        
        
        
        --
        
        
        
        --Total Contractual Obligations:
        
        $
        1,710,120
        
        
        
        133,021
        
        
        
        1,264,499
        
        
        
        312,600
        
        
        
        -



Other indebtedness includes long-time loans borrowed from individuals.



We currently have no material commitments for capital expenditures. Other than working capital and loans, we presently have no other alternative source of working capital. We need working capital to fund our construction and real estate projects. We may not have sufficient working capital to fund new construction projects line as well as providing working capital necessary for our ongoing operations and obligations. We may need to raise additional working capital to complete these projects. We may seek to raise additional capital through the sale of equity securities. No assurances can be given that we will be successful in obtaining additional capital, or that such capital will be available in terms acceptable to our company. At this time, we have no commitments or plans to obtain additional capital.



Off-balance Sheet Arrangements



We have not entered into any other financial guarantees or other commitments to guarantee the payment obligations of any third parties. We have not entered into any derivative contracts that are indexed to our shares and classified as stockholders equity or that are not reflected in our consolidated financial statements. Furthermore, we do not have any retained or contingent interest in assets transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity. We do not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing or hedging services with us.



ITEM 3. CONTROLS AND PROCEDURES



As required by Rule 13a-15 under the Securities Exchange Act of 1934, as of September 30, 2007, the end of the period covered by this report, our management concluded its evaluation of the effectiveness of the design and operation of our disclosure controls and procedures. Disclosure controls and procedures are controls and procedures designed to reasonably assure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, such as this report, is recorded, processed, summarized and reported within the time periods prescribed by SEC rules and regulations, and to reasonably assure that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.



Our management does not expect
that our disclosure controls and procedures will prevent all error and all fraud. A control system, no matter how well designed and
operated, can provide only reasonable, not absolute, assurance that the control systems objectives will be met. Further, the
design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be
considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can
provide absolute assurance that all control issues and instances of fraud, if any, have been detected. These inherent limitations
include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or
mistake. The design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and
there can be no assurance that any design will succeed in achieving its stated goals under all potential future
conditions.



28


As of the evaluation date, our
Chief Executive Officer and Chief Financial Officer concluded that we do not maintain disclosure controls and procedures that are
effective in providing reasonable assurance that information required to be disclosed in our reports under the Securities Exchange
Act of 1934 is recorded, processed, summarized and reported within the time periods prescribed by SEC rules and regulations, and
that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial
Officer, to allow timely decisions regarding required disclosure.




There have been no changes in our
internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal
control over financial reporting.



PART II  OTHER INFORMATION




Item 1.
        Legal Proceedings




None




Item 2.
        Unregistered Sales of Equity Securities and Use of Proceeds




None




Item 3.
        Defaults Upon Senior Securities




None




Item 4.
        Submissions of Matters to a Vote of Security Holders




None




Item 5.
        Other Information



None




Item 6.
        Exhibits




31.1
        Rule 13a-14(a)/15d-14(a) certification of Chief Executive Officer



31.2
        Rule 13a-14(a)/15d-14(a) certificate of Chief Financial Officer



32.1
        Section 1350 certification of Chief Executive Officer



32.2
        Section 1350 certification of Chief Financial Officer





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SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant has caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



Gold Horse International, Inc.




Date:  November 19, 2007
        By:/s/ Liankuan Yang


Liankuan Yang

Chief Executive Officer, Principal Executive Officer




Date:  November 19, 2007
        By:/s/ Adam Wasserman


Adam Wasserman

Chief Financial Officer, Principal Financial and Accounting officer





30