SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-KSB

(Mark One)

[X]  ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE  SECURITIES  EXCHANGE ACT OF
     1934

                     For the Fiscal Year Ended June 30, 2005

[  ] TRANSITION  REPORT UNDER SECTION 13 OR 15(d) OF THE  SECURITIES  EXCHANGE
     ACT OF 1934

       For the transition period from _______________ to ________________

                         Commission File Number 0-30430

                              INTERMOST CORPORATION
                 (Name of Small Business Issuer in its charter)

          Wyoming                                     87-0418721
(State or other jurisdiction                (I.R.S. Employer Identification No.)
 of incorporation or organization)

             31st Floor, B31-23 Guomao Building, Renmin Rd.(South),
                             Shenzhen, China 518014
               (Address of principal executive offices)(Zip code)

Issuer's telephone number, including area code:  86 755 822 10238

Securities to be registered pursuant to Section 12(b) of the Act:

  Title of each class        Name of each exchange on which each is registered
  -------------------        -------------------------------------------------
         None                                         None

Securities to be registered pursuant to Section 12(g) of the Act:

                         Common Stock, $0.001 par value
                                (Title of class)

Check whether the issuer:  (1) filed all reports required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports);  and (2) has been
subject to such filing requirements for the past 90 days.

                                                         Yes  X    No
                                                             -----     ------

         Check if disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any amendment to
this Form 10-KSB. [ ]

     The  registrant's  revenues  for the fiscal  year ended June 30,  2005 were
$16,834,252

         The number of shares of the registrant's common stock, $.001 par value
per share, outstanding as of September 30, 2005 was 145,410,278. The aggregate
market value of the voting and non-voting common equity held by non-affiliates
of the registrant on September 30, 2005, based on the last sales price on the
OTC Bulletin Board as of such date, was approximately $13,086,925.

                       DOCUMENTS INCORPORATED BY REFERENCE

         None

         Transition Small Business Disclosure Format:   Yes         No    X
                                                           -------      -------
<PAGE>

                                TABLE OF CONTENTS
                                                                            Page

PART I

         ITEM 1.      DESCRIPTION OF BUSINESS..............................   4
         ITEM 2.      DESCRIPTION OF PROPERTY..............................   9
         ITEM 3.      LEGAL PROCEEDINGS....................................   9
         ITEM 4.      SUBMISSION OF MATTERS TO A VOTE OF
                      SECURITY HOLDERS.....................................  10

PART II

         ITEM 5.      MARKET FOR COMMON EQUITY.............................
                      RELATED STOCKHOLDER MATTERS AND
                      SMALL BUSINESS ISSUERS PURCHASE OF EQUITY SECURITIES.  10
         ITEM 6.      MANAGEMENT'S DISCUSSION AND ANALYSIS
                      OR PLAN OF OPERATION.................................  12
         ITEM 7.      FINANCIAL STATEMENTS.................................  20
         ITEM 8.      CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
                      ON ACCOUNTING AND FINANCIAL DISCLOSURE...............  20
         ITEM 8A.     CONTROLS AND PROCEDURES..............................  20
         ITEM 8B      OTHER INFORMATION....................................  21

PART III

         ITEM 9.      DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND
                      CONTROL PERSONS; COMPLIANCE WITH
                      SECTION 16(a) OF THE EXCHANGE ACT....................  21
         ITEM 10.     EXECUTIVE COMPENSATION...............................  23
         ITEM 11.     SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
                      OWNERS AND MANAGEMENT AND RELATED
                      STOCKHOLDER MATTERS..................................  25
         ITEM 12.     CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.......  25
         ITEM 13.     EXHIBITS.............................................  26
         ITEM 14      PRINCIPAL ACCOUNTANT FEES AND SERVICES...............  27

SIGNATURES.................................................................  28

                                       2

<PAGE>




                    Note Regarding Forward Looking Statements

This Annual Report on Form 10-KSB contains "forward-looking statements." These
forward-looking statements are based on our current expectations, assumptions,
estimates and projections about our business and our industry. Words such as
"believe," "anticipate," "expect," "intend," "plan," "may," and other similar
expressions identify forward-looking statements. In addition, any statements
that refer to expectations, projections or other characterizations of future
events or circumstances are forward-looking statements. These forward-looking
statements are subject to certain risks and uncertainties that could cause
actual results to differ materially from those reflected in the forward-looking
statements. Factors that might cause such a difference include, but are not
limited to, the following:

o     our lack of capital and whether or not we will be able to raise capital
      when we need it,

o     government regulation of the Internet and Internet services in China,

o     our ability to successfully compete in our markets and industries,

o     our ability to find suitable acquisition targets and, once acquired, to
      integrate these acquisitions into our business;

o     the loss of the services of our President, Chief Executive Officer and
      Chief Financial Officer, Mr. Andy Lin

o     adverse changes to the political, economic or social conditions in China

and other factors, some of which will be outside our control. You are cautioned
not to place undue reliance on these forward-looking statements, which relate
only to events as of the date on which the statements are made. We undertake no
obligation to publicly revise these forward-looking statements to reflect events
or circumstances that arise after the date hereof. You should refer to and
carefully review the information in future documents we file with the Securities
and Exchange Commission.

                       Information on Currency Translation

All amounts are in Renminbi ("Rmb") unless indicated to be in United States
Dollars ("$" or "US$"). Our sales are principally in Renminbi. The translation
of Renminbi amounts into US dollars are for reference purposes only and have
been made at the exchange rate of Rmb8.28 for US$1. The People's Bank of China
sets and publishes daily a base exchange rate with reference primarily to the
supply and demand of Renminbi against the United States dollar in the market
during the prior day. The People's Bank of China also takes into account other
factors such as the general conditions existing in the international foreign
exchange markets. Although Chinese governmental policies were introduced in 1996
to reduce restrictions on the convertibility of Renminbi into foreign currency
for current amount items, conversion of Renminbi into any other currency for
capital items, such as foreign direct investment, loans or security, requires
the approval of the State Administration for Foreign Exchange. Renminbi which
had been tightly pegged at Rmb8.28 for US$1 for the previous decade, was
revalued on July 21, 2005 to Rmb8.11 for US$1 following the removal of the peg
to the US dollar and pressure for the United States. The Peoples Bank of China
also announced that the Renminbi would be pegged to a basket of foreign
currencies, rather then being strictly tied to the US dollar and would trade
within a narrow 0.3% band against this basket of currencies, which is dominated
by the US dollar, Euro, Japanese Yen and South Korean Won, with a smaller
proportion made up of the British pound, Thai Baht and Russian Ruble. The
translation of Renminbi amounts in this Annual Report on Form 10-KSB is not a
representation that the Renminbi amounts could actually be converted into United
States dollars at that rate or at any other rate on that date or on any other
date.
                                       3


<PAGE>



                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS

History and Development of the Company

Intermost Corporation (as used in this Annual Report on Form 10-KSB, unless the
context otherwise requires, the terms "we," "us," "the Company," and "Intermost"
refer to Intermost Corporation and its subsidiaries) was incorporated as La Med
Tech, Inc. under the laws of the State of Utah on March 6, 1985. The Company
changed its name to Entertainment Concepts International in 1987, to Lord &
Lazarus, Inc. in 1988, and to Utility Communication International, Inc. in 1996.

From the date of incorporation through October 1998, the Company's operations
were limited to efforts to identify and acquire, or merge with, one or more
operating businesses. In October 1998, the Company acquired all of the issued
shares of Intermost Limited, a British Virgin Islands Company ("IML"), by
issuing to the then shareholders of IML a total of 4,970,000 shares of the
Company's common stock, par value $0.001 per share (the "Merger"). Following the
Merger, (i) IML became a wholly-owned subsidiary of the Company, (ii) the
shareholders of IML held 58.7% of all issued and outstanding shares of the
Company, (iii) the Company changed its name to Intermost Corporation, (iv) the
Company terminated all its prior business activities and adopted IML's business
plan, and (v) all officers and directors of the Company resigned and were
replaced by officers and directors of IML.

In February 2003, the Company redomiciled from the State of Utah to the State of
Wyoming.

IML was incorporated in January 1998 to develop a Chinese-language Internet
business portal and to render services in connection therewith in the People's
Republic of China ("China"). During the period following the Merger, the Company
entered into agreements with, and completed acquisitions of, various businesses
that provided or supported Internet services in an effort to implement this
business plan. The Company also endeavored to develop its own Internet services
businesses, including e-commerce business solutions. However, the global decline
in the demand for Internet services after mid-2000, which resulted in a
significant economic slowdown that affected many of the companies with whom we
do business, materially undermined the effectiveness of our efforts. While we
continued (and still continue) to offer web design and hosting services to
customers in China through our subsidiary, ChinaE.com Information Technology
Ltd. ("ChinaE"), we also began to look for ways to diversify or expand our
business.

In November 2002 ChinaE purchased eight licenses for HanWEB Publishing Server
3.0, an online real time translation engine that translates traditional Chinese
characters, used in most of the world, to simplified Chinese characters, which
are used only in China, and vice versa, and six licenses for HanVoice Web to
Phone Server 1.0, a real time Internet to telephone conversion server for
Cantonese, Putonghua and English. These were purchased from KanHan Technologies
Ltd. ("KanHan") at a cost of $150,000. The Company was one of two distributors
of these licenses in China.

With the assistance of KanHan, the Company opened an office in Guangzhou in
April 2003. The office was staffed with two persons who were responsible for
introducing these products to businesses and government agencies in Guangdong
Province. For a period of approximately one year, KanHan subsidized the costs
related to maintaining this office and developing a market for these products.
The amount of the subsidy was approximately $12,800 per month. The office was
closed in March 2004 and the Company is not longer receiving the subsidy,
although it continues to market the licenses.

In May, 2003, the Company's wholly owned subsidiary, IMOT Information Technology
(Shenzhen) Ltd. ("IMOT Technology"), received approval from the governments of
Shenzhen and Shanghai for its proposed acquisition of 51% of the issued and
outstanding shares of Shanghai Newray Photographic Equipment Co., Ltd.
("Shanghai Newray") from Shanghai Newray Business Development Co., Ltd.
("Shanghai Newray Business"), the owner of 75.5% of the issued and outstanding
capital stock of Shanghai Newray. Shanghai Newray is located in Shanghai and is
engaged in the sale of digital photographic equipment. Approval of the
governments of Shenzhen and Shanghai was required to complete the acquisition,
which was memorialized by a Shareholding Transfer Agreement entered into on May
23, 2003 between IMOT Technology and Shanghai Newray Business.

                                       4
<PAGE>

Pursuant to the Shareholding Transfer Agreement, IMOT Technology paid Shanghai
Newray Business Rmb200,000 (approximately $24,000) in cash to reimburse Shanghai
Newray Business for certain expenses related to the acquisition and agreed to
transfer to Shanghai Newray Business 4,000,000 shares of the Company's
restricted common stock. The cash used to reimburse Shanghai Newray Business for
its expenses was paid with the Company's funds.

On October 3, 2003 IMOT Technology entered into an agreement for the acquisition
of 25% of the issued and outstanding shares of Shanghai Fortune Venture Limited
("Shanghai Fortune") from certain shareholders of Shanghai Fortune. Shanghai
Fortune has the right to operate a property rights exchange in Shanghai, and
through its investment in Xi'an Assets and Equity Exchange, operate a property
rights exchange in Xi'an. In China, property rights, including intellectual
property rights, may be listed on and transferred through such exchanges. The
share transfer was approved by the government of Shanghai on April 12, 2004. The
consideration for this acquisition was Rmb600,000, approximately $72,464, in
cash plus 10 million shares of our common stock. The value of the common stock
was determined to be $0.24 per share, based upon the average of the closing
prices for the 10-day period from September 22, 2003 to October 1, 2003. The
shares were issued on April 14, 2004.

On August 10, 2004, all necessary government approvals were obtained to complete
the transfer of 51% of the issued and outstanding shares of Golden Anke
Technology Ltd. ("Golden Anke") from two of its shareholders, Tu Guoshen and Li
Zhiquan, to IMOT Technology. Pursuant to the Share Transfer Agreement signed on
March 31, 2004 among IMOT Technology, Intermost, Golden Anke, Tu Guoshen and Li
Zhiquan, the purchase price paid for the stock was $3.24 million. On August 10,
2004 we issued to the selling shareholders 12 million shares of our common
stock, in full payment of the purchase price. The value of our common stock was
determined by applying a 20% discount to the average closing price during the
period from January 20 to March 19, 2004. Golden Anke is a leading digital
security imaging system provider operating in China. Golden Anke offers a
variety of solutions in video surveillance, digital image processing and
compressing, Internet image transfer and imaging security systems.

In September 2, 2004, IML incorporated a 100% owned subsidiary, ChinaE.com
Technology (Shenzhen) Ltd. ("ChinaE Tech"), to take over the business of ChinaE
to provides and support Internet services including, but not limited to,
web-hosting, web design, domain name registration and software development.

On December 8, 2004, IMOT Technology entered into an agreement for the
acquisition of 15% of the issued and outstanding shares of Shenzhen
International Hi-Tech Exchange ("Hi-Tech Exchange") from Shenzhen Merchant
Technology Investment Co., Ltd. Hi-Tech Exchange is an enterprise authorized by
the PRC government to carry out business in the transfer of hi-tech property
rights and corporate equity interests. The share transfer was approved by the
government of Shenzhen on February 25, 2005. The consideration for this
acquisition was 2,470,355 shares of our common stock. The value of the common
stock was determined to be $0.22 per share based upon the average of the closing
prices for the period from October 18, 2004 to November 18, 2004. The share were
issued on February 28, 2005.

                                       5
<PAGE>

On January 6, 2005, all necessary government approvals were obtained to complete
the transfer of 80% of the issued and outstanding shares of Hainan Concord
Financial Products Development Co., Ltd. ("Hainan Concord") from Guangzhou Ditai
Communication Co., Ltd. and Zhai Xiya to IMOT Technology. Pursuant to the Share
Transfer Agreement signed on December 11, 2004 the purchase price paid for the
stock was $917,874. On January 12, 2005 we issued to the selling shareholders 5
million shares of our common stock, in full payment of the purchase price. The
value of our common stock was determined by applying a 15% discount to the
average closing price for the 10 days trading period from November 16, 2004 to
November 30, 2004. Hainan Concord's principle business is to issue and manage
multi-functional membership cards for the people who participate in private
equity exchange in Hainan. Hainan Concord also provide financial institutions
with research and development services for their financial products and
instruments.

Management is continuing efforts to identify and explore acquisition, merger and
development opportunities.

Products and Services

Internet Services

Through ChinaE Tech, our wholly-owned subsidiary, we offer web design, web
hosting, domain name registration, software development and office automation
software to our clients. We operate within what is commonly referred to as the
"business-to-business" segment of the Internet market, where products and
services are offered principally to businesses, as compared to the
"business-to-consumer" segment of the Internet services market, where products
and services are offered to consumers directly.

We locate web design and hosting customers and secure web design and hosting
projects primarily through the efforts of our sales team. We currently employ 10
sales persons for our Internet solution services. All of our sales team members
are based in Shenzhen, but occasionally travel throughout China, as necessary.
Our sales persons are paid a base salary, and earn commissions on revenues we
receive from the customers they secure.

Digital Imaging System

We sell digital photographic equipment and we provide value-added services (such
as software design and system integration) for such equipment, and LCD monitors
through our subsidiary. Shanghai Newray is also a wholesaler of various brands
of consumer digital photographic equipment, including traditional 35mm cameras,
digital cameras and camera accessories. During the 2005 fiscal year, we
successfully developed the market for sales of LCD monitors to the Shanghai
Railway Department for installation of LCD monitors on all the train in
Shanghai. One customers of Shanghai Newray accounted for approximately 85% of
our revenues.

Through Golden Anke, we have expanded our digital imaging services business to
include digital imaging security systems for offices, department stores and
shopping malls.

Both Shanghai Newray and Golden Anke sell their products through sales
representatives.

Property Rights Exchange

Property rights exchanges are platforms that permit privately-owned and
state-owned property rights transactions. Subject to the parameters established
by the government of China, property rights exchanges provide services for the
purchase and sale of equity rights, debts, intellectual property rights and
technology property rights. Property rights listed on the exchanges may be
traded through negotiation, auction and bids.

                                       6
<PAGE>

Our associated company, Shanghai Fortune is a registered member of Shanghai
Technology Exchange ("STE"). In December 2003 STE was merged into Shanghai
United Assets & Equity Exchange (SUAEE). SUAEE has continued STE's exchange
business and Shanghai Fortune is a registered member of SUAEE and will continue
to operate. Shanghai Fortune also owns a 33.75% interest in the Xi'an Assets and
Equity Exchange. Furthermore, Shanghai Fortune also offers consultancy services
related to property right transfers, including financial arrangements and advice
and assistance with business combinations. Shanghai Fortune finds prospective
clients principally through its team of project managers and through referrals
by its business network.

Our subsidiary, Hainan Concord's principle business is to issue and manage
multi-functional membership cards for the people who participate in private
equity exchange in Hainan, and has an exclusive agreement with Hainan Exchange
Centre Non-Public Company Registration Co., Ltd. to issue multi-functional
membership and credit cards to their members.

Through our 15% investment in Hi-Tech Exchange, we have further expended our
investment in Shenzhen, China, Hi-Tech Exchange is authorized by the government
of China to engage in the business of transferring property rights and corporate
equity interests in Shenzhen.

At this time the various property rights exchanges in China work, for the most
part, independently of one another. We believe that this is inefficient. We are
in the process of using our software technology to develop, and we hope to
eventually implement, an electronic information and trading platform for
property rights exchanges that will enable the flow of information regarding
rights transfers, as well as payments, among the different property rights
exchanges in China, including those owned and operated by Shanghai Fortune.

Trading

Shanghai Fortune is also engaged in the business of trading parts and components
for machines and equipment. Most of its products, including die castings,
bearings, drive motors, flywheels, and lift motors, are exported to the U.S.

Competition

Internet Services

The market for Internet services and software is intensely competitive and we
expect it to become more competitive in the future. Increased competition could
result in pricing pressures, low operating margins and the realization of little
or no market value. Currently, our competitors are primarily other Chinese owned
and operated Internet services and software development companies.

Most of our current and potential competitors may have longer operating
histories, larger customer bases, greater brand recognition and greater
financial, marketing and other resources than we do, and may enter into
strategic or commercial relationships on more favorable terms than we can. In
addition, new technologies and the expansion of existing technologies may
increase competitive pressure on us. We are not a significant presence, in the
Chinese market for Internet services.


                                       7
<PAGE>


Photographic Equipment

We also face substantial competition in the photographic equipment market. In
China, Shanghai Newray's photographic equipment, which is sold under the brand
name "Seagull" (English translation) represents one of the more prominent
competitors in the marketplace. However, the brand does not have significant
recognition outside of China. In the world market for both digital imaging
systems and consumer digital photographic equipment, manufacturers such as
Kodak, Minolta, Canon, Nikon and Pentax dominate, and most likely will continue
to dominate the market for several years due to their greater brand recognition
and greater financial, marketing and other resources. We anticipate that it will
take several years to increase awareness of the Seagull brand. However, we
believe that these products will eventually become accepted in the marketplace
outside China. We believe that we will be able to compete with the
well-established brands because we will be able to offer comparable equipment at
a lower price. Currently, however, we do not have a significant presence in the
market for digital photographic equipment outside China and we cannot guarantee
you that we will ever establish a significant presence or be able to compete
successfully in the world market.

Property Rights Exchange

There is no national property rights exchange in China. It has been estimated
that there are approximately 100 property rights exchanges in China, most of
them small in scale and serving only the local area. There are also a few large
property rights exchanges serving the largest cities in China, including the
Beijing Property Rights Exchange Center, the Tianjin Property Rights Exchange
Center and the Shanghai Property Rights Exchange Center. Even the operations of
the large property rights exchanges are localized.

Currently, because of the localized nature of property rights exchanges, there
is not significant competition among them. However, further development and
expansion of other large property rights exchanges, or the nationalization of
property rights exchanges, would be likely to result in an increase in
competition. If that were to happen, it could have a material adverse effect on
our ability to attract property owners to list their properties for sale on our
exchange and to identify and secure investors or buyers for the properties we
list.

Regulations

Since we operate principally through our subsidiaries in China, we are subject
to and affected by laws, regulations, administrative determinations, court
decisions and similar constraints that apply to business operations located in
China.

China has enacted regulations governing Internet connection and the distribution
of information via the Internet. Pursuant to Article 6 of the Revised
Provisional Regulations Governing the Management of Chinese Computer Information
Networks Connected to International Networks, individuals or entities operating
computer networks within China which are connected to the Internet and conduct
international information exchange must use the international access channels
provided by the Ministry of Information Industry ("MII") and obtain various
licenses and approvals. Our relevant subsidiaries have secured the necessary
licenses and approvals, and access the Internet through ChinaNet, an approved
channel of MII.

The operation of our property rights exchange will be largely dependant upon the
development of China's policies and laws relating to the transfer of private and
state-owned property rights. The transfer and management of state-owned property
rights are subject to the supervision of the Administrative Bureau of
State-owned Assets, whereas the property rights of privately-owned enterprises
must be transferred in compliance with the Company Law and related regulations.

                                       8
<PAGE>

According to the Provisional Procedures on the Administration of the Transfer of
State-owned Property Rights in Enterprises, all the transfers of state-owned
property rights must be carried out through duly authorized property rights
exchange centers. NSB and Xi'an Assets and Equity Exchange have secured the
necessary licenses and approvals for their operations and qualify to transfer
state-owned property rights.

We work diligently to assure compliance with all applicable regulations which
impact our business, including cooperating with the MII, the Ministry of Public
Security and the Administrative Bureau of State-owned Assets. There can be no
assurance, however, that additional regulations will not be enacted that might
adversely affect our operations.

Employees

As of June 30, 2005 we employed 56 full-time employees consisting of 1
management executive, 19 engineering and technical staff, 13 administrative and
clerical staff, and 23 sales persons. None of our employees are members of any
labor union, and we have never experienced any business interruption as a result
of any labor disputes. We do not provide any special benefit or incentive
programs for our employees. We believe that we enjoy good relations with all of
our employees.

ITEM 2.  DESCRIPTION OF PROPERTY

Our principal office consists of approximately 2,400 square feet of office space
that is located at 31st Floor, B31-23 Guomao Building, Renmin Rd. (South),
Shenzhen, China 518014. The premises are leased from an unrelated third party
with rental payments and management fees of approximately $17,000 per year. This
lease will expire in August 2007.

Our representative office in Hong Kong consists of approximately 500 square feet
of office space located at Suite 4703, Central Plaza, Hong Kong. The premises
are leased from an unrelated third party with rental payments, office facilities
and management fees of approximately $20,000 per year. There is no lease
agreement signed for the premises.

All of our office facilities are in good condition and we believe they are
adequate to support our operations for the foreseeable future.

ITEM 3.  LEGAL PROCEEDINGS

In June 2001, we filed a lawsuit in the Court of First Instance of High Court of
Hong Kong (the "Court") against J.R. Hi-Tech Investment Corporation ("J.R.
Hi-Tech") and its controlling shareholders, Mr. Xin Lei Wang and Mr. Yong Jiang,
(collectively, the "Defendants"). On October 24, 2000, we entered into a
Subscription Agreement with the Defendants, which provided among other things
for our subscription of 70,000 ordinary shares, par value $1 per share,
representing 58.3% of the post-closing issued and outstanding shares of J.R.
Hi-Tech in consideration of our payment of $176,470 in cash and our issuance of
510,300 shares of our common stock. J.R. Hi-Tech's principal asset is a 90%
interest in Shenzhen China Websecurity.com, a Chinese-foreign equity joint
venture, which engages in the provision of Internet security services, systems
integration and software development services. Despite the Defendants' failure
to deliver J.R. Hi-Tech ordinary shares to us as provided in the Subscription
Agreement, we delivered in January 2001 Rmb1,500,000 in cash to J.R. Hi-Tech
(but not our shares). In this lawsuit, we seek rescission of the Subscription
Agreement, recovery of the Rmb1,500,000, and additional damages and injunctive
relief. On June 22, 2001, the Court issued an order to freeze certain bank
accounts of the Defendants. On July 3, 2001, following a hearing, the Court
extended this order indefinitely. However, due to the uncertainty of any
recovery from J.R. Hi-Tech or the other two Defendants, in fiscal 2001, we have
written off the entire Rmb1,500,000 we paid to J.R. Hi-Tech. In June 8, 2005, we
sought settlement and recovered the court deposit of Rmb535,000 plus interest
income of Rmb27,184.

                                       9
<PAGE>

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

No matters were put before our shareholders for a vote during the last quarter
of our fiscal year.

                                     PART II

ITEM 5. MARKET FOR REGISTRANT'S  COMMON EQUITY AND RELATED  STOCKHOLDER  MATTERS
        AND SMALL BUSINESS ISSUERS PURCHASE OF EQUITY SECURITIES

Our common stock is quoted on the National Association of Securities Dealers,
Inc. Over-The-Counter Electronic Bulletin Board (the "OTC Bulletin Board"), and
is traded under the symbol "IMOT".

The following table represents the high and low bid prices for our common stock
on the OTC Bulletin Board for each quarter during the last two fiscal years.

                                                    High             Low


Fiscal 2004

              Quarter ended September 30, 2003      0.42             0.21
              Quarter ended December 31, 2003       0.50             0.20
              Quarter ended March 31, 2004          0.40             0.28
              Quarter ended June 30, 2004           0.34             0.28

Fiscal 2005

              Quarter ended September 30, 2004      0.34             0.20
              Quarter ended December 31, 2004       0.28             0.18
              Quarter ended March 31, 2005          0.34             0.19
              Quarter ended June 30, 2005           0.24             0.07



The above bid information was obtained from the "Finance" section of yahoo.com
and reflects inter-dealer prices, without retail mark-up, mark-down or
commission and may not represent actual transactions.

As of September 30, 2005, there were approximately 631 holders of record of the
Company's common stock. This number does not include an indeterminate number of
shareholders whose shares are held by brokers in street name.

We have never declared or paid any cash dividend on our common stock and do not
expect to declare or pay any cash dividend in the foreseeable future.

On March 12, 2004 we entered into an employment agreement with our President,
Mr. Andy Lin. The employment agreement was amended on October 5, 2004. Pursuant
to the amended employment agreement, the Board of Directors, in its discretion,
may grant to Mr. Lin an option to purchase 1,000,000 shares of our common stock
and an option to purchase an additional 1,000,000 shares of our common stock for
each year that he provides services pursuant to the employment agreement. The
exercise price of the option is to be computed by averaging the price of the
common stock for a period of five trading days prior to the last day of Mr.
Lin's service year or the date of the option grant. The option is to terminate
on the earlier of the following: (i) one year after the termination of Mr. Lin's
employment; or (ii) the seventh anniversary from the date of vesting of the
options, whichever is earlier. The Board of Directors has not granted any
options to Mr. Lin as of the date of this report.

                                       10
<PAGE>

During the fiscal year ended June 30, 2005, the Company issued common stock to
various parties. The following transactions have not been reported by the
Company in previous quarterly reports. The value of the common stock for each
issuance was based on one of the following: the market price of the shares on
the date of the transactions, the market price of the shares on the date the
negotiations between the parties began or on the fair value of services
received. The issuances were as follows:

On August 12, 2004, the Company issued 12,000,000 shares of common stock to the
designated shareholders of Tu Guoshen for the purchase of 51% of the issued and
outstanding shares of Golden Anke Technology Ltd. The value of the common stock
was determined to be $0.27 per share, for a total of $3,240,000. The stock was
issued in reliance on the exemption from registration provided by Section 4(2)
of the Ssecurities Act of 1933. There was no general solicitation by the Company
in making this offering and the offerees were all accredited investors.

On January 12, 2005, the Company issued 5,000,000 shares of common stock to Jin
Hua Qing and Zhai Xi Ya for the purchase of 80% of the issued and outstanding
shares of Hainan Concord Financial Products Development Co., Ltd. The value of
the common stock was determined to be $0.184 per share for a total of $920,000.
The stock was issued in reliance on the exemption from registration provided by
Section 4(2) of the Securities Act of 1933. There was no general solicitation by
the Company in making this offering and the offerees were both accredited
investors.

On February 28, 2005, the Company issued 2,470,355 shares of common stock to
Shenzhen Merchant Technology Investment Co., Ltd. for the purchase of 15% of the
issued and outstanding shares of Shenzhen International Hi-Tech Properties
Exchange Centre. The value of the common stock was determined to be $0.22 per
share, for a total of $543,478. The stock was issued in reliance on the
exemption from registration provided by Section 4(2) of the Securities Act of
1933. There was no general solicitation by the Company in making this offering
and the offerees were all accredited investors.

On February 28, 2005, the Company issued (i) 341,924 shares of common stock with
a value of $0.177 per share to Liang Jun in partial settlement of the
outstanding balance due him with a value of HK$502,320.96 ($64,400) (ii) 200,000
shares of common stock with value of $0.29 per share to Stanford Capital
International Limited for investment relations services rendered having a value
of $58,000 (iii) 35,000 shares of common stock with a value of $0.25 per share
to Wang Chong as compensation for legal services rendered to us having a value
of $8,750. All of these shares were issued in reliance on the exemption from
registration provided by Section 4(2) of the Securities Act 1933. There was no
general solicitation by the Company in making this offering and the offerees
were all accredited investors.

On May 2, 2005, the Company issued 723,878 shares of common stock with a value
of $0.11 per share to Pollet, Richardson & Patel for legal services already
rendered having a value of $79,626. The stock was issued in reliance on the
exemption from registration provided by Section 4(2) of the Securities Act of
1933. There was no general solicitation by the Company in making this offering
and the offeree was an accredited investor.

                                       11
<PAGE>

On June 6, 2005, the Company issued 160,909 shares of common stock with a value
of $0.11 per share to Robert Weingarten for professional services already
rendered having a value of $17,700. The stock was issued in reliance on the
exemption from registration provided by Section 4(2) of the Securities Act of
1933. There was no general solicitation by the Company in making this offering
and the offeree was an were accredited investor.

Equity Compensation Plan

On December 1, 2003 our Board of Directors adopted, and on January 28, 2004 our
stockholders approved, the Intermost Corporation 2003 Equity Incentive Plan. As
of June 30, 2005, no awards have been granted under the Plan.

                    Equity Compensation Plan Information (1)
<TABLE>
<S>                              <C>                         <C>                      <C>

------------------------------- ---------------------------- --------------------- ----------------------------
------------------------------- ---------------------------- --------------------- ----------------------------
                                Number of securities to be Weighted average
                                exercise Number of securities issued upon
                                exercise of price of outstanding remaining
                                available for outstanding options, options
                                warrants and rights future issuance under the
                                warrants and rights equity compensation plan
                                                                                   (excluding       securities
                                                                                   reflected in column (a)
Plan Category                               (a)                          (b)                   (c)
------------------------------- ---------------------------- --------------------- ----------------------------
------------------------------- ---------------------------- --------------------- ----------------------------

------------------------------- ---------------------------- --------------------- ----------------------------
------------------------------- ---------------------------- --------------------- ----------------------------
Shareholder Approved                         0                           N/A               20,000,000
------------------------------- ---------------------------- --------------------- ----------------------------
------------------------------- ---------------------------- --------------------- ----------------------------

------------------------------- ---------------------------- --------------------- ----------------------------
------------------------------- ---------------------------- --------------------- ----------------------------
Not Approved by Shareholders
                                            N/A                          N/A                   N/A
------------------------------- ---------------------------- --------------------- ----------------------------
</TABLE>

(1) Pursuant to the terms of the Intermost Corporation 2003 Equity Incentive
Plan, awards may be granted for options to purchase common stock, or for common
stock.

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

Critical Accounting Policies and Estimates

Management's discussion and analysis of results of operations and financial
condition is based upon the Company's consolidated financial statements. These
statements have been prepared in accordance with accounting principles generally
accepted in the United States of America. These principles require management to
make certain estimates, judgments and assumptions that affect the reported
amounts of assets, liabilities, revenues and expenses, and related disclosure of
contingent assets and liabilities. On an on-going basis, we evaluate our
estimates based on historical experience and various other assumptions that are
believed to be reasonable under the circumstances, the results of which form the
basis for making judgments about the carrying values of assets and liabilities
that are not readily apparent from other sources. Actual results may differ from
these estimates under different assumptions or conditions.

The following critical accounting policies rely upon assumptions, judgments and
estimates and were used in the preparation of the Company's consolidated
financial statements:

Revenue Recognition

Revenues are recognized (i) with respect to services, at the time a project (or
a milestone thereof) is completed and accepted by the customer, and (ii) with
respect to products, at the time products are delivered to customers and
collectibility for such sales is reasonably assured. We have adopted Staff
Accounting Bulletin No.101, Revenue Recognition ("SAB 101") in our financial
statements. SAB 101 provides in part further interpretive guidance for public
companies on the recognition, presentation, and disclosure of revenues in
financial statements. The adoption of SAB 101 did not have a material impact on
our revenue recognition practices.

                                       12
<PAGE>

Accounts Receivable

We typically extend credit to our customers. From time to time, e-commerce
solution services are provided under fixed-price contracts where the revenues
and the payment of related receivable balances are due upon the achievement of
certain milestones. Management estimates the probability of collection of the
receivable balances and provides an allowance for doubtful accounts based upon
its judgment in assessing the realization of these receivable balances taking
into account aging, historical experience, the customer's financial condition
and general economic conditions.

Long-lived assets and goodwill

The Company periodically evaluates the carrying value of long-lived assets held
or used whenever events and circumstances indicate that the carrying value of
the asset may no longer be recoverable. An impairment loss, measured on the fair
value of the asset, is recognized if expected future undiscounted cash flows are
less than the carrying value of the assets.

We evaluate goodwill, at a minimum, on an annual basis and whenever events and
changes in circumstances suggest that the carrying amount may not be recoverable
in accordance with SFAS No. 142 "Goodwill and Other Intangible Assets".
Impairment of goodwill is tested at the reporting unit level by comparing the
reporting unit's carrying amount, including goodwill, to the fair value of the
reporting unit. The fair values of the reporting units are estimated using
discounted cash flows approach. If the carrying amount of the reporting unit
exceeds its fair value, goodwill is considered impaired and a second step is
performed to measure the amount of impairment loss, if any.

Overview

We believe that the People's Republic of China represents an exciting emerging
world market whose role in the global economy is increasing steadily. China's
economic growth rate, measured by its gross domestic product, has consistently
been higher than 7% over the past 10 years. This economic growth is attributable
to many factors, including investment in the country's infrastructure, increased
privatization of businesses and an abundant source of labor. Currently, we offer
products and services to businesses and consumers located primarily in China.
Our plan is to take advantage of China's economic growth to expand our existing
businesses and, possibly, in the future, to sell our products and services
outside of China. We also have begun to acquire diverse businesses that are not
dependent on, or directly related to, each other. We believe that
diversification is a good hedge against the collapse of a single industry, such
as the global collapse of the technology industry that occurred in 2000. We
expect that any acquisitions we make will improve our financial condition,
although we cannot guarantee any such result.

Currently over half of our revenues are generated by two subsidiaries, Golden
Anke, which sells, and provides value-added services for, digital security
imaging system, and Shanghai Newray, which sells, and provides value-added
services for, digital photographic equipment. The balance of our revenues are
generated primarily by ChinaE and ChinaE Tech both of which distribute licenses
for Chinese language translation software and offers web design and hosting
services.

In response to the economic recovery, we began to aggressively expand our core
business by using our technical expertise to develop an electronic information
and trading platform for use by property rights exchanges in China. We also
began to diversify our business, so that we will no longer be dependent on one
market for revenue. Our plan for the future is to strengthen our core Internet
business, control our overall expenditures, enhance the effectiveness of our
operations and continue to expand by acquiring other profitable businesses.
During the past two years we have acquired a digital imaging system business, a
property rights exchange business and a security systems business. We are
planning to use our technological expertise to enhance the products and services
provided by these businesses. Generally, the issuance of our common stock
represents some or all of the purchase price we pay for an acquired business. We
believe that the continued active trading of our common stock will be important
to the principals of target companies and future acquisitions may be dependent
on the active trading of our common stock. However, our common stock has not
been actively traded and, if our common stock continues to trade with limited
volume and at current levels, we may not be able to make acquisitions as
planned.

                                       13
<PAGE>

Currently, we are experiencing an increase in revenue and generated a net profit
in fiscal 2005. We will continue to develop our business in the property rights
exchange industry by using our technical expertise to develop an electronic
platform for the trading of private property right exchanges in China. Through
our acquisition in the business in Shanghai, Xi'an, Hainan and Shenzhen, we have
enhanced our market presence in major property rights exchange centres in the
PRC, and after the new electronic trading platform is in operation, we will have
another source of revenue from the property rights exchange industry.

During the fiscal year ended June 30, 2005 we earned net income of $514,823.
However, we still have an accumulated deficit of $8,398,211. Our auditor, E.
Randall Gruber, CPA, PC, has issued a "going concern" opinion for our financial
statements at June 30 2005.


                                       14
<PAGE>

Results of Operations

The following is summary financial information reflecting our operations for the
periods indicated.
<TABLE>

                                                              Year Ended June 30,

                                                            2004                2005
                                                            ----                ----
         <S>                                           <C>               <C>

         Net revenues                                 $1,827,382         $16,834,252
         Cost of revenues                            (1,466,213)        (11,437,855)
         Gross profit                                    361,169           5,396,397
         Selling, general and administrative         (1,216,760)         (1,690,609)
         Amortization on intangible assets                     -           (504,293)
         Gain/(loss) on disposal of fixed assets           5,356             (6,795)
         Impairment of software license                 (31,250)                   -
         Loan Interest income                                  -                  13
         Investment income                                     -              27,130
         Profit/(loss) from operations                 (881,485)           3,221,843
         Share of profit of an associated
          Company                                        141,824             195,175
         Other income/(loss), net                          (493)              15,153
         Profit/(loss) before taxation                 (740,154)           3,432,171
         Taxation                                        (6,867)           (759,096)
         Profit/(loss) before minority interest        (747,021)           2,673,075
         Minority interests                             (63,710)         (2,131,252)
         Net profit/(loss)                            $(810,731)            $541,823

</TABLE>


Year Ended June 30, 2005 Compared to Year Ended June 30, 2004

Net revenues.

Net revenues for the year ended June 30, 2005 increased by $15,007,000, or 821%,
to $16,834,000 from $1,827,000 for the year ended June 30, 2004.

Net revenues during fiscal 2005 were derived principally from e-commerce
solutions, sales of photographic equipment, sales of digital security system and
consultancy fee income. Net revenues during fiscal 2004 were derived principally
from e-commerce solutions, sales of photographic equipment, sales of computer
software and a management fee that we collected from Kanhan for promoting its
software and helping it establish a presence in China. The term "e-commerce
solutions" includes web site design and development and web hosting.

The following table reflects the total net revenues and percentage of net
revenues by major category for the periods indicated:


                                       15
<PAGE>
<TABLE>


                                               Total Net Revenues         Percent of Total Net Revenues
                                              Year Ended June 30,              Year Ended June 30,
                                              2004          2005              2004           2005
                                              ----          ----              ----           ----
                                               US$           US$
<S>                                        <C>            <C>                <C>           <C>

E-commerce solutions
   - Web site design and development         342,869       225,897            18.76%        1.34%
Sales of computer software                     5,755             -             0.31%           -%
Sales of photographic equipment            1,373,438       924,618            75.16%        5.49%
Sales of digital security system                   -    15,682,832                 -       93.16%
Management fee income                        103,382             -             5.66%           -%
Consultancy fee income                         1,938           905             0.11%        0.01%
                                           ---------    ----------           -------     --------
     Total                                 1,827,382    16,834,252           100.00%      100.00%
                                           =========    ==========           =======     ========
</TABLE>

Total revenues derived from e-commerce solutions decreased by $117,000, or 34%,
to $226,000 in fiscal 2005 as compared to $343,000 in fiscal 2004. Sales of
photographic equipment decreased by $449,000, or 33%, to $925,000 in fiscal 2005
as compared to $1,373,000 in fiscal 2004. Sales of computer software decreased
by $6,000, or 100% to nil in fiscal 2005 as compared to $6,000 in fiscal 2004.
Management fee income decreased by $103,000, or 100%, to nil in fiscal 2005 as
compared to $103,000 in fiscal 2004. Sales of digital security system increased
by $15,683,000 in fiscal 2005 from 0 during the year ended June 30, 2004.

The increase in total net revenues and the character of those sales was
primarily attributable to management's decision to revise the Company's plan of
operation to develop our business beyond the market for Internet products and
services as well as the recovery of the economy of China.

We remain convinced that the Chinese Internet market will continue to develop,
outpacing the growth of other more mature Internet markets, and that our
presence in the market will allow us to capitalize on opportunities to sell
computer software products and web design and hosting services in China. We
believe that the expansion of the Chinese economy will continue, and that by
diversifying our business we will be able to better capitalize on this expansion
by being in different markets. Even though the businesses we have acquired are
diverse from our core business, we believe that our technological expertise can
be used to enhance the products and services that we now offer or that we will
offer in the future.

Costs of Revenues.

Costs of revenues consist principally of salaries for computer network
technicians, costs of photographic equipment, costs of digital security system,
depreciation, and other costs including travel, employee benefits, office
expenses and related expenses allocated to the engineering and technician staff.


                                       16
<PAGE>

The following table reflects the principal components of costs of revenues and
the percentage of net revenues represented by each component for the periods
indicated:
<TABLE>

                                  Total Cost of Revenues       Percent of Total Net Revenues
                                    Year Ended June 30,               Year Ended June 30,
                                   2004           2005               2004         2005
                                 ---------      --------           -------      -------
                                    US$           US$
<S>                             <C>            <C>                <C>           <C>

Engineers/technician salaries      102,638        84,308             5.62%        0.50%
Write-off of Kanhan product              -     (150,000)                -%       -0.89%
Cost of digital security system          -    10,623,112                -%       63.10%
Cost of photographic equipment   1,222,219       822,905            66.88%        4.89%
Cost of computer software            5,352             -             0.29%           -%
Depreciation                         3,797         4,881             0.21%        0.03%
Other                              132,207        52,649             7.23%        0.31%
                                ----------       -------         ---------     --------
     Total                       1,466,213    11,437,855            80.23%       67.94%
                                 =========    ==========          ========      =======
</TABLE>

Compared to the 2004 fiscal year, the total costs of revenues for the 2005
fiscal year increased by $9,972,000, or 680%, from $1,466,000. The increase in
costs of revenues, as compared to the last fiscal year, was principally
attributable to the increase in our sales of digital security systems. The
principal components of costs of revenues during the 2004 fiscal year were the
costs of hardware, photographic equipment and computer software, other costs
associated with support of the engineering and technician staff, engineer and
technician salaries, and depreciation of equipment utilized in connection with
services. The write-off of KanHan products of $150,000 represents the return of
the software license we purchased from KanHan in fiscal 2003.

Selling, General and Administrative Expense.

Selling, general and administrative expense ("SG&A") consists principally of (1)
sales commissions, advertising, trade show and seminar expenses, and
direct-field sales expense, (2) salaries for administrative and sales staff, (3)
corporate overhead, and (4) allowances for bad and doubtful accounts. The
following table reflects the principal components of SG&A and the percentage of
net revenues represented by each component for the periods indicated:
<TABLE>

                                           Total SG&A                Percent of Total Net Revenues
                                        Year Ended June 30,                Year Ended June 30,
                                       2004           2005                2004         2005
                                     --------       --------            --------     --------
                                        US$            US$
<S>                                  <C>           <C>                  <C>           <C>


Sales and marketing salaries and
     commissions                       81,624        105,471               4.47%        0.63%
Other sales and marketing             138,010         55,810               7.55%        0.33%
Rent obligation                        74,654         63,532               4.09%        0.38%
Administrative salaries               101,638        200,881               5.56%        1.19%
Corporate overhead                    820,834      1,144,142              44.92%        6.80%
Bad and doubtful debt for
   other receivables                       -         120,773                  -%       0.72%
                                  -----------     ----------           ---------    --------
     Total                          1,216,760      1,690,609              66.59%       10.05%
                                    =========      =========              ======     ========
</TABLE>


                                       17
<PAGE>

The principal components of SG&A during the 2005 fiscal year were sales and
marketing salaries and commissions, other marketing expenditures, administrative
salaries and benefits, bad debt expense and other corporate expenses, which
includes legal and professional fees, general office expenses, traveling
expenses, general employee benefit expense, depreciation and consultancy fees.

For the 2005 fiscal year, SG&A increased by $474,000, or 39%, to $1,691,000 as
compared to $1,217,000 for the 2004 fiscal year. Sales and marketing salaries
and commissions increased 29% during the 2005 fiscal year, to $105,000, as
compared to $82,000 for fiscal 2004. During the 2005 fiscal year, rent
obligations decreased by 11,000 or 15% to $64,000, as compared to $75,000 in the
2004 fiscal year. Rent obligations decreased due to the moving of our office in
PRC to a smaller office space. Administrative salaries increased by $99,000 or
98% to $201,000 during the 2005 fiscal year, as compared to $102,000 in the 2004
fiscal year. Other corporate expense increased during the 2005 fiscal year, by
$323,000 or 39% to $1,144,000, as compared to $821,000 in the 2004 fiscal year.
The increase in SG&A was principally attributable to a combination of (1)
corporate overhead including professional fees, consultancy fees, overseas
traveling and audit fees and (2) provision for a doubtful account for the
investment deposit Zenith Technology Ltd.

Minority Interest.

We reported a minority interest in our earnings of $2,131,000 for the 2005
fiscal year, reflecting the proportionate interest in the profits of Shanghai
Newray, Golelen Anke and Hainan Concord owned by other parties as compared to a
minority interest in our earnings of $64,000 for the 2004 fiscal year,
reflecting the ownership of third parties in Shanghai Newray.

Liquidity and Capital Resources

To date, we have funded our operations with cash from our operating activities,
sales of our securities and by using our common stock to make acquisitions and
purchases. As of June 30, 2005 we had cash and cash equivalents of $135,000 and
working capital of $4,883,000 as compared to $187,000,000 of cash and cash
equivalents and $409,000 of working capital at June 30, 2004.

Net cash used in operating activities totaled $1,627,000 during the 2005 fiscal
year as compared to $818,000 of cash in operating activities used during the
2004 fiscal year. Cash was used to pay liabilities, which increased due to our
expanded operations. Our use of cash was partially offset by non-cash charges,
including the use of our common stock (or the reservation of common stock to be
used) in exchange for services in the amount of $248,000, depreciation expense
in the amount of $26,000 and amortization of intangible assets in the amount of
$504,000.

Net cash provided by investing activities was $1,593K for the 2005 fiscal year
while net cash provided by investing activities was $7,000 for the 2004 fiscal
year. Funds provided by investing activities consisted of acquisition of
associated companies and subsidiaries and addition of office equipment.

Net cash used in financing activities was $18,000 for the 2005 fiscal year while
net cash provided by financing activities was $919,000 for the 2004 fiscal year.
Funds used in financing activity was cash repayment to director for amount due
during fiscal 2005.

We had no long term debt at June 30, 2005 or at June 30, 2004. Except as
otherwise described herein, we have no plans to make any major capital
expenditures during the next 12 months and we are not aware of any trends or
uncertainties that could affect sales of our products. We do not have any off
balance sheet arrangements.

                                       18
<PAGE>

We have implemented various cost management measures to reduce our overhead. We
are also evaluating various opportunities to accelerate the path to, and attain,
profitability. The investment in Shanghai Newray, and Golden Anke are the
beginning of our plan to invest in or acquire businesses that are not dependent
on the Internet market. The investment in Shanghai Fortune, Hainan Concord and
Hi-Tech Exchange are part of a plan to develop and expand our investment in
Property Rights Exchanges in the PRC. However, there can be no assurance that
the cash provided by our current operations will be sufficient to meet our cash
needs in the 2006 fiscal year. The Company will likely need to borrow money or
obtain additional equity financing in order to sustain operations. At present,
we have no commitments for funding and we cannot assure you that funding will be
available to us on acceptable terms, or at all. If we need financing and cannot
obtain it, we may be required to severely curtail, or even cease, our
operations.

On July 3, 2003 the Company's wholly-owned subsidiary, IMOT Technology, entered
into an agreement, subject to final approval from the governments of Shenzhen
and Hainan for its proposed acquisition of (i) 21% of the issued and outstanding
shares of Hainan Special Economic Zone Property Rights Exchange Center
("Exchange Center") from Hainan Concord Investment Holding Co., Ltd. and
Guangzhou Keensheng Science and Technology Development Co., Ltd., the owners of
100% of the issued and outstanding capital stock of Exchange Center
(collectively, the "Exchange Stockholders").

Exchange Center is the only institution in Hainan approved by the Hainan
Provincial Securities Commission to facilitate the trading of property rights,
including intellectual property rights. Exchange Center charges a transaction
fee of 0.3% on each trade. The Company, through IMOT Technology, intends to
continue and expand these operations in China.

Because final government approval of this transaction was not received by the
date required by the Stock Exchange Agreements, the Stock Exchange Agreements
were re-signed on December 16, 2003 to extend the date for receipt of government
approval. As at the date of this report, this transaction is still awaiting
government approval.

CERTAIN FACTORS AFFECTING FUTURE OPERATING RESULTS

Our operating results have been, and will continue to be, affected by a wide
variety of factors that could have a material adverse effect on revenues and
profitability during any particular period. Some of these factors include:

o        Our ability to successfully implement our business plan;

o        Whether or not we will be able to obtain the additional capital
         necessary to support our operations;

o        Whether or not we will find joint venture prospects or acquisition
         prospects with which to enhance our business;

o        Whether or not we can successfully integrate acquisitions that we make
         into our business;

o        The level and rate of acceptance of our products and services by the
         Chinese people;

o        Continued growth in the use of the Internet in China;

o        Entry of new competition (including established companies from outside
         China and companies with substantially greater resources) into our
         market;

                                       19
<PAGE>

o     Fluctuations in the level of orders for services delivered in a quarter;

o     Rescheduling or cancellation of orders by customers;

o     Competitive pressures on selling prices;

o     Changes in product, service or customer mix;

o     Rapid changes in technology, which result in our technology becoming
      obsolete;

o     Dependence upon certain key employees, in particular our President, Mr.
      Andy Lin;

o     Availability and cost of computer technicians;

o     Loss of any strategic relationships;

o     Loss of our largest customers;

o     Our ability to introduce new products and services on a timely basis;

o     New product and service introductions by our competitors;

o     Fluctuations in exchange rates, and

o Adverse changes in the general economic, social or political conditions in the
People's Republic of China.

Except as noted above, we are not aware of any trends, events or uncertainties
that have had, or are reasonably likely to have, a material impact on our
operations or our short-term or long-term liquidity.

ITEM 7.  FINANCIAL STATEMENTS

The financial statements, together with the registered independent auditors'
report thereon of E. Randall Gruber, CPA, PC appear beginning on page F-1 of
this report.

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

In May 2005, the Company's Board of Directors dismissed Grobstein Horwath &
Company LLP as the independent auditors for the Company and selected E. Randall
Gruber, CPA, PC to serve as its new registered independent auditor.

The report of Grobstein Horwath & Company LLP, on the financial statements of
the Company as of and for the years ended June 30, 2004 did not contain an
adverse opinion, or a disclaimer of opinion. However the report was qualified as
to the Company's ability to continue as a going concern. During the year ended
June 30, 2004, and the interim period from July 1, 2004 through the date of
dismissal of Grobstein Horwath & Company LLP, the Company did not have any
disagreements with Grobstein Horwath & Company LLP, on any matter of accounting
principles or practices, financial statement disclosure, or auditing scope or
procedure, which disagreements, if not resolved to the satisfaction of Grobstein
Horwath & Company LLP, would have caused it to make a reference to the subject
matter of the disagreements in connection with its reports.

                                       20
<PAGE>

Prior to engaging E. Randall Gruber, CPA, PC, the Company had not consulted E.
Randall Gruber, CPA, PC regarding the application of accounting principles to a
specified transaction, completed or proposed, or the type of audit opinion that
might be rendered on the Registrant's financial statements.

ITEM 8A  CONTROLS AND PROCEDURES

     Disclosure Controls and Procedures

     We maintain controls and procedures  designed to ensrue that we are able to
collect the  information we are required to disclose in the reports we file with
the SEC, and to record, process,  summarize and disclose this information within
the time periods  specified by the SEC. Based on an evaluation of our disclosure
controls  and  procedures  as of the end of the period  covered  by this  report
conducted by management,  with the  participation of the Chief Executive Officer
who is also our Chief  Financial  Officer  concluded  that  these  controls  and
procedures  are  effective  to  ensure  that  we are  able to  record,  process,
summarize  and report the  information  we are  required  to  disclosure  in the
reports we file with the SEC within the required time periods.

     Management's Annual Report on Internal Control over Financing Reporting

     Management  is  responsible  for  establishing  and  maintaining   adequate
internal  control  over  financing  reporting  as such term is  defined in Rules
13a-15(f) or 15d-15(f)  under the  Securities  Exchange Act of 1934, as amended.
Under the supervision and with the  participation  of management,  including the
Chief Executive and Chief Financing  Officers,  we assessed the effectiveness of
our internal control over financial  reporting as of June 30, 2005. We concluded
that our internal control over financial  reporting was effective as of June 30,
2005

         Changes in Internal Control Over Financing Reporting

         During the quarter ended June 30, 2005 there has been no charge in our
internal control over financial reporting that has materially affected, or is
reasonably likely to materially affect, our internal control over financial
reporting.

ITEM 8B  OTHER INFORMATION

On July 28, 2005 the Company completed a private placement of 1,028,278 shares
of its common stock under the exemption provisions of Regulation S to a private
party at US$0.05 per share, raising a total of US$51,414. The shares were issued
on September 12, 2005.

On September 7, 2005, the Company completed a private placement of 3,000,000
shares of its common stock under the exemption provision of Regulation S to a
private party at US$0.05 per share, raising a total of US$150,000. The shares
were issued on September 20, 2005.

On September 10, 2005, the Company completed a private placement of 40,000,000
shares of its common stock under the exemption provisions of Regulation S to
four parties at US$0.05 per share, raising a total of US$2,000,000. The shares
were issued on September 26, 2005.

The Company intends to use the proceeds for general working capital purpose.


                                       21
<PAGE>

                                    PART III

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

     Identification  of Directors,  Executive  Officers and Certain  Significant
     Employees

The following table sets forth certain information regarding the directors and
executive officers of the Company.

         Name              Age               Position

         Andy Lin          59       President, Chief Executive Officer, Chief
                                    Financial Controller and Director

         Shim Yang         47       Director

         Catalina Chan     54       Director


There are no family relationships among any of the directors or officers of the
Company.

None of our directors or executive officers has, during the past five years,

o        had any bankruptcy petition filed by or against any business of which
         such person was a general partner or executive officer, either at the
         time of the bankruptcy or within two years prior to that time,

o        been  convicted in a criminal  proceeding  and none of our  directors
         or executive  officers is subject to a pending  criminal proceeding,

o        been subject to any order, judgment, or decree not subsequently
         reversed, suspended or vacated of any court of competent jurisdiction,
         permanently or temporarily enjoining, barring, suspending or otherwise
         limiting his involvement in any type of business, securities, futures,
         commodities or banking activities, or

o        been found by a court of competent jurisdiction (in a civil action),
         the Securities and Exchange Commission or the Commodity Futures Trading
         Commission to have violated a federal or state securities or
         commodities law, and the judgment has not been reversed, suspended, or
         vacated.

Business Experience

Andy Lin has served as President, Chief Executive Officer and Chief Financial
Officer of the Company since June 2001 and as a director of the Company since
October 1998. Mr. Lin co-founded the Company's predecessor, IML, in January 1998
and served as Vice President of the Company from the Merger, in October 1998
until June 2001. Prior to forming IML, he was the Vice President of China
Business Resources from 1994 to 1998. Mr. Lin graduated from Tsinghua University
in 1970 with a Bachelor degree and from the Chinese Academy of Sciences in 1981
with a Master of Science degree in computer science.

                                       22
<PAGE>

Shim Yang joined the Company's predecessor, IML, as a director in January 1998
and was appointed a director of the Company following the Merger in October
1998. Since December 1997, Mr. Yang has been a Managing Director of Corporate
Finance International Ltd., a privately-held investment consulting and business
brokerage company in Hong Kong specializing in corporate finance and business
restructuring consulting, where he is responsible for corporate development and
strategic management. From January 1997 to December 1997, Mr. Yang served as
Managing Director of CEC (HK) Ltd., a privately-held company in Hong Kong
specializing in securing financing for start-up Internet companies in Hong Kong
and China. From 1993 to 1996, Mr. Yang served as Managing Director of Eagle Gain
Ltd., a privately-held company in Hong Kong specializing in securing financing
for real estate development in China. Mr. Yang received a Bachelors degree in
Economics from the University of Foreign Trade in China in 1982.

Catalina Chan has served as a director of the Company since April 2002. Ms.
Chan. first established Multi M Company Limited in 1984 and it was one of the
first companies to introduce Casio Products into China and is responsible for
the trading and logistic management of these products in China. She has over 18
years of experience in Chinese trade for digital products including cameras,
watches, personal computers and printers, software and accessories.

Term of Office

All directors named above will serve until the next annual meeting of the
Company's shareholders. Officers will hold their positions at the pleasure of
the Board of Directors, absent any employment agreement.

Compliance With Section 16(a) of Exchange Act

Section 16(a) of the Securities Exchange Act requires our directors, executive
officers and persons who own more than 10% of our common stock to file reports
of ownership and changes in ownership of our common stock with the Securities
and Exchange Commission. Directors, executive officers and persons who own more
than 10% of our common stock are required by Securities and Exchange Commission
regulations to furnish to us copies of all Section 16(a) forms they file.

The Company believes that, with respect to its fiscal year ended June 30, 2005,
none of the Company's directors and officers and none of the persons known to
the Company to own more than 10% of the Company's common stock, were required to
file beneficial ownership reports with the Securities and Exchange Commission
and no such reports were filed.

ITEM 10. EXECUTIVE COMPENSATION

For the 2005 fiscal year, all executive officers received their salaries from
the Company and no bonus was paid to any executive officer. Executive officers
include our current Chief Executive Officer and President, Andy Lin, and Kam Fai
Sun, our former Finance Manager.

The following table sets forth information concerning cash and non-cash
compensation paid or accrued to our executive officers during the past three
fiscal years:


                                       23
<PAGE>
<TABLE>

                                                                       LONG TERM COMPENSATION
                                 ANNUAL COMPENSATION                    AWARDS                                  PAYOUTS

                                                          Other          Restricted                           All Other
                                                           Annual        Stock       Securities      LTIP     Compen-sation
Name and Principal              Salary          Bonus     Compensation   Awards      Underlying      Payout      ($)
Position                Year         ($)          ($)          ($)          ($)      Options/SARs      ($)
<S>                    <C>       <C>             <C>       <C>           <C>         <C>             <C>       <C>

                                                                 -

                        2005        89,743         0            0            0             0            0         0
Andy Lin,               2004        81,196         0            0            0             0            0         0
CEO and                 2003      128,205(3)       0            0            0             0            0         0
President(1)

                        2005          0            0            0            0             0            0         0
Kam Fai Sun             2004          0            0            0            0             0            0         0
Finance Manager (2)     2003      102,564(4)       0            0            0             0            0         0
</TABLE>


(1) Mr. Lin was appointed as Chief Executive Officer and President of the
Company in June 2001. Previously, Mr. Lin served as Vice President of the
Company.
 (2) Mr. Sun's employment with the Company began on March 25, 2002 and
terminated on February 28, 2003. Mr. Sun continues to perform consulting
services for the Company. (3) Of this amount, $76,923 was paid in cash and the
balance, totaling $51,282, was paid by issuing to Mr. Lin 1,709,400 shares of
the Company's common stock having a value of $0.03 a share.
(4) Of this amount, $51,282 was paid in cash and the balance, totaling $51,282,
was paid by issuing to Mr. Sun 1,709,400 shares of the Company's common stock
having a value of $0.03 a share.

Director's Compensation

None of our directors received any compensation for his or her service as a
director in the 2005 fiscal year.

The Company reimburses its directors for out-of-pocket expenses incurred on
behalf of the Company.

On September 10, 2005, the Board of directors approved a plan to compensate the
directors with common stock for their services provided to the Company. Pursuant
to this plan, the following shares were issued.

      Andy Lin 1,000,000 shares of common stock
      Shim Yang 400,000 shares of common stock
      Catalina Chan 300,000 shares of common stock

Other Compensation and Employment Arrangements

On March 12, 2004 we entered into an Employment Agreement with Andy Lin, our
Chief Executive Officer and President. The effective date of the Employment
Agreement is March 1, 2004. The term of the Employment Agreement is three years,
and it may be automatically renewed. As compensation for his services, Mr. Lin
will receive an annual salary of HK$700,000 (US$89,744). The Board of Directors
may, in its discretion, grant an annual bonus to Mr. Lin. Pursuant to an
amendment to the Employment Agreement that was entered into on October 5, 2004,
the Board of Directors may also, in its discretion, grant options to Mr. Lin to
purchase shares of our common stock. If any option is granted, the exercise
price of the option is to be computed as the average of the closing price of the
common stock for the five trading days prior to the date of grant or the average
of the closing price of the common stock for the five trading days immediately
preceding the last day of the Executive's service year.

The Company has adopted and the stockholders have approved the Intermost
Corporation 2003 Equity Incentive Plan. The following discussion is qualified in
its entirety by the terms and provisions of the Plan.

                                       24
<PAGE>

The Plan authorizes awards of options, awards of stock ("Stock Award") and the
granting of bonus stock ("Stock Bonus"). Persons eligible to receive awards
under the Plan include the Company's employees, officers and directors and its
consultants, independent contractors and advisors. As of June 30, 2005, all of
the Company's employees, officers and directors were eligible to receive awards
under the Plan. The number of persons covered by the Plan may increase if we add
additional employees (including officers) and directors. As of the date of this
Annual Report, no awards have been granted from the Plan.

The Company's Board of Directors administers the Plan. For purposes of this
discussion, the body administering the Plan will be referred to as the
Administrator. The Administrator has the authority to determine, at its
discretion, the number and type of awards that will be granted, the recipients
of the awards, any exercise or purchase price required to be paid, when options
may be exercised and the term of option grants. Awards under the Plan are not
defined as to any group. The term of the Plan is 10 years from the date the Plan
was adopted by the Board of Directors. We have reserved 20,000,000 shares of our
common stock for awards to be made under the Plan.

The exercise price for stock options granted to officers and directors must be
the fair market value of the common stock on the date of grant. The exercise
price for stock options granted to eligible persons other than officers and
directors may not be less than 85% of the fair market value of the common stock
on the date of grant. The term of an option may not exceed 10 years.

A Stock Award is an offer by the Company to sell to an eligible person shares of
common stock that may or may not be subject to restrictions. Stock Awards
granted to officers and directors must be granted at the fair market value of
the common stock on the date of the award. Stock Awards granted to eligible
persons who are not officers or directors may not be granted at less than 85% of
the fair market value of the common stock on the date of the award. Stock Awards
may be subject to vesting conditions, as determined by the Administrator.

A Stock Bonus is a grant of shares that may be awarded to an eligible person. A
Stock Bonus may be subject to vesting conditions, as determined by the
Administrator. A Stock Bonus may be awarded for any reason determined by the
Administrator, including, but not limited to, extraordinary services rendered to
the Company by an eligible person, as an award for performance achieved by the
Company or upon satisfaction of performance goals by the eligible person.

In the United States, a recipient will not recognize any taxable income at the
time an option is granted. However, upon exercise of an option, the recipient
will include in income as compensation an amount equal to the difference between
the fair market value of the shares on the date of exercise and the recipient's
exercise price. The included amount will be treated as ordinary income by the
recipient and may be subject to withholding. Upon resale of the shares by the
recipient, any subsequent appreciation or depreciation in the value of the
shares will be treated as capital gain or loss. There is no tax consequence to
the Company as a result of either the grant or the vesting of stock options.

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

Common Stock

         The following table is furnished as of September 30, 2005, to indicate
beneficial ownership of shares of the Company's common stock by (1) each
shareholder of the Company who is known by the Company to be a beneficial owner
of more than 5% of the Company's common stock, (2) each director and named
officer of the Company, individually, and (3) all officers and directors of the
Company as a group.

                                       25
<PAGE>


         Name and Address of                   Number of Shares
         Beneficial Owner (1)                  Beneficially Owned       Percent

     Allied Point Limited (3)..............       3,418,653   (2)       2.35%
     Jun Liang (3).........................       3,418,653   (2)       2.35%
     Andy Lin (3)..........................       3,418,653   (2)       2.35%
     Andy Lin .............................       5,922,801   (5)       4.07%
     Shim Yang.............................         750,000                *%
     Catalina Chan (4).....................       1,300,000                *%
     Grand Grade International Ltd (4).....       1,000,000                *%
     Alfredo Properties Limited ...........      20,000,000            13.75%
     Tu Guoshen ...........................       8,830,000             6.07%
                                                  ---------             -----

     Beneficial owner of more than 5% of
     common stock and all officers and directors
     as a group (3 persons)                      40,221,454            27.66%
                                                 ==========            ======

*        Less than 1%.
(1)      Unless  otherwise  noted,  each person or group  identified  possesses
         sole voting and  investment  power with respect to the
         shares shown opposite the name of each person or group.
(2)      Allied Point Limited is a corporation organized under the laws of the
         British Virgin Islands and is owned 50% by Jun Liang and 50% by Andy
         Lin. Therefore, Mr. Liang and Mr. Lin are deemed to be the beneficial
         owners of those shares.
(3)      Address is 31st Floor, B31-23 Guomao Building, Renmin Rd.(South),
         Shenzhen, China 518014.
(4)      Catalina Chan is director and shareholder of Grand Grade  International
         Ltd. and may be deemed to be the beneficial  owner of the share held by
         Grand Grade International Ltd.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

During the years ended June 30, 2004 and 2005, Jun Liang, a director until
February 2003, and Andy Lin, an officer, director and principal shareholder of
the Company, advanced funds to the Company on an unsecured, non-interest bearing
basis without pre-determined repayment terms. At June 30, 2004, the net balances
owed to Mr. Liang and Mr. Lin were $90,759 and $17,909, respectively. At June
30, 2005, the net balances owed to Mr. Liang was $25,845.

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

(a)      Exhibits

Exhibit
Number   Description of Exhibit
-------------- -----------------------------------------------------------------
2.1            Articles of Merger *
-------------- -----------------------------------------------------------------
-------------- -----------------------------------------------------------------
3.1            Articles of Incorporation *
-------------- -----------------------------------------------------------------
-------------- -----------------------------------------------------------------
3.2            Bylaws *
-------------- -----------------------------------------------------------------
-------------- -----------------------------------------------------------------
10.1           Employment Agreement, dated March 12, 2004, between Intermost
               Corporation and Andy Lin (2)
-------------- -----------------------------------------------------------------
-------------- -----------------------------------------------------------------
10.2           Amendment to Employment Agreement dated March 12, 2004 between
               Intermost Corporation and Andy Lin*
-------------- -----------------------------------------------------------------
-------------- -----------------------------------------------------------------
10.3           Cooperative Agreement re:formation of Jiayin E-Commerce joint
               venture (1)

                                       26
<PAGE>

-------------- -----------------------------------------------------------------
-------------- -----------------------------------------------------------------
10.4           Agreement Regarding Transfer of Properties on 38th Floor, Guomao
               Building (3)
-------------- -----------------------------------------------------------------
-------------- -----------------------------------------------------------------
10.5           Shareholding  Transfer  Agreement dated May 23, 2003 between IMOT
               Information  Technology  (Shenzhen) Ltd. and Shanghai Newray
               Business Development Co., Ltd. (4)
-------------- -----------------------------------------------------------------
-------------- -----------------------------------------------------------------
10.6           Share Transfer  Agreement among IMOT  Information  Technology
               (Shenzhen)  Ltd.,  Shenzhen Golden Anke Technology Co. Ltd.,
               Intermost Corporation, Tu Guoshen and Li Zhiquan (5)
-------------- -----------------------------------------------------------------
-------------- -----------------------------------------------------------------
10.7           Sale and Purchase  Agreement among IMOT  Information  Technology
               (Shenzhen)  Ltd.,  Shanghai  Fortune Venture  Limited,  North
               Shanghai  Branch of Shanghai  Technology  Property Right Exchange
               Center and Intermost Corporation (6)
-------------- -----------------------------------------------------------------
-------------- -----------------------------------------------------------------
10.8           Distributorship  Agreement dated November 28, 2002 between KanHan
               Technologies  Limited and ChinaE.com Information Technology Ltd.
               (7)
-------------- -----------------------------------------------------------------
-------------- -----------------------------------------------------------------
10.9           Intermost Corporation 2003 Equity Incentive Plan (8)
-------------- -----------------------------------------------------------------
-------------- -----------------------------------------------------------------
16.1           Letter on Change in Certifying Accountant (9)
-------------- -----------------------------------------------------------------
-------------- -----------------------------------------------------------------
21.1           Significant Subsidiaries *
-------------- -----------------------------------------------------------------
-------------- -----------------------------------------------------------------
31.1           Certification of Chief Executive Officer Pursuant to Rule 13a-14
               (a) and 15d-14(a) *
-------------- -----------------------------------------------------------------
-------------- -----------------------------------------------------------------
32.1           Certification  Pursuant  to 18  U.S.C.  Section  1350,  as
               adopted  pursuant  to  Section  906 of the Sarbanes-Oxley Act of
               2002 *
-------------- -----------------------------------------------------------------
*Filed herewith.

(1)  Incorporated by reference to the respective exhibits filed with
     Registrant's Registration Statement on Form 10-SB (Commission File No.
     0-30430).
(2)  Incorporated by reference to the exhibit filed with the Registrant's
     Current Report on Form 8-K filed with the SEC on March 25, 2004.
(3)  Incorporated by reference to the respective exhibits filed with the
     Registrant's Quarterly Report on Form 10-QSB for the quarter ended March
     31, 2000.
(4)  Incorporated by reference to the exhibit filed with the Registrant's
     Current Report on Form 8-K filed with the SEC on June 9, 2003.
(5)  Incorporated by reference to the exhibit filed with the Registrant's
     Current Report on Form 8-K filed with the SEC on August 17, 2004.
(6)  Incorporated by reference to the exhibit filed with the Registrant's
     Current Report on Form 8-K filed with the SEC on April 26, 2004.
(7)  Incorporated by reference to the exhibit filed with the Registrant's
     Current Report on Form 8-K filed with the SEC on February 14, 2003.
(8)  Incorporated by reference to the exhibit filed with the Registrant's Proxy
     Statement filed with the SEC on January 6, 2004. (9) Incorporated by
     reference to the exhibit filed with the Registrant's Current Report on Form
     8-K filed with the SEC on March 8,
     2004.


ITEM 14.  PRINCIPAL ACCOUNTANT FEES AND SERVICES

The following table sets forth fees billed to us by our auditors during the
fiscal years ended June 30, 2004 and June 30, 2005 for: (i) services rendered
for the audit of our annual financial statements and the review of our quarterly
financial statements, (ii) services by our auditor that are reasonably related
to the performance of the audit or review of our financial statements and that
are not reported as Audit Fees, (iii) services rendered in connection with tax
compliance, tax advice and tax planning, and (iv) all other fees for services
rendered.


                                  June 30, 2005       June 30, 2004
                                  -------------       -------------

(i)    Audit Fees                $   233,800        $    196,000
(ii)   Audit Related Fees        $    10,256               $  --
(iii)  Tax Fees                     $     --              $6,500
(iv)   All Other Fees                $    --           $      --



                                       27
<PAGE>

                                   SIGNATURES

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


                                         INTERMOST CORPORATION



                                      By:/s/ Andy Lin
                                         --------------------------------------
                                         Andy Lin
                                         President, Chief Executive Officer
                                         and Chief Financial Officer
Dated:   October 13, 2005

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



    Signature                Title                                     Date



/s/ Andy Lin              President, Chief Executive Officer,   October 13, 2005
------------------------- Chief Financial Officer and Director
Andy Lin



/s/ Shim Yang             Director                              October 13, 2005
-------------------------
Shim Yang



/s/ Catalina Chan         Director                              October 13, 2005
------------------
Catalina Chan


                                       28
<PAGE>

                                                                    Exhibit 21
                        LIST OF SIGNIFICANT SUBSIDIARIES

Name of Subsidiary                                  Jurisdiction of Organization

Chinae.com Information Technology Ltd.                                     China
IMOT Information Technology (Shenzhen) Ltd                                 China
Shanghai Newray Photographic Equipment Co. Ltd.                            China
Golden Anke Technology Ltd
China
Hainan Concord Financial Products Development Co., Ltd.                    China
ChinaE.com Technology (Shenzhen) Ltd.                                      China



                                       29
<PAGE>

                                                                     Exhibit 31

        CERTIFICATION OF CHIEF EXECUTIVE OFFICER/CHIEF FINANCIAL OFFICER
                       PURSUANT TO RULES 13a-14 AND 15d-14
                     OF THE SECURITIES EXCHANGE ACT OF 1934

I, Andy Lin, Chief Executive Officer and Chief Financial Officer of Intermost
Corporation (the "Company"), certify that:

         I have reviewed this Annual Report on Form 10-KSB of Intermost
Corporation.

         Based on my knowledge, this Annual Report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this Annual
Report.

         Based on my knowledge, the financial statements, and other financial
information included in the report, fairly present in all material respects the
financial condition, results of operations and cash flows of the Company as of,
and for, the periods, presented in the report.

         I am responsible for establishing and maintaining disclosure controls
and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the
Company and have:

(a)              designed such disclosure controls and procedures, or caused
                 such disclosure controls and procedures to be designed under
                 our supervision, to ensure that material information relating
                 to the Company, including its consolidated subsidiaries, is
                 made known to me by others within those entities, particularly
                 during the period in which the periodic report is being
                 prepared;

(b)              evaluated the effectiveness of the Company's disclosure
                 controls and procedures and presented in this report our
                 conclusions about the effectiveness of the disclosure controls
                 and procedures, as of the end of the period covered by this
                 Annual Report based on such evaluation; and

(c)              disclosed in this Annual Report any change in the Company's
                 internal control over financial reporting that occurred during
                 the Company's most recent fiscal quarter that has materially
                 affected, or is reasonably likely to materially affect, the
                 Company's internal control over financial reporting; and

         I have disclosed, based on our most recent evaluation of internal
control over financial reporting, to the Company's auditors and to the audit
committee of the board of directors (or persons fulfilling the equivalent
function): (i) all significant deficiencies in the design or operation of
internal control over financial reporting which are reasonably
                 likely to adversely affect the Company's ability to record,
process, summarize and report financial information; and

            (ii) any fraud, whether or not material, that involves management or
                 other employees who have a significant role in the Company's
                 internal control over financial reporting.



                                       30
<PAGE>


Dated:  October 13, 2005



/s/ Andy Lin
Andy Lin
Chief Executive Officer and Chief Financial Officer

                                       31
<PAGE>



                                                                     Exhibit 32

                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Intermost Corporation (the "Company") on
Form 10-KSB for the period ending June 30, 2005, as filed with the Securities
and Exchange Commission on the date hereof (the "Report"), I, Andy Lin, Chief
Executive Officer and Chief Financial Officer of the Company, certify, pursuant
to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that:

     (1) The Report  fully  complies  with the  requirements  of section 3(a) or
15(d) of the Securities and Exchange Act of 1934; and

     (2)  The  information  contained  in the  Report  fairly  presents,  in all
material  respects,  the  financial  condition  and results of operations of the
Company.



                                            /s/ Andy Lin
                                            Andy Lin
               Chief Executive Officer and Chief Financial Officer
                                            October 13, 2005



                                       32
<PAGE>

                                                                   Exhibit 14

                       CODE OF BUSINESS CONDUCT AND ETHICS
           (as approved by the Board of Directors on October 1, 2004)


THIS CODE APPLIES TO EVERY DIRECTOR, OFFICER (INCLUDING THE CHIEF EXECUTIVE
OFFICER, PRESIDENT AND CHIEF FINANCIAL OFFICER), AND EMPLOYEE OF INTERMOST
CORPORATION (THE "COMPANY").

To further the Company's fundamental principles of honesty, loyalty, fairness
and forthrightness, the Board of Directors of the Company (the "Board:") has
established and adopted this Code of Business Conduct and Ethics (this "Code").

This Code strives to deter wrongdoing and promote the following six objectives:

o        honest and ethical conduct;

o        avoidance of conflicts of interest;

o        full, fair, accurate, timely and transparent disclosure;

o        compliance with applicable government and self-regulatory organization
         laws, rules and regulations;

o        prompt internal reporting of Code violations; and

o        accountability for compliance with the Code.

Below, we discuss situations that require application of our fundamental
principles and promotion of our objectives. If you believe there is a conflict
between this Code and a specific procedure, please consult the Company's Board
of Directors for guidance. Each of our directors, officers and employees is
expected to:

o      understand the requirements of your position, including Company
       expectations and governmental rules and regulations that apply to your
       position;

o        comply with this Code and all applicable laws, rules and regulations;

o        report any violation of this Code of which you become aware; and

o        be accountable for complying with this Code.

<PAGE>





TABLE OF CONTENTS
==========================================================================

ETHICS ADMINISTRATOR......................................................36
--------------------
ACCOUNTING POLICIES.......................................................36
-------------------
AMENDMENTS AND MODIFICATIONS OF THIS CODE.................................36
-----------------------------------------
ANTI-BOYCOTT AND U.S. SANCTIONS LAWS......................................
------------------------------------
BRIBERY...................................................................37
-------
COMPLIANCE WITH LAWS, RULES AND REGULATIONS...............................37
-------------------------------------------
COMPUTER AND INFORMATION SYSTEMS..........................................37
--------------------------------

CORPORATE OPPORTUNITIES AND USE AND PROTECTION OF COMPANY ASSETS..........38
----------------------------------------------------------------
DISCIPLINE FOR NONCOMPLIANCE WITH THIS CODE...............................38
-------------------------------------------
DISCLOSURE POLICIES AND CONTROLS..........................................38
--------------------------------
ENVIRONMENT, HEALTH AND SAFETY............................................38
------------------------------
FILING OF GOVERNMENT REPORTS..............................................39
----------------------------
FOREIGN CORRUPT PRACTICES ACT.............................................39
-----------------------------
INSIDER TRADING OR TIPPING................................................39
--------------------------
INVESTOR RELATIONS AND PUBLIC AFFAIRS.....................................40
-------------------------------------
RECORD RETENTION..........................................................40
----------------
REPORTING VIOLATIONS OF THIS CODE.........................................40
---------------------------------
WAIVERS...................................................................42
-------
CONCLUSION................................................................42
----------


                              ETHICS ADMINISTRATOR

All matters concerning this Code shall be heard by the Board of Directors.

                               ACCOUNTING POLICIES

The Company will make and keep books, records and accounts, which in reasonable
detail accurately and fairly present the Company's transactions.

All directors, officers, employees and other persons are prohibited from
directly or indirectly falsifying or causing to be false or misleading any
financial or accounting book, record or account. You and others are expressly
prohibited from directly or indirectly manipulating an audit, and from
destroying or tampering with any record, document or tangible object with the
intent to obstruct a pending or contemplated audit, review or federal
investigation. The commission of, or participation in, one of these prohibited
activities or other illegal conduct will subject you to federal penalties, as
well as to punishment, up to and including termination of employment.

No director, officer or employee of the Company may directly or indirectly make
or cause to be made a materially false or misleading statement, or omit to
state, or cause another person to omit to state, any material fact necessary to
make statements made not misleading, in connection with the audit of financial
statements by independent accountants, the preparation of any required reports
whether by independent or internal accountants, or any other work which involves
or relates to the filing of a document with the Securities and Exchange
Commission ("SEC").

                    AMENDMENTS AND MODIFICATIONS OF THIS CODE

There shall be no amendment or modification to this Code except upon approval by
the Board of Directors.

In case of any amendment or modification of this Code that applies to an officer
or director of the Company, the amendment or modification shall be posted on the
Company's website within two days of the board vote or shall be otherwise
disclosed as required by applicable law or the rules of any stock exchange or
market on which the Company's securities are listed for trading. Notice posted
on the website shall remain there for a period of twelve months and shall be
retained in the Company's files as required by law.

                                       33
<PAGE>

                                     BRIBERY

You are strictly forbidden from offering, promising or giving money, gifts,
loans, rewards, favors or anything of value to any governmental official,
employee, agent or other intermediary (either inside or outside the United
States) which is prohibited by law. Those paying a bribe may subject the Company
and themselves to civil and criminal penalties. When dealing with government
customers or officials, no improper payments will be tolerated. If you receive
any offer of money or gifts that is intended to influence a business decision,
it should be reported to your supervisor our CEO or the chairman of the Board of
Directors immediately.

The Company prohibits improper payments in all of its activities, whether these
activities are with governments or in the private sector.

                   COMPLIANCE WITH LAWS, RULES AND REGULATIONS

The Company's goal and intention is to comply with the laws, rules and
regulations by which we are governed. In fact, we strive to comply not only with
requirements of the law but also with recognized compliance practices. All
illegal activities or illegal conduct are prohibited whether or not they are
specifically set forth in this Code.
Where law does not govern a situation or where the law is unclear or
conflicting, you should discuss the situation with your supervisor, our CEO or
the chairman of the Board of Directors, who may then direct you to our legal
counsel. Business should always be conducted in a fair and forthright manner.
Directors, officers and employees are expected to act according to high ethical
standards.

                        COMPUTER AND INFORMATION SYSTEMS

For business purposes, officers and employees are provided telephones and
computer workstations and software, including network access to computing
systems such as the Internet and e-mail, to improve personal productivity and to
efficiently manage proprietary information in a secure and reliable manner. You
must obtain the permission from your supervisor or our CEO to install any
software on any Company computer or connect any personal laptop to the Company
network. As with other equipment and assets of the Company, we are each
responsible for the appropriate use of these assets. Except for limited personal
use of the Company's telephones and computer/e-mail, such equipment may be used
only for business purposes. Officers and employees should not expect a right to
privacy of their e-mail or Internet use. All e-mails or Internet use on Company
equipment is subject to monitoring by the Company.

                  CONFIDENTIAL INFORMATION BELONGING TO OTHERS

You must respect the confidentiality of information, including, but not limited
to, trade secrets and other information given in confidence by others, just as
we protect our own confidential information. This includes, but is not limited
to partners, suppliers, contractors, competitors or customers. However, certain
restrictions about the information of others may place an unfair burden on the
Company's future business. For that reason, directors, officers and employees
should coordinate with your supervisor or the CEO to ensure appropriate
agreements are in place prior to receiving any confidential third-party
information. In addition, any confidential information that you may possess from
an outside source, such as a previous employer, must not, so long as such
information remains confidential, be disclosed to or used by the Company.
Unsolicited confidential information submitted to the Company should be refused,
returned to the sender where possible and deleted, if received via the Internet.

                                       34
<PAGE>

        CORPORATE OPPORTUNITIES AND USE AND PROTECTION OF COMPANY ASSETS

You are prohibited from:

o        taking for yourself,  personally,  opportunities  that are  discovered
         through the use of Company  property,  information  or position;

o        using Company property, information or position for personal gain; or

o        competing with the Company.

You have a duty to the Company to advance its legitimate interests when the
opportunity to do so arises.

You are personally responsible and accountable for the proper expenditure of
Company funds, including money spent for travel expenses or for customer
entertainment. You are also responsible for the proper use of property over
which you have control, including both Company property and funds and property
that customers or others have entrusted to your custody. Company assets must be
used only for proper purposes.

Company property should not be misused. Company property may not be sold, loaned
or given away regardless of condition or value, without proper authorization.
Each director, officer and employee should protect our assets and ensure their
efficient use. Theft, carelessness and waste have a direct impact on the
Company's profitability. Company assets should be used only for legitimate
business purposes.

                   DISCIPLINE FOR NONCOMPLIANCE WITH THIS CODE

Disciplinary actions for violations of this Code can include oral or written
reprimands, suspension or termination of employment or a potential civil lawsuit
against you. The violation of laws, rules or regulations, which can subject the
Company to fines and other penalties, may result in your criminal prosecution.

                        DISCLOSURE POLICIES AND CONTROLS

The continuing excellence of the Company's reputation depends upon our full and
complete disclosure of important information about the Company that is used in
the securities marketplace. Our financial and non-financial disclosures and
filings with the SEC must be transparent, accurate and timely. We must all work
together to insure that reliable, truthful and accurate information is disclosed
to the public.

The Company must disclose to the SEC, current security holders and the investing
public information that is required, and any additional information that may be
necessary to ensure the required disclosures are not misleading or inaccurate.
The Company requires you to participate in the disclosure process, which is
overseen by our CEO and CFO. The disclosure process is designed to record,
process, summarize and report material information as required by all applicable
laws, rules and regulations. Participation in the disclosure process is a
requirement of a public company, and full cooperation and participation by our
CEO, CFO and, upon request, other employees in the disclosure process is a
requirement of this Code.

Officers and employees must fully comply with their disclosure responsibilities
in an accurate and timely manner or be subject to discipline of up to and
including termination of employment.

                                       35
<PAGE>

                         ENVIRONMENT, HEALTH AND SAFETY

The Company is committed to managing and operating our assets in a manner that
is protective of human health and safety and the environment. It is our policy
to comply, in all material respects, with applicable health, safety and
environmental laws and regulations. Each employee is also expected to comply
with our policies, programs, standards and procedures.

                          FILING OF GOVERNMENT REPORTS

Any reports or information provided, on our behalf, to federal, state, local or
foreign governments should be true, complete and accurate. Any omission,
misstatement or lack of attention to detail could result in a violation of the
reporting laws, rules and regulations.

                          FOREIGN CORRUPT PRACTICES ACT

The United States Foreign Corrupt Practices Act prohibits giving anything of
value, directly or indirectly, to foreign government officials or foreign
political candidates in order to obtain, retain or direct business. Accordingly,
corporate funds, property or anything of value may not be, directly or
indirectly, offered or given by you or an agent acting on our behalf, to a
foreign official, foreign political party or official thereof or any candidate
for a foreign political office for the purpose of influencing any act or
decision of such foreign person or inducing such person to use his influence or
in order to assist in obtaining or retaining business for, or directing business
to, any person.
You are also prohibited from offering or paying anything of value to any foreign
person if it is known or there is a reason to know that all or part of such
payment will be used for the above-described prohibited actions. This provision
includes situations when intermediaries, such as affiliates, or agents, are used
to channel payoffs to foreign officials.

                           INSIDER TRADING OR TIPPING

Directors, officers and employees who are aware of material, non-public
information from or about the Company (an "insider"), are not permitted,
directly or through family members or other persons or entities, to:

o        buy or sell securities (or derivatives relating to such securities) of
         the Company, or

o        pass on, tip or disclose material, nonpublic information to others
         outside the Company including family and friends.

Such buying, selling or trading of securities may be punished by discipline, up
to and including termination of employment; civil actions, resulting in
penalties of up to three times the amount of profit gained or loss avoided by
the inside trade or stock tip, or criminal actions, resulting in fines and jail
time.

Examples of information that may be considered material, non-public information
in some circumstances are:

o      undisclosed annual, quarterly or monthly financial results, a change in
       earnings or earnings projections, or unexpected or unusual gains or
       losses in major operations;

o      undisclosed negotiations and agreements regarding mergers, concessions,
       joint ventures, acquisitions,  divestitures,  business
       combinations or tender offers;

o      undisclosed major management changes;

o      a substantial contract award or termination that has not been publicly
       disclosed;

o      a major lawsuit or claim that has not been publicly disclosed;

                                       36
<PAGE>

o      the gain or loss of a significant customer or supplier that has not been
       publicly disclosed;

o      an undisclosed filing of a bankruptcy petition by the Company;

o      information that is considered confidential; and

o      any other undisclosed information that could affect our stock price.

The same policy also applies to securities issued by another company if you have
acquired material, nonpublic information relating to such company in the course
of your employment or affiliation with the Company.

When material information has been publicly disclosed, each insider must
continue to refrain from buying or selling the securities in question until the
third business day after the information has been publicly released to allow the
markets time to absorb the information.

                      INVESTOR RELATIONS AND PUBLIC AFFAIRS

It is very important that the information disseminated about the Company be both
accurate and consistent. For this reason, all matters relating to the Company's
internal and external communications are handled by our CEO (or, if retained for
such purpose, a public relations consultant). Our CEO (or a public relations
consultant retained by the Company) is solely responsible for public
communications with stockholders, analysts and other interested members of the
financial community. Our CEO (or a public relations consultant retained by the
Company) is also solely responsible for our marketing and advertising activities
and communication with employees, the media, local communities and government
officials. Our CEO serves as the Company's spokesperson in both routine and
crisis situations.

                                RECORD RETENTION

The alteration, destruction or falsification of corporate documents or records
may constitute a criminal act. Destroying or altering documents with the intent
to obstruct a pending or anticipated official government proceeding is a
criminal act and could result in large fines and a prison sentence of up to 20
years. Document destruction or falsification in other contexts can result in a
violation of the federal securities laws or the obstruction of justice laws.

                        REPORTING VIOLATIONS OF THIS CODE

You should be alert and sensitive to situations that could result in actions
that might violate federal, state, or local laws or the standards of conduct set
forth in this Code. If you believe your own conduct or that of a fellow employee
may have violated any such laws or this Code, you have an obligation to report
the matter.

Generally, you should raise such matters first with an immediate supervisor.
However, if you are not comfortable bringing the matter up with your immediate
supervisor, or do not believe the supervisor has dealt with the matter properly,
then you should raise the matter with our CEO who may, if a law, rule or
regulation is in question, then refer you to our legal counsel. The most
important point is that possible violations should be reported and we support
all means of reporting them.

Directors and officers should report any potential violations of this Code to
the chairman of the Board of Directors or to our legal counsel.

We will not allow retaliation against an employee for reporting a possible
violation of this Code in good faith. Retaliation for reporting a federal
offense is illegal under federal law and prohibited under this Code. Retaliation
for reporting any violation of a law, rule or regulation or a provision of this
Code is prohibited. Retaliation will result in discipline, up to and including
termination of employment, and may also result in criminal prosecution. However,
if a reporting individual was involved in improper activity the individual may
be appropriately disciplined even if he or she was the one who disclosed the
matter to the Company. In these circumstances, we may consider the conduct of
the reporting individual in reporting the information as a mitigating factor in
any disciplinary decision.



                                       37
<PAGE>


                                     WAIVERS

There shall be no waiver of any part of this Code for any director or officer
except by a vote of the Board of Directors. In case a waiver of this Code is
granted to a director or officer, the notice of such waiver shall be posted on
our website within five days of the Board's vote or shall be otherwise disclosed
as required by applicable law or the rules of any stock exchange or market on
which the Company's securities are listed for trading. Notices posted on our
website shall remain there for a period of 12 months and shall be retained in
our files as required by law.

                                   CONCLUSION
This Code is an attempt to point all of us at the Company in the right
direction, but no document can achieve the level of principled compliance that
we are seeking. In reality, each of us must strive every day to maintain our
awareness of these issues and to comply with the Code's principles to the best
of our abilities. Before we take an action, we must always ask ourselves:

o        Does it feel right?

o Is this action ethical in every way?

o Is this action in compliance with the law?

o        Could my action create an appearance of impropriety?

o Am I trying to fool anyone, including myself, about the propriety of this
action?

If an action would elicit the wrong answer to any of these questions, do not
take it. We cannot expect perfection, but we do expect good faith. If you act in
bad faith or fail to report illegal or unethical behavior, then you will be
subject to disciplinary procedures. We hope that you agree that the best course
of action is to be honest, forthright and loyal at all times.


                                       38
<PAGE>


                              INTERMOST CORPORATION

                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<S>                                                                                     <C>



Report of Independent Auditors                                                                   F-2

Consolidated Balance Sheets as of June 30, 2004                                                  F-3

Consolidated Statements of Operations for the year ended June 30, 2003 and 2004                  F-4

Consolidated Statements of changes in Stockholders' Equity for the years ended
   June 30, 2003 and 2004                                                                        F-5

Consolidated Statements of Cash Flows for the year ended June 30, 2003 and 2004                  F-6

Notes to and forming part of the Consolidated Financial Statements                         F-7 - F27


</TABLE>


                           E. Randall Gruber, CPA, PC



             Report of Independent Registered Public Accounting Firm


To the Board of Directors and Stockholders
of Intermost Corporation

I have audited the accompanying consolidated balance sheets of Intermost
Corporation and subsidiaries (the "Company") as of June 30, 2005 and June 30,
2004, and the related consolidated statements of operations, stockholders'
equity and cash flows for the years then ended. These consolidated financial
statements are the responsibility of the Company's management. My responsibility
is to express an opinion on these consolidated financial statements based on my
audit.

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

In my opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of
Intermost Corporation and subsidiaries as of June 30, 2005 and June 30, 2004,
and the consolidated results of their operations and their cash flows for the
years then ended, in conformity with accounting principles generally accepted in
the United States of America.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 2 to the
consolidated financial statements, the Company has suffered recurring losses
from operations and has a significant accumulated deficit. In addition, the
Company continues to experience negative cash flows from operations. These
factors raise substantial doubt about the Company's ability to continue as a
going concern. Management's plans in regard to these matters are also described
in Note 2. The consolidated financial statements do not include any adjustments
that might result from the outcome of this uncertainty.






E. Randall Gruber, CPA, PC October 5, 2005



                                       39
<PAGE>




           Member - American Institute of Certified Public Accountants
         Registered - Public Company Accounting Oversight Board (PCAOB)

                     Intermost Corporation and Subsidiaries
                           Consolidated Balance Sheet
<TABLE>


                                                               June 30, 2005                         June 30, 2004
                                                            -----------------------------     ---------------------------------
                                                            ------------ -- -------------     -------------- --- --------------
                                                                    Rmb                 US$               Rmb                US$
<S>                                                          <C>              <C>                 <C>              <C>

Assets

Current assets:
Cash and cash equivalents                                     1,116,365             134,827         1,544,822            186,573
Accounts receivable                                          65,447,719           7,904,314         3,052,336            368,640
Inventory                                                        95,651              11,552             6,000                724
Short-term Investment                                         1,560,000             188,406                 -                  -
Deposits, prepayments and other receivables                   1,805,251             218,025         4,503,799            543,937
                                                            ------------    -------------     --------------
                                                            ------------    -------------     --------------     --------------

 Total current assets                                        70,024,986           8,457,124         9,106,957          1,099,874


Unlisted investment                                           4,817,270             581,796                 -                  -
Property and equipment, net                                     224,711              27,139           365,400             44,131
Goodwill                                                     28,993,445           3,501,624         4,568,552            551,758
Intangible assets                                             1,468,079             177,304                 -                  -
Investment in associated company                             23,858,517           2,881,463        21,646,308          2,614,288
                                                            ------------    -------------     --------------
                                                            ------------    -------------     --------------     --------------

Total assets                                                129,387,008          15,626,450        35,687,217          4,310,051
                                                            ============    =============     ==============     ==============
                                                            ============    =============     ==============     ==============

 Liabilities, Minority Interests and Stockholders' Equity

Current liabilities:
Accounts payable                                             10,659,994           1,287,439         3,117,252            376,480
Accrued liabilities and other payables                        7,628,160             921,275         1,714,076            207,014
Customer deposits                                               842,938             101,804           421,051             50,851
Deferred revenue                                                316,598              38,236           286,357             34,584
Business taxes and government surcharges payable              6,227,208             752,079            36,131              4,364
Due to directors                                                      -                   -           148,283             17,909
Due to related companies                                      3,917,684             473,150                 -                  -
                                                            ------------    -------------     --------------     --------------
                                                            ------------    -------------     --------------

Total current liabilities                                    29,592,582           3,573,983         5,723,150            691,202
                                                            ------------    -------------     --------------     --------------
                                                            ------------    -------------     --------------

Commitments

Minority interests                                           23,877,573           2,883,765           940,072            113,535
                                                            ------------    -------------     --------------     --------------
                                                            ------------    -------------     --------------

Stockholders' equity:
Preferred stock, par value of US$0.001 -
  Authorized - 5,000,000 shares
  Issued  and outstanding - None
Common stock, par value US$0.001 -
  Authorized - 100,000,000 shares
  Issued and outstanding - 87,949,472 shares                    728,259              87,954                 -                  -
  Issued and outstanding - 67,017,406 shares                          -                   -           554,938             67,021
Additional paid-in capital                                  144,733,846          17,479,933       102,521,781         12,381,858
Shares to be issued                                              22,832               2,757             1,656                200
Accumulated deficit                                         (69,537,188)         (8,398,211)      (74,023,484)        (8,940,034)
Accumulated other comprehensive loss                            (30,896)             (3,731)          (30,896)            (3,731)
                                                            ------------    -------------     --------------     --------------
                                                            ------------    -------------     --------------

Stockholders' equity                                         75,916,853           9,168,702        29,023,955          3,505,314
                                                            ------------    -------------     --------------     --------------
                                                            ------------    -------------     --------------

Total liabilities, minority interests and stockholders'     129,387,008          15,626,450        35,687,217                  1
equity                                                                                                                 4,310,05
                                                            ============    =============     ==============     ==============
                                                            ============    =============     ==============

</TABLE>


See accompanying report of independent registered public accounting firm and
notes to consolidated financial statements.


                                       40
<PAGE>


                     Intermost Corporation and Subsidiaries
                      Consolidated Statements of Operations
<TABLE>

                                                                                        Years Ended June 30,
                                                          ----------------------------------------------------------------------
                                                                    2005                                  2004
                                                           --------------------------------    ----------------------------------
                                                              Rmb                       US$                Rmb                US$
<S>                                                        <C>              <C>                 <C>                 <C>

Net revenues                                                 139,387,605       16,834,252           15,130,727        1,827,382
Cost of revenues                                             (94,705,435)     (11,437,855)         (12,140,249)      (1,466,213)
                                                           -------------    ---------------    ---------------    ---------------
                                                           -------------    ---------------    ---------------    ---------------

Gross profit                                                  44,682,170        5,396,397            2,990,478          361,169
                                                           -------------    ---------------    ---------------    ---------------
                                                           -------------    ---------------    ---------------    ---------------


Costs and expenses:
Selling, general and administrative expenses                 (13,998,244)      (1,690,609)         (10,074,773)      (1,216,760)
Amortization on intangible assets                             (4,175,546)        (504,293)                   -                -
Gain/(loss) on disposal of fixed assets                          (56,259)          (6,795)              44,345            5,356
Impairment of software license                                         -                 -            (258,750)         (31,250)
Loan interest income                                                 105                13                   -                -
Investment income                                                224,640            27,130                   -                -
                                                           -------------    ---------------    ---------------    --------------

Total costs and expenses                                     (18,005,304)      (2,174,554)         (10,289,178)      (1,242,654)
                                                           -------------    ---------------    ---------------    --------------

Profit/(Loss) from operations                                 26,676,866        3,221,843           (7,298,700)        (881,485)
                                                           -------------    ---------------    ---------------    ---------------
                                                           -------------    ---------------    ---------------    ---------------

Other income (expense):
Interest income                                                  4,844                585             14,937              1,804
Other income (expense), net                                    120,620             14,568            (19,021)            (2,297)
                                                           -------------    ---------------    ---------------    ---------------
                                                           -------------    ---------------    ---------------    ---------------

  Total other income (expense)                                 125,464             15,153             (4,084)              (493)
                                                           -------------    ---------------    ---------------    ---------------

Profit / (Loss) before income taxes, minority
interests and
    equity in earnings of an associated company             26,802,330          3,236,996         (7,302,784)          (881,978)

Income taxes                                                (6,285,315)          (759,096)           (56,860)            (6,867)
                                                           -------------    ---------------    ---------------    ---------------

Profit / (Loss) before minority interests and
equity in
    earnings of an associated company                       20,517,015          2,477,900           (7,359,644)        (888,845)

Minority interests                                         (17,646,768)        (2,131,252)            (527,516)         (63,710)
                                                           -------------    ---------------    ---------------    ---------------

Profit / (Loss) before equity in earnings of an associated                        346,648
    company                                                  2,870,247                              (7,887,160)        (952,555)

Equity in earnings of an associated company                  1,616,049            195,175            1,174,308          141,824
                                                           -------------    ---------------    ---------------    ---------------

Net Profit / (loss)                                          4,486,296            541,823           (6,712,852)        (810,731)
                                                           =============    ===============    ===============    ===============



Net profit/(loss) per common share - basic and diluted              0.06                  0.007             (0.12)           (0.01)
                                                           =============    ===============    ===============    ===============

Weighted average number of common shares outstanding - basic
    and diluted                                             81,129,812           81,129,812         57,105,734       57,105,734
                                                           =============    ===============    ===============    ===============

</TABLE>

See accompanying report of independent registered public accounting firm and
notes to consolidated financial statements.


                                       41
<PAGE>



                     Intermost Corporation and Subsidiaries
                 Consolidated Statements of Stockholders' Equity
                       Years Ended June 30, 2004 and 2005
<TABLE>

                                                       Common Stock
                                Issued           Reserved and to be Issued
                         Number                                                                         Accumulated
                           of                                              Additional                    Other
                      -------------                 Number                  Paid-In     Accumulated  Comprehensive     Stockholders'
                         Shares     Amount     of Shares   Amount          Capital       Deficit        Loss               Equity
                      --------------------------------------------------------------------------------------------------------------
                                         Rmb                   Rmb           Rmb           Rmb         Rmb          Rmb         US$
<S>                   <C>           <C>       <C>         <C>         <C>          <C>           <C>          <C>            <C>

Balance as of
June 30, 2002          33,120,481    274,279   2,000,000    16,560    62,085,259   (58,378,023)    (30,896)   3,967,179     479,128
Issuance of common
stock for services
   rendered             1,027,318      8,505           -         -       248,176             -           -      256,681      31,000
Issuance of common
stock to
a director for
   partial
settlement
of
balance due             2,213,401     18,326           -         -     1,064,033             -           -    1,082,359     130,720
Issuance of common
stock to
employee as
   compensation         3,870,800     32,048           -         -       964,959             -           -      997,007     120,411
Issuance of common
stock for
settlement of
   creditors, net
of
issuance cost           2,014,066     16,676  (2,000,000)  (16,560)         (116)            -           -            -           -
Issuance of common
stock for
acquisition             4,000,000     33,120           -         -     4,272,480             -           -    4,305,600     520,000
Common stock
reserved
and
to be
issued for
   services
rendered                        -          -   3,820,000    31,630     2,000,282             -           -    2,031,912     245,400
Net loss                        -          -           -         -             -    (8,932,609)          -   (8,932,609)  1,078,818)

Balance as of
June 30,
2003                   46,246,066    382,954   3,820,000    31,630    70,635,073   (67,310,632)    (30,896)   3,708,129     447,841

Issuance of common
stock for
services
   rendered             4,717,640     39,060  (3,820,000)  (31,630)    1,979,770             -           -    1,987,200     240,000

Issuance of common
stock for
private
   placement            6,053,700     50,124           -         -     9,639,154             -           -    9,689,278   1,170,204
Issuance of common
stock
for
acquisition            10,000,000     82,800           -         -    19,789,200             -           -   19,872,000   2,400,000
Common stock
reserved
and to
be issued for
   services rendered            -          -     200,000     1,656       478,584             -           -      480,240      58,000
Net loss                        -          -           -         -             -    (6,712,852)          -   (6,712,852)   (810,731)

Balance as of
June 30,
2004 (Rmb)             67,017,406    554,938     200,000     1,656   102,521,781   (74,023,484)    (30,896)  29,023,995           -
Balance as of
June 30,
2004 (US$)             67,017,406     67,021     200,000       200    12,381,858    (8,940,034)     (3,731)   3,505,314   3,505,314

Issuance of common
stock
for
services
   rendered             1,119,787      9,273    (200,000)   (1,656)      865,917             -           -      873,534     105,499

Issuance of common
stock
for
acquisition            19,470,355    161,215           -         -    38,783,583             -           -   38,944,798   4,703,478

Issuance of common
stock to
a former
   director for
settlement
of
balance due              341,924      2,833           -         -       530,413             -           -      533,246      64,402

Common stock reserved
and to
be issued for
   services rendered            -          -   2,757,628    22,832     2,032,152             -           -    2,054,984     248,186

Net profit                      -          -           -         -             -     4,486,296           -    4,486,296     541,823
 ---------------------------------------------------------------------------------------------------------------
 ---------------------------------------------------------------------------------------------------------------

Balance as of June 30,
2005 (Rmb)             87,949,472    728,259   2,757,628    22,832   144,733,846    (69,537,188)  (30,896)    75,916,853           -
Balance as of June 30,
2005 (US$)             87,949,472     87,954   2,757,628     2,757    17,479,933     (8,398,211)   (3,731)     9,168,702   9,168,702

==================================================================================
</TABLE>

See accompanying report of independent registered public accounting frm and
notes to consolidated financial statements.


                                       42
<PAGE>




                     Intermost Corporation and Subsidiaries
                      Consolidated Statements of Cash Flows
<TABLE>

                                                                                     Years Ended June 30,
                                                                 --------------------------------------------------------------
                                                                              2005                           2004
                                                                 --------------------------------------------------------------
                                                                 -------------------------------
                                                                           Rmb         US$                Rmb             US$
<CAPTION>
<S>                                                                 <C>              <C>             <C>             <C>

Cash flows from operating activities:
Net profit / (loss)                                                  4,486,296          541,823    (6,712,852)       (810,731)
Adjustments to reconcile net loss to net cash used in operating
    activities:
    Issuance of common stock in exchange for services                  873,584          105,499     1,987,200         240,000
    Common stock reserved and to be issued in exchange for
    services                                                         2,054,984          248,186       480,240          58,000
    Bad debt written off and provision for doubtful debt:
       Other receivables                                             1,000,000          120,773             -               -
    Amortization of computer software held for sale                          -                -       621,000          75,000
    Amortization of intangible asset                                 4,175,546          504,293             -               -
    (Gain) loss on disposal of fixed assets                             56,259            6,795       (44,345)         (5,356)
    Impairment of software license                                           -                -       258,750          31,250
    Depreciation of plant and equipment                                215,036           25,971       378,337          45,693
    Minority interests                                              17,646,768        2,131,252       527,516          63,710
    Equity in earnings of an associated company                     (1,616,049)       (195,175)    (1,174,308)       (141,824)
Changes in operating assets and liabilities:
      (Increase) decrease in -
    Accounts receivable                                            (62,395,383)     (7,535,674)    (1,660,217)       (200,509)
    Deposits, prepayments and other receivables                      1,705,776          206,012    (1,380,613)       (166,741)
    Inventory                                                           31,392            3,791       361,522          43,662
      Increase (decrease) in -
    Accrued liabilities and other payables                           4,111,574          496,567      (532,577)        (64,321)
    Accounts payable                                                 7,542,742          910,959       158,332          19,122
    Deferred revenue                                                    30,241            3,652           357              43
    Customer deposits                                                  421,887           50,953       (51,613)         (6,233)
    Business taxes and government surcharges payable                 6,191,077          747,715        12,638           1,526

Net cash used in operating activities                              (13,468,320)     (1,626,608)    (6,770,633)       (817,709)
                                                                 ---------------                -------------------------------
                                                                 ---------------                -------------------------------

Cash flows from investing activities:
Additions to plant and equipment                                       (96,834)        (11,695)      (213,336)        (25,765)
Acquisition of investment in an associated company                  (4,669,998)       (564,010)      (600,000)        (72,464)
Acquisition of investment in subsidiaries                            5,037,294          608,369           __-               -
Proceeds on disposal of plant and equipment                                  -                -       870,000         105,072
Increase in amount due from related company                         12,917,684        1,560,107             -               -

Net cash provided by investing activities                           13,188,146        1,592,771        56,664           6,843

Cash flows from financing activities:
Advances from (repayments to) directors/former directors              (148,283)        (17,909)      (274,588)        (33,163)
Net proceeds from issuance of common stock                                   -                -     7,880,926         951,803

Net cash provided by/(used in) financing activities                   (148,283)        (17,909)     7,606,338         918,640

Cash and cash equivalents:
Net increase / (decrease)                                             (428,457)        (51,746)       892,369         107,774
Balance at beginning of year                                         1,544,822          186,573       652,453          78,799

Balance at end of year                                               1,116,365        134,827       1,544,822         186,573

Supplemental disclosures of cash flow information:
  Cash paid for -
    Interest                                                                 -                -             -               -
    Income taxes                                                        38,279          4,623          73,019           8,819

Non-cash investing and financing activities:
Issuance of common stock in exchange for services                      873,534          105,499     1,987,200         240,000

Issuance of common stock in settlement of balance due to a                      ===============
    director                                                           533,246           64,402             -               -
Issuance of common stock for acquisitions                           38,944,798        4,703,478    19,872,000       2,400,000
Common stock reserved and to be issued in exchange for services      2,054,984        248,186         480,240          58,000

===================================================================================================================
</TABLE>

See accompanying report of independent registered public accounting firm and
notes to consolidated financial statements.

                                       43
<PAGE>


                     Intermost Corporation and Subsidiaries
                   Notes to Consolidated Financial Statements


1. ORGANIZATION AND PRINCIPAL ACTIVITIES

         Intermost Corporation (hereinafter referred to as the "Company",
         including its subsidiaries and associated companies, when the context
         so requires) was originally incorporated in the State of Utah on March
         6, 1985 under the name Utility Communications International, Inc. The
         Company changed its name from Utility Communications International,
         Inc. to Intermost Corporation on October 23, 1998. In February 2003,
         the Company redomiciled from the State of Utah to the State of Wyoming.

         On October 23, 1998, the Company acquired a 100% interest in Intermost
         Limited ("IL"), a company incorporated in the British Virgin Islands,
         by issuing 4,970,000 shares of its common stock with a par value of
         US$0.001 per share (after the redenomination of par value and a stock
         split) to the shareholders of IL.

         The acquisition of IL by the Company was treated as a reverse
         acquisition since IL was the continuing entity as a result of the
         exchange reorganization.

         The Company is engaged in providing, directly and through its
         subsidiaries and associated companies, business portal and e-commerce
         solutions, the sale of photographic equipment and the sale of digital
         security imaging system in the People's Republic of China (the "PRC" or
         "China"), including Hong Kong. Segment information is provided at Note
         16. The Company's fiscal year-end is June 30.

         The Company's subsidiaries and affiliated companies and their principal
         activities as of June 30, 2005 are summarized as follows:
<TABLE>

                                                        Place of        Percentage of
                                                      Incorporation    Equity Interest
                                                    -----------------  Attributable to
                           Name                      or Organization     the Company         Principal Activities
                                                    ------------------ ----------------- ------------------------------
                                                    ------------------ ----------------- ------------------------------
<S>                                                    <C>                <C>                      <C>

        Intermost Limited ("IL")                       British Virgin              100%             Investment holding
                                                              Islands

        China E.com Information Technology Ltd.                   PRC              100%            Business portal and
          ("CECITL")*                                                                             e-commerce solutions

        IMOT Information Technology (Shenzhen)                    PRC              100%             Investment holding
          Ltd. ("IITSL")*

        Intermost (H.K.) Limited ("IHKL")                   Hong Kong              100%                       Inactive

        Shenzhen Bank Union & Jiayin E-commerce                   PRC             55.3%                       Inactive
          Company Ltd. ("SBUJE")**

        Intermost Focus Advertising Company Ltd.                  PRC               90%                       Inactive
          ("IFACL")**

        Shanghai Newray Photographic Equipment                    PRC               51%          Sales of photographic
          Co., Ltd. ("SNPE")**                                                             equipment, and LCD monitors

        Shanghai Fortune Venture Ltd. ("SFVL")***                 PRC               25%    Private equity exchange and
                                                                                                    investment holding

        Golden Anke Technology Ltd. ("GATL")**                    PRC               51%      Sales of digital security
                                                                                                                system
        China E.com Technology (Shenzhen) Ltd.                    PRC              100%            Business postal and
          ("CECTSC")*                                                                             e-commence solutions

        Hainan Concord Financial Products                         PRC               80%      Private equity exchange &
          Development Co., Ltd. ("HCFPDCL")**                                                       investment holding

        Shenzhen International Hi-Tech Property                   PRC               15%        Private equity exchange
          Right Exchange Centre

</TABLE>

                                       44
<PAGE>

         *      CECITL, IITSL and CECTSC are wholly foreign owned enterprises
                established in the PRC to be operated for a period of 10 years
                until 2008.

         **     SBUJE, IFACL, SNPE, GATL and HCFPDCL are equity joint ventures
                established in the PRC to be operated for a period of 10 years
                until 2009, 2010, 2013, 2014 and 2015 respectively. They are
                subsidiaries of the Company and their operations are
                consolidated into the Company's financial statements.

         ***    SFVL is an equity joint venture established in the PRC to
                operate for a period of 10 years until 2012. It is an associated
                company of the Company and is accounted for under the equity
                method of accounting.

         The Company owns certain of its subsidiaries through trusts that were
         created by a Declaration of Trust executed by Huang Liqiong and Jun
         Liang in February 2000. The trusts were created by, and therefore are
         revocable by, IL. Accordingly, IL consolidates the operations of CECITL
         since it is the beneficial owner of a majority of the outstanding
         interests and, through its ability to revoke the trusts, retains
         control of these interests.


2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         Basis of Presentation - The consolidated financial statements have been
         prepared in accordance with generally accepted accounting principles in
         the United States of America.

         Principles of Consolidation - The consolidated financial statements
         include the accounts of the Company and its majority-owned
         subsidiaries, of which the Company has the ability to exercise control
         and direct operations and the minority interests do not possess
         participatory rights. All material intercompany balances and
         transactions have been eliminated on consolidation.

         Going Concern - As shown in the accompanying consolidated financial
         statements, the Company incurred a net loss of Rmb6,712,852 for the
         year ended June 30, 2004 and has an accumulated deficit of
         Rmb74,023,484 as of June 30, 2004. Although the company have a net
         profit of Rmb 4,486,296 for the year ended June 30, 2005 and has an
         accumulated deficit of Rmb 69,537,188 as of June 30, 2005, the Company
         continues to experience negative cash flows from operations. The
         Company will be required to raise additional capital to fund its
         operations, and will continue to attempt to raise capital resources
         from both related and unrelated parties until such time as the Company
         is able to generate revenues sufficient to maintain itself as a viable
         entity. These factors have raised substantial doubt about the Company's
         ability to continue as a going concern. There can be no assurances that
         the Company will be able to raise additional capital or achieve
         profitability. These consolidated financial statements do not include
         any adjustments that might result from the outcome of this uncertainty.

         The Company plans to strengthen its core business, control its overall
         expenditures, improve the efficiency of its operations and continue its
         efforts to expand by acquiring other business opportunities During the
         year ended June 30, 2005, the company acquired various subsidiaries and
         associated companies (see Note 1). The Company also raised additional
         capital by three private placements of HK$400,000 in July 28, 2005,
         US$150,000 in September 7, 2005 and US$2,000,000 in September 10, 2005.

                                       45
<PAGE>

         Cash and Cash Equivalents - The Company considers all cash and highly
         liquid investments purchased with an original maturity of three months
         or less to be cash equivalents. As at June 30, 2005 the company did not
         have any cash equivalents.

         Accounts Receivable - In order to determine the value of the Company's
         accounts receivable, the Company records a provision for doubtful
         accounts to cover estimated credit losses. Management reviews and
         adjusts this allowance periodically based on historical experience and
         its evaluation of the collectibility of outstanding accounts
         receivable. The Company evaluates the credit risk of its customers
         utilizing historical data and estimates of future performance (see Note
         5).

         Associated Company - An associated company is a business enterprise in
         which the Company owns between 20% and 50% of the equity capital, and
         does not have direct or indirect or joint control, and therefore, has
         only limited ability to participate in financial and operating policy
         decisions.

         The Company's investment in associated companies are accounted for
         under the equity method of accounting, whereby the investment is
         initially recorded at cost and the carrying amount is adjusted
         thereafter for the post acquisition change in the Company's share of
         the associated company's results of operations.

         Plant and Equipment - Plant and equipment are recorded at cost. Major
         renewals and improvements are capitalized; minor repairs and
         maintenance expenditures are charged to expense as incurred. The cost
         and related accumulated depreciation applicable to equipment sold or no
         longer in service is eliminated from the accounts and any gain or loss
         is included in the statement of operations.

         Depreciation is provided on the straight-line method over the estimated
         useful lives of the respective assets at the following annual rates:

                    Buildings                                20 years
                    Computer equipment                       3 years
                    Motor vehicles                           5 years
                    Furniture and office equipment           5 years

         Inventory - Inventory consists of finished goods and is valued at the
         lower of cost or market using the weighted average cost method of
         accounting. As of June 30, 2005, inventories were comprised of digital
         security imaging system and office automation software.

         Goodwill - Goodwill represents the excess of the purchase price over
         the fair value of the net tangible and identifiable intangible assets
         acquired in a business combination. In accordance with Statement of
         Financial Accounting Standards ("SFAS") No. 142, "Goodwill and Other
         Intangible Assets", goodwill is no longer subject to amortization.
         Rather, goodwill is subject to at least an annual assessment for
         impairment, applying a fair-value based test. Fair value is generally
         determined using a discounted cash flow analysis.

         Computer Software Held for Sale - The Company accounts for software
         costs in accordance with SFAS No. 86, "Accounting for the Costs of
         Computer Software to Be Sold, Leased, or Otherwise Marketed". Computer
         software held for sale represents the purchase price of software
         licenses acquired during the year ended June 30, 2003 and is being
         amortized over the estimated economic life of 2 years. For the year
         ended June 30, 2004, the Company recorded amortization of Rmb621,000.
         During the year ended June 30, 2004, the Company also determined that
         the asset had been impaired, as a result of which the Company recorded
         an asset impairment charge of Rmb258,750 during such period to reduce
         the carrying value of the asset to zero at June 30, 2004. The company
         signed a settlement agreement with the supplier on March 31, 2005 to
         terminate the distributorship agreement and return all the software.
         Both parties confirm that they have no claim against each other
         outstanding payment. Hence the company reverses the amortization amount
         Rmb 1,242,000 in the statements of operation for year ended June 30,
         2005.

         Impairment of Long-Lived Assets - Long-lived assets are evaluated for
         impairment whenever events or changes in circumstances indicate that
         the carrying amount of an asset may not be recoverable in accordance
         with SFAS No. 144, "Accounting for the Impairment or Disposal of
         Long-Lived Assets". An asset is considered impaired if its carrying
         amount exceeds the future net cash flow the asset is expected to
         generate. If an asset is considered to be impaired, the impairment to
         be recognized is measured by the amount by which the carrying amount of
         the asset exceeds its fair market value. The recoverability of
         long-lived assets is assessed by determining whether the unamortized
         balances can be recovered through undiscounted future net cash flows of
         the related assets. The amount of impairment, if any, is measured based
         on projected discounted future net cash flows using a discount rate
         reflecting the Company's average cost of capital.

                                       46
<PAGE>

         Goodwill is evaluated, at a minimum, on an annual basis and whenever
         events and changes in circumstances suggest that the carrying amount
         may not be recoverable. Impairment of goodwill is tested at the
         reporting unit level by comparing the reporting unit's carrying amount,
         including goodwill, to the fair value of the reporting unit. The fair
         values of the reporting units are estimated using the discounted cash
         flows approach. If the carrying amount of the reporting unit exceeds
         its fair value, goodwill is considered impaired and a second step is
         performed to measure the amount of impairment loss, if any.

         Revenue Recognition - The Company recognizes revenue in accordance with
         SEC Staff Accounting Bulletin No. 101, "Revenue Recognition in
         Financial Statements". The Company recognizes revenue when the
         significant risks and rewards of ownership have been transferred to the
         customer pursuant to PRC law, including factors such as when persuasive
         evidence of an arrangement exists, delivery has occurred, the sales
         price is fixed or determinable, sales and value-added tax laws have
         been complied with, and collectibility is probable.

         Revenue from the sale of photographic equipment and digital security
         imaging system are recognized from the sale of photographic equipment
         and digital security imaging system represents the invoiced value of
         the goods supplied to customers. Revenue are recognized upon delivery
         of goods and passage of title to customers.

         Revenue from web-site development contracts is recognized based on the
         terms of the contract. The Company uses either the percentage of
         completion or the completed contract methods to recognize such revenue.
         Contracts are short-term in nature and require acceptance by the
         customer pursuant to the respective contracts are accounted for under
         the completed contract method. Revenues are allocated to the elements
         of the contract based on the fair values of the elements. Provisions
         for estimated contract losses are recognized in the year the loss
         becomes probable and can be reasonably estimated.

         Revenue from maintenance contracts is recognized on a straight-line
         basis over the term of the maintenance contract, generally twelve
         months. The unearned portion of maintenance revenue is classified as
         deferred revenue and amortized over the life of the contract.

         Cost of Revenues - Cost of revenues includes the cost of the direct
         labor force, sub-contract fees, costs of systems sales and integration,
         depreciation and amortization, and other similar costs, including
         travel, employee welfare, office and related expenses allocable to the
         engineering and technical staff.

         Income Taxes - Income taxes are provided under the provisions of SFAS
         No. 109, which requires recognition of the estimated future tax
         consequences attributable to differences between the financial
         statement carrying amounts of existing assets and liabilities and their
         respective tax bases and net operating loss carry forwards under the
         liability method. Deferred tax assets and liabilities are measured
         using expected tax rates in effect for the year in which those
         temporary differences are expected to be recovered or settled. The
         Company has recorded a full valuation allowance for its deferred tax
         assets as of June 30, 2005 due to the uncertainty of the realizability
         of those assets.

         Operating Leases - Leases where substantially all the rewards and risks
         of ownership of assets remain with the leasing company are accounted
         for as operating leases. Rentals payable and receivable under operating
         leases are recorded in the statement of operations on a straight-line
         basis over the lease terms. Lease incentives received are recognized in
         the statement of operations as an integral part of the net
         consideration agreed for the use of the leased asset.

         Comprehensive Income (Loss) - The Company has adopted SFAS No. 130,
         "Reporting Comprehensive Income", which requires the disclosure of
         comprehensive income, which includes net income (loss), unrealized
         gains and losses on marketable securities classified as
         available-for-sale, and foreign currency translation adjustments. Total
         comprehensive loss for the years ended June 30, 2004 and 2005 consisted
         of the net loss for the respective years. As of June 30, 2005,
         accumulated other comprehensive loss was comprised of foreign currency
         translation adjustments.

                                       47
<PAGE>

         Stock-Based Compensation - The Company may periodically issue shares of
         common stock for services rendered or for financing costs. Such shares
         are valued based on the market price of the shares on the transaction
         date.

         The Company may periodically issue stock options to employees and stock
         options or warrants to non-employees in non-capital raising
         transactions for services and for financing costs.

         The Company has adopted Statement of Financial Accounting Standards No.
         123, "Accounting for Stock-Based Compensation" ("SFAS No. 123"), which
         establishes a fair value method of accounting for stock-based
         compensation plans.

         The provisions of SFAS No. 123 allow companies to either record an
         expense in the financial statements to reflect the estimated fair value
         of stock options to employees, or to continue to follow the intrinsic
         value method set forth in Accounting Principles Board Opinion No. 25,
         "Accounting for Stock Issued to Employees", but to disclose on an
         annual basis the pro forma effect on net income (loss) and net income
         (loss) per share had the fair value of the stock options been recorded
         in the financial statements. SFAS No. 123 was amended by SFAS No. 148,
         which now requires companies to disclose in interim financial
         statements the pro forma effect on net income (loss) and net income
         (loss) per common share of the estimated fair market value of stock
         options issued to employees. The Company has elected to continue to
         account for stock-based compensation plans utilizing the intrinsic
         value method. Accordingly, compensation cost for stock options will be
         measured as the excess, if any, of the fair market price of the
         Company's common stock at the date of grant above the amount an
         employee must pay to acquire the common stock.

         In accordance with SFAS No. 123, the cost of stock options and warrants
         issued to non-employees is measured at the grant date based on the fair
         value of the award. The fair value of the stock-based award is
         determined using the Black-Scholes option-pricing model. The resulting
         amount is charged to expense on the straight-line basis over the period
         in which the Company expects to receive benefit, which is generally the
         vesting period.

         Pro Forma Financial Disclosure - In accordance with SFAS No. 123, the
         Company will provide footnote disclosure with respect to stock-based
         employee compensation. The value of a stock-based award will be
         determined using the Black-Scholes option-pricing model, whereby
         compensation cost is the fair value of the award as determined by the
         pricing model at the grant date or other measurement date. The
         resulting amount will be charged to expense on the straight-line basis
         over the period in which the Company expects to receive benefit, which
         is generally the vesting period. Stock options issued to non-employee
         directors at fair market value will be accounted for under the
         intrinsic value method.

         The Company did not have any stock options outstanding during the years
         ended June 30, 2004 and 2005. Accordingly, no pro forma financial
         disclosure is provided herein.

         Foreign Currency Translation - The Company maintains its books and
         records in Renminbi ("Rmb"), the currency of the PRC. The Rmb is the
         Company's functional currency, as the Company's business activities are
         located in the PRC and denominated in Rmb. Translation of amounts into
         United States dollars ("US$") has been made at the rate of Rmb8.28 to
         US$1.00. On July 21, 2005. due to the change of rate of currency
         translation of Rmb to US$ by the PRC government, the rate of exchange
         is changed to approxionately Rmb8.11 to US$1.00

         The translation of the financial statements of subsidiaries whose
         functional currencies are other than Rmb into Rmb is performed for
         balance sheet accounts using closing exchange rates in effect at the
         balance sheet date and for revenue and expense accounts using an
         average exchange rate during each reporting period. The gains or losses
         resulting from translation are included in stockholders' equity
         separately as accumulated other comprehensive loss.

                                       48
<PAGE>

         Transactions in currencies other than functional currencies during the
         year are translated into the respective functional currencies at the
         applicable rates of exchange prevailing at the time of the
         transactions. Monetary assets and liabilities denominated in currencies
         other than functional currencies are translated into the respective
         functional currencies at the applicable rates of exchange in effect at
         the balance sheet date. Exchange gains and losses are included in the
         statement of operations. Exchange gains and losses were not significant
         for the years ended June 30, 2004 and 2005.

         The Rmb is not readily convertible into US$ or other foreign
         currencies. Translation of amounts from Rmb into US$ is for the
         convenience of readers and has been made at the noon buying rate in New
         York City for cable transfers in foreign currencies as certified for
         customs purposes by the Federal Reserve Bank of New York on June 30,
         2004 and June 30, 2005 of US$1.00 = Rmb8.28. No representation is made
         that the Rmb amounts could have been, or could be, converted into US$
         at that rate or at any other rate.

         Earnings per Common Share - Statement of Financial Accounting Standards
         No. 128, "Earnings Per Share", requires presentation of basic earnings
         per share ("Basic EPS") and diluted earnings per share ("Diluted EPS").
         Basic earnings (loss) per share is computed by dividing earnings (loss)
         available to common stockholders by the weighted average number of
         common shares outstanding (including shares reserved for issuance)
         during the period. Diluted earnings per share gives effect to all
         dilutive potential common shares outstanding during the period. The
         Company did not have any potentially dilutive securities outstanding
         during the years ended June 30, 2004 and 2005. Accordingly, basic and
         diluted loss per common share is the same for the years ended June 30,
         2004 and 2005.

         Use of Estimates - The preparation of financial statements in
         conformity with accounting principles generally accepted in the United
         States of America requires management to make estimates and assumptions
         that affect the reported amounts of assets and liabilities and the
         disclosure of contingent assets and liabilities at the date of the
         financial statements and the reported amounts of revenues and expenses
         during the reporting period. Such estimates include provisions for
         doubtful accounts, sales returns and allowances, long-lived assets and
         deferred income taxes. Actual results could differ from those
         estimates.

         Recent Accounting Pronouncements - Fair Value of Financial Instruments
         - The estimated fair values for financial instruments under SFAS No.
         107, "Disclosures about Fair Value of Financial Instruments", are
         determined at discrete points in time based on relevant market
         information. These estimates involve uncertainties and cannot be
         determined with precision. The estimated fair values of the Company's
         financial instruments, which includes cash and cash equivalents,
         accounts receivable and accounts payable, approximates their carrying
         value in the financial statements due to the short-term nature of these
         financial instruments..
         In November 2004, the FASB issued SFAS No. 151, entitled Inventory
         Costs -- An Amendment of ARB No. 43, Chapter 4. SFAS No. 151 amends the
         guidance in ARB No. 43, Chapter 4, entitled Inventory Pricing [June
         1953], to clarify the accounting for "abnormal amounts" of idle
         facility expense, freight, handling costs, and wasted material
         [spoilage]. Before revision by SFAS No. 151, the guidance that existed
         in ARB No. 43 stipulated that these type items may be "so abnormal"
         that the appropriate accounting treatment would be to expense these
         costs as incurred [i.e., these costs would be current-period charges].
         SFAS No. 151 requires that these type items be recognized as
         current-period charges without regard to whether the "so abnormal"
         criterion has been met. Additionally, SFAS No. 151 requires that
         allocation of fixed production overheads to the costs of conversion be
         based on the normal capacity of the production facilities. The adoption
         of SFAS 151 did not impact the financial statements.

         In December 2004, the FASB issued SFAS No. 152, entitled Accounting for
         Real Estate Time-Sharing Transactions -- An Amendment of FASB
         Statements No. 66 and 67. SFAS No. 152 amends SFAS No. 66 to reference
         the financial accounting and reporting guidance for real estate
         time-sharing transactions that is provided in AICPA Statement of
         Position 04-2. SFAS No. 152 also amends SFAS No. 67 to state that the
         guidance for (a) incidental operations and (b) costs incurred to sell
         real estate projects does not apply to real estate time-sharing
         transactions. The accounting for those operations and costs is subject
         to the guidance of SOP 04-2. This statement is effective for financial
         statements for fiscal years beginning after June 15, 2005. The adoption
         of SFAS 152 did not impact the financial statements.

         In December 2004, the FASB issued SFAS No. 153, entitled Exchanges of
         Nonmonetary Assets -- An Amendment of APB Opinion No.29. SFAS No. 153
         amends Opinion 29 to eliminate the exception for nonmonetary exchanges
         of nonmonetary assets that do not have commercial substance. A
         nonmonetary exchange has commercial substance if the future cash flows
         of the entity are expected to change significantly as a result of the
         exchange. The adoption of SFAS 153 did not impact the financial
         statements.

                                       49
<PAGE>

         In December 2004, the FASB issued SFAS No. 123 (Revised), entitled
         Share-Based Payment. This revised Statement eliminates the alternative
         to use APB Opinion No. 25's intrinsic value method of accounting that
         was provided in SFAS No. 123 as originally issued. Under Opinion 25,
         issuing stock options to employees generally resulted in recognition of
         no compensation cost. This Statement requires entities to recognize the
         cost of employee services received in exchange for awards of equity
         instruments based on the grant-date fair value of those awards. For
         public companies that file as a small business issuer, this Statement
         is effective as of the beginning of the first interim or annual
         reporting period that begins after December 15, 2005. The adoption of
         SFAS 123 (Revised) will not impact the financial statements as the
         Company has not granted any equity instruments to employees.

         In May 2005, the FASB issued SFAS No. 154, entitled Accounting Changes
         and Error Corrections--a replacement of APB Opinion No. 20 and FASB
         Statement No. 3. This Statement replaces APB Opinion No. 20, Accounting
         Changes, and FASB Statement No. 3, Reporting Accounting Changes in
         Interim Financial Statements, and changes the requirements for the
         accounting for and reporting of a change in accounting principle. This
         Statement applies to all voluntary changes in accounting principle. It
         also applies to changes required by an accounting pronouncement in the
         unusual instance that the pronouncement does not include specific
         transition provisions. Opinion 20 previously required that most
         voluntary changes in accounting principle be recognized by including in
         net income of the period of the change the cumulative effect of
         changing to the new accounting principle. This Statement requires
         retrospective application to prior periods' financial statements of
         changes in accounting principle, unless it is impracticable to
         determine either the period-specific effects or the cumulative effect
         of the change. This Statement defines retrospective application as the
         application of a different accounting principle to prior accounting
         periods as if that principle had always been used or as the adjustment
         of previously issued financial statements to reflect a change in the
         reporting entity. This Statement also redefines restatement as the
         revising of previously issued financial statements to reflect the
         correction of an error. The adoption of SFAS 154 did not impact the
         financial statements.



3. CERTAIN SIGNIFICANT RISKS AND UNCERTAINTIES

         Country Risk:

         The  Company is subject to the  consideration  and risks of  operating
         in the PRC.  These  include  risks associated

         The economy of PRC differs significantly from the economies of the
         "western" industrialized nations in such respects as structure, level
         of development, gross national product, growth rate, capital
         reinvestment, resource allocation, self-sufficiency, rate of inflation
         and balance of payments position, among others. Only recently has the
         PRC government encouraged substantial private economic activities. The
         Chinese economy has experienced significant growth in the past several
         years, but such growth has been uneven among various sectors of the
         economy and geographic regions. Actions by the PRC government to
         control inflation have significantly restrained economic expansion in
         the recent past. Similar actions by the PRC government in the future
         could have a significant adverse effect on economic conditions in PRC.

         Many laws and regulations dealing with economic matters in general and
         foreign investment in particular have been enacted in the PRC. However,
         the PRC still does not have a comprehensive system of laws, and
         enforcement of existing laws may be uncertain and sporadic.

                                       50
<PAGE>

         The Company's primary sources of revenues and cash flows are derived
         from its business operations in the PRC. The PRC economy has, for many
         years, been a centrally-planned economy, operating on the basis of
         annual, five-year and ten-year state plans adopted by central PRC
         governmental authorities, which set out national production and
         development targets. The PRC government has been pursuing economic
         reforms since it first adopted its "open-door" policy in 1978. There is
         no assurance that the PRC government will continue to pursue economic
         reforms or that there will not be any significant change in its
         economic or other policies, particularly in the event of any change in
         the political leadership of, or the political, economic or social
         conditions in, the PRC. There is also no assurance that the Company
         will not be adversely affected by any such change in governmental
         policies or any unfavorable change in the political, economic or social
         conditions, the laws or regulations, or the rate or method of taxation
         in the PRC.

         As many of the economic reforms, which have been or are being
         implemented by the PRC government, are unprecedented or experimental,
         they may be subject to adjustment or refinement, which may have adverse
         effects on the Company. Further, through state plans and other economic
         and fiscal measures such as the leverage of exchange rate, it remains
         possible for the PRC government to exert significant influence on the
         PRC economy.

         The Company's financial instruments that are exposed to concentration
         of credit risk consist primarily of cash and cash equivalents. Cash and
         cash equivalents are maintained with government-owned banks in the PRC
         with high credit ratings. Accordingly, the Company believes that no
         significant credit risk exists.

         The Company's business activity is with customers in the PRC, and the
         customer base is not concentrated.

         On January 1, 1994, the PRC government introduced a single rate of
         exchange as quoted daily by the People's Bank of China (the "Unified
         Exchange Rate"). No representation is made that the Rmb amounts have
         been, or could be, converted into US$ at that rate. This quotation of
         exchange rates does not imply free convertibility of Rmb to other
         foreign currencies. All foreign exchange transactions continue to take
         place either through the Bank of China or other banks authorized to buy
         and sell foreign currencies at the exchange rate quoted by the People's
         Bank of China. Approval of foreign currency payments by the People's
         Bank of China or other institutions requires submitting a payment
         application form together with suppliers' invoices, shipping documents
         and signed contracts.


                                       51
<PAGE>


         Industry Risk:

         The Company operates in business segments, which are characterized by
         rapid technological advances, changes in customer requirements, and
         evolving regulatory requirements and industry standards. Any failure by
         the Company to anticipate or to respond adequately to technological
         changes in its industry segments, changes in customer requirements or
         changes in regulatory requirements or industry standards, could have a
         material adverse effect on the Company's business and operating
         results.


4. SHANGHAI FORTUNE VENTURE LTD.

         On April 12, 2004, the Company completed the acquisition of a 25%
         interest in Shanghai Fortune Venture Ltd. ("SFVL"), a company
         incorporated in Shanghai, PRC.

         The total purchase price of Rmb20,472,000 consisted of Rmb19,872,000 in
         the form of 10,000,000 shares of the Company's common stock and
         Rmb600,000 of cash consideration. The value of the common stock issued
         was based on the market value of the common stock at the completion
         date. The acquisition agreement contains a provision that for the five
         years subsequent to the completion of this transaction, the profit to
         be distributed to the Company shall not be less than US$420,000 per
         annum. If SFVL cannot achieve this target in the first year, the
         Company will be entitled to demand that SFVL to return a portion of
         10,000,000 shares to the Company.

         The Company's investment in SFVL at June 30, 2004 and June 30, 2005
         were as follows:

<TABLE>

                                                                                             Rmb                 US$
        <S>                                                                       <C>                       <C>

        Cash consideration paid                                                          600,000              72,464
        10,000,000 shares of the Company's common stock valued at $0.24 per
            share                                                                     19,872,000           2,400,000
                                                                                 ----------------      ----------------
                                                                                 ----------------      ----------------

        Total consideration paid                                                      20,472,000           2,472,464

        25% of net income of SFVL for the period from April 13, 2004 to June
            30, 2005                                                                   1,174,308             141,824
                                                                                 ----------------      ----------------
                                                                                 ----------------      ----------------

                                                                                      21,646,308           2,614,288
        Commissions paid                                                                 596,160              72,000
        25% of net income of SFVL for the year ended June 30 2005                      1,616,049             195,175
                                                                                 ----------------      ----------------
                                                                                 ----------------      ----------------
                                                                                      23,858,517           2,881,463
                                                                                 ================      ================
                                                                                 ================      ================

</TABLE>


         Since December 6, 2002, SFVL has been an official registered member of
         the Shanghai Technology Exchange (the "STE") and was entitled to
         conduct exchange business with the STE. The STE was the major entity in
         the Shanghai Equity Exchange Market. SFVL had the exclusive right to
         manage and operate the North Shanghai Branch (the "NSB") of the STE.
         The NSB had the right to conduct the same exchange business as STE and
         share 80% of the profits with the STE.

         SFVL was also a founder and major participant in the Yangtze River
         Delta Equity Exchange Market Place (the "YRDE"). The YRDE included more
         than 14 major exchanges in Shanghai and the surrounding cities and was
         the largest equity exchange market place in China.

         However, in December 2003, the STE and another exchange were merged
         into the Shanghai United Assets and Equity Exchange (the "SUAEE"). The
         SUAEE is a non-profit government-sponsored organization.

                                       52
<PAGE>

         As a result of the merger of the STE, although SFVL continues to
         maintain its membership, it is currently unclear how the NSB and the
         YRDE will conduct business going forward, and how SFVL will participate
         in the equity exchange markets, as a result of the pending issuance of
         final regulations by the local PRC government. Due the uncertainly in
         the status of the final regulation by the local PRC government on YRDE,
         SFVL subsequently acquired 33.75% of the shareholding in Xian Asset and
         Equity Exchange in June 3, 2004 in order to develop the Equity Exchange
         Market in another major province in PRC.



         Summarized financial information for SFVL is presented below.

                  Shanghai Fortune Venture Ltd. and Subsidiary
                          (A Development Stage Company)

                           Consolidated Balance Sheet
<TABLE>


                                                            June 30, 2005                       June 30, 2004
                                                    ----------------------------- -----------------------------
                                                             Rmb            US$             Rmb           US$
<S>                                                   <C>           <C>               <C>           <C>

       Assets

       Current assets                                 21,008,290      2,537,233      50,610,183     6,112,341
       Equipment, net                                    269,583         32,558          63,028         7,612
       Intangible assets, net                            150,000         18,116         170,000        20,531
       Investments                                     1,153,449        139,306       1,350,000       163,044
                                                    -------------   ------------ --------------- -------------
                                                    -------------   ------------ --------------- -------------

       Total assets                                   22,581,322      2,727,213      52,193,211     6,303,528
                                                    =============   ============ =============== =============
                                                    =============   ============ =============== =============

       Liabilities and Stockholders' Equity

       Current liabilities                                43,981          5,312      37,806,286     4,565,977
       Minority interest                                  97,714         11,801         626,753        75,695
       Stockholders' equity                           22,439,627      2,710,100      13,760,172     1,661,856
                                                    -------------   ------------ --------------- -------------
                                                    -------------   ------------ --------------- -------------

       Total liabilities and stockholders' equity     22,581,322      2,727,213      52,193,211     6,303,528
                                                    =============   ============ =============== =============
</TABLE>


                                       53
<PAGE>


                  Shanghai Fortune Venture Ltd. and Subsidiary
                          (A Development Stage Company)
                      Consolidated Statement of Operations
<TABLE>

                                                       Year ended                  Period From April 12, 2004
                                                     June 30, 2005                     to June 30, 2004
                                               -------------------------------- ----------------------------------
                                                       Rmb               US$             Rmb                  US$
<S>                                               <C>              <C>                <C>               <C>


       Net revenues                             36,735,136         4,436,611      46,358,830            5,598,893

       Cost of sales                            25,971,924         3,136,706      40,379,921            4,876,802
                                                                                     760,794
       Operating costs and expenses              1,126,778           136,084                          91,883
       Other income                                      -                 -        (12,526)              (1,513)
       Income tax                                   33,840             4,087
       Minority interest                         (529,038)          (63,893)         533,410               64,422
       Surplus reserve                           2,215,260           267,543               -                    -
       Dividend                                  1,255,626           151,646               -                    -
       Equity in earnings of an associated
           company                                 196,551            23,738               -                    -
                                                -----------     -------------    ------------     ----------------
                                                -----------     -------------    ------------     ----------------
       Net income                                6,464,195           780,700       4,697,231              567,299
                                                ===========     =============    ============     ================
</TABLE>


         Shanghai Fortune Venture Ltd.'s operating subsidiary is exempt from PRC
         enterprise income taxes through December 31, 2004 due to a one year tax
         holiday. Beginning January 1, 2005, Shanghai Fortune Venture Ltd.'s PRC
         enterprise income tax rate will be 33%.


5. ACCOUNTS RECEIVABLE

         Accounts receivable are summarized as follows:
<TABLE>

                                                            June 30, 2005                         June 30, 2004
                                                   ---------------------------------     --------------------------------
                                                             Rmb                US$               US$                US$
<S>                                                  <C>                <C>                 <C>                <C>

        Accounts receivable                           65,447,719          7,904,314         3,052,336            368,640


        Less:  Allowance for doubtful accounts                 -                  -                 -                  -
                                                   --------------     --------------     -------------    ---------------
                                                   --------------     --------------     -------------    ---------------

                                                      65,447,719          7,904,314         3,052,336            368,640
                                                   ==============     ==============     =============    ===============

</TABLE>

         There was no activity in the Company's allowance for doubtful accounts
         during the year ended June 30, 2004 and June 30, 2005.


                                       54
<PAGE>


6. DEPOSITS, PREPAYMENTS AND OTHER RECEIVABLES

         Deposits, prepayments and other receivables are summarized as follows:
<TABLE>

                                                                  June 30, 2005                     June 30, 2004
                                                          ------------------------------    ------------------------------
                                                                   Rmb              US$               Rmb              US$
     <S>                                                      <C>               <C>              <C>              <C>


        Rental and utilities deposits                           57,682            6,966            67,538            8,157
        Advance to employees                                    28,069            3,390            34,061            4,114
        Prepaid expenses                                        10,077            1,218            78,385            9,467

        Subscription money held in escrow account (a)                -                -         1,808,352          218,400
        Court deposit for legal proceeding (b)                       -                -           535,000           64,613
        Deposit on investment in an associated company
            (c)                                                      -                -         1,000,000          120,773
        Due from minority stockholders (d)                     245,000           29,589           245,000           29,589
        Other loans (e)                                      1,347,000          162,681           730,200           88,188
        Deposit on investment in a subsidiary (f)              105,000           12,681                 -                -
        Other                                                   12,423            1,500             5,263              636
                                                          -------------    -------------     -------------    -------------
                                                          -------------    -------------

                                                             1,805,251          218,025         4,503,799          543,937
                                                          =============    =============     =============    =============
</TABLE>


         (a) Subscription money held in escrow account was fully repaid to the
         Company in September 2004.

         (b) During September 2000, the Company entered into an agreement to
         acquire 58.3% of the outstanding shares of J.R. Hi-Tech Investment
         Corporation ("JRHIC") from its two stockholders. JRHIC's main
         investment via a holding company was a 90% ownership of Shenzhen China
         Websecurity.com, a Chinese-foreign equity joint venture established in
         the PRC, which engaged in providing internet security services, systems
         integration and software development services. Based on the terms of
         the agreement, the consideration to be paid was Rmb1,500,000 in cash
         and 510,300 shares of common stock of the Company valued at
         Rmb10,974,001 or US$2.60 per share. As of June 30, 2001, the Company
         had paid Rmb1,500,000 in cash, but had not issued the 510,300 shares of
         common stock, nor had it received the transfer of shares from the
         stockholders of JRHIC. The Company is in the process of commencing
         legal action to terminate the agreement and attempt to recover
         Rmb1,500,000. Due to the uncertainty of any recovery from the
         stockholders of JRHIC, the Company provided a valuation allowance on
         the full amount of this receivable as a bad debt expense in the year
         ended June 30, 2001. During the year ended June 30, 2002, the Company
         paid Rmb535,000 to the Court and an Injunction Order was granted
         against the Defendants to freeze bank accounts held in the name of the
         Defendants until a conclusion or further order from the Court was
         obtained. In June 8, 2005, the company sought for court settlement and
         recovered the court deposit of Rmb535,000 plus interest income of
         Rmb27,184.

         (c) Deposit on investment in an associated company of Zenith Technology
         Ltd. ("Zenith") from Mr. Xie Wei, the major stockholder of Zenith.
         Although the acquisition is still pending for to government approval,
         the Company cannot locate Mr. Xie Wei for more than six months. The
         amount was charged off as a bad debt in June 30, 2 005.

         (d) The amount receivable from the minority stockholders of Shanghai
         Newray Photographic Equipment Co., Ltd. of Rmb245,000 is unsecured,
         non-interest bearing, and due and payable during the year ending June
         30, 2006.

         (e) At June 30, 2004, the Company had advanced Rmb475,200 to Metrolink
         Holdings Limited, which is controlled by a shareholder of the Company,
         as a deposit for a potential project (which was repaid in September
         2004) and Rmb255,000 to Mr. Zhu Wei, the former holder of a 51%
         interest in Shanghai Newray Photographic Equipment Co., Ltd. chich is
         unsecured, non-interest bearing, and due and payable during the year
         ending June 30, 2006 At June 30, 2005, cash loan to Shanghai Sanou,
         unrelated third party of Rmb1,000,000 which is unsecured , non interest
         bearing and due and payable on or before December 1, 2005, cash loan to
         Hainan Man Lai Yuan, unrelated third party of Rmb85,000 with interest
         rate at 0.45% per month, and due and payable on April 25, 2006 and
         short-term cash loan to unrelated party of Rmb7,000 with interest rate
         at 0.25% per month.

                                       55
<PAGE>

         (f) Deposit on investment in a subsidiary of Hainan Concord of 98%
         shareholding in Hainan Yin Quan Tong and the acquisition is completed
         in July 2005.

7.         GOODWILL

         On May 29, 2003, the Company completed the acquisition of a 51%
         interest in Shanghai Newray Photographic Equipment Co., Ltd. ("SNPE"),
         a company incorporated in Shanghai, PRC. SNPE had no operations prior
         to the acquisition and had no assets and liabilities other than cash
         balances. Subsequent to the acquisition, staff with expertise in the
         photographic business in Shanghai was recruited and SNPE commenced
         business operations, including sales of photographic equipment, and
         sales of LCD monitors to PRC Railway Dept. The acquisition provided the
         Company with a presence in the digital imaging business. The Company
         also expects to assist SNPE in developing its digital imaging platform
         for photo processing and other related business, which may provide
         further expansion into other parts of the PRC. These factors
         contributed to a purchase price in excess of the fair market value of
         SNPE's net tangible assets acquired, and as a result, the Company has
         recorded goodwill in connection with this transaction.

         The total purchase price of Rmb4,823,552 consisted of 4,000,000 shares
         of the Company's common stock valued at Rmb4,305,600 (US$0.13 per
         share) and Rmb200,000 (US$24,155) in cash consideration, and commission
         expenses of Rmb317,952 (US$38,400) paid to an unrelated advisor. The
         value of the common stock issued was based on the market value of the
         common stock at the completion date of the acquisition.

         The allocation of the purchase price to the assets acquired and
         liabilities assumed based on the fair value of SNPE was as follows:

                                                Rmb                 US$

        Cash acquired                       500,000              60,386
        Goodwill                          4,568,552             551,758
        Minority interest                 (245,000)             (29,589)
                                    ----------------      ----------------
                                    ----------------      ----------------

        Total                             4,823,552             582,555
                                    ================      ================
                                    ================      ================


       Prior to the acquisition by the Company, SNPE had no operations since it
       was incorporated on April 3, 2003. Accordingly, no pro forma financial
       information is presented. The results of operations of SNPE have been
       included in the Company's consolidated financial statements since the
       completion of the acquisition on May 29, 2003.

       Goodwill of Rmb4,568,552 represented the excess of the purchase price
       over the fair value of the net tangible assets acquired. The goodwill has
       been included in the photographic business segment.

       Goodwill is summarized as follows:

<TABLE>

                                                                              Rmb                    US$
          <S>                                                     <C>                       <C>

         Goodwill acquired in SNPE transaction on May 29, 2003         4,568,552                551,758
                                                                 -----------------      -----------------
                                                                 -----------------      -----------------

         Balance, June 30, 2004                                        4,568,552                551,758
                                                                 -----------------      -----------------

         Balance, June 30, 2005                                        4,568,552                551,758
                                                                 =================      =================
</TABLE>

                                       56
<PAGE>

         On August 10, 2004, the Company's wholly-owned subsidiary, IMOT
         Information Technology (Shenzhen) Ltd. ("IMOT Technology"), received
         all necessary government approval required to complete the transfer of
         51% of the issued and outstanding shares of Golden Anke Technology,
         Ltd. ("Golden Anke") from two of its shareholders to IMOT Technology.

         Previously, on March 31, 2004, IMOT Technology had entered into
         agreement to acquire a 51% interest in Golden Anke from two of Golden
         Anke's stockholders. The agreement was subject to final approval from
         the government of Shenzhen, PRC the completion of a due diligence
         investigation by the parties, and approval by the respective boards of
         directors of each party. The purchase price was determined to be
         $3,240,000, consisting of 12,000,000 shares of the Company's common
         stock at a value of $0.27 per share. The value of the common stock was
         determined by computing the average closing price of the Company's
         common stock from January 20, 2004 to March 19, 2004, and then applying
         a 20% discount.

         Golden Anke is a digital security imaging system provider in China,
         offering a variety of solutions on video surveillance, digital image
         processing and compressing, Internet image transfer and imaging
         security systems.

         The total purchase price of Rmb 27,542,592 consisted of 12,000,000
         shares of the Company's common stock valued at Rmb26,827,000 (US$0.27
         per share) and commission expenses of Rmb715,392 ($86,400) paid to an
         unrelated advisor. The value of the common stock issued was based on
         the market value of the common stock at the completion date of the
         acquisition.

         Goodwill of Rmb16,437,064 represented the excess of the purchase price
         over the fair value of the net tangible asset acquired. The goodwill
         has been included in the digital security system segment.

         Goodwill is summarized as follows:
<TABLE>

                                                                               Rmb                US$
         <S>                                                         <C>                  <C>

         Goodwill acquired in GATL transaction on August 10, 2004       17,152,456          2,071,552

                                                                      -------------   ----------------
                                                                      -------------   ----------------
         Balance, June 30, 2005                                         17,152,456          2,071,552
                                                                      =============   ================
                                                                      =============   ================
</TABLE>


         Pursuant to the Stock Exchange Agreement relating to Hainan Concord
         Financial Products Development Co., Ltd. ("Development"), IITSL will
         issue to the Development Stockholders 5,000,000 shares of the Company's
         restricted common stock having a value of Rmb76,617,600 (US$920,000).
         The consideration for the transaction was determined by arm's-length
         negotiations between the parties, none of whom is related.

         Development provides financial institutions with research and
         development services related to financial products and instruments. Its
         subsidiary, Hainan Yangpu Multifunctional Smart Card Sales and
         Management Co. Ltd., issues and manages multifunctional smart cards and
         provides related services. The Company, through IITSL, also intends to
         continue and expand these operations in the PRC.

         The total purchase price of Rmb7,915,600 consisted of 5,000,000 shares
         of the Company's common stock valued at Rmb7,617,600 (US$0.184 per
         share) and commission expenses of Rmb596,160 (72,000) paid to unrelated
         advisor. The value of the common stock issued was based on the market
         value of the common issued was based on the market value of the common
         stock at the completion dated of the acquisition.

         Goodwill of Rmb6,676,277 represented the excess of the purchase price
         over the fair value of the net tangible asset acquired. The goodwill
         has been included in the unallocated segment.

         Goodwill is summarized as follows:

                                       57
<PAGE>

<TABLE>
<S>                                                                <C>               <C>
                                                                            Rmb                  US$

         Goodwill acquired in HCFPDCL transaction on Jan 6, 2005      7,272,437              878,314
                                                                  --------------     ----------------
                                                                  --------------     ----------------
         Balance, June 30, 2005                                       7,272,437              878,314
                                                                  ==============     ================
</TABLE>


8. PLANT AND EQUIPMENT
         Plant and equipment is summarized as follows:
<TABLE>

                                                   June 30, 2005                          June 30, 2004
                                                ----------------------------    ------------------------------
                                                       Rmb              Rmb                 Rmb            US$
<S>                                                 <C>           <C>                 <C>             <C>

         Plant and equipment, at cost:
         Computer equipment                          974,606       117,706             931,061         112,447
         Furniture and office equipment              406,092        49,045             402,259          48,582
         Motor vehicles                               83,228        10,052             532,470          64,308
                                                -----------   --------------    ----------------   ------------
                                                -----------   --------------

         Total                                     1,463,926       176,803           1,865,790         225,337
         Less:  Accumulated depreciation          (1,239,215)     (149,664)         (1,500,390)       (181,207)
                                                -----------   --------------    ----------------   ------------
                                                -----------   --------------

                                                     224,711        27,139             365,400          44,130
                                                ===========   ==============    ================   ============
</TABLE>

         On June 18, 2003, the Company entered into an agreement to dispose of
         its building, with a cost of Rmb2,790,204 (US$336,981) and related
         accumulated depreciation of Rmb488,289 (US$58,972), for Rmb940,000
         (US$113,527), as a result of which the Company recorded an impairment
         charge of Rmb1,360,000 (US$164,251) for the year ended June 30, 2003.
         The Company completed the disposal of the building in April 2004.

         Depreciation expense was Rmb378,337 (US$45,693) and Rmb 215,036
         (US$25,971) for the years ended June 30, 2004 and 2005, respectively.


9. ACCRUED LIABILITIES AND OTHER PAYABLES

         Accrued liabilities and other payables are summarized as follows:
<TABLE>

                                                        June 30, 2005                      June 30, 2004
                                                -----------------------------    -------------------------------
                                                    Rmb            US$                 Rmb                US$
<S>                                               <C>              <C>              <C>                <C>

        Accrued operating expenses
            Wages and bonus                        722,443          87,252             151,441           18,290
            Consultancy fees                     1,054,575         127,364             240,464           29,041
            Legal and professional fees          2,263,593         273,381             350,062           42,278
            Audit fees                           2,753,928         332,600                   -                -
        Other                                      619,621          74,833             220,626           26,646
        Due to a former director (see Note 15)     214,000          25,845             751,483           90,759
                                                --------------   ------------    ----------------     ----------
                                                --------------   ------------    ----------------     ----------

                                                 7,628,160         921,275           1,714,076          207,014
                                                ==============   ============    ================     ==========
</TABLE>


                                       58
<PAGE>

10. WRITE-BACK OF AMORTIZATION OF SOFTWARE HELD FOR SALES

         The Company signed a Distributorship Agreement with Kanhan Technologies
       Ltd. of $150,000 on Nov. 28, 2002 for re-sell Kanhan's software license
       in PRC market and the company set up an office in Guangzhou for sales of
       Kanhan's product. Because of economic recession, finally the company
       return goods to Kanhan during the fiscal year and set-off the Accounts
       payable.

11. INCOME TAXES
         The Company and its subsidiaries are subject to income taxes on an
         entity basis on income arising in, or derived, from the tax
         jurisdiction in which they operate. The Company is subject to the
         United States federal tax at a rate of 35%. IL was incorporated under
         the International Business Companies Act of the British Virgin Islands
         and, accordingly, is exempted from payment of the British Virgin
         Islands income taxes. The subsidiaries (IITSL, CECITL, SBUJE and IFACL)
         established in the PRC are subject to PRC enterprise income taxes at a
         rate of 15%. SNPE is subject to a special PRC enterprise income tax at
         a rate 0.5% of turnover. IHKL is subject to Hong Kong profits tax at a
         rate of 17.5%. As of June 30, 2004 and 2005, all subsidiary companies
         except SNPE, GATL and HCFPDCL were in a tax loss position.

         The reconciliation of the United States federal income tax rate to the
         effective income tax rate based on loss before income taxes stated in
         the consolidated statements of operations is as follows:
<TABLE>

                                                                     Years Ended June 30,
                                                                 -----------------------------
                                                                      2005             2004
                                                                         %                %
<S>                                                                <C>                 <C>

         United States federal income tax rate                          35               35
         Effect of different tax rates in foreign jurisdictions        (28)              (3)
         Valuation allowance for deferred tax assets                    (7)             (33)
                                                                 ------------     ------------

                                                                         -               (1)
                                                                 ============     ============
</TABLE>


         Deferred taxation consisted of:
<TABLE>

                                                 June 30, 2005                     June 30, 2004
                                           -----------------------------  ----------------------------
                                                   Rmb             US$            Rmb             US$
<S>                                           <C>               <C>         <C>               <C>

         Deferred tax assets, gross:
                                             5,890,340         711,394
         Net operating loss carry forwards                                   5,683,827        686,453
         Valuation allowance                (5,890,340)       (711,394)     (5,683,827)      (686,453)
                                            -----------     -----------    -----------     ------------
                                            -----------     -----------

         Deferred tax assets, net                    -               -               -              -
                                            ===========     ===========    ===========     ============
</TABLE>

         The change in valuation allowance from June 30, 2004 to June 30, 2005
         is primarily related to the tax effects of the increase in the net
         operating loss in the current fiscal year. The Company has net
         operating loss carryforwards totaling approximately Rmb37,892,178 as of
         June 30, 2004 and Rmb39,268,930 as of June 2005, primarily relating to
         operations in the PRC.

         A valuation allowance has been established for the full amount of the
         deferred tax benefit related to those loss carryforwards and other
         deferred tax assets as management believes that their realization is
         uncertain.


                                       59
<PAGE>

12. STOCKHOLDERS' EQUITY

         Year Ended June 30, 2003:

     In May 2002, the Company issued  20,000,000 shares of common stock for cash
     at  US$0.02  per  share.  The  gross  proceeds   amounted  to  Rmb3,312,000
     (equivalent to US$400,000).  In connection with this issuance,  the Company
     was required to pay issuance  costs by issuing  2,000,000  shares of common
     stock of Rmb331,200  (equivalent  to US$40,000) to a placement  agent.  The
     subscription  proceeds  amounting to  Rmb788,257  had been received and the
     balance of  Rmb2,523,743  was held by the  placement  agent.  The money was
     released to the Company during the year ended June 30, 2003.

     In May 2003, the Company issued common stock to various parties.  The value
     of the common  stock  issued was based on the market price of shares at the
     dates of the  transactions  or on the fair value of the services  received,
     whichever was more reliably measurable. The value of common stock issued as
     employee  compensation  was based on the market  price of the shares at the
     date of issuance. The issuances were as follows:

     The Company issued 1,027,318  shares of common stock for services  rendered
     at a range of US$0.02 to US$0.0532 per share, of which 2,213,401  shares of
     common stock were issued to the chief executive officer of the Company, Mr.
     Andy Lin,  as partial  settlement  of amounts due to Mr. Lin at US$0.15 and
     US$0.02 per share. The Company issued 1,709,400 shares of common stock each
     to the chief executive officer of the Company,  Mr. Lin, and an employee of
     the Company,  at US$0.03 per share, as part of their  remuneration  for the
     year ended June 30, 2003. In addition, the Company issued 200,000 shares of
     common  stock each to two  directors  of the Company at US$0.04 and US$0.03
     per share.  The Company also issued 52,000 shares to an  ex-employee of the
     Company as dismissal notice compensation at US$0.074 per share. The Company
     issued 2,014,066 shares of common stock to various creditors for settlement
     of  balances  due at US$0.001  to US$0.02  per share.  The  Company  issued
     4,000,000  shares of common  stock to acquire a 51%  interest  in  Shanghai
     Newray Photographic Equipment Co., Ltd. at US$0.13 per share.

     At June 30, 2003, the Company had recorded 3,820,000 shares of common stock
     as  reserved  and to be issued to various  parties  for  services  rendered
     through June 30, 2003 at prices  ranging from US$0.03 to US$0.24 per share,
     which were issued subsequent to June 30, 2003.

     Year Ended June 30, 2004:

     During the year ended June 30, 2004,  the Company  issued  shares of common
     stock to various parties. The value of the common stock issued was based on
     the  market  price of the shares at the date of the  transaction  or on the
     fair  value of  services  received.  The  issuances  of  common  stock  are
     summarized as follows:

     On September 11, 2003, the Company issued  3,000,000 shares of common stock
     with a value of US$0.05  per share to certain  designated  shareholders  of
     Firstmax Investment Limited for consulting services rendered to the Company
     in the prior  fiscal year having a value of  US$150,000.  At June 30, 2003,
     the value of these  shares had been  recorded  and the share  amounts  were
     included in common stock reserved and to be issued.

     In  connection  with a private  offering of the  Company's  securities,  on
     October 30, 2003, the Company issued  6,053,700 shares of common stock with
     a value of US$0.20 per share to investors in the PRC.

     On October 30, 2003,  the Company  issued 700,000 shares of common stock to
     Stanford Capital  International Ltd. for investor relations  services.  The
     Company's  contract with Stanford Capital  International  Ltd. provided for
     the issuance of 300,000  shares upon its effective date (April 1, 2003) and
     200,000  shares per quarter on the last day of each  quarter.  Accordingly,
     the 700,000 shares included the payment for services rendered for the three
     months ended June 30, 2003 and September  30, 2003.  At June 30, 2003,  the
     Company had recorded  500,000 of such shares,  consisting of 300,000 shares
     valued  at the  closing  price on April 1,  2003 of  US$0.03  per share and
     200,000  shares valued at the closing price on June 30, 2003 of US$0.24 per
     share, which share amounts were included in common stock reserved and to be
     issued at such date.  In  addition,  200,000  shares  valued at the closing
     price on September 30, 2003 of US$0.22 per share.  The  aggregate  value of
     such shares was US$101,000.

     On October 30, 2003,  the Company issued 72,640 shares of common stock with
     a value of US$0.20 per share to Shanghai  Newray  Business  Development Co.
     Ltd.,  the  owner  of a 24.5%  interest  in  Shanghai  Newray  Photographic
     Equipment  Co.,  Ltd.  ("SNPE"),  in exchange  for  services  to  introduce
     investors to subscribe for 908,000 shares of common stock of the Company in
     the private offering issued on October 2003 having a value of US$14,528.

                                       60
<PAGE>

     On October 30, 2003, the Company issued 320,000 shares of common stock with
     a value of US$ 0.12 per share to  Yorkshire  Capital  Ltd. in exchange  for
     services  rendered in connection  with the acquisition of 51% of the shares
     of SNPE on May 29, 2003 with a value of US$38,400.

     On April 14, 2004, the Company issued  3,500,000  shares of common stock to
     Li Lao Hu,  3,000,000  shares of common stock to Li Xiao Qin, and 3,500,000
     shares of common  stock to Huang Xiu Juan  valued at US$0.24  per share for
     the purchase of a 25% interest in Shanghai Fortune Venture Ltd.,  having an
     aggregate value of US$2,400,000.

     On June 24,  2004,  the Company  issued  400,000  shares of common stock to
     Stanford  Capital  International  Limited for investor  relations  services
     rendered to the Company for the three  months  ended  December 31, 2003 and
     March 31, 2004, with 200,000 shares valued at the closing price on December
     31,  2003 of US$0.32  per share and  200,000  shares  valued at the closing
     price on March 31, 2004 of US$0.30 per share,  having an aggregate value of
     US$124,000.

     On June,  2004,  the Company  issued  225,000 shares of common stock with a
     value of US$0.32 per share to Hank Vanderkam for legal services rendered to
     the Company, having a value of US$72,000. At June 30, 2004, the Company had
     recorded  200,000  shares of common  stock as reserved  and to be issued to
     Stanford Capital  International Limited for investor relations services for
     the three  months  ended June 30, 2004 valued at the closing  price on June
     30, 2004 of US$0.29.  At June 30, 2004,  the value of these shares had been
     recorded and the share amounts were  included in common stock  reserved and
     to be issued. The shares were issued subsequent to June 30, 2004.

     Year ended June 30, 2005:

     Stock Option Plan - On December 1, 2003, the Board of Directors adopted the
     Intermost Corporation 2003 Equity Incentive Plan (the "Plan"). The Plan was
     approved  at  a  stockholders'  meeting  on  January  28,  2004.  The  Plan
     authorizes   awards  of  options   (both   incentive   stock   options  and
     non-qualified  stock  options),  awards of stock  ("Stock  Award")  and the
     granting of bonus stock ("Stock Bonus"). Persons eligible to receive awards
     under the Plan include the Company's employees,  officers and directors and
     its consultants,  independent contractors and advisors. As of June 30, 2004
     and June 30, 2005, no awards have been granted under the Plan.

     The Company's  Board of Directors,  or a committee  comprised of members of
     the  Company's  Board  of  Directors   (hereinafter   referred  to  as  the
     "Administrator"),  will  administer  the Plan.  The  Administrator  has the
     authority to determine,  at its  discretion,  the number and type of awards
     that will be  granted,  the  recipients  of the  awards,  any  exercise  or
     purchase price  required to be paid,  when options may be exercised and the
     term of option  grants.  Awards  under the Plan are not  defined  as to any
     group.  The term of the Plan is 10 years from the date the Plan was adopted
     by the Board of Directors.  The Company has reserved  20,000,000  shares of
     common stock for awards to be made under the Plan.

     The exercise price for stock options granted to officers and directors must
     be the fair  market  value of the  common  stock on the date of grant.  The
     exercise  price for stock  options  granted to eligible  persons other than
     officers and directors may not be less than 85% of the fair market value of
     the common stock on the date of grant. The term of an option may not exceed
     10 years.

     A Stock  Award is an offer by the  Company  to sell to an  eligible  person
     share of common stock that may or may not be subject to restrictions. Stock
     Awards granted to officers and directors must be granted at the fair market
     value of the common stock on the date of the award. Stock Awards granted to
     eligible  persons who are not officers or  directors  may not be granted at
     less than 85% of the fair market  value of the common  stock on the date of
     the award. Stock Awards may be subject to vesting conditions, as determined
     by the Administrator.

                                       61
<PAGE>

     A Stock  Bonus is a grant of  shares  that may be  awarded  to an  eligible
     person. A Stock Bonus may be subject to vesting  conditions,  as determined
     by  the  Administrator.  A  Stock  Bonus  may be  awarded  for  any  reason
     determined   by  the   Administrator,   including,   but  not  limited  to,
     extraordinary services rendered to the Company by an eligible person, as an
     award for  performance  achieved  by the  Company or upon  satisfaction  of
     performance goals by the eligible person.

     In the United States,  a recipient will not recognize any taxable income at
     the time an option is granted.  However,  upon  exercise of an option,  the
     recipient  will  include in income as  compensation  an amount equal to the
     difference  between  the fair  market  value of the  shares  on the date of
     exercise and the recipient's  exercise  price.  The included amount will be
     treated  as  ordinary  income  by  the  recipient  and  may be  subject  to
     withholding.  Upon resale of the shares by the  recipient,  any  subsequent
     appreciation  or depreciation in the value of the shares will be treated as
     capital  gain or loss.  There is no tax  consequence  to the  Company  as a
     result of either the granting or the vesting of stock options.


13.      COMMITMENTS

         Operating Leases - The Company has operating lease agreements for
         office premises which extend through August 2007. Future minimum rental
         payments under agreements classified as operating leases with
         non-cancelable terms are as follows:


                                              ------------------------------
                                                      Rmb               US$

            Year Ending June 30, 2006              72,576              8,765

                                 June 30,
            2007                                   72,576              8,765
                                 June 30,
            2008                                   12,096              1,461

                                              ------------     -------------
                                              ------------     -------------
                     Total                        157,248             18,991
                                              ============     =============

         Rent expense for the years ended June 30, 2004 and 2005 was and
         Rmb219,057 ($26,456) and Rmb285,857 (US$34,524), respectively.

         Employment Agreement - On March 12, 2004 the Company entered into an
         Employment Agreement with Andy Lin, its Chief Executive Officer and
         President. The effective date of the Employment Agreement is March 1,
         2004. The term of the Employment Agreement is three years, and it may
         be automatically renewed. As compensation for his services, Mr. Lin
         will receive an annual salary of HK$700,000 (US$89,744). The Board of
         Directors may, in its discretion, grant an annual bonus to Mr. Lin.
         Pursuant to an amendment to the Employment Agreement that was entered
         into on October 5, 2004, the Board of Directors may also, in its
         discretion, grant options to Mr. Lin to purchase shares of the
         Company's common stock. If any option is granted, the exercise price of
         the option is to be computed as the average of the closing price of the
         common stock for the five trading days prior to the date of grant or
         the average of the closing price of the common stock for the five
         trading days immediately preceding the last day of the Executive's
         service year.


14. RETIREMENT PLAN AND POST-EMPLOYMENT BENEFITS

     The Company has no  retirement  plans or  post-employment  benefits for its
     employees.



                                       62
<PAGE>



15. RELATED PARTY TRANSACTIONS

         In addition to the transactions and information disclosed elsewhere,
         during the years ended June 30, 2004 and 2005, the Company had the
         following transactions with related parties.

         Related parties are considered to be related if one party has the
         ability, directly or indirectly, to control the other party, or
         exercise significant influence over the other party in making financial
         and operating decisions. Parties are also considered to be related if
         they are subject to common control or common significant influence.


         (1)      Related party transactions during the fiscal years ended June
                  30, 2004 and 2005 are as follows:
<TABLE>

                  Name of related party             Existing relationship with the Company
                  --------------------------------- --------------------------------------------------------
<S>                                                   <C>


                  (a)  Shanghai Newray Business
                       Development Co. Ltd.         24.5% interest in SNPE

                  (b)  Juiding Group
                                                   ("JG") A director
                                                   of the Company,
                                                   Mr. Tao Guo Xin,
                                                   is a shareholder
                                                   of and controls
                                                   the management of
                                                   JG.

                                                                            Years Ended June 30,
                                                         ------------------------------------------------------------
                                                                     2005                           2004
                                                         ------------------------------ -----------------------------
                                                                     Rmb            US$           Rmb           US$

                 (a) 72,640 shares of common stock for services rendered to
                     introduce accredited investors in the private placement
                     offering issued in October 2003 at US$0.20 per share -
                     Shanghai
                     Newray Business Development Co. Ltd                          -            -         120,292        14,528

                 (b) Payment on behalf of Golden Anke to
                     suppliers by Juiding Group.                          3,917,684      473,150               -             -

===================================================================================================================

         (2) Balances with related parties are as follows:


                                                          June 30, 2005                              June 30, 2004
                                               ------------------------------------        -----------------------------------
                                                            Rmb                 US$                    Rmb                US$
                 Due to a director:
                     Mr. Andy Lin                            -                   -                 148,283            17,909
                                               =================    ================      =================    ===============
                                               =================    ================      =================    ===============

                 Due to a former director:
                     Mr. Jun Liang                     214,000              25,845                 751,483             90,759
                                               =================    ================      =================    ===============
</TABLE>

                  Mr. Jun Liang ceased to be a director of the Company upon the
                  Company being redomiciled from the State of Utah to the State
                  of Wyoming in February 2003.

                  The outstanding balances with the director and former director
                  are unsecured, non-interest bearing and without pre-determined
                  repayment terms.

                                       63
<PAGE>


16. SEGMENT INFORMATION

         The Company adopted SFAS No. 131, "Disclosures About Segments of an
         Enterprise and Related Information", in respect of its operating
         segments. The Company's reportable segments are E-Commerce Solutions,
         System Sales Integration, Phone Payment System, Web Advertisement,
         Sales of Computer Software, Photographic Business and Digital Security
         System Business. E-Commerce Solutions comprises revenue from web-site
         development contracts and maintenance contracts. The Photographic
         Business consists of sales of photographic equipment and the Digital
         Security System Business consists of sales of digital image security
         surveillance system.

         Each segment is managed separately because each business requires
         different technology and marketing strategies. The Company evaluates
         performance based on operating earnings of the respective business
         units. The accounting policies of the segments are the same as those
         described in the summary of significant accounting policies. The
         corporate assets include primarily cash and cash equivalents and
         deposits and other receivables. There were no significant intercompany
         transactions during any of the reported periods. In determining
         operating income (loss) by reportable segment, general corporate
         expenses and other income and expense items of a non-operating nature
         are not considered, as such items are not allocated to the Company's
         segments. Segment information for the years ended June 30, 2004 and
         2005 is as follows:

         (a) Net revenues:
<TABLE>

                                                                         Years Ended June 30,
                                               --------------------------------------------------------------------------
                                                               2005                                   2004
                                               -------------------------------------     --------------------------------
                                                                                         ---------------
                                                             Rmb                US$                 Rmb              US$
<S>                                               <C>                   <C>                 <C>               <C>

               E-commerce solutions                    1,870,424            225,897           2,838,959          342,869
               Consultancy fee                             7,500                906              16,050            1,938

               Sales of computer software                      -                  -             903,654          109,137
               Photographic business                   7,655,834            924,617          11,372,064        1,373,438
               Sales of digital
                security system                      129,853,847         15,682,832                   -                -
                                               ------------------    ---------------     ---------------    -------------
                                               ------------------    ---------------     ---------------    -------------
                                                     139,387,605         16,834,252          15,130,727        1,827,382
                                               ==================    ===============     ===============    =============
                                               ==================    ===============     ===============    =============


               PRC                                   139,387,605         16,834,252          15,114,677        1,825,444
               Hong Kong                                       -                  -              16,050            1,938
                                               ------------------    ---------------     ---------------    -------------
                                               ------------------    ---------------

                                                     139,387,605         16,834,252          15,130,727        1,827,382
                                               ==================    ===============     ===============    =============


         (b) Net Profit / (loss):

                                                                            Years Ended June 30,
                                                  --------------------------------------------------------------------------
                                                                2005                                    2004
                                                  ----------------------------------      ----------------------------------
                                                                       ---------------
                                                               Rmb                US$               Rmb                 US$

               E-commerce solutions                    (362,864)             (43,824)       (2,441,407)           (294,856)
               System sales and integration                (160)                 (19)            6,015                 726
               Web advertisement                           (776)                 (94)             (505)                (61)
               Sales of computer software                     -                    -           617,823              74,616
               Photographic business                    362,631               43,796           549,106              66,318
               Sales of digital
                  security system                    13,784,268            1,664,766                 -                   -
                                                 ------------------    ---------------   ---------------   -----------------
                                                 ------------------    ---------------   ---------------   -----------------
                                                     13,783,099            1,664,625        (1,268,968)           (153,257)


               Reconciliation:
               Net Profit / (loss) for
                 reportable segments                 13,783,099            1,664,625        (1,268,968)           (153,257)
               Unallocated corporate expenses        (9,296,803)          (1,122,802)       (5,443,884)           (657,474)
                                                 ------------------    ---------------   ---------------   -----------------
                                                 ------------------    ---------------   ---------------   -----------------
                                                      4,486,296              541,823        (6,712,852)           (810,731)
                                                 ==================    ===============   ===============   =================
</TABLE>

<TABLE>
        (c)    Assets:

                                                                 June 30, 2005                       June 30, 2004
                                                       -----------------------------------  --------------------------------
                                                       -----------------------------------
                                                                 Rmb                US$             Rmb               US$
<S>                                                     <C>                      <C>            <C>             <C>



               E-commerce solutions                            346,837           41,888          664,809            80,291
               Sales of computer software                            -                  -        632,147            76,346
               Photographic business                         7,200,476            869,623      8,332,099         1,006,292
               Sales of digital  Security System            83,410,478         10,073,729              -                 -
                                                       ----------------   ----------------  --------------   ---------------
                                                       ----------------   ----------------  --------------   ---------------
                                                                                               9,629,055         1,162,929
                                                            90,957,791         10,985,240
                                                       ================   ================  ==============   ===============
                                                       ================   ================  ==============   ===============

               Reconciliation:

               Total assets for reportable segments         90,957,791         10,985,240      9,629,055         1,162,929
               Other corporate assets                       38,429,217          4,641,210     26,058,162         3,147,121
                                                       ----------------   ----------------  --------------   ---------------
                                                       ----------------   ----------------  --------------   ---------------

                                                           129,387,008         15,626,450     35,687,217         4,310,050
                                                       ================   ================  ==============   ===============
                                                       ================   ================  ==============   ===============
</TABLE>

     Substantially all of the Company's  identifiable  assets are located in the
     PRC.

<TABLE>

         (d) Other items:

                                                                                 Years Ended June 30,
                                                        ------------------------------------------------------------------------
                                                                       2005                                  2004
                                                        -----------------------------------     --------------------------------
                                                                             --------------
                                                                    Rmb                US$               Rmb               US$
<S>                                                       <C>                  <C>                 <C>                <C>

               Depreciation:
                   E-commerce solutions                         188,773             22,799           358,605            43,310
                   Photographic business                          3,371                407             3,089               373
                   Unallocated corporate assets                  22,892              2,765            16,643             2,010
                                                        ----------------     --------------    --------------    --------------
                                                        ----------------

                                                                215,036             25,971           378,337            45,693
                                                        ================     ==============    ==============    ==============
                                                        ================     ==============    ==============    ==============

               Expenditures for fixed assets:
                   E-commerce solutions                          57,164              6,904           180,835            21,840
                   Photographic business                              -                  -            10,111             1,221
                   Unallocated corporate assets                  39,670              4,791            22,390             2,704
                                                        ----------------     --------------    --------------    --------------
                                                        ----------------

                                                                 96,834             11,695           213,336            25,765
                                                        ================     ==============    ==============    ==============
                                                        ================     ==============    ==============    ==============

</TABLE>



     (e) Major customers and concentrations:

     For the year ended June 30,  2005,  the two largest  customers  were in the
     digital security system segment, accounted for 84%, and in the photographic
     business segment, accounted for 85%, of total revenues,  respectively.  For
     the year  ended  June  30,  2004,  the two  largest  customers  were in the
     photographic  business  segment  and  accounted  for  40%  and 7% of  total
     revenues, respectively

     As of June 30, 2005,  one customer  accounted for 99% of the total accounts
     receivable balance.

     As of June 30, 2004,  one customer  accounted for 88% of the total accounts
     receivable balance.

17. PENDING TRANSACTIONS

     On Dec 16, 2003, the Company's  wholly-owned  subsidiary,  IMOT Information
     Technology (Shenzhen) Ltd. ("IITSL"), entered into an agreement, subject to
     the final  approval  from the  government  of Shenzhen and Hainan,  PRC, to
     acquire 21% of the issued and outstanding shares of Hainan Special Economic
     Zone Property Rights  Exchange  Center (the "Exchange  Center") from Hainan
     Concord  Investment  Holding Co., Ltd. and Guangzhou  Keensheng Science and
     Technology  Development  Co.,  Ltd.,  the  owners of 100% of the issued and
     outstanding  capital  stock  of  the  Exchange  Center  (collectively,  the
     "Exchange Stockholders").

     This  agreement  was  awaiting  government  approval  and  was  pending  at
     September 30, 2005.

     Pursuant to the Stock Exchange  Agreement  relating to the Exchange Center,
     IITSL  will  issue to the  Exchange  Stockholders  5,000,000  shares of the
     Company's   restricted   common  stock  having  a  value  of   Rmb8,980,000
     (approximately  US$1,085,000).  The  consideration  for the transaction was
     determined by arm's-length  negotiations between the parties,  none of whom
     is related.

     The  Exchange  Center is the only  institution  in Hainan  approved  by the
     Hainan  Provincial  Securities  Commission  to  facilitate  the  trading of
     property  rights,  including  intellectual  property  rights.  The Exchange
     Center  charges  a  transaction  fee of 0.3% on each  trade.  The  Company,
     through IITSL, intends to continue and expand these operations in the PRC.


18. SUBSEQUENT EVENTS

     On July 28, 2005 the Company  completed a private  placement  of  1,028,278
     shares of its common stock under the exemption provision of Regulation S to
     a party at US$0.05 per share, raising a total of US$51,414.

     On  September  7,  2005,  the  Company  completed  a private  placement  of
     3,000,000  shares of its common  stock  under the  exemption  provision  of
     Regulation  S to  a  party  at  US$0.05  per  share,  raising  a  total  of
     US$150,000.

     On  September  10,  2005,  the  Company  completed a private  placement  of
     40,000,000  shares of its common  stock under the  exemption  provision  of
     Regulation  S to  four  parties  at  US$0.05  per  share,  raising  a total
     US$2,000,000.

     The  Company  intends  to use the  proceeds  for  general  working  capital
     purposes.  Following  the  issuance  of the share,  the  Company  will have
     140,410,278 shares issued and outstanding.