**United States**

**SECURITIES AND EXCHANGECOMMISSION**

**Washington,D.C. 20549**

 

**FORM 10-KSB**

 

**ANNUAL REPORT UNDER SECTION 13OR 15(d) OF**

**THE SECURITIES EXCHANGE ACT OF 1934**

 

**Forthe Fiscal Year Ended December 31, 2004**

 

**CommissionFile Number 0-49701**

 

**PACIFIC VEGAS GLOBAL STRATEGIES,INC.**

(Name of small business issuerin its charter)

 
| **COLORADO**                                    | ** ** | **84-1159783**                     |
|-------------------------------------------------|------------|------------------------------------|
| (State or  Other Jurisdiction of Incorporation) |       | (IRS  Employer Identification No.) |

 

**16/F,Winsome House**

**73Wyndham Street, Central, Hong Kong**

(Address of Principal ExecutiveOffices)

 

**(011)(852) 3154-9370**

(Issuer’s Telephone Number,Including Area Code)

 

Securities registered under Section 12(g) of the Exchange Act:

 

**CommonStock, with No Par Value**

(Title of Class)

 

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

YES  ý     NO  o

 

Check if disclosure of delinquent filers in response to Item 405 ofRegulation S-B is not contained in this form, and no disclosure will becontained, to the best of registrant’s knowledge, in definitive proxy orinformation statements incorporated by reference in Part III of this Form10-KSB or any amendment to this Form 10-KSB.    ý

 

State issuer’s revenues for its most recent fiscal year:  **US$30,211**.

 

State the aggregate market value of the voting and non-voting commonequity held by non-affiliates:  **US$1,546,308.45**.*

 

----

*      Theaggregate market value was determined by multiplying the number of outstandingshares (excluding those shares held of record by officers, directors andgreater than five percent shareholders) by **US$0.03**, theaverage bid and asked price of the registrant’s common stock as of March 15,2005, such date being within 60 days prior to the date of filing.

 

State the number of shares outstanding of each of the issuer’s classesof common equity, as of the latest practicable date:  **99,963,615**sharesof Common Stock with No Par Value as of February 28, 2005.

 

Documents incorporated by reference: **NONE**

 

Transitional Small Business Disclosure Format:     YES  o     NO  ý

 

 

----

 

**PART****     I**

 

**ITEM  1.****         DESCRIPTIONOF BUSINESS**

 

**1.****     INTRODUCTION**

 

All statements other than statements of historical fact included inthis annual report regarding our financial position and operating and strategicinitiatives and addressing industry developments are forward-lookingstatements. Where, in any forward-looking statement, we or our managementexpresses an expectation or belief as to future results, such expectation orbelief is expressed in good faith and believed to have a reasonable basis, butthere can be no assurance that the statement of such expectation or belief willresult or be achieved or accomplished. Factors which could cause actual resultsto differ materially from those anticipated include but are not limited togeneral economic, financial and business conditions; competition anddevelopment in the online sports gaming industry; the business abilities andjudgment of personnel; the impacts of unusual items resulting from ongoingevaluations of business strategies; and changes in business strategies.

 

Our principal executive office is located at 16/F, Winsome House, 73Wyndham Street, Central, Hong Kong, telephone (852) 3154-9370.

 

**2.****     ACQUISITIONOF CYBER TECHNOLOGY GROUP HOLDINGS LTD.**

 

On November 25, 2002, Pacific Vegas Global Strategies, Inc.,formerly known as Goaltimer International, Inc. (the “Company” or “PVGS”),entered into an agreement for a transaction of share exchange with CyberTechnology Group Holdings Ltd. (“CTGH”) for the Company to acquire CTGH througha plan of share exchange under the laws of Colorado. Pursuant to the shareexchange agreement, the Company would acquire 100% of the issued andoutstanding capital shares of CTGH, in exchange for 60,000,000 new shares ofcommon stock of the Company. On December 12, 2002, our shareholdersapproved this transaction of share exchange.

 

The transaction was finally executed and concluded on January 8,2003, upon which control of the Company passed to the shareholders of CTGH, andCTGH became a wholly owned subsidiary of the Company.

 

CTGH is an investment holding company, incorporated in the BritishVirgin Islands since June 2000. CTGH owns 100% of the capital stock ofPacific Vegas Development Ltd. (“PVD”).

 

PVD is an IT company, incorporated in Samoa since April 2000,engaged in the business of system solutions development and technical supportingservices for e-business, especially e-gaming related business. PVD is the soleshareholder of Pacific Vegas International Ltd. (“PVI”).

 

PVI is a company incorporated and located in the Commonwealth ofDominica since April 2000, established to conduct an offshore business ofinternational sportsbook under the International Gaming License granted by theGovernment of the Commonwealth of Dominica.

 

Since the Company was a non-operating public shell before itsacquisition of CTGH, the nature of the acquisition was treated as a capitaltransaction or recapitalization in substance, rather than a

 

2

----

 

business combination. The acquisition did not result in any purchaseaccounting adjustments or creation of goodwill.

 

**3.****     DESCRIPTIONOF CORPORATE STRUCTURE AND BUSINESS OPERATIONS**

 

The Company was a non-operating public shell with no subsidiaries,associates or affiliates and no active business operations prior to itsacquisition of CTGH. The acquisition of CTGH restructured the Company into anincorporated group with active business operations, upon which the Companybecame one of a few listed companies engaged in e-gaming business.

 

**3.1****  CTGH- The Financial Operation Center for the Group**

 

CTGH was incorporated as an investment holding company primarily foracquiring e-gaming related business through capital transactions. It acquiredand currently holds 100% equity shares of PVD, which in turn owns 100% capitalshares of PVI. As an investment holding company, CTGH operated as the financialoperation center for the Group, focusing primarily on strategic financialplanning and capital transactions for business acquisition, while conductinggeneral administration for the Group as well.

 

**3.2****  PVD- The Technical Operation Center for the Group**

 

PVD is the sole shareholder of PVI. PVD was established as an ITcompany primarily in the business of system solutions development and technicalsupporting services for e-business, especially e-gaming related business. PVDoperated as the technical operation center for the Group, primarily forsupporting the technical needs of PVI.

 

**3.3****  PVI- The Revenue Operation Center for the Group**

 

Incorporated and located in the Commonwealth of Dominica since April 2000,PVI was granted an International Gaming License by the Government of Dominicato conduct an offshore business of international sportsbook. Such license issubject to annual renewal under the laws of Dominica, and the license wasrenewed every year for the past years.

 

PVI operated as the revenue operation center for the Group, through itsoperations of international sportsbook business, the only revenue-generatingoperations of the Group.

 

Sportsbook operations set out and offer various wagering options atvarious prices, or as known more commonly, odds or lines, for wagering onsports events and take wagers at such prices, to earn a percentage of grosswagers, the net wager earnings, as sportsbook revenue.

 

For the fiscal year ended December 31, 2003, PVI achieved a totalof gross wagers of US$94.47 million and a total revenue (net wager earnings) ofUS$1.70 million. For the fiscal year ended December 31, 2004, PVI achieveda total of gross wagers of US$85.43 million and a total revenue (net wagerearnings) of US$0.03 million.

 

3

----

 

**3.4****  Cessationof Sportsbook Business**

 

On December 6, 2004, our Board ofDirectors reviewed our business operations and financial conditions and notedthe following factors:

 

•      Our operations of sportsbookbusiness had incurred net wager losses consecutively for the first nine monthsof 2004;

 

•      Our cash flows had becomeinsufficient to maintain our sportsbook operations and pay our corporateexpenses;

 

•      Our principal shareholderhad decided to discontinue financing the Company to maintain our operations ofsportsbook business;

 

•      Our operations of sportsbookbusiness had become highly vulnerable to net wager losses due to loss of ourbusiness from small clients, therefore increasing the likelihood of incurringcontinuing losses from such operations in the future;

 

•      Our efforts to try torecover our business from small clients would require a material amount ofcapital expenses for systems upgrade and a material amount of marketingexpenses for market campaign, and there can be no assurance that our businessfrom small clients would be recovered by such capital expenses and marketingexpenses; and

 

•      Our ability to raise capitalin the equity securities market on terms favorable to us or affordable by ushad become nearly nil at this time.

 

In light of the foregoing, effective as of December 6,2004, our Board of Directors resolved to cease our entire operations ofsportsbook business, as an immediate remedial action to prevent further losses.

 

Currently, there is no active business operations by the Company and/orits subsidiary companies. The Company is to further review and re-evaluate itsbusiness structure and strategies to determine what and how to proceed in thefuture.

 

**4.****     EMPLOYEES**

 

As at December 31, 2004, the Company had 5 employees, including 2executive officers with PVGS in Hong Kong for corporate administration, and aminimum number of 3 local employees with PVI in Dominica as required by thegaming license rules of Dominica. As an subsequent event in connection to ourcessation of business operations, the Company dismissed all other employees.

 

As stated in section 2.7 (1) of Item 6 hereof, our internationalgaming license, which is subject to annual renewal, expired as of January 27,2005, and we have not yet decided whether or not to proceed the annual renewal.In case we have decided not to renew our gaming license, the 3 local employeeswith PVI in Dominica will be dismissed accordingly.

 

**5.****     ADDITIONALINFORMATION**

 

Compliance with federal, state and local provisions which have beenenacted regarding the discharge of materials into the environment or otherwiserelating to the protection of the

 

4

----

 

environment has not had, and is not expected to have, any adverseeffect upon our capital expenditures, earnings or competitive position. TheCompany is not presently a party to any litigation or administrativeproceedings with respect to its compliance with such environmental standards.In addition, the Company does not anticipate being required to expend anysignificant capital funds in the near future for environmental protection inconnection with its operations.

 

**ITEM 2.****         DESCRIPTIONOF PROPERTY**

 

The Company maintained leased space in theCommonwealth of Dominica under the name of PVI, which is a space ofapproximately 180 square meters, pursuant to a lease of 3 years with automaticannual renewal at a monthly rent of US$775. This lease was for our operationsof sportsbook business, and this lease will be terminated as of May 1, 2005.

 

The Company leased its executive offices inHong Kong, which was a space of approximately 311 square meters, pursuant to alease of 2 years at a monthly rent of US$6,410, and this lease was terminatedwhen it expired on January 23, 2005.

 

Currently the Company maintains its executiveoffices in Hong Kong, which consist of a space of approximately 60 squaremeters and such space is provided by our principal shareholder for the Companyto use as its executive offices for a temporary period of 6 months commencing January 24,2005 with no rental charges to the Company.

 

The Company does not invest in, and has notadopted any policy with respect to investments in, real estate or interests inreal estate, real estate mortgages or securities of or interests in personsprimarily engaged in real estate activities. It is not the Company’s policy toacquire assets primarily for possible capital gain or primarily for income.

 

**ITEM 3.****         LEGALPROCEEDINGS**

 

No material legal proceedings to which theCompany or any of its subsidiary companies is a party or to which any of itsproperty is the subject are pending, and no such proceedings are known by us tobe contemplated. The Company is not presently a party to any litigation oradministrative proceedings with respect to our compliance with federal, stateand local provisions which have been enacted regarding the discharge ofmaterials into the environment or otherwise relating to the protection of theenvironment and no such proceedings are known by us to be contemplated. Nolegal actions are contemplated nor judgments entered against any of ourofficers or directors concerning any matter involving our business.

 

**ITEM 4.****         SUBMISSIONOF MATTERS TO A VOTE OF SECURITY HOLDERS**

 

No matter was submitted during the fourth quarter of the fiscal yearcovered by this report to a vote of security holders through the solicitationof proxies or otherwise.

 

5

----

 

**PART****     II**

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

 

Our common stock was traded on the OTC Bulletin Board under the symbol “PVEG.OB”from January 8, 2003 until September 26, 2003, at which time it wasmoved from the OTC Bulletin Board to the OTC Non-Bulletin Board for failure tocomply with certain reporting requirements (NASD Rule 6530). It has since thentraded on the Pink Sheets under the symbol “PVEG.PK”. The nature of the marketfor common stocks trading on the Pink Sheets is limited, sporadic and highlyvolatile, and the absence of an active market may have an effect upon the highand low prices as reported. The following information sets forth the high andlow last sale prices per share of our common stock for the periods indicated asreported by the OTC Bulletin Board or the Pink Sheets:

 
| **QUARTER ENDED**        | ** ** | **HIGH** | ** ** | **LOW** | ** ** |
|--------------------------|------------|----------|------------|---------|------------|
|                     |       |     |       |    |       |
| March 31,  2003     |       | US$      | 1.35       |    | US$        | 1.30 |   |
| June 30,  2003      |       | US$      | 0.60       |    | US$        | 0.55 |   |
| September 30,  2003 |       | US$      | 0.12       |    | US$        | 0.10 |   |
| December 31,  2003  |       | US$      | 0.15       |    | US$        | 0.12 |   |
|                     |       |     |       |    |       |
| March 31,  2004     |       | US$      | 0.41       |    | US$        | 0.41 |   |
| June 30,  2004      |       | US$      | 0.12       |    | US$        | 0.12 |   |
| September 30,  2004 |       | US$      | 0.05       |    | US$        | 0.05 |   |
| December 31,  2004  |       | US$      | 0.03       |    | US$        | 0.03 |   |

 

The quotations set forth herein reflect inter-dealer prices, withoutretail mark-ups, mark-downs, or commissions, and may not necessarily representactual transactions.

 

As at December 31, 2004, there were approximately 748 records andbeneficial holders of our common stock.

 

We have not declared or paid any dividends to date.

 

During the fiscal year ended December 31,2004, we did not sell any equity securities that were not registered under theSecurities Act of 1933, as amended.

 

We did not repurchase any of our equity securities within the fourthquarter of the fiscal year covered by this report.

 

**ITEM 6.****         MANAGEMENT’SDISCUSSION AND ANALYSIS OR PLAN OF OPERATION**

 

The Management’s Discussion and Analysis or Plan of Operations in thisreport contains a number of forward-looking statements within the meaning of Section 27Aof the Securities Act of 1933, as amended, and Section 21E of theSecurities Exchange Act of 1934, as amended. Such forward-looking statementsare based on management’s current projections or expectations with

 

6

----

 

regard to the future operations of business. Although managementbelieves that the assumptions made and expectations reflected in suchforward-looking statements are reasonable, there is no assurance that suchassumptions or expectations will prove to be correct and/or accurate, and as aresult of certain risks and uncertainties, actual results of operations maydiffer materially.

 

**1.****     CRITICAL ACCOUNTING POLICIES AND ESTIMATES**

 

Thepreparation of our financial statements in conformity with accountingprinciples generally accepted in the United States requires our management tomake estimates and assumptions that affect the amounts reported in ourfinancial statements and accompanying notes. Actual results could differmaterially from those estimates.

 

We believe that the following are some of themore critical judgment areas in the application of our accounting policies thatcurrently affect our financial condition and results of operations.

 

We recognize wagers revenue on a net basis inthe consolidated statement of operations after a wager is accepted and theoutcome of the bet is certain.

 

We maintain allowances for doubtful accountsfor estimated losses resulting from the inability of our customers to makerequired payments. If the financial condition of our customers were todeteriorate, resulting in an impairment of their abilities to make payments,additional allowances may be required which would result in an additionalgeneral and administrative expense in the period of such determination wasmade.

 

The above listing is not intended to be acomprehensive list of all of our accounting policies.  In many cases, the accounting treatment of aparticular transaction is specifically dictated by generally acceptedaccounting principles, with no need for management’s judgment in theirapplication. There are also areas in which management’s judgment in selectingany viable alternative would not produce a materially different result.  See our audited financial statements andnotes thereto which begin at “Item 7. Financial Statements” of this AnnualReport on Form 10-KSB which contain accounting policies and other disclosuresrequired by generally accepted accounting principles.

 

**2.****     RESULTS OF OPERATIONS**

 

**2.1****  Revenue**

 

The Company’s revenue for the fiscal yearended December 31, 2004 was US$30,211, which was derived from thesportsbook business operated by PVI, the Company’s wholly owned subsidiaryincorporated and located in the Commonwealth of Dominica, conducting suchbusiness under the laws of the Commonwealth of Dominica. There was no otherrevenues from any business of the Company for the subject period.

 

Our revenue for the fiscal year 2004decreased by US$1.67 million or 98.23%, as compared to the revenue of US$1.70million for the fiscal year 2003.

 

During the fiscal year 2004, oursportsbook operations incurred negative revenue (net wager losses) for thefirst nine months.

 

7

----

 

Such significant adverse change in ouroperation results was mainly due to a change in the way that most small clientsplaced their wagers.

 

For a sportsbook to be profitable, it must beable to maintain sufficient business from small clients. In sportsbook businessmost small clients are sports fans with passion for their favorite teams andplayers and they usually place their wagers based on emotions. Industrialstatistics indicate that approximately 96% of sportsbook net wager earningscome from wagers by small clients.

 

Our business was mainly based in the Asianmarket. Best personalized toll-free call center services used to be one of ourmarketing features, and most Asian clients used and appreciated the way theycould place their wagers by using personalized toll-free call center services,even when internet-based online sports wagering emerged and became more popularin western countries. But internet-based online wagering unexpectedly emergedand became the most popular way of sports wagering in Asia, and most smallclients in Asia unexpectedly changed their way of wagering from phone wageringto internet-based online wagering. As a result of such an unexpected change, wehad lost our business from most small clients when our hardware and softwaresystems were not in such place to accommodate online wagering operations.

 

For the fiscal year 2004, our sportsbookoperations recorded a total of gross wagers of US$85.43 million, decreased byUS$9.04 million or 9.57%, comparing to the total gross wagers of US$94.47million for the fiscal year 2003, and particularly for the second half of year2004 our gross wagers decreased by US$15.21 million or 33.60% as compared tothe same period of year 2003, due to loss of our business from small clients.

 

In sportsbook operations, the principal rule to ensure net wagerearnings is to avert risks of an open position on a game or to achieve abalanced position on the wager book of the game, which means that half of thetotal wagers is on one side and the other half is on the opposite side. Such abalanced position could be achieved, theoretically, by adjusting the wageroptions and prices as necessary to divert wagering demands until the wagers indollar amount line up on both sides of the book. But it is difficult for asportsbook to achieve or even approach to such a balanced position if there areinsufficient wagering demands from small clients, and it is then highly riskyfor the sportsbook to net wager losses when it is exposed to an open wagerposition.

 

Due to loss of our business from smallclients, we had not only suffered losing our earnings from wagers by smallclients, but also experienced more operational difficulties. Without havingsufficient business from small clients, it had become more difficult to balanceour wager book, therefore resulting in more open positions, which had made oursportsbook operations more vulnerable to larger bettors who usually make heavywagers based on rational analysis rather than emotions and such heavy wagershit our sportsbook badly.

 

**2.2**** ****Expenses**

 

Total expenses for the fiscal year ended December 31,2004 were US$2.39 million, including US$1.37 million for operating expenses(selling, general and administrative expenses), US$0.27 million fordepreciation, US$0.64 million for impairment loss and US$0.11 million forprovision for irrecoverable deposits.

 

8

----

 

Comparing to the fiscal year 2003, our totalexpenses for 2004 increased by US$0.29 million or 13.68%, while taking intoaccount the impairment loss of US$0.64 million and the provision forirrecoverable deposits of US$0.11 million incurred in 2004 due to theparticular circumstances, our total expenses for 2004, excluding suchimpairment loss and provision for irrecoverable deposits, decreased by US$0.47million or 22.17%, mainly due to our reduction of manpower cost, network andsystem expenses, and telecommunication expenses in the first 11 months and ourcessation of sportsbook operations in December.

 

**2.3**** ****Impairment Loss**

 

The Company accounts for the impairment anddisposition of long-lived assets in accordance with SFAS No. 144 Accounting forthe Impairment or Disposal of Long-Lived Assets, under which long-lived assetsare reviewed for events or changes in circumstances that indicate that theircarrying value may not be recoverable. Recoverability of assets to be held andused is measured by comparing the carrying amount of the asset to the futureundiscounted net cash flows expected to be generated by the asset, andrecoverability of assets held for sale is measured by comparing the carryingamount of the assets to their estimated fair market value. In case any assetsare considered to be impaired, the impairment is measured by the amount bywhich the carrying amount of the assets exceeds the estimated fair value.

 

In light of the increasing net wager lossesand highly vulnerable position to further net wager losses in our sportsbookoperations, the Company determined at the end of the third quarter of 2004 thatour property, plant and equipment had been impaired as a result of thesignificant decline in our sportsbook business, and recorded a non-cashprovision for impairment loss of US$643,864 related to property, plant andequipment in accordance with the provisions of SFAS 144.

 

**2.4**** ****Provision for IrrecoverableDeposits**

 

The Company recorded a provision for irrecoverable deposits of US$0.11million in light of the following particulars:

 

For our international gaming license, which is subject to annualrenewal, adeposit of US$100,000 in the name of PVI was made to the Government ofDominica, as required by the gaming license regulations of Dominica, andsuch deposit was carried over every year upon the license renewal. Our gaminglicense was expired as of January 27, 2005, and we have not yet decidedwhether or not to proceed with the annual renewal, while we have received awritten notice from the Government of Dominica for the annual gaming licensefees for the year 2005, indicating that the gaming license regulatory authorityof Dominica has acknowledged our qualification for renewal of the gaminglicense. The Company determinedthat such deposit may not be refunded incase we abandon our privilege to renew the gaming license.

 

We have decided to terminate all utilityservices for PVI in Dominica as of March 31, 2005. As a result of ourtermination of the service contracts before expiration, our deposits ofUS$8,442 made to the service suppliers may not be refundable.

 

**2.5**** ****Loss**

 

For the fiscal year ended December 31,2004, the Company incurred a net loss of US$2.35 million,

 

9

----

 

primarily due to the significant decline inour sportsbook revenue and the impairment loss.

 

As a result of the substantially increasednet loss for the year 2004, comparing the balance as at December 31, 2003to the balance as at December 31, 2004, our cash and cash equivalents onhand dropped significantly from US$0.56 million to US$0.04 million, our totalassets decreased significantly from US$1.81 million to US$0.06 million, and ourshareholders’ equity declined significantly from US$1.51 million to negativeUS$0.83 million.

 

**2.6****  Liquidity and Capital Resources**

 

For the fiscal year ended December 31,2004, the Company had a net decrease of US$0.52 millionin cash and cash equivalents, mainly due tothe significant net loss during the period.

 

Material factors to our cash flows for theyear 2004 are as follows:

 

•      Net cash decrease of US$2.35 million due to the net loss;

•      Netcash increase of US$0.13 million fromchanges in operating assets and liabilities, and US$1.02 million fordepreciation and provisions for impairment loss and irrecoverabledeposits as adjusted to reconcile thenet loss to net cash flows by operating activities; and

•      Netcash increase of US$0.67 million by loans from a director of the Company.

 

**2.7****  Forward-Looking Statements**

 

All statements other thanstatements of historical fact included in this annual report regarding ourfinancial position and operating and strategic initiatives and addressingindustry developments are forward-looking statements. Where, in any forward-lookingstatement, we or our management expresses an expectation or belief as to futureresults, such expectation or belief is expressed in good faith and believed tohave a reasonable basis, but there can be no assurance that the statement ofexpectation or belief will result or be achieved or accomplished. Factors whichcould cause actual results to differ materially from those anticipated includebut are not limited to general economic, financial and business conditions;competition and development in the online sports gaming industry; the businessabilities and judgment of personnel; the impacts of unusual items resultingfrom ongoing evaluations of business strategies; and changes in businessstrategies. We do not intend to update these forward-looking statements, and itis our advice to review the “Additional Cautionary Statements” section belowfor more information about risks that could affect our financial results andpositions.

 

**2.7 (1)****    Recommencementof Sportsbook Business**

 

In light of the circumstances that we canreasonably foresee, we believe that it is unlikely for the Company torecommence a sportsbook business.

 

Our operations of a sportsbook business willbe highly vulnerable to continued net wager losses, unless we are able torecover sufficient business from small clients. Our efforts to try to recoverbusiness from small clients will require a material amount of capital expensesfor systems upgrade and a material amount of marketing expenses, but there canbe no assurance that sufficient business from small clients will be recoveredthrough such capital and marketing expenses.

 

10

----

 

Since our working capital has become negativeand our principal shareholder has discontinued financing to the Company for anyexpenses other than the minimum expenses for the Company’s continuation in anon-operating status, and our ability to raise capital funds in the equitysecurities market on terms favorable to us or affordable by us is nearly nil inthe future period that we can reasonably predict, it is unlikely that theCompany will acquire sufficient funds to support recommencement of a sportsbookbusiness.

 

Our International Gaming License, which issubject to annual renewal, expired as of January 27, 2005, and we have notyet decided whether or not to proceed with the annual renewal. It will not bepossible to recommence our sportsbook business without our gaming licenserenewed. We have received a written notice from the Government of Dominica forthe annual gaming license fees for year 2005, indicating that the gaminglicense regulatory authority of Dominica has acknowledged our qualification forrenewal of the gaming license, but there can be no assurance that our gaminglicense will be renewed for the current year.

 

**2.7 (2)****    Restructureand Recapitalization**

 

We will further review and re-evaluate ourbusiness structure and strategies to determine what and how to proceed in thefuture. It is unlikely that the Company will initiate or launch any businessuntil an effective business restructure has been accomplished. However, therecan be no assurance as to when or whether such a business restructure will beaccomplished.

 

We are also taking into account thepossibility for corporate reorganization and recapitalization. We will furtherreview and re-evaluate our corporate structure and business resources todetermine what and how to proceed in the future. However, there can be noassurance as to when or whether the Company will be able to enter into suchcorporate reorganization and recapitalization.

 

**2.7 (3)****    MinimumExpenses**

 

There will be certain expenses for theCompany to maintain as a going concern in a non-operating status. Such expenseswill include, but not limited to, employee salaries, professional fees, telecommunicationexpenses, travel expenses, and miscellaneous administrative expenses. It isestimated that such expenses will be approximately US$40,000 for each quarterlyperiod.

 

It is expected that our principal shareholderwould continue to finance the Company to support such expenses for a period oftime, assuming that in such a period of time the Company would be able torestructure its business and restart on a revenue-generating operation and/orraise additional capital funds to support its continuation as a going concern.However, there can be no assurance that our principal shareholder will notdiscontinue his financing at any time before the Company could accomplish thisplan.

 

**3.****     ADDITIONAL CAUTIONARY STATEMENTS AND RISK FACTORS**

 

**3.1****  Going Concern**

 

The financial statements presented in this annual report have beenprepared in conformity with generally accepted accounting principles, whichcontemplate continuation of the Company as a going concern. However, asubstantial doubt has been raised with regard to the ability of the

 

11

----

 

Company to continue as a going concern, particularly in light of thatthe Company had negative working capital and negative stockholders’ equity,with its current liabilities in excess of its current assets, while the Companymaintained no revenue-generating operations since December 6, 2004.

 

The Company’s current liabilities are mostly the debts due to ourprincipal shareholder for his loans to the Company. Such debts will continue toincrease as long as such financing from our principal shareholder to theCompany continues.

 

As stated in section 2.7 (3) of Item 6hereof, it is estimated that the minimum expenses for the Companyto maintain as a going concernwill be approximately US$40,000 for each quarterly period. Our principalshareholder, who is also the sole director of the Company, has undertaken tofinance the Company for such expenses for a “reasonable” period of time,assuming that in such a period of time the Company would be able to restructureits business and restart on a revenue-generating operation and/or raiseadditional capital funds to support its continuation as a going concern.However, our principal shareholder retains his right to discontinue such financingat his own discretion in case the Company could not accomplish so in such aperiod of time. It is uncertain as for how long or to what extent such a periodof time would be “reasonable” to the discretion of our principal shareholder,and there can be no assurance that the financing from our principal shareholderwill not be discontinued at any time.

 

Such uncertainties may result in adverse effects on continuation of theCompany as a going concern. The financial statements presented herein do notreflect any adjustments that might result from the outcome of suchuncertainties.

 

**3.2****  The Market for Our Stock**

 

The market for our stock is limited. Ourcommon stock is currently traded on the Pink Sheets under the symbol “PVEG.PK”.On March 15, 2005, the last reported sale price of our common stock on thePink Sheets was US$0.03 per share. However, we consider our common stock to be “thinlytraded” and any last reported sale prices may not be a true market-basedvaluation of the common stock.

 

Our common stock is considered to be a “pennystock” and, as such, the market for our common stock may be further limited bycertain SEC rules applicable to penny stocks.

 

As long as the price of our common stock remains below US$5.00 pershare or we have net tangible assets of US$2,000,000 or less, our common sharesare likely to be subject to certain “penny stock” rules promulgated by SEC.Those rules impose certain sales practice requirements on brokers who sellpenny stocks to persons other than established customers and accreditedinvestors (generally institutions with assets in excess of US$5,000,000 orindividuals with a net worth in excess of US$1,000,000). For transactionscovered by the penny stock rules, the broker must make a special suitabilitydetermination for the purchaser and receive the purchaser’s written consent tothe transaction prior to the sale. Furthermore, the penny stock rules generallyrequire, among other things, that brokers engaged in secondary trading of pennystocks provide customers with written disclosure documents, monthly statementsof the market value of penny stocks, disclosure of the bid and asked prices anddisclosure of the compensation to the brokerage firm and disclosure of thesales person working for the brokerage firm. These rules and regulations

 

12

----

 

adversely affect the ability of brokers to sell our common shares andlimit the liquidity of our securities.

 

13

----

 

**ITEM  7.****         FINANCIAL STATEMENTS**

 

**TABLE OF CONTENTS**

 
| Independent Auditors’ Report                                |   |   |
|------------------------------------------------------------------|--------|--------|
| Financial Statements:                                            |   |   |
| Consolidated Balance Sheets                                      |   |   |
| Consolidated Statements of Operations                            |   |   |
| Consolidated Statements of Changes in  Stockholders’ Equity |   |   |
| Consolidated Statements of Cash Flows                            |   |
| Notes to Consolidated Financial Statements                       |   |   |

 

14

----

 

**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

 

 

To the Stockholders and Board of Directors

**Pacific Vegas Global Strategies, Inc.**

(incorporated in Colorado with limited liability)

 

 

We have audited the accompanying consolidated balance sheets of PacificVegas Global Strategies, Inc. as of December 31, 2004 and 2003, and therelated consolidated statements of operations, stockholders’ equity and cashflows for the years then ended. These consolidated financial statements are theresponsibility of the Company’s management. Our responsibility is to express anopinion on these consolidated financial statements based on our audits.

 

We conducted our audits in accordance with the standards of the PublicCompany Accounting Oversight Board (United States). Those standards requirethat we plan and perform the audit to obtain reasonable assurance about whetherthe financial statements are free of material misstatement. An audit includesexamining, on a test basis, evidence supporting the amounts and disclosures inthe financial statements. An audit also includes assessing the accountingprinciples used and significant estimates made by management, as well asevaluating the overall financial statement presentation. We believe that ouraudits provide a reasonable basis for our opinion.

 

In our opinion, the consolidated financial statements referred to abovepresent fairly, in all material respects, the consolidated financial positionof Pacific Vegas Global Strategies, Inc. as of December 31, 2004 and 2003,and the results of its operations and its cash flows for the years then ended,in conformity with U.S. generally accepted accounting principles.

 

The accompanying financial statements have been prepared assuming theCompany will continue as a going concern. As discussed in Note 3(c) to thefinancial statements, the Company has suffured recurring losses from operationsand has a net capital deficiency that raise substantial doubt about its abilityto continue as a going concern. Management’s plans in regards to these mattersare also described in Note 3(c). The financial statements do not include anyadjustments that might result from the outcome of this uncertainty.

 

 
| /s/ Moores  Rowland Mazars   |   |
|------------------------------|--------|
| Chartered Accountants        |
| Certified Public Accountants |
| Hong Kong                    |

 

March 29, 2005

 

15

----

 

****PACIFIC VEGAS GLOBAL STRATEGIES, INC.****

CONSOLIDATED STATEMENTS OF OPERATIONS

For the Year Ended December 31,2004 and 2003

 
| ** **                                           | ** ** | ** ** | ** ** | **Year Ended December 31,** | ** **  |
|------------------------------------------------------|------------|------------|------------|----------------------------------|-------------|
| ** **                                           | ** ** | **Note**   | ** ** | **2004**                         | ** **  | **2003** | ** ** |
| ** **                                           | ** ** | ** ** | ** ** | **US$**                          | ** **  | **US$** | ** ** |
|                                                 |       |       |       |                             | ** **  |   |   |
| **Revenue**                                          | ** ** | ** ** | ** ** | **30,211**                       | ** **  | 1,702,762 |   |
|                                                 |       |       |       |                             | ** **  |   |   |
| **Expenses**                                         | ** ** | ** ** |       |                             | ** **  |   |   |
| Selling,  general and administrative expenses        |       |       | ** ** | **(1,365,106**                   | **)**       | (1,741,280 | ) |
| Depreciation                                         |       |       | ** ** | **(268,365**                     | **)**       | (357,452 | ) |
| Impairment  loss on property, plant and equipment    |       |       | ** ** | **(643,864**                     | **)**       | — |   |
| Provision  for irrecoverable deposits                |       |       | ** ** | **(108,442**                     | **)**       | — |   |
| ** **                                           | ** ** | ** ** |       | **(2,385,777**                   | **)**       | (2,098,732 | ) |
|                                                 |       |       |       |                             | ** **  |   |   |
| **Operating  loss**                                  | ** ** | ** ** | ** ** | **(2,355,566**                   | **)**       | (395,970 | ) |
| Interest  income                                     |       |       | ** ** | **8,465**                        | ** **  | 8,222 |   |
| **Loss  before income tax**                          | ** ** | ** ** | ** ** | **(2,347,101**                   | **)**       | (387,648 | ) |
| Income tax  expense                                  |       |       | ** ** | **—**                       | ** **  | — |   |
| **Net loss**                                         | ** ** | ** ** | ** ** | **(2,347,101**                   | **)**       | (387,648 | ) |
|                                                 |       |       |       |                             | ** **  |   |   |
| **Loss per share - Basic**                           | ** ** | 5          |       | **(0.0235**                      | **) ** | (0.0039 | ) |
| Weighted average number of  common stock outstanding |       |       | ** ** | **99,963,615**                   | ** **  | 99,963,615 |   |

 

The accompanying notes are an integral part of these consolidatedfinancial statements.

 

16

----

 

****PACIFIC VEGAS GLOBAL STRATEGIES, INC.****

CONSOLIDATEDBALANCE SHEETS

As at December 31, 2004and 2003

 
| ** **                                                                              | ** ** | ** ** | ** ** | **As at December 31,** | ** ** |
|-----------------------------------------------------------------------------------------|------------|------------|------------|-----------------------------|------------|
| ** **                                                                              | ** ** | **Note**   | ** ** | **2004**                    | ** ** | **2003** | ** ** |
| ** **                                                                              | ** ** | ** ** | ** ** | **US$**                     | ** ** | **US$** | ** ** |
|                                                                                    |       |       |       |                        | ** ** |   |   |
| **Assets**                                                                              | ** ** | ** ** | ** ** | ** **                  | ** ** |   |   |
| **Current  assets**                                                                     |       |       |       |                        | ** ** |   |   |
| Cash and  cash equivalents                                                              | ** ** | ** ** |       | **40,506**                  | ** ** | 561,046 |   |
| Accounts  receivable, net of allowance for doubtful accounts                            |       |       | ** ** | **—**                  | ** ** | 162,406 |   |
| Other current asset                                                                     |       |       | ** ** | **—**                  | ** ** | 50,916 |   |
| **Total  current assets**                                                               |       |       | ** ** | **40,506**                  | ** ** | 774,368 |   |
|                                                                                    |       |       | ** ** | ** **                  | ** ** |   |   |
| Property,  plant and equipment, net                                                     | ** ** | 6          |       | **—**                  | ** ** | 911,075 |   |
| Deposits                                                                                |       | 7          |       | **15,761**                  | ** ** | 124,203 |   |
| ** **                                                                              | ** ** | ** ** | ** ** | **15,761**                  | ** ** | 1,035,278 |   |
| **Total  Assets**                                                                       |       |       | ** ** | **56,267**                  | ** ** | 1,809,646 |   |
|                                                                                    | ** ** | ** ** | ** ** | ** **                  | ** ** |   |   |
| **Liabilities  and Stockholders’ Equity**                                          |       |       | ** ** | ** **                  | ** ** |   |   |
| **Current  liabilities**                                                                | ** ** | ** ** | ** ** | ** **                  | ** ** |   |   |
| Accounts  payable                                                                       |       |       |       | **—**                  | ** ** | 10,419 |   |
| Accrued  expenses                                                                       | ** ** |       |       | **141,607**                 | ** ** | 212,211 |   |
| Due to a  director                                                                      |       | 9          | ** ** | **674,745**                 | ** ** | — |   |
| Other  payables                                                                         |       |       | ** ** | **74,012**                  | ** ** | 74,012 |   |
| **Total****current liabilities**                                                        |       |       | ** ** | **890,364**                 | ** ** | 296,642 |   |
|                                                                                    |       |       | ** ** | ** **                  | ** ** |   |   |
| Commitments  and contingencies                                                          |       | 11         | ** ** | ** **                  | ** ** |   |   |
| **Stockholders’  equity**                                                          |       |       | ** ** | ** **                  | ** ** |   |   |
| Common stock                                                                            |       |       | ** ** | ** **                  | ** ** |   |   |
| Authorized:                                                                             |       |       | ** ** | ** **                  | ** ** |   |   |
| No par value,  100,000,000 shares of common stock as of December 31, 2004 and 2003 |       |       | ** ** | ** **                  | ** ** |   |   |
| Issued and  outstanding:                                                                |       |       | ** ** | ** **                  | ** ** |   |   |
| No par value,  99,963,615 share of common stock as of December 31, 2004  and 2003  |       |       | ** ** | **—**                  | ** ** | — |   |
| Additional  paid-in capital                                                             |       | 10         | ** ** | **2,425,988**               | ** ** | 2,425,988 |   |
| Accumulated  losses                                                                     |       |       | ** ** | **(3,260,085**              | **)**      | (912,984 | ) |
| **Total  stockholders’ equity**                                                    |       |       | ** ** | **(834,097**                | **)**      | 1,513,004 |   |
| **Total  Liabilities and Stockholders’ Equity**                                    |       |       | ** ** | **56,267**                  | ** ** | 1,809,646 |   |

 

The accompanying notes are an integral part of these consolidatedfinancial statements.

 

17

----

 

****PACIFIC VEGAS GLOBAL STRATEGIES, INC****

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Year Ended December 31,2004 and 2003

 
| ** **                                                                        | ** ** | **Year Ended December 31,** | ** ** |
|-----------------------------------------------------------------------------------|------------|----------------------------------|------------|
| ** **                                                                        | ** ** | **2004**                         | ** ** | **2003** | ** ** |
| ** **                                                                        | ** ** | **US$**                          | ** ** | **US$** | ** ** |
| **Cash  flows from operating activities**                                         |       |                             |       |   |   |
| Net loss                                                                          | ** ** | **(2,347,101**                   | **)**      | (387,648 | ) |
| Adjustment  to reconcile net income to net cash provided by operating activities: |       | ** **                       | ** ** |   |   |
| Depreciation  of property, plant and equipment                                    | ** ** | **268,365**                      | ** ** | 357,452 |   |
| Impairment  loss on property, plant and equipment                                 | ** ** | **643,864**                      | ** ** | — |   |
| Provision  for irrecoverable deposits                                             | ** ** | **108,442**                      | ** ** | — |   |
| Changes in  operating assets and liabilities:                                     |       | ** **                       | ** ** |   |   |
| Accounts  receivable                                                              | ** ** | **162,406**                      | ** ** | 149,555 |   |
| Deposits                                                                          | ** ** | **—**                       | ** ** | (10,970 | ) |
| Other  current asset                                                              | ** ** | **50,916**                       | ** ** | (20 | ) |
| Accounts  payable                                                                 | ** ** | **(10,419**                      | **)**      | (59,493 | ) |
| Accrued  expenses                                                                 | ** ** | **(70,604**                      | **)**      | 77,885 |   |
| Other  payables                                                                   | ** ** | **—**                       | ** ** | (3,741 | ) |
| **Net cash  (used in) provided by operating activities**                          | ** ** | **(1,194,131**                   | **)**      | 123,020 |   |
|                                                                              |       | ** **                       | ** ** |   |   |
| **Cash  flows from investing activities**                                         |       | ** **                       | ** ** |   |   |
| Purchases of  property, plant and equipment                                       | ** ** | **(1,154**                       | **)**      | (2,899 | ) |
| **Net cash  used in investing activities**                                        | ** ** | **(1,154**                       | **)**      | (2,899 | ) |
|                                                                              |       | ** **                       | ** ** |   |   |
| **Cash  flows from financing activities**                                         |       | ** **                       | ** ** |   |   |
| Due to/from a stockholder                                                         | ** ** | **—**                       | ** ** | 316,472 |   |
| Due to a director                                                                 | ** ** | **674,745**                      | ** ** | — |   |
| **Net cash  provided by financing activities**                                    | ** ** | **674,745**                      | ** ** | 316,472 |   |
|                                                                              |       | ** **                       | ** ** |   |   |
| **Net  (decrease) increase in cash and cash equivalents**                         | ** ** | **(520,540**                     | **)**      | 436,593 |   |
| Cash and  cash equivalents, as at beginning of year                               | ** ** | **561,046**                      | ** ** | 124,453 |   |
| Cash and  cash equivalents, as at end of year                                     | ** ** | **40,506**                       | ** ** | 561,046 |   |

 

The accompanying notes are an integral part of these consolidatedfinancial statements.

 

18

----

 

****PACIFIC VEGAS GLOBAL STRATEGIES, INC.****

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

As at December 31, 2004and 2003

 
| ** **                                                | ** ** | **Common stock**      | ** ** | ** ** | ** ** | ** **                      | ** ** | ** **              | ** ** |
|-----------------------------------------------------------|------------|-----------------------|------------|------------|------------|---------------------------------|------------|-------------------------|------------|
| ** **                                                | ** ** | **Number of  shares** | ** ** | **Amount** | ** ** | **Additional  paid-in capital** | ** ** | **Accumulated  losses** | ** ** | **Total** | ** ** |
| ** **                                                | ** ** | ** **            | ** ** | **US$**    | ** ** | **US$**                         | ** ** | **US$**                 | ** ** | **US$** | ** ** |
|                                                      |       |                  |       |       |       |                            |       |                    |       |   |   |
| As at January 1,  2003                               |       | 99,963,615            |       | —     |       | 2,500,000                       |       | (525,336                | )          | 1,974,664 |   |
| Receipt of  net liabilities of PVGS before reorganization |       | —                |       | —     |       | (74,012                         | )          | —                  |       | (74,012 | ) |
| Net loss  for the year                                    |       | —                |       | —     |       | —                          |       | (387,648                | )          | (387,648 | ) |
|                                                      |       |                  |       |       |       |                            |       |                    |       |   |   |
| As at December 31,  2003                             |       | 99,963,615            |       | —     |       | 2,425,988                       |       | (912,984                | )          | 1,513,004 |   |
| Net loss  for the year                                    |       | —                |       | —     |       | —                          |       | (2,347,101              | )          | (2,347,101 | ) |
| ** **                                                | ** ** | ** **            | ** ** | ** ** | ** ** | ** **                      | ** ** | ** **              | ** ** | ** ** | ** ** |
| **As at December 31, 2004**                          | ** ** | **99,963,615**        |       | —     | ** ** | **2,425,988**                   | ** ** | **(3,260,085**          | **)**      | **(834,097** | **)** |

 

Theaccompanying notes are an integral part of these consolidated financialstatements.

 

19

----

**** ****

****PACIFIC VEGAS GLOBAL STRATEGIES, INC.****

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

**1.****              ORGANIZATIONAND PRINCIPAL ACTIVITIES**

 

Pacific Vegas Global Strategies, Inc. (“PVGS”),formerly known as Goaltimer International, Inc., was incorporated in Coloradoon December 19, 1990. Prior to the reorganization (as described in Note 2hereof) with Cyber Technology Group Holdings Limited (“CTGH”) on January 8,2003, the principal business of PVGS was the development and selling of timeand personal management products. PVGS had discontinued operations since 1994and its only activity had been accruing loan interest on notes payable andlooking for a merger candidate.

 

Upon the completion of the reorganization, theprincipal business activities of PVGS had been, through its subsidiaries,conducting an international sportsbook business from the Commonwealth ofDominica by way of telecommunications and/or the Internet, until December 6,2004, when the Board of Directors of PVGS resolved to cease the operations ofsuch business.

 

Currently, the Company’s only activities areaccruing non-operating (general and administrative) expenses whilecontemplating plans for business restructuring and corporatereorganization.

 

Details of PVGS’s subsidiaries and their principalactivities are as follows:

 
| **Name of company**                                         | ** ** | **Date of  formation** | ** ** | **Place of  incorporation** | ** ** | **Percentage of share  held****by the Company** | ** ** | **Principal activities** | ** ** |
|-------------------------------------------------------------|------------|------------------------|------------|-----------------------------|------------|-------------------------------------------------|------------|--------------------------|------------|
| **Direct**                                                  | ** ** | **Indirect**           |
|                                                        |       |                   |       |                        |       |                                            |       |                     |       |   |   |
| Cyber Technology Group  Holdings Limited (“CTGH”) |       | June 22, 2000     |       | British Virgin Islands      |       | 100                                             | %          | —                   |       | Investment holding |   |
|                                                        |       |                   |       |                        |       |                                            |       |                     |       |   |   |
| Pacific Vegas Development  Limited (“PVD”)        |       | April 26, 2000    |       | Samoa                       |       | —                                          |       | 100                      | %          | Investment holding, provision  of management services and information technology support |   |
|                                                        |       |                   |       |                        |       |                                            |       |                     |       |   |   |
| Pacific Vegas International Limited (“PVI”)       |       | April 10, 2000    |       | Commonwealth of Dominica    |       | —                                          |       | 100                      | %          | International sportsbook  operations (business ceased since December 6, 2004) |   |

 

In these consolidated financialstatements, PVGS and its subsidiaries are collectively referred as “the Company”.

 

**2.****              REORGANIZATION**

 

In November 2002, the Boards of Directors of PVGS and CTGH decidedthat PVGS would acquire CTGH through a plan of share exchange under the laws ofColorado (the “Share Exchange Agreement”). Pursuant to the Share ExchangeAgreement, and subject to the terms of this agreement PVGS would acquire 100%of the issued and outstanding shares of CTGH, all in exchange for 60,000,000new investment shares of common stock in PVGS. The closing of this

 

20

----

 

transaction was to take place on December 22, 2002. The shareswere issued on December 22, 2002, but the closing was delayed until January 8,2003.

 

For accounting purposes, the transaction has been treated as a recapitalizationof CTGH with PVGS being the legal survivor and CTGH being the accountingsurvivor and the operating entity. The SEC Staff’s Training Manual (Division ofCorporate Finance – Accounting Disclosure Rules and Practices) indicates thatthese transactions are considered as capital transactions in substance ratherthan business combinations. That is, the historical financial statements priorto January 8, 2003 are those of CTGH, even though they were labeled asthose of PVGS. Accumulated losses of the accounting survivor, CTGH, is carriedforward after the recapitalization. Operations prior to the recapitalizationare those of the accounting survivor, CTGH. Earnings per share for periodsprior to the recapitalization are restated to reflect the equivalent number ofshares. Upon completion of the transaction, the financial statements becomethose of the operating company, with adjustments to reflect the changes inequity structure and receipt of the assets/liabilities of the public shell,PVGS. Accordingly, the Company’s stockholders’ equity as of January 1,2003 has been recapitalized and restated to properly disclose its issuance of60,000,000 shares for the shares exchange.

 

Following the recapitalization, PVGS took over 100% of the issued andoutstanding shares of CTGH and CTGH became a wholly-owned subsidiary of PVGS.

 

**3.****              SUMMARYOF SIGNIFICANT ACCOUNTING POLICIES**

 

**(a)****          Basisof accounting**

 

The consolidated financial statements are presented in United Statesdollars and have been prepared in accordance with accounting principlesgenerally accepted in United States of America.

 

**(b)****         ****Principlesof consolidation**

 

The consolidated financial statements include the accounts of PVGS andits subsidiaries. All material intercompany balances and transactions have beeneliminated on consolidation.

 

**(c)****         ****Preparation of financialstatements**

 

The Company had a negative working capital and a negative stockholders’equity of US$849,858 and US$834,097 respectively as at December 31, 2004.The accompanying financial statements have been prepared in conformity withgenerally accepted accounting principles, which contemplate continuation of theCompany as a going concern. However, a substantial doubt has been raised withregard to the ability of the Company to continue as a going concern, since theCompany had total liabilities in excess of its total assets and, particularly,current liabilities in excess of its current assets, while the Companymaintained no revenue-generating operations since December 6, 2004. Inlight of the situation, the Company has been contemplating practical plans fora business restructuring and possible arrangements to raise additional capitalfunds to support its continuation as a going concern, but there can be noassurance that the Company will be successful in procuring any of such efforts.

 

21

----

 

The principal shareholder, whois also the sole director of the Company, has undertaken to finance the Companyfor a “reasonable” period of time for the Company to continue as a goingconcern, assuming that in such a period of time the Company would be able torestructure its business and restart on a revenue-generating operation and/orraise additional capital funds to support its continuation as a going concern. However,the principal shareholder of the Company retains his right to discontinue suchfinancing at his own discretion in case the Company is unable to accomplish soin such a period of time. It is uncertain as for how long or to what extentsuch a period of time would be “reasonable” to the discretion of the principalshareholder, and there can be no assurance that the financing from theprincipal shareholder will not be discontinued at any time.

 

These uncertainties may result in adverse effects on continuation ofthe Company as a going concern. The accompanying financial statements do notreflect any adjustments that might result from the outcome of theseuncertainties.

 

**(d)****          Cashand cash equivalents**

 

Cash and cash equivalents are defined as cash on hand, deposits withbanks, and short-term, highly liquid investments with original maturities ofthree months or less.

 

**(e)****          Property,plant and equipment and depreciation**

 

Property, plant and equipment are stated at cost, less accumulateddepreciation. Maintenance and repairs are charged to current operations asincurred. Upon sale, retirement, or other disposition of these assets, the costand related accumulated depreciation are removed from the respective accounts,and any gain or loss is included in the consolidated statement of operations.

 

Depreciation is provided by using the straight-line method over theestimated useful lives of the related assets. The estimated useful lives of allproperty, plant and equipment are 5 years.

 

**(f)****           ****Provision for doubtful accounts**

 

The Company provides an allowance fordoubtful accounts, which is based upon a review of outstanding receivables,historical collection information and current economic and business conditions.Accounts receivable for the net wagers are ordinarily due 10 business daysafter the outcome of the wager is certain. No interest is chargeable tocustomers for accounts that are unpaid after the due date. Accounts past duemore than one year are considered delinquent. Delinquent receivables arewritten off based on individual credit evaluation and specific circumstances ofthe customer.

 

No amount of accounts receivable are past duemore than 90 days as at December 31, 2004 and 2003. There were no accountsreceivable written off in any of the periods presented.

 

**(g)****         Incometaxes**

 

The Company accounts for income tax under the provisions of SFAS No.109, which requires recognition of deferred tax assets or liabilities. Deferredincome taxes are provided using the liability method. Under the liabilitymethod deferred income taxes are recognized for all significant

 

22

----

 

temporary differences between the tax and financial statements bases ofassets and liabilities.

 

**(h)****         Operatingleases**

 

Leases where substantially all the rewards and risks of ownership ofassets remain with the leasing company are accounted for as operating leases.Rentals payable under operating leases are charged to the consolidatedstatement of operations on a straight-line basis over the lease terms.

 

**(i)****            Relatedparties**

 

Parties are considered to be related if one party has the ability tocontrol the other party or exercise significant influence over the other partyin making financial and operational decisions.

 

**(j)****            Revenuerecognition**

 

Revenue is recognized when it is probable that the economic benefitswill flow to the Company and when the revenue can be measured reliably.

 

Wager revenue is recognized on a net basis in the consolidatedstatement of operations after a wager is accepted and the outcome of the wageris certain.

 

**(k)****        Impairmentof long-lived assets**

 

The long-lived assets held andused by the Company are reviewed for impairment whenever events or changes incircumstances indicate that the carrying amount of assets may not be recoverable.It is reasonably possible that these assets could become impaired as a resultof technology or other industry changes. Determination of recoverability ofassets to be held and used is by comparing the carrying amount of an asset tofuture net undiscounted cash flows to be generated by the assets. If suchassets are considered to be impaired, the impairment to be recognized ismeasured by the amount by which the carrying amount of the assets exceeds thefair value of the assets. Assets to be disposed of are reported at the lower ofthe carrying amount or fair value less costs to sell.

 

**(l)****            Foreigncurrency translation**

 

PVGS and its subsidiary in the Commonwealthof Dominica maintain their books and records in United States dollars. Thebooks and records of PVGS’s subsidiaries in the British Virgin Islands and inSamoa are maintained in Hong Kong dollars. The financial statements of PVGS’ssubsidiaries denominated in Hong Kong dollars have been translated into UnitedStates dollars in accordance with SFAS No. 52, “Foreign Currency Translation”.Foreign currency transactions during the year are translated into United Statesdollars at approximately the market exchange rates existing at the transactiondates. Monetary assets and liabilities denominated in foreign currencies aretranslated into United States dollars at approximately the market exchangerates ruling at the balance sheet date. The effect on the statements ofoperations of transaction gains and losses is insignificant for all periodspresented.

 

**(m)****      Useof estimates**

 

The preparation of the consolidated financial statements in conformitywith accounting principles

 

23

----

 

generally accepted in the United States of America requires managementto make estimates and assumptions that affect certain reported amounts anddisclosures. Accordingly, actual amounts could differ from those estimates.

 

**(n)****         Fairvalue of financial instruments**

 

The estimated fair values for financial instruments under SFAS No. 107,“Disclosures about Fair Value of Financial Instruments”, are determined atdiscrete points in time based on relevant market information. These estimatesinvolve uncertainties and cannot be determined with precision. The estimatedfair values of the Company’s financial instruments, which includes cash andother payables approximate their carrying values in the consolidated financialstatements because of the short-term maturity of those instruments.

 

**(o)****          Recentlyissued accounting standards**

 

There are no new accounting pronouncements for which adoption isexpected to have a material effect on the Company’s consolidated financialstatements.

 

**4.****              OPERATINGRISKS**

 

**(a)****          Concentrationof major customers**

 

Credit risk represents the accounting loss that would be recognized atthe reporting date if counterparties failed completely to perform ascontracted. Concentration of credit risk (whether on or off balance sheet) thatarise from financial instruments exist for the Company’s customers orcounterparties when there are similar economic characteristics that would causetheir ability to meet contractual obligations to be similarly affected bychanges in economic or other conditions. The major concentration of credit riskarises from the Company’s receivables.

 

**(b)****          Cashand time deposits**

 

The Company’s subsidiaries maintain their cash balances with variousbanks and financial institutions located in various locations. Such amounts arenot insured or otherwise protected should the financial institutions be unableto meet their liabilities. There has been no history of credit losses.

 

**5.****              LOSSPER SHARE**

 

Basic loss per common share is based on the weighted average number ofcommon stock outstanding during each period as restated as a result of therecapitalization, as described in Note 2 hereof.

 

The Company had no potential common stock instruments with a dilutiveeffect for any period presented, therefore basic and diluted earnings per shareare the same. The 60,000,000 shares, in connection with the recapitalization,as described in Note 2, were included in the computation of loss per share asif outstanding at the beginning of each period presented.

 

24

----

 

**6.****              PROPERTY,PLANT AND EQUIPMENT, NET**

 
| **As at****December 31,  2004** | ** ** | **Cost (1)** | ** ** | **Accumulated  depreciation** | ** ** | **Net carrying  amount** | ** ** |
|--------------------------------------|------------|--------------|------------|-------------------------------|------------|--------------------------|------------|
| ** **                           | ** ** | **US$**      | ** ** | **US$**                       | ** ** | **US$**                  | ** ** |
| Network  system                      |       | 536,128      |       | 536,128                       |       | —                   |       |
| Telecommunication  system            |       | 36,860       |       | 36,860                        |       | —                   |       |
| Office  equipment                    |       | 25,864       |       | 25,864                        |       | —                   |       |
| Leasehold  improvement               |       | 6,056        |       | 6,056                         |       | —                   |       |
| Furniture  and fixtures              |       | 845          |       | 845                           |       | —                   |       |
| Website  development                 |       | 540,121      |       | 540,121                       |       | —                   |       |
|                                 |       | 1,145,874    |       | 1,145,874                     |       | —                   |       |

 

----

(1)               In the third quarter of 2004, managementdetermined that property, plant and equipment had been impaired as a result ofthe significant decline in its sportsbook business. As a result, the Companyrecorded a non-cash provision for impairment loss of US$643,864 related toproperty, plant and equipment in accordance with the provisions of SFAS 144.The impairment loss establishes a new cost basis. Accordingly the amount hasbeen netted against the original cost.

 
| **As at****December 31, 2003** | ** ** | **Cost**  | ** ** | **Accumulated  depreciation** | ** ** | **Net carrying  amount** | ** ** |
|-------------------------------------|------------|-----------|------------|-------------------------------|------------|--------------------------|------------|
| ** **                          | ** ** | **US$**   | ** ** | **US$**                       | ** ** | **US$**                  | ** ** |
| Network  system                     |       | 833,392   |       | 411,119                       |       | 422,273                  |       |
| Telecommunication  system           |       | 56,708    |       | 28,354                        |       | 28,354                   |       |
| Office  equipment                   |       | 48,631    |       | 18,493                        |       | 30,138                   |       |
| Leasehold  improvement              |       | 13,652    |       | 4,007                         |       | 9,645                    |       |
| Furniture  and fixtures             |       | 1,301     |       | 650                           |       | 651                      |       |
| Website  development                |       | 834,900   |       | 414,886                       |       | 420,014                  |       |
|                                |       | 1,788,584 |       | 877,509                       |       | 911,075                  |       |

 

**7.****             ****DEPOSITS**

 
| ** **                                  | ** ** | **As at December 31,** | ** ** |
|---------------------------------------------|------------|-----------------------------|------------|
| ** **                                  | ** ** | **2004**                    | ** ** | **2003** | ** ** |
| ** **                                  | ** ** | **US$**                     | ** ** | **US$** | ** ** |
| Deposit for gaming license                  | ** ** | **100,000**                 |       | 100,000 |   |
| Utilities                                   | ** ** | **24,203**                  |       | 24,203 |   |
| ** **                                  |       | **124,203**                 |       | 124,203 |   |
| Less : Provision for irrecoverable deposits | ** ** | **(108,442**                | **)**      | — |   |
| ** **                                  |       | **15,761**                  |       | 124,203 |   |

 

25

----

 

**8.****              INCOMETAXES**

 

PVGS and its subsidiaries are subject to income taxes on an entitybasis on income arising in or derived from the tax jurisdictions in which eachentity is domiciled.

 

No provision for withholding or United States federal or state incometaxes or tax benefits on the undistributed earnings and/or losses of PVGS’ssubsidiaries has been provided as the earnings of these subsidiaries, in theopinion of the management, will be reinvested indefinitely. Determination ofthe amount of unrecognized deferred taxes on these earnings is not practical,however, unrecognized foreign tax credits would be available to reduce aportion of the tax liability.

 

Under the current laws of the British Virgin Islands, PVGS’ssubsidiaries are not subject to tax on income or capital gains, and no BritishVirgin Islands withholding tax will be imposed upon payments of dividends totheir stockholders. Subsidiaries are not subject to any tax in Samoa and theCommonwealth of Dominica.

 

**9.****              RELATEDPARTY TRANSACTIONS**

 
| ** **                 | ** ** | **As at December 31,** | ** ** |
|----------------------------|------------|-----------------------------|------------|
| ** **                 | ** ** | **2004**                    | ** ** | **2003** | ** ** |
| ** **                 | ** ** | **US$**                     | ** ** | **US$** | ** ** |
| Due to a director, current | ** ** | **674,745**                 |       | — |   |

 

Theamount due is unsecured, interest free and has no fixed term of repayment.

 

**10.****      ****ADDITIONAL PAID-IN-CAPITAL**

 

As a result of reorganization (Note 2), thepaid-in capital of CTGH became the additional paid-in capital of the Companyunder accounting rules for this recapitalization.

 

**11.****      ****COMMITMENTS AND CONTINGENCIES**

 

Asat December 31, 2004 and 2003, the Company had commitments undernon-cancelable operating lease payments in respect of land and buildings asfollows:

 
| ** ** | ** ** | **As at December 31,** | ** ** |
|------------|------------|-----------------------------|------------|
| ** ** | ** ** | **2004**                    | ** ** | **2003** | ** ** |
| ** ** | ** ** | **US$**                     | ** ** | **US$** | ** ** |
| 2004       | ** ** | **—**                  |       | 78,394 |   |
| 2005       | ** ** | **4,756**                   |       | 4,940 |   |
| ** ** |       | **4,756**                   |       | 83,334 |   |

 

Other than the operating leasecommitments mentioned above, there were no material outstanding capitalcommitments.

 

26

----

 

Lease expenses of the Companyare as follows:

 
| ** **       | ** **   | **Year ended December 31,** | ** **   |
|------------------|--------------|----------------------------------|--------------|
| ** **       | ** **   | **2004**                         | ** **   | **2003** | ** ** |
| *** ***     | *** *** | **US$**                          | *** *** | **US$** | *** *** |
| Rental  expenses | ** **   | **113,980**                      |         | 154,483 |   |

 

**12.****      ****GROUP RESTRUCTURING OF CTGH**

 

Before the restructuring discussed in Note 2,CTGH, PVD and PVI were wholly owned by the same shareholder. In April 2002,as a result of restructuring, PVD and PVI became subsidiaries of CTGH with nosubstantive change in the shareholder’s interest.

 

This transaction involved transfers amongentities under common control and has been accounted for in a manner similar toa pooling of interests. Therefore, the consolidated financial statements ofCTGH reflect the financial position and results of operations as if the groupstructure had always been in existence.

 

**13.****       RECLASSIFICATIONS**

 

Certainreclassifications have been made to the current year’s financial statements andto the prior year’s financial statements to conform to the classifications usedin the current year.

 

27

----

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

 

On June 23, 2003, Michael Johnson & Co. LLC, Denver, Colorado,was dismissed as our principal independent accountant to audit our financialstatements. Their report on our financial statements for each of the past twoyears did not contain an adverse opinion or disclaimer of opinion and was notmodified as to uncertainty, audit scope or accounting principles. The decisionto change accountants was recommended and approved by our Board of Directors.

 

During our two most recent fiscal years and any later interim period,there were no disagreements with the former accountant, whether or not resolved,on any matter of accounting principles or practices, financial statementdisclosure or auditing scope or procedure, which, if not resolved to the formeraccountant’s satisfaction, would have caused it to make reference to thesubject matter of the disagreement in connection with its report.

 

On June 23, 2003, we engaged Moores Rowland, Hong Kong, certifiedpublic accountants, as our principal accountant to audit our financialstatements. During our two most recent fiscal years, and any later interimperiod prior to engaging Moores Rowland, Hong Kong, we did not consult the newaccountant regarding the application of accounting principles to a specificcompleted or contemplated transaction, or the type of audit opinion that mightbe rendered on our financial statements, and either written or oral advice wasprovided that was an important factor considered by us in reaching a decisionas to the accounting, auditing or financial reporting issue.

 

Our auditors, Moores Rowland, Hong Kong, merged with Mazars, Hong Kongon October 1, 2003 and are now practicing under the name of Moores RowlandMazars.

 

**ITEM  8A****.****                 CONTROLSAND PROCEDURES**

 

As at the end of the period covered by this Annual Report onForm10-KSB, we carried out an evaluation, under the supervision and with theparticipation of our management, including our Chief Executive Officer and ourChief Financial Officer, of the effectiveness of the design and operation ofour disclosure controls and procedures pursuant to Exchange Act Rule 13a-14 and15d-14. Based upon that evaluation, our Chief Executive Officer and our ChiefFinancial Officer concluded that our disclosure controls and procedures areeffective in timely alerting them to material information relating to theCompany required to be included in our periodic SEC filings.

 

Subsequent to the date of that evaluation, there have been nosignificant changes in our internal controls or in other factors that couldsignificantly affect internal controls, nor were any corrective actionsrequired with regard to significant deficiencies and material weaknesses.

 

The requirements to provide (i) a report of management on our internalcontrols over financial reporting and (ii) our registered public accountingfirm’s attestation report on management’s assessment of our internal controlover financial reporting are not yet applicable to us.

 

28

----

 

**ITEM  8B**.                 OTHERINFORMATION

 

None.

 

29

----

 

**PART****              III**

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

 

The names, addresses, ages andterms of office of our executive officers and directors are set forth asfollows:

 
| **Name (1)** | ** ** | **Age**    | ** ** | **Office**                                                      | ** ** | **Term Expires (2)** | ** ** |
|--------------|------------|------------|------------|-----------------------------------------------------------------|------------|----------------------|------------|
| ** **   | ** ** | ** ** | ** ** | ** **                                                      | ** ** | ** **           | ** ** |
| Raymond Chou |       | 44         |       | President, Chief Executive Officer, and  Secretary and Director |       | 2005                 |       |
|         |       |       |       |                                                            |       |                 |       |
| Richard Wang |       | 51         |       | Executive Vice President and Chief  Financial Officer           |       |                 |       |

 

----

(1)          Thebusiness address is 16/F, Winsome House, 73 Wyndham Street, Central, Hong Kong.

(2)          Theterm of office of each officer is at the discretion of the Board of Directors.

 

**Raymond Chou**,President, Chief Executive Officer, Secretary and Director

 

Mr. Chou graduated from the University of Macau with a bachelor degreein Business Administration. Mr. Chou was the managing director of Shanghai HYDIndustries Ltd. for the period of May 1999 through January 2003. Prior tothat, he was in the position as General Manager of Shanghai ELAN ChemicalIndustries Ltd. since May 1992.

 

**Richard Wang**,Executive Vice President and Chief Financial Officer

 

Mr. Wang holds a master degree in Economics from Fudan University.Prior to joining CTGH in June 2000, he was in the position as GeneralManager of Shanghai HYD Industries Ltd. since June 1996. His previousexperience also includes employment as Deputy General Manager of Shanghai ELANChemical Industries Ltd. for the period of May 1994 through April 1999.

 

Based solely upon a review of Forms 3 and 4 and amendments theretofurnished to us pursuant to § 240.16a-3(e) during our most recent fiscalyear and Forms 5 and amendments thereto furnished to us with respect to ourmost recent fiscal year, and any written representation from the reportingperson (as hereinafter defined) that no Form 5 is required, we are not aware ofany person who, at any time during the fiscal year, was a director, officer,beneficial owner of more than ten percent of any class of our equity securitiesregistered pursuant to Section 12 of the Exchange Act (“reporting person”)that failed to file on a timely basis, as disclosed in the above Forms, reportsrequired by Section 16(a) of the Exchange Act during the most recentfiscal year or prior fiscal years.

 

We have adopted a code of ethics that applies to all of our employees,including our chief executive officer and our chief financial officer.

 

We currently do not have at least one audit committee financial expertserving on our audit committee. We expect to identify and retain an auditcommittee financial expert in the future.

 

30

----

 

**ITEM  10****.****                   EXECUTIVECOMPENSATION**

 

**1.****              SUMMARY COMPENSATION TABLE**

 

The following table, and itsaccompanying explanatory footnotes, includes annual and long-term compensationinformation on our Chief Executive Officer and Chief Financial Officer forservices rendered in all capacities during the fiscal years ended December 31,2004, 2003 and 2002.

 
| **Name and  Principal Position** | ** ** | **Fiscal Year** | ** ** | **Salary** | ** ** | **Bonus** | ** ** | **Options  Granted** | ** ** | **Other  Compensation (1)** | ** ** |
|----------------------------------|------------|-----------------|------------|------------|------------|-----------|------------|----------------------|------------|-----------------------------|------------|
| ** **                       |       |            |       | **US$**    |       | **US$**   |       | **US$**              |       | **US$**                     |       |
| Raymond  Chou, CEO               |       | 2004            |       | 83,333     |       | 0         |       | 0                    |       | 0                           |       |
|                             |       | 2003            |       | 83,333     |       | 0         |       | 0                    |       | 0                           |       |
|                             |       | 2002            |       | 83,333     |       | 0         |       | 0                    |       | 0                           |       |
| Richard  Wang, CFO               |       | 2004            |       | 39,000     |       | 0         |       | 0                    |       | 23,076                      |       |
|                             |       | 2003            |       | 39,000     |       | 0         |       | 0                    |       | 23,076                      |       |
|                             |       | 2002            |       | 39,000     |       | 0         |       | 0                    |       | 23,076                      |       |

 

----

(1)          Other compensationconsists of the director’s fee for the directorship in CTGH.

 

**2.****              OPTION GRANTS IN LAST FISCAL YEAR**

 

The following summary tablesets forth information concerning grants of stock options made during thefiscal year ended December 31, 2004 to our Chief Executive Officer andChief Financial Officer.

 
| **Name and Position** | ** ** | **Options Granted** | ** ** | **Percent of Total  Options Granted  in Fiscal Year** | ** ** | **Exercise Price** | ** ** | **Expiration Date** | ** ** |
|-----------------------|------------|---------------------|------------|-------------------------------------------------------|------------|--------------------|------------|---------------------|------------|
|                  |       |                |       |                                                  |       |               |       |                |       |
| Raymond  Chou, CEO    |       | 0                   |       | N/A                                                   |       | N/A                |       | N/A                 |       |
|                  |       |                |       |                                                  |       |               |       |                |       |
| Richard  Wang, CFO    |       | 0                   |       | N/A                                                   |       | N/A                |       | N/A                 |       |

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

 

The following table sets forththe number of shares of our common stock owned beneficially as of December 31,2004 by each person known by us to have owned beneficially more than fivepercent of such shares then outstanding, by each of our officers and directorsand by all of our officers and directors as a group. This information giveseffect to securities deemed outstanding pursuant to

 

31

----

 

Rule 13d 3(d)(1) under theSecurities Exchange Act of 1934, as amended. As far as is known to ourmanagement, no person owns beneficially more than five percent of theoutstanding shares of common stock as of December 31, 2004 except as setforth below.

 
| **Name of Beneficial Owner**                         | ** ** | **Amount and Nature of  Beneficial Owner** | ** ** | **Percentage of Class  Beneficially Owned** | ** ** |
|------------------------------------------------------|------------|--------------------------------------------|------------|---------------------------------------------|------------|
| ** **                                           | ** ** | ** **                                 | ** ** | ** **                                  | ** ** |
| Raymond Chou  (1)                                    |       | 42,720,000  Common Stock                   |       | 42.736                                      | %          |
|                                                 |       |                                       |       |                                        |       |
| Kwan Sin Yee  (2) (3)                                |       | 5,700,000  Common Stock                    |       | 5.702                                       | %          |
|                                                 |       |                                       |       |                                        |       |
| Richard Wang  (1)                                    |       | 0                                          |       | 0                                           |       |
|                                                 |       |                                       |       |                                        |       |
| All  executive officers and Directors as a group (1) |       | 42,720,000  Common Stock                   |       | 42.736                                      | %          |

 

----

(1)          Thebusiness address is 16/F, Winsome House, 73 Wyndham Street, Central, Hong Kong.

(2)          Thebusiness address is 7/F, Flat B, 110 Soy Street, Kowloon, HongKong.

(3)          Thisrecord has been registered since January 8, 2003.  However, it was not presented in item 11 ofour Form 10 KSB for the fiscal year ended December 31, 2003 due to aclerical error.

 

**ITEM  12****.****                   CERTAINRELATIONSHIPS AND RELATED TRANSACTIONS**

 

Details ofrelated party transactions during the years December 31, 2004, 2003 and2002 are set out in note 9 to our consolidated financial statements included inItem 7 of this Form 10-KSB and are incorporated by reference herein.

 

**ITEM  13****.****                   EXHIBITSAND REPORTS ON FORM 8-K**

 

**(a)****          Exhibits**

 
| Exhibit 2.1  | Plan of Share Exchange (1)                                                                           |
|--------------|------------------------------------------------------------------------------------------------------|
| Exhibit 3.1  | Articles of Incorporation (2)                                                                        |
| Exhibit 3.2  | Articles of Amendment (3)                                                                            |
| Exhibit 3.3  | Bylaws (2)                                                                                           |
| Exhibit 14.1 | Code of Corporate and Employee Conduct (As  amended)                                                 |
| Exhibit 21.1 | Subsidiaries (3)                                                                                     |
| Exhibit 31.1 | Certification of Chief Executive Officer  pursuant to Rule 13a-14(a)                                 |
| Exhibit 31.2 | Certification of Chief Financial Officer  pursuant to Rule 13a-14(a)                                 |
| Exhibit 32.1 | Certification of Chief Executive Officer  pursuant to Rule 13a-14(b) and 18 U.S.C. Section 1350 |
| Exhibit 32.2 | Certification of Chief Financial Officer  pursuant to Rule 13a-14(b) and 18 U.S.C. Section 1350 |

 

----

(1)          Incorporatedby reference to our amended annual report on Form 10-KSB/A for the fiscal yearended December 31, 2002 which was filed on October 7, 2003 (SEC FileNo. 0-49701).

 

32

----

 

(2)          Incorporatedby reference to the Exhibits to our amended Form 10-SB/A which was filed on May20, 2002 (SEC File No. 0-49701).

(3)          Incorporatedby reference to the Exhibits to our annual report on Form 10-KSB for the fiscalyear ended December 31, 2003 which was filed on May 27, 2004 (SEC File No.0-49701).

 

**(b)****          Reportson Form 8-K**

 

During the last quarter of the period covered by this report, we didnot file any Reports on Form 8-K.

 

**ITEM 14****.****                   PRINCIPAL ACCOUNTANT FEES ANDSERVICES**

 

1.  **Audit Fees**.  The aggregate fees billed for each of thelast two fiscal years for professional services rendered by our principalaccountant for the audit of our annual financial statements and review offinancial statements included in our quarterly reports on Form 10-QSB orservices that are normally provided by the accountant in connection withstatutory and regulatory filings or engagements for those fiscal years wereUS$80,000 for fiscal 2004 and US$75,000 for fiscal 2003.

 

2.  **AuditRelated Fees**.  The aggregatefees billed in each of the last two fiscal years for assurance and relatedservices by our principal accountant that are reasonably related to theperformance of the audit or review of our financial statements and are notreported under item (1) above were US$1,500 for fiscal 2004 and US$21,000 forfiscal 2003.

 

3.  **Tax Fees**.  The aggregate fees billed in each of the lasttwo fiscal years for professional services rendered by our principal accountantfor tax compliance, tax advice, and tax planning were NIL for fiscal 2004 and NIL for fiscal 2003. The nature ofthe services comprising the fees disclosed under this category included NIL.

 

4.  **All OtherFees**.  The aggregate feesbilled in each of the last two fiscal years for products and services providedby our principal accountant, other than the services reported in items (1), (2)and (3) above, were NIL for fiscal 2004 and NIL for fiscal 2003. The nature ofthe services comprising the fees disclosed under this category included NIL.

 

5.  We do not currently have aseparate audit committee. Rather, our Board of Directors serves as the auditcommittee. Our Board of Directors approved all of the services described initems (2), (3) and (4) above.

 

33

----

 

**SIGNATURES**

 

 

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

 

**PACIFICVEGAS GLOBAL STRATEGIES, INC.**

Registrant

 
| Date:  | March 31, 2005                   |   | By: |  /s/  RAYMOND CHOU |   |
|--------|---------------------------------------|--------|-----|-------------------------|--------|
|   | Raymond Chou                          |
|   | President and Chief Executive Officer |

 

 

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

 
| **NAME**         | ** ** | **TITLE**                   | ** **                          | **DATE** |
|------------------|------------|-----------------------------|-------------------------------------|----------|
|             |       |                        |                                |     |
| /s/ RAYMOND CHOU |       |                        | President, Chief Executive Officer, |     | March 31, 2005 |   |
| Raymond Chou     |       | Secretary and Director      |                                |     |
|             |       |                        |                                |     |
| /s/ RICHARD WANG |       |                        | Executive Vice President            |     | March 31, 2005 |   |
| Richard Wang     |       | and Chief Financial Officer |                                |     |
|                  |            |                             |                                     |          |  |  |  |

 

34

----

 

**EXHIBIT INDEX**

 
| **NO.** | ** ** | **DESCRIPTION  OF EXHIBIT**                                                                          |
|---------|------------|------------------------------------------------------------------------------------------------------|
|    |       |                                                                                                 |
| 2.1     |       | Plan of Share Exchange (1)                                                                           |
| 3.1     |       | Articles of Incorporation (2)                                                                        |
| 3.2     |       | Articles of Amendment (3)                                                                            |
| 3.3     |       | Bylaws (2)                                                                                           |
| 14.1    |       | Code of Corporate and Employee Conduct (As  amended)                                                 |
| 21.1    |       | Subsidiaries (3)                                                                                     |
| 31.1    |       | Certification of Chief Executive Officer  Pursuant to Rule 13a-14(a)                                 |
| 31.2    |       | Certification of Chief Financial Officer  Pursuant to Rule 13a-14(a)                                 |
| 32.1    |       | Certification of Chief Executive Officer  Pursuant to Rule 13a-14(b) and 18 U.S.C. Section 1350 |
| 32.2    |       | Certification of Chief Financial Officer  Pursuant to Rule 13a-14(b) and 18 U.S.C. Section 1350 |

 

----

(1)          Incorporatedby reference to our amended annual report on Form 10-KSB/A for the fiscal yearended December 31, 2002 which was filed on October 7, 2003 (SEC FileNo. 0-49701).

(2)          Incorporatedby reference to the Exhibits to our amended Form 10-SB/A which was filed on May20, 2002 (SEC File No. 0-49701).

(3)          Incorporatedby reference to the Exhibits to our annual report on Form 10-KSB for the fiscalyear ended December 31, 2003 which was filed on May 27, 2004 (SEC File No.0-49701).

 

35

----