##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 
 FORM 10-Q
 
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended September 30, 2009
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to .
 Asia Electrical Power International Group Inc.
  NEVADA
    
    0-51787
    
    98-0522960(State or other
    
    (Commission File No.)
    
    (IRS Employeejurisdiction of
    
    
    
    Identification No.)incorporation ororganization)
 E-4, Floor 3, Haijin Square  Taizi Road, Nanshan District, Shenzhen, PRC 518067
 86 755 2823 1993  (Issuer Telephone number)
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ(Do not check if a smaller reporting company)
 o þ




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TABLE OF CONTENTS  PART I  FINANCIAL INFORMATIONItem 1. Financial StatementsItem 2. Managements Discussion and Analysis of Financial Condition and Results of OperationsItem 3. Quantitative and Qualitative Disclosures about Market RisksItem 4. Controls and ProceduresPART II  OTHER INFORMATIONItem 6. ExhibitsSIGNATURESEX-31.1EX-31.2EX-32    Table of Contents  
 PART I  FINANCIAL INFORMATION
 
 Item 1. Financial Statements.
 ASIA ELECTRICAL POWER INTERNATIONAL GROUP INC.
CONSOLIDATED BALANCE SHEETS
 September 30, 2009
    
    
    December 31, 2008(Unaudited)
    
    
    (Audited)Current Assets:Cash
    
    $
    1,532,054
    
    
    $
    3,013,900Accounts receivables, net of allowance for
doubtful accounts of $346,220
    
    
    5,015,378
    
    
    
    2,465,300Other receivables
    
    
    177,283
    
    
    
    141,203Advances to suppliers
    
    
    71,712
    
    
    
    66,351Inventory
    
    
    2,311,361
    
    
    
    2,290,470Total current assets
    
    
    9,107,788
    
    
    
    7,977,224Fixed AssetsLand use right
    
    
    2,743,148
    
    
    
    2,791,248Plant, property, and equipment
    
    
    7,819,228
    
    
    
    7,387,62810,562,376
    
    
    
    10,178,876Less: depreciation and amortization
    
    
    1,345,429
    
    
    
    1,056,603Net fixed assets
    
    
    9,216,947
    
    
    
    9,122,273Other Assets:Deposits
    
    
    499,529
    
    
    
    1,043,807Advances to affiliate
    
    
    2,718,496
    
    
    
    920,500Total other assets
    
    
    3,218,025
    
    
    
    1,964,307Total Assets
    
    $
    21,542,760
    
    
    $
    19,063,804LIABILITIES AND STOCKHOLDERS EQUITYCurrent Liabilities:Notes payable
    
    $
    
    
    
    $
    201,653Accounts payable
    
    
    5,201,552
    
    
    
    3,727,138Advances from customers
    
    
    788,799
    
    
    
    1,105,403Accrued liabilities
    
    
    470,626
    
    
    
    337,803Other liabilities
    
    
    1,355,724
    
    
    
    396,531Total current liabilities
    
    
    7,816,701
    
    
    
    5,768,528Convertible Note Payable
    
    
    1,405,499
    
    
    
    1,321,508Total Liabilities
    
    
    9,222,200
    
    
    
    7,090,036Stockholders Equity:Preferred stock: authorized 5,000,000 shares
of $0.001 par value; issued and outstanding,
5,000,000 shares
    
    
    5,000
    
    
    
    5,000Common stock: authorized 150,000,000 shares
of $0.001 par value; issued and outstanding,
51,959,693 shares
    
    
    51,960
    
    
    
    51,960Capital in excess of par value
    
    
    8,221,456
    
    
    
    8,221,456Paid in capital  stock options
    
    
    2,933,333
    
    
    
    2,933,333Accumulated earnings (deficit)
    
    
    74,836
    
    
    
    (245,975
    )Earnings appropriated for statutory reserves
    
    
    183,749
    
    
    
    183,749Comprehensive income (loss)
    
    
    850,226
    
    
    
    824,245Total stockholders equity
    
    
    12,230,560
    
    
    
    11,973,768Tot Total Liabilities and Stockholders Equity
    
    $
    21,542,760
    
    
    $
    19,063,804
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ASIA ELECTRICAL POWER INTERNATIONAL GROUP INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three and Nine Months Ended September 30, 2009 and 2008
(Unaudited)
 Nine Months Ended September 30,
    
    
    Three months ended September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Revenue
    
    $
    13,351,210
    
    
    $
    9,406,051
    
    
    $
    6,637,692
    
    
    $
    3,997,033Cost of Sales
    
    
    10,406,404
    
    
    
    7,810,410
    
    
    
    5,008,791
    
    
    
    3,292,637Gross Profit
    
    
    2,944,806
    
    
    
    1,595,641
    
    
    
    1,628,901
    
    
    
    704,396Expenses:Selling and Administrative
Expenses
    
    
    2,416,659
    
    
    
    872,667
    
    
    
    1,121,791
    
    
    
    251,043Operating Income
    
    
    528,147
    
    
    
    722,974
    
    
    
    507,110
    
    
    
    453,353Other Income (Expense)Interest expense
    
    
    (87,957
    )
    
    
    (4,811
    )
    
    
    (29,125
    )
    
    
    (1,123
    )Losses on foreign currency
transactions
    
    
    (61,148
    )
    
    
    (3,331
    )
    
    
    
    
    
    
    (3,331
    )Interest income
    
    
    8,001
    
    
    
    9,279
    
    
    
    2,123
    
    
    
    4,976Other income
    
    
    95,410
    
    
    
    5,663
    
    
    
    33,639
    
    
    
    (32,817
    )Net other
income
(expense)
    
    
    (45,694
    )
    
    
    6,800
    
    
    
    6,637
    
    
    
    (32,295
    )Income before Income Taxes
    
    
    482,453
    
    
    
    729,774
    
    
    
    513,747
    
    
    
    421,058Provision for Income Taxes:Current Provision
    
    
    (161,644
    )
    
    
    (63,041
    )
    
    
    (114,174
    )
    
    
    (37,993
    )Net Income for the Period
    
    
    320,809
    
    
    
    666,733
    
    
    
    399,573
    
    
    
    383,065Other Comprehensive Income Foreign currency translation
adjustments
    
    
    25,983
    
    
    
    172,306
    
    
    
    11,557
    
    
    
    41,660Total Comprehensive Income
    
    $
    346,792
    
    
    $
    839,039
    
    
    $
    411,130
    
    
    $
    424,725Income Per Common Share Basic and Diluted
    
    $
    0.01
    
    
    $
    0.01
    
    
    $
    0.01
    
    
    $
    0.01Weighted average number of
shares
outstanding
    
    
    51,959,693
    
    
    
    51,959,693
    
    
    
    51,959,693
    
    
    
    51,959,693
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ASIA ELECTRICAL POWER INTERNATIONAL GROUP INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Nine Month Periods Ended September 30, 2009 and 2008
(Unaudited)
 2009
    
    
    2008CASH FLOWS FROM OPERATIONS:Net income
    
    $
    320,809
    
    
    $
    666,733Adjustments to reconcile net income to net cash provided
(consumed) by operating activities:Charges not requiring the outlay of cash:Depreciation and amortization
    
    
    286,495
    
    
    
    236,308Amortization of discount on convertible note
    
    
    83,991
    
    
    
    Changes in assets and liabilities:Increases in accounts receivable
    
    
    (2,534,784
    )
    
    
    (1,132,081
    )(Increase) decrease in other receivables
    
    
    (44,503
    )
    
    
    209,488(Increase) decrease in advances to suppliers
    
    
    (5,198
    )
    
    
    94,392Increase in inventory
    
    
    (15,328
    )
    
    
    (240,783
    )Decrease in notes payable
    
    
    (201,653
    )
    
    
    Increase in accounts payable
    
    
    1,465,056
    
    
    
    (15,331
    )Increase (decrease) in advances from customers
    
    
    (319,219
    )
    
    
    367,732Increase (decrease) in other payables
    
    
    953,590
    
    
    
    (1,328,250
    )Decrease in accrued liabilities
    
    
    131,975
    
    
    
    72,400Net Cash Provided (Consumed)
By Operating Activities
    
    
    121,231
    
    
    
    (1,069,392
    )CASH FLOWS FROM INVESTING ACTIVITIES:Payment to affiliate
    
    
    (1,797,323
    )Purchases of fixed assets
    
    
    (425,411
    )
    
    
    (214,350
    )Increase in construction in progress
    
    
    
    
    
    
    (850,804
    )Return of guarantee deposit
    
    
    203,789
    
    
    
    Increase (decrease) in deposits
    
    
    409,311
    
    
    
    (241,959
    )Net Cash Provided (Consumed)
By Investing Activities
    
    
    (1,609,634
    )
    
    
    (1,307,114
    )CASH FLOWS FROM FINANCING ACTIVITIES:Borrowings under promissory note
    
    
    
    
    
    
    1,545,483Funds set aside for collateral account
    
    
    
    
    
    
    (275,457
    )Borrowings under bank credit facility
    
    
    
    
    
    
    918,189Net Cash Provided (Consumed)
By Financing Activities
    
    
    
    
    
    
    2,188,215Effect of exchange rate changes on cash
    
    
    6,557
    
    
    
    172,307Net change in cash
    
    
    (1,481,846
    )
    
    
    (15,984
    )Cash balance, beginning of period
    
    
    3,013,900
    
    
    
    2,920,073Cash balance, end of period
    
    $
    1,532,054
    
    
    $
    2,904,089
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ASIA ELECTRICAL POWER INTERNATIONAL GROUP INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2009
(Unaudited)
 1. BASIS OF PRESENTATION
   2. NOTES PAYABLE AND RELATED WARRANTY DEPOSIT
  3. SELLING AND ADMINISTRATIVE EXPENSE
  Nine Months Ended
    
    
    Nine Months EndedSeptember 30, 2009
    
    
    September 30, 2008Salaries and benefits
    
    $
    460,444
    
    
    $
    417,712Executive salaries
    
    
    615,000
    
    
    
    Office and utilities
    
    
    78,044
    
    
    
    54,563Travel expenses
    
    
    244,047
    
    
    
    131,052Research and development
    
    
    154,655
    
    
    
    19,520Depreciation
    
    
    191,550
    
    
    
    153,775Promotional expense
    
    
    102,421
    
    
    
    51,902Professional fees and expenses
    
    
    435,000
    
    
    
    Other expenses
    
    
    135,498
    
    
    
    44,143$
    2,416,659
    
    
    $
    872,667
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4. INCOME TAXES
  5. SUPPLEMENTAL DISCLOSURE OF CASH FLOWS INFORMATION
   6




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Item 2. Managements Discussion and Analysis of Financial Condition and Results of
Operations.
 Cautionary Notice Regarding Forward Looking Statements.
  Background
 Berita International
Corporation. Keiji International Group Inc. Asia Electrical Power International Group Inc. Agreement Naiji
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Results of Operations
 September 30, 2009, compared to September 30, 2008
 Revenues
 Nine months
    
    
    
    
    
    Nine monthsended September
    
    
    
    
    
    ended September30, 2009
    
    % Sales
    
    30, 2008
    
    % SalesRevenue
    
    $
    13,351,210
    
    
    
    100
    %
    
    $
    9,406,051
    
    
    
    100
    %Cost of Sales
    
    
    10,406,404
    
    
    
    78
    %
    
    
    7,810,410
    
    
    
    83
    %Gross Profit
    
    $
    2,944,806
    
    
    
    22
    %
    
    $
    1,595,641
    
    
    
    17
    %
   Three months
    
    
    
    
    
    Three monthsended September
    
    
    
    
    
    ended September30, 2009
    
    % Sales
    
    30, 2008
    
    % SalesRevenue
    
    $
    6,637,692
    
    
    
    100
    %
    
    $
    3,997,033
    
    
    
    100
    %Cost of Sales
    
    
    5,008,791
    
    
    
    75
    %
    
    
    3,292,637
    
    
    
    82
    %Gross Profit
    
    $
    1,628,901
    
    
    
    25
    %
    
    $
    704,396
    
    
    
    18
    %
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Selling and Administrative Expenses
    9




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Operating Income
   Other Income (Expense)
  Income Taxes
  Income before Income Taxes, Net Income for the Period, Total Comprehensive Income, and Loss Per
Common Share
   10




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Current Trends in the Industry
   Liquidity and Capital Resources
   Materials, Labor, Overhead
    
    $
    4,200,000Selling Expenses and Administrative Expenses
    
    $
    800,000Total
    
    $
    5,000,000
 Sources of Capital
  11




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Material Commitments
  Seasonal Aspect
  Off Balance Sheet Arrangements
  CRITICAL ACCOUNTING POLICIES
  NEW ACCOUNTING PRONOUNCEMENTS
   12




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Off-Balance Sheet Commitments and Arrangements
  Revenue Recognition
  Income Taxes
  13




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Item 3. Quantitative and Qualitative Disclosures about Market Risks
  
 Item 4. Controls and Procedures
  Changes in Internal Controls
  
 PART II  OTHER INFORMATION
 
 Item 6. Exhibits
 31.1
    
    Certification of Chief Executive Officer pursuant to Section 302 of
the Sarbanes-Oxley Act of 200231.2
    
    Certification of Chief Financial Officer pursuant to Section 302 of
the Sarbanes-Oxley Act of 200232.
    
    Certification of Chief Executive Officer and Chief Financial Officer
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 (Signatures appear on following page)
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SIGNATURES
  ASIA ELECTRICAL POWER INTERNATIONAL GROUP INC.
  By:
    /s/ Yulong GuoYulong GuoPresident, Chief Executive Officer and DirectorBy:
    /s/ Yunbin LiYunbin LiChief Financial Officer 15