SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-K
(Mark One)

|X| Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act
    of 1934
                    For the fiscal year ended March 31, 2009

                                       or

| | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
    Act of 1934

                         COMMISSION FILE NUMBER 1-15863

                                 IA GLOBAL, INC.
                                 ---------------
             (Exact name of registrant as specified in its charter)

                    DELAWARE                           13-4037641
                    --------                           ----------
         (State or other jurisdiction of            (I.R.S. Employer
         incorporation or organization)            Identification No.)

           101 CALIFORNIA STREET, SUITE 2450, SAN FRANCISCO, CA 94111
           ----------------------------------------------------------
               (Address of principal executive offices) (Zip Code)

       (Registrant's telephone number, including area code) (415)-946-8828

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

   COMMON STOCK, $.01 PAR VALUE            The American Stock Exchange
   ----------------------------            ---------------------------
        (Title of class)            Name of Each Exchange on which registered

Securities registered pursuant to Section 12(g) of the Act:  NONE

         Indicate by check mark if the registrant is a well-known issuer, as
defined in Rule 405 of the Securities Act.
                                                                Yes |_|   No |X|

         Indicate by check mark if the registrant is not required to file
reports pursuant to Section 13 or Section 15(d) of the Act.
                                                                Yes |_|   No |X|

         Indicate by check mark whether the registrant has submitted
electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation
S-T (Section 232.405 of this chapter) during the preceding 12 months (or for
such shorter period that the registrant was required to submit and post such
files).                                                         Yes |_|   No |_|

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

         Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. |_|

         Indicate by check mark whether the registrant is large accelerated
filer, an accelerated filer, or a non-accelerated filer. See definition of
"accelerated filer and large accelerated filer" in Rule 12b-2 of the Exchange
Act.

         Large accelerated filer |_|      Accelerated filer         |_|
         Non-accelerated filer   |_|      Smaller reporting Company |X|

         Indicate by check mark whether the registrant is a shell Company (as
defined in Rule 12b-2 of the Act).
                                                                Yes |_|   No |X|

         The aggregate market value of the common equity held by non-affiliates
of the registrant as of September 1, 2009 was approximately $6,507,289.

         The number of shares of the registrant's common stock outstanding as of
September 1, 2009: 225,953,489 shares of Common stock.

                       DOCUMENTS INCORPORATED BY REFERENCE

         None.   TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----
                                     PART I

Item 1.  Business ..........................................................   1

Item 1A. Risk Factors ......................................................   5

Item 1B. Unresolved Staff Comments .........................................  13

Item 2.  Properties ........................................................  13

Item 3.  Legal Proceedings .................................................  13

Item 4.  Submission of Matters to a Vote of Security Holders ...............  13


                                     PART II

Item 5.  Market for Registrant's Common Equity, Related Stockholder Matters
         and Issuer Purchases of Equity Securities .........................  14

Item 6.  Selected Financial Data ...........................................  16

Item 7.  Management's Discussion and Analysis of Financial Condition
         and Results of Operations .........................................  17

Item 7A. Quantitative and Qualitative Disclosures about Market Risk ........  31

Item 8.  Financial Statements and Supplementary Data .......................  31

Item 9.  Changes in and Disagreements With Accountants on Accounting
         and Financial Disclosure ..........................................  32

Item 9A. Controls and Procedures ...........................................  32

Item 9B. Other Information .................................................  32


                                    PART III

Item 10. Directors, Executive Officers and Corporate Governance ............  33

Item 11. Executive Compensation ............................................  35

Item 12. Security Ownership of Certain Beneficial Owners
         and Management and Related Stockholder Matters ....................  48

Item 13. Certain Relationships and Related Transactions,
         and Director Independence .........................................  50

Item 14. Principal Accounting Fees and Services ............................  51


                                     PART IV

Item 15. Exhibits, Financial Statement Schedules ...........................  51

SIGNATURES

                                       iiPART I

CHANGE IN YEAR-END

         On July 25, 2007, the Board of Directors resolved that the fiscal year
of IA Global that began on January 1, 2007 would end on December 31, 2007, and
from that date forward, the fiscal year of the Company will be the period
beginning on April 1 of each year and ending on March 31 of the following year.
The Company filed a Form 10-K for the calendar year ending December 31, 2007 and
filed a Transition Report on Form 10-K to reflect the three month transition
period of January 1, 2008 through March 31, 2008.

         This Annual Report on Form 10-K is the Company's first annual report
for our newly adopted fiscal year-end of March 31, 2009 and covers the twelve
months ended March 31, 2009.

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

         The following discussion, in addition to the other information
contained in this report, should be considered carefully in evaluating us and
our prospects. This report (including without limitation the following factors
that may affect operating results) contains forward-looking statements (within
the meaning of Section 27A of the Securities Act of 1933, as amended
("Securities Act") and Section 21E of the Securities Exchange Act of 1934, as
amended ("Exchange Act") regarding us and our business, financial condition,
results of operations and prospects. Words such as "expects," "anticipates,"
"intends," "plans," "believes," "seeks," "estimates" and similar expressions or
variations of such words are intended to identify forward-looking statements,
but are not the exclusive means of identifying forward-looking statements in
this report. Additionally, statements concerning future matters such as revenue
projections, projected profitability, growth strategies, development of new
products, enhancements or technologies, possible changes in legislation and
other statements regarding matters that are not historical are forward-looking
statements.

         Forward-looking statements in this report reflect the good faith
judgment of our management and the statements are based on facts and factors as
we currently know them. Forward-looking statements are subject to risks and
uncertainties and actual results and outcomes may differ materially from the
results and outcomes discussed in the forward-looking statements. Factors that
could cause or contribute to such differences in results and outcomes include,
but are not limited to, those discussed below and in "Management's Discussion
and Analysis of Financial Condition and Results of Operations" as well as those
discussed elsewhere in this report. Readers are urged not to place undue
reliance on these forward-looking statements which speak only as of the date of
this report. We undertake no obligation to revise or update any forward-looking
statements in order to reflect any event or circumstance that may arise after
the date of this report.

EXCHANGE RATES

         Certain information in this Annual Report on Form 10-K is expressed in
Japanese Yen, the Philippine Peso and the Australian Dollar. At March 31, 2009,
the exchange rate for the Japanese Yen was US $1= Yen [98.636], the Philippine
Peso was US $1= [48.4238] and the Australian $ was US $1= [1.4457].In this Form
10K, at "current exchange rates" is defined as the exchange rates as of the date
of the transaction.

ITEM 1.  BUSINESS

GENERAL DEVELOPMENT OF BUSINESS

THE COMPANY AND OUR BUSINESS

         IA Global, Inc. is a broad based services Company with a dedicated
focus on growth of existing business, together with expansion through mergers
and acquisitions in the Pacific Rim region. Our mission is to identify and
invest in business opportunities, apply our skills and resources to nurture and
enhance the performance of those businesses across key business metrics, and to
deliver accelerating shareholder value.

                                       1To realize this plan, we are seeking investments in the business
process outsourcing ("BPO") and financial services sectors. These sectors
demonstrate long-term growth prospects in which we, by applying our skills and
resources, can add significant value to our investments. Beyond Japan, we are
expanding our reach to encompass, the Philippines, Southeast Asia and the growth
opportunities and synergies these markets present.

         IA Global takes a long-term approach to its acquisitions and
partnerships. It is built on the belief that our people, combining pragmatic
hands-on management with extensive operations and financial experience, have the
expertise to grow the businesses we invest in, to optimize their potential and
provide increasing returns on investment over the long run. IA Global has
acquired a select portfolio of investments in Japan, Australia and the
Philippines/Singapore area, targeted and developed with the aim of producing
outstanding growth and profitability. This has laid the foundation for a medium
term plan to establish a broad network of complementary subsidiaries and
majority-owned investments in the greater Pacific Rim region.

BUSINESS PROCESS OUTSOURCING

         In Japan, IA Global is 100% owner of Global Hotline, except as
disclosed, a Business Process Outsourcing organization, operating several major
call centers providing outbound telemarketing services for telecommunications,
insurance, credit cards and catalog products. Since our acquisition of Global
Hotline in June 2005, this business has expanded rapidly with the signing of
significant multi-year contracts with major corporations.

         This growth has been driven by new contracts, process improvements,
infrastructure expansion, and macro economic trends such as the ongoing gains in
the Japanese economy, consistent year on year growth in targeted industries,
higher disposable incomes, and the increasingly rapid growth of the senior
citizen demographic. As of March 31, 2009, Global Hotline employed 885 full and
part-time personnel to support these multi-million dollar contracts. In the
Philippines, we acquired 100% of Shift Resources Inc.("Shift") on April 10, 2008
and Asia Premier Executive Suites Inc. ("Asia Premier") on May 27, 2008,
multi-service call center operations that have now been merged into a single
Company operating as Global Hotline Philippines.

HUMAN CAPITAL AND RESOURCES

         IA Global has a 20.25% equity investment in Slate Consulting Co Ltd
("Slate"). Slate is a Japan headquartered Executive Search firm with operations
and business entities in Tokyo and a call center in Manila, Philippines.

FINANCIAL SERVICES

         In Japan, we have a 12.6% equity investment as of September 1, 2009 in
Taicom Securities Co Ltd ("Taicom"), a Japanese securities firm. Taicom provides
a broad range of value-added financial services and competitive products. These
services currently include the brokerage of Japanese commodities, options
derivatives trading, foreign currency, equities and margin as well as offering
wealth management and investment consulting services to diversified clients. In
addition to offering a broad news and information gathering network, Taicom
offers creative solutions that meet the sophisticated trading needs of its
clients.

         Taicom is a member of the Osaka Stock Exchange. Taicom is headquartered
in Tokyo and in Osaka and has three branch offices in Japan.

CORPORATE INFORMATION

         We were incorporated in Delaware on November 12, 1998. The Company's
executive offices are located at 101 California Street, Suite 2450, San
Francisco, CA 94111, with its operating units being located primarily in Japan,
China, Philippines and Australia. The Company's telephone number is (415)
946-8828 and its primary website is located at www.iaglobalinc.com. The
information on our website is not a part of this Form 10-K.

                                       2THE COMPANY'S COMMON STOCK

         Our common stock currently trades on the NYSE AMEX Exchange ("NYSE
AMEX") under the symbol "IAO."

INDUSTRY OVERVIEW

         The Asian markets have been growing at a swift pace in recent years and
this growth is expected to continue into the foreseeable future. The growth is
based on a shift in economic activity from Europe and North America to the Asian
markets and a growth in intra-Asian economic activity. The growth of a generally
affluent middle class within most Asian countries is driving demand for an
increasing spread of goods and services, particularly in the 20 -35 year old age
demographic. Although much attention has been given to China and India, Japan
continues to be the second largest economy in the world. These and other factors
are contributing to the growth of our existing investments and present us with
an increasing number of quality investment opportunities.

         Over the past year there has been a tremendous change in sentiment
toward BPO, with the strategy that used to be thought of as a "good idea that
should be discussed" is today one of critical and urgent importance for most
large organizations. As a result, BPO growth is continuing to expand across a
wide range of industries and functions, and seems unstoppable given the current
economic climate.

         Our principal Japanese subsidiary, Global Hotline has demonstrated
growth. This growth was driven by improvements in the Japanese economy,
consistent year on year growth in targeted areas of the telecommunications and
insurance industries, higher disposable incomes, and the expanding senior
citizen demographic.

         Annual sales for the Japanese telecommunication industry were estimated
at $137 billion in 2004, the most recent available information. Further growth
is being fueled by increased broadband, networking, and cell phone usage. Also,
recent changes in regulations affecting Japan's telecommunications market has
spurred strong competition between carriers. Similar to the US market, Japanese
consumers can now retain usage of their existing telephone numbers while easily
changing their telecommunications service supplier.

         Annual sales for the Japanese insurance market were estimated at $242
billion in 2003, the most recent available information. The aging of the
Japanese population and limited government sponsored long-term and national care
insurance has resulted in a growing demand for all types of insurance products.
Japanese consumers purchase multiple policies to cover risks such as medical,
cancer, and life and renew these policies annually.

KEY MARKET OPPORTUNITIES

         Our key market opportunities are as follows:

         - We intend to improve profitability and EBITDA during FY 2010 by
improving sales and margins and reducing expenses.

         - Expand our Global Hotlines Japan operations by adding new contracts
and product offerings.

         - Expand our Global Hotlines Philippines operations through a marketing
agreement with HTMT, and partnering programs with Jones Lang LaSalle and SPi
Technologies, and new product offerings.

         - We intend to expand our reach to encompass, the Philippines,
Southeast Asia and the growth opportunities and synergies these markets present.
Our long-term "Buy to Hold" approach to our investments gives our management
team time to comprehensively analyze, understand and select the companies we
invest in, their sectors and competition in depth, and to accurately gauge their
potential.

         - We intend to enhance the performance of those businesses across key
business metrics, and to deliver accelerating shareholder value.

                                       3- We intend to increase investor relation activities to increase the
trading volume and share price of our common stock.

PRIMARY RISKS AND UNCERTAINTIES

         We are exposed to various risks related to legal claims, our need for
additional financing, our level of indebtedness, our NYSE AMEX listing, our
investment in ArqueMax Ventures, declining economic conditions, our Global
Hotline business, our controlling shareholder groups, the sale of significant
numbers of our shares and a volatile market price for our common stock. These
risks and uncertainties are discussed in Item 1A, "Factors That May Effect
Future Results."

DISTRIBUTION METHODS

         Global Hotline was established September 7, 2004. Operating exclusively
in Japan, Global Hotline's multiple call centers undertake telemarketing of
telecommunications products and services, and a range of insurance products and
services.

         In the Philippines, the Company acquired 100% of Shift on April 10,
2008 and Asia Premier on May 27, 2008, multi-service call center operations that
have now been merged into a single Company operating as Global Hotline
Philippines Inc. Global Hotline Philippines provides inbound and outbound
telemarketing services, and collocation facilities to a variety of industries on
a world-wide basis. In addition, it signed a long term Business Processing and
Marketing Services Agreement with HTMT Global Solutions Limited ("HTMT") on
January 9, 2009. Global Hotline Philippines will also extensively use HTMT's
world class infrastructure, certifications, and extensive call center facilities
to deliver services to Global Hotline Philippines' growing client base. Under a
revenue sharing and collocation basis Global Hotline Philippines can now
undertake outsourcing projects without the need to infuse new capital to build
out additional call center facilities.

COMPETITION

         Global Hotline operates in a competitive market segment. Our
competitive advantage is our ability to successfully operate multiple call
centers that undertake telemarketing of telecommunications products and
services, and a range of insurance products and services. Global Hotline faces
competition from Hikari Tsushin, Moshi-Moshi Hotline and Prestige International.
Because each of these competitors is a telemarketer like Global Hotline, there
is no significant difference in price or quality of the products Global Hotline
offers compared with the competition. Therefore, customer service, industry
reputation and relationships are the key basis on which Global Hotline competes
for business.

         Global Hotline Philippines operates in a competitive market segment.
Our competitive advantages are our lower cost infrastructure, our customer
acquisition competencies, our superior client service culture, and our focus on
niche markets such as litigation documentation processing. Secondly, the
Philippines has risen to become the world's second largest location for BPO
operations, fulfilling a market need that is estimated by the Philippine
Business Processing Association to expand by 20% in 2009. Global Hotline
Philippines faces competition from organizations such as Convergys Corp,
PeopleSupport Corp, and Accenture Corp among others. Global Hotline Philippines
differentiates itself by deploying a mix model of standard BPO services with
secured margin co-location services.

GEOGRAPHICAL MARKETS

         Global Hotline currently operates only in Japan. Global Hotline
Philippines operates in the Philippines, but services customers world-wide.

                                       4INTELLECTUAL PROPERTY

         We regard our trade secrets, domain name rights and similar
intellectual property as significant to our growth and success. We rely upon a
combination of copyright and trademark laws, trade secret protection, domain
name registration agreements, confidentiality and non-disclosure agreements and
contractual provisions with our employees and with third parties to establish
and protect our proprietary rights.

LICENSES

         We have no licenses as of March 31, 2009.

EMPLOYEES

         As of March 31, 2009, we had 585 full-time and 322 part-time employees.
Most employees were based in Japan. The Chief Executive Officer is based in
Japan and the Chief Operating and Financial Officer is based out of the offices
in the United States.

WEBSITE ACCESS TO UNITED STATES SECURITIES AND EXCHANGE COMMISSION REPORTS

         We file annual and quarterly reports, proxy statements and other
information with the Securities and Exchange Commission ("SEC"). You may read
and copy any document we file at the SEC's Public Reference Room at 100 F
Street, N.E., Washington D.C. 20549. Please call the SEC at 1-800-SEC-0330 for
further information on the public reference room. The SEC maintains a website at
http://www.sec.gov that contains reports, proxy and information statements and
other information concerning filers. We also maintain a web site at
http://www.iaglobalinc.com that provides additional information about our
Company and links to documents we file with the SEC. The Company's charters for
the Audit Committee, the Compensation Committee, and the Nominating Committee;
and the Code of Conduct & Ethics are also available on the Company's website.
The information on our website is not part of this Form 10-K.

ITEM 1A. RISK FACTORS

FACTORS THAT MAY AFFECT FUTURE RESULTS

         The following factors, in addition to the other information contained
in this report, should be considered carefully in evaluating us and our
prospects. This report (including without limitation the following factors that
may affect operating results) contains forward-looking statements (within the
meaning of Section 27A of the Securities Act and Section 21E of the Exchange
Act) regarding us and our business, financial condition, results of operations
and prospects. Words such as "expects," "anticipates," "intends," "plans,"
"believes," "seeks," "estimates" and similar expressions or variations of such
words are intended to identify forward-looking statements, but are not the
exclusive means of identifying forward-looking statements in this report.
Additionally, statements concerning future matters such as the development of
new products, enhancements or technologies, projections of revenues and
profitability, possible changes in legislation and other statements regarding
matters that are not historical are forward-looking statements.

         Forward-looking statements in this report reflect the good faith
judgment of our management and the statements are based on facts and factors as
we currently know them. Forward-looking statements are subject to risks and
uncertainties and actual results and outcomes may differ materially from the
results and outcomes discussed in the forward-looking statements. Factors that
could cause or contribute to such differences in results and outcomes include,
but are not limited to, those discussed below and in "Management's Discussion
and Analysis of Financial Condition and Results of Operations" as well as those
discussed elsewhere in this report. Readers are urged not to place undue
reliance on these forward-looking statements which speak only as of the date of
this report. We undertake no obligation to revise or update any forward-looking
statements in order to reflect any event or circumstance that may arise after
the date of the report.

                                       5THE COMPANY COULD BE EXPOSED TO LEGAL CLAIMS.

         We could be exposed to legal claims. Currently, there are no pending
legal proceedings against us that will have a material adverse effect on our
cash flows, financial condition or results of operations.

         On April 30, 2009, Global Hotline entered into negotiations on
$12,379,000 in debt with its Japanese banks. Global Hotline is proposing to
refinance this debt on a long term basis and freeze any payments in the short
term. To date, eight loans have been renegotiated. We expect to adjust the
repayment dates on many loans with our largest lender to a September 30, 2009
due date and then to re-finance the loans on a long term basis.

         On May 26, 2009 IA Global received notices from H Capital. On May 27,
2009, Global Hotline and SG Telecom did not repay the loans as requested by H
Capital. On June 9, 2009, the unlicensed Japanese lender submitted documents
claiming ownership of the Company's 600 shares of Global Hotline.

         After review by Japanese corporate counsel, the Company is challenging
the validity of the loans and the collateral claimed by H Capital. The Company
has discovered that Global Hotline management provided stock certificates to the
unlicensed lender in early March 2009 in violation of the loan agreement the
Company signed. The Company has disputed all notices received from H Capital.
The parties continue to negotiate over the alleged unpaid loans.

         The balance due as of July 31, 2009 is 170,000,000 Yen, or
approximately $1,753,000 at current exchange rates, plus interest of
approximately 15,567,000 Yen, or approximately $160,000 at current exchange
rates. Total interest and fees paid during the three months ended March 31, 2009
was 3,329,000 Yen or approximately $34,000 at current exchange rates.

WE WILL NEED ADDITIONAL FINANCING TO SUPPORT OUR OPERATIONS AND ACQUIRE
BUSINESSES.

         Each entity will need to obtain additional financing in order to
continue our current operations, service our debt repayments and acquire
businesses. There can be no assurance that we will be able to secure funding, or
that if such funding is available, whether the terms or conditions would be
acceptable to us. If the Company is unable to obtain additional financing, we
may need to restructure our operations, divest all or a portion of our business
or file for bankruptcy by Global Hotline and/ or IA Global.

         Moreover, if we raise additional capital through borrowing or other
debt financing, we will incur substantial interest expense. Sales of additional
equity securities will dilute on a pro rata basis the percentage ownership of
all holders of common stock. When we raise more equity capital in the future, it
will result in substantial dilution to our current stockholders.

OUR LEVEL OF INDEBTEDNESS AND THE TERMS OF OUR FINANCING ARRANGEMENTS MAY
ADVERSELY AFFECT OPERATIONS

         At March 31, 2009, we had current and long-term indebtedness of $15.3
million. Global Hotline will need to repay or refinance $13.4 million by March
31, 2010, including approximately $4.4 million in September 30, 2009.

         As of February 25, 2009, all Global Hotline assets, including accounts
receivable are collateralized to H Capital. On approximately April 1, 2009, the
Company pledged its ownership in Global Hotline as collateral for the loans,
subject to a thirty day notice period in the case of default under the
agreement.

         On April 30, 2009, Global Hotline entered into negotiations on
$12,379,000 in debt with its Japanese banks. Global Hotline is proposing to
refinance this debt on a long term basis and freeze any payments in the short
term. To date, eight loans have been renegotiated. We expect to adjust the
repayment dates on many loans with our largest lender to a September 30, 2009
due date and then to re-finance the loans on a long term basis.

                                       6On May 26, 2009 IA Global received notices from H Capital. On May 27,
2009, Global Hotline and SG Telecom did not repay the loans as requested by H
Capital. On June 9, 2009, the unlicensed Japanese lender submitted documents
claiming ownership of the Company's 600 shares of Global Hotline.

         After review by Japanese corporate counsel, the Company is challenging
the validity of the loans and the collateral claimed by H Capital. The Company
has discovered that Global Hotline management provided stock certificates to the
unlicensed lender in early March 2009 in violation of the loan agreement the
Company signed. The Company has disputed all notices received from H Capital.
The parties continue to negotiate over the alleged unpaid loans.

         The balance due as of July 31, 2009 is 170,000,000 Yen, or
approximately $1,753,000 at current exchange rates, plus interest of
approximately 15,567,000 Yen, or approximately $160,000 at current exchange
rates. Total interest and fees paid during the three months ended March 31, 2009
was 3,329,000 Yen or approximately $34,000 at current exchange rates.

         On August 2, 2009, we entered into a Stock Purchase Agreement
("Agreement 1") with Inter Asset Japan LBO No 1 Fund, an existing shareholder
(the "Shareholder"). Under the terms of Agreement 1, we agreed to issue and sell
to the Shareholder 1,500,000 shares of the Company's common stock, par value
$0.01 per share, for an aggregate purchase price of $60,000, or $0.04 per share.
On August 17, 2009, we entered into a Stock Purchase Agreement ("Agreement 2")
with Inter Asset Japan LBO No 1 Fund. Under the terms of Agreement 2, we agreed
to issue and sell to the Shareholder 5,000,000 shares of the our common stock
for an aggregate purchase price of $200,000, or $0.04 per share.

         Also under the terms of the Agreement 2, the Shareholder has committed
to purchase, and we have agreed to issue and sell to the Shareholder, additional
shares of our common stock in accordance with the following schedule:

      o  2,500,000 shares at a purchase price of US$.04 per share, or an
         aggregate price of US$100,000 on or before September 4, 2009.

      o  1,250,000 shares at a purchase price of US$.04 per share, or an
         aggregate price of US$50,000 on or before September 18, 2009.

      o  50,000,000 shares at a purchase price of US$.04 per share, or an
         aggregate price of US$2,000,000 on or before November 10, 2009.

         The Shareholder's obligation to purchase the foregoing shares by the
date specified is conditioned upon the representations and warranties of the
Company contained in the Agreement being accurate as of the date of such
closing.

         Finally, the Shareholder has the option, but not the obligation, to
purchase, on or before December 31, 2009, an additional 50,000,000 shares of
Common Stock at a purchase price of US$.04 per share, or an aggregate price of
US$2,000,000.

         Our level of indebtedness and the terms of our financing arrangements
could:

      o  result in a bankruptcy by Global Hotline and/ or IA Global.

      o  result in a default under the loan agreements;

      o  a collateral call by a lender, including the loss of our Global Hotline
         subsidiary;

      o  lawsuits with lenders;

      o  impact our ability to obtain additional financing to support capital
         expansion plans and for working capital and other purposes on
         acceptable terms or at all;

      o  divert substantial cash flow from our operations and expansion plans in
         order to service our fixed obligations;

                                       7o  place us at a possible competitive disadvantage compared to less
         leveraged competitors and competitors that have better access to
         capital resources.

         Our ability to make scheduled payments on our debt and other fixed
obligations will depend on our future operating performance and cash flows,
which in turn will depend on prevailing economic and political conditions and
financial, competitive, regulatory, business and other factors, many of which
are beyond our control.

         Our ability to renegotiate the terms of our loans will depend on our
negotiations with our Japanese banks and H Capital.

         We are principally dependent upon our operating cash flows to fund our
operations and to make scheduled payments on debt and other fixed obligations.
We cannot assure you that we will be able to generate sufficient cash flows from
our operations to pay our debt and other fixed obligations as they become due,
and if we fail to do so our business could be harmed. If the Company is unable
to obtain additional financing or renegotiate the terms of our loans, we may
need to restructure our operations, divest all or a portion of our business,
provide the Global Hotline business in a collateral call or file for bankruptcy.

         See also our risk factor "We will need additional financing to support
our operations and acquire businesses," above.

WE ARE NOT IN COMPLIANCE WITH CERTAIN NYSE AMEX REQUIREMENTS FOR CONTINUED
LISTING.

         Pursuant to NYSE AMEX listing rules, our common stock could be delisted
from NYSE AMEX if we do not meet certain standards regarding our financial
condition, operating results and share price, including, among other factors,
maintaining adequate stockholders' equity and market capitalization and
minimizing losses from continuing operations over multiple years. The Company
currently is below the minimum stockholder's equity requirement of $6 million.

         The Company received a Deficiency Letter from the NYSE AMEX, dated July
10, 2009. In this letter, NYSE AMEX Staff determined that the Company's
securities have been selling for a low price per share for a substantial period
of time and, pursuant to Section 1003(f)(v) of the NYSE AMEX Company Guide (the
"Company Guide"), the Company's continued listing is predicated on it effecting
a reverse stock split of its common stock by January 11, 2010. The Company will
review a reverse stock split in accordance with the Deficiency Letter.

         The Company was previously notified by Staff that the Exchange deemed
it appropriate for the Company to effect a reverse stock split to address its
low selling price.

         The Company also received a Deficiency Letter from the NYSE AMEX, dated
July 14, 2009. In this letter, NYSE AMEX Staff determined that the Company has
not filed its Form 10K for the twelve months ended March 31, 2009. The timely
filing of this report is a condition of the Company's continuing listing on NYSE
AMEX, as required by Sections 134 and 1101 of the Company Guide. In addition,
the Company's failure to file this report is a material violation of its listing
agreement with NYSE AMEX. Pursuant to 1003(d) of the Company Guide, the Exchange
is authorized to suspend, and unless prompt corrective action is taken, remove
the Company's security from NYSE AMEX.

         The Company is required to submit a plan to NYSE AMEX by July 28, 2009
to bring the Company in compliance with Sections 134 and 1101 of the Company
Guide by October 12, 2009. The Company submitted this plan on August 4, 2009 and
expects to be in compliance with Sections 134 and 1101 of the Company Guide by
October 12, 2009.

         If our securities are delisted from NYSE AMEX, we believe they will be
quoted again for trading on the OTC Bulletin Board, which may depress demand for
our shares and limit market liquidity due to the reluctance or inability of
certain investors to buy stocks on the OTC Bulletin Board. Consequently, an
investor may find it more difficult to trade our securities, which may adversely
affect the ability to resell securities purchased from the selling stockholders.

                                       8WE ARE IN DEFAULT UNDER THE JUNE 8, 2009 SERVICES AGREEMENT WITH ARQUEMAX
VENTURES, LLC

         On July 17, 2009, AMV notified us that we were in default of 5 (h)
under the June 8, 2009 Services Agreement ("Agreement") and as a result did not
fund the $60,000 due June 30, 2009, July 15, 2009 and July 31, 2009. However,
AMV was late in funding as required by the June 8, 2009 Agreement. AMV could
claim ownership of our Taicom shares. This would result in a loss on equity
investment of approximately $3,313,000. Based on the $120,000 in funding under
this Agreement, the Company may be required to issue 4,000,000 shares. The
parties are negotiating over the Agreement.

DECLINING GENERAL ECONOMIC, BUSINESS, OR INDUSTRY CONDITIONS MAY CAUSE REDUCED
REVENUES AND PROFITABILITY.

         Recently, concerns over inflation, energy costs, geopolitical issues,
the availability and cost of credit, the U.S. mortgage market and a declining
real estate market in the U.S. have contributed to increased volatility and
diminished expectations for the global economy and expectations of slower global
economic growth going forward. These factors, combined with volatile oil prices,
declining business and consumer confidence and increased unemployment, have
precipitated a recession. If the economic climate in the U.S. or abroad does not
improve from its current condition or continues to deteriorate, our customers or
potential customers could reduce or delay their purchases of our products, which
would adversely impact our revenues and our ability to manage inventory levels,
collect customer receivables and ultimately our profitability.

         Volatility and disruption of financial markets could affect our access
to credit. The current difficult economic market environment has caused
contraction in the availability of credit in the marketplace. This could
potentially reduce or eliminate the sources of liquidity for the Company.

WE ARE EXPOSED TO CHANGES IN THE TELECOMMUNICATION AND INSURANCE INDUSTRIES.

         Global Hotline may be affected by the following factors that would
impact its ability to operate as a telemarketer of telecommunications and
insurance products in Japan and the Philippines.

         o The businesses have unfunded payroll and social insurance taxes of
approximately 485 million Yen or approximately $4.8 million at current exchange
rates as of March 31, 2009;

         o The businesses have a concentration of major customers, including
AIG;

         o The businesses require cash and liquidity to operate;

         o Its contracts with telecommunication and insurance companies may not
be renewed;

         o The cost to hire and train staff to startup new contracts and the
related debt to fund this expansion;

         o Increased usage of wireless technology for telephone and internet
usage;

         o Passing of new or changes in existing legislation;

         o Impact of privacy laws;

         o New competitors;

         o Decreased pricing;

         o Changes in the availability of employees or wages paid to employees
to operate the call centers; and

         o Loss of key personnel.

                                       9Our business is dependent upon our ability to operate efficiently by
maintaining tight control on cash flows. Any change in these factors could
adversely affect our ability to achieve the contract rates and to operate as a
telemarketer of telecommunications and insurance products in Japan. This could
result in inadequate cash flow for operations and debt repayments, which would
have a material adverse effect on our business, prospects, financial condition
and results of operations and result in a bankruptcy filing by Global Hotline
and/ or IA Global.

OUR CONTROLLING SHAREHOLDER GROUP HAS SUBSTANTIAL INFLUENCE OVER OUR COMPANY

         As of March 31, 2009, IAJ LBO Fund, PBAA Fund Limited, Terra Firma,
Inter Asset Japan Co Ltd ("IAJ"), IA Turkey and Hiroki Isobe, (collectively, the
"Controlling Shareholders") collectively hold approximately 35.2% of our common
stock. These Controlling Shareholders have stated in a Schedule 13D that they
may be deemed to constitute a "group" for the purposes of Rule 13d-3 under the
Exchange Act. Hiroki Isobe controls each of our Controlling Shareholders.

         IAJ could cause a change of control of our board of directors if in
combination with another large shareholder elects candidates of their choice to
the board at a shareholder meeting, and approve or disapprove any matter
requiring stockholder approval, regardless of how our other shareholders may
vote. Further, under Delaware law, IAJ could have a significant influence over
our affairs, if in combination with another large shareholder, including the
power to cause, delay or prevent a change in control or sale of the Company,
which in turn could adversely affect the market price of our common stock.

THE SALE OF A SIGNIFICANT NUMBER OF OUR SHARES OF COMMON STOCK COULD DEPRESS THE
PRICE OF OUR COMMON STOCK.

         Sales or issuances of a large number of shares of common stock in the
public market or the perception that sales may occur could cause the market
price of our common stock to decline. As of March 31, 2009, 218.5 million shares
of common stock were outstanding. Significant shares of common stock are held by
our principal shareholders, other Company insiders and other large shareholders.
As "affiliates" (as defined under Rule 144 of the Securities Act ("Rule 144"))
of the Company, our principal shareholders, other Company insiders and other
large shareholders may only sell their shares of common stock in the public
market pursuant to an effective registration statement or in compliance with
Rule 144.

THE MARKET PRICE OF OUR COMMON STOCK MAY BE VOLATILE.

         The market price of our common stock has been and is likely in the
future to be volatile. Our common stock price may fluctuate in response to
factors such as:

         o A bankruptcy filing by Global Hotline and/ or IA Global,

         o Alleged manipulation of our stock price,

         o Sale of a significant number of our common stock by shareholders,

         o General market and economic conditions,

         o Announcements by us regarding liquidity, significant acquisitions,
equity investments and divestitures, strategic relationships, addition or loss
of significant customers and contracts, capital expenditure commitments, loan,
note payable and agreement defaults, loss of our subsidiaries and impairment of
assets and our NYSE AMEX listing,

         o Quarterly variations in our operating results,

         o Issuance of convertible or equity securities for general or merger
and acquisition purposes,

         o Issuance or repayment of debt, accounts payable or convertible debt
for general or merger and acquisition purposes,

         o Investor relation activities,

                                       10o Announcements of technological innovations,

         o New product introductions by us or our competitors,

         o Competitive activities,

         o Additions or departures of key personnel,

         o Issuance of loans to customers or related or affiliated parties,

         o Defending significant litigation, and

         o Foreign exchange gains and losses.

         These broad market and industry factors may have a material adverse
effect on the market price of our common stock, regardless of our actual
operating performance. These factors could have a material adverse effect on our
business, financial condition and results of operations.

WE MAY INCUR LOSSES IN THE FUTURE.

         We have experienced net losses since inception. There can be no
assurance that we will achieve or maintain profitability.

WE MAY ENGAGE IN ACQUISITIONS, MERGERS, STRATEGIC ALLIANCES, JOINT VENTURES AND
DIVESTITURES THAT COULD RESULT IN FINANCIAL RESULTS THAT ARE DIFFERENT THAN
EXPECTED.

         In the normal course of business, we engage in discussions relating to
possible acquisitions, equity investments, mergers, strategic alliances, joint
ventures and divestitures. Such transactions are accompanied by a number of
risks, including:

         o Use of significant amounts of cash,

         o Potentially dilutive issuances of equity securities on potentially
unfavorable terms,

         o Incurrence of debt on potentially unfavorable terms as well as
amortization expenses related to goodwill and other intangible assets, and

         o The possibility that we may pay too much cash or issue too many of
our shares as the purchase price for an acquisition relative to the economic
benefits that we ultimately derive from such acquisition.

         The process of integrating any acquisition may create unforeseen
operating difficulties and expenditures. The areas where we may face
difficulties include:

         o Diversion of management time, during the period of negotiation
through closing and after closing, from its focus on operating the businesses to
issues of integration,

         o Decline in employee morale and retention issues resulting from
changes in compensation, reporting relationships, future prospects or the
direction of the business,

         o The need to integrate each Company's accounting, management
information, human resource and other administrative systems to permit effective
management, and the lack of control if such integration is delayed or not
implemented,

         o The need to implement controls, procedures and policies appropriate
for a public Company that may not have been in place in private companies, prior
to acquisition,

         o The need to incorporate acquired technology, content or rights into
our products and any expenses related to such integration, and

         o The need to successfully develop any acquired in-process technology
to realize any value capitalized as intangible assets.

                                       11From time to time, we have also engaged in discussions with candidates
regarding the potential acquisitions of our product lines, technologies and
businesses. If a divestiture such as this does occur, we cannot be certain that
our business, operating results and financial condition will not be materially
and adversely affected. A successful divestiture depends on various factors,
including our ability to:

         o Effectively transfer liabilities, contracts, facilities and employees
to any purchaser,

         o Identify and separate the intellectual property to be divested from
the intellectual property that we wish to retain,

         o Reduce fixed costs previously associated with the divested assets or
business, and

         o Collect the proceeds from any divestitures.

         In addition, if customers of the divested business do not receive the
same level of service from the new owners, this may adversely affect our other
businesses to the extent that these customers also purchase other products
offered by us. All of these efforts require varying levels of management
resources, which may divert our attention from other business operations.

         If we do not realize the expected benefits or synergies of any
divestiture transaction, our consolidated financial position, results of
operations, cash flows and stock price could be negatively impacted.

WE ARE DEPENDENT ON KEY PERSONNEL.

         Our success depends to a significant degree upon the continued
contributions of key management and other personnel, some of whom could be
difficult to replace. We do not maintain key man life insurance covering certain
of our officers. Our success will depend on the performance of our officers, our
ability to retain and motivate our officers, our ability to integrate new
officers into our operations and the ability of all personnel to work together
effectively as a team. Our failure to retain and recruit officers and other key
personnel could have a material adverse effect on our business, financial
condition and results of operations.

WE HAVE LIMITED INSURANCE.

         We have limited director and officer insurance and commercial insurance
policies. Any significant insurance claims would have a material adverse effect
on our business, financial condition and results of operations.

WE ARE EXPOSED TO FOREIGN CURRENCY GAINS AND LOSSES.

         The majority of our operations are located in Japan and the Philippines
and we have equity investments that operate in Japan and Australia, We do not
trade in hedging instruments or "other than trading" instruments and a
significant change in the foreign currency exchange rate between the Japanese
Yen, Australian Dollar, Philippine Peso and US Dollar would have a material
adverse or positive effect on our business, financial condition and results of
operations.

WE ARE SUBJECT TO COMPETITIVE PRESSURES.

         We face competition from entities that provide competing call center
operations, including entities that resell telephone and broadband lines and
insurance products in Japan and the Philippines. Certain of our competitors may
be able to devote greater resources to marketing, adopt more aggressive pricing
policies and devote substantially more resources to developing their services
and products. We may be unable to compete successfully against current and
future competitors, and competitive pressures may have a material adverse effect
on our business. Further, as a strategic response to changes in the competitive
environment, we may from time to time make certain pricing, service or marketing
decisions or acquisitions that could have a material adverse or positive effect
on our business, prospects, financial condition and results of operations.

                                       12ITEM 1B. UNRESOLVED STAFF COMMENTS

Not applicable.

ITEM 2.  PROPERTIES

         Our executive offices are currently located at 101 California Street,
Suite 2450, San Francisco, CA 94111. The office is leased, and the lease is
renewable on a month to month basis for $300 per month effective March 15, 2007.

         A summary of material Global Hotline property leases is as follows:

                                    Total                                  Monthly           Lease           Termination
          Location               Sq. Meters          Description           Payment           Term               Clause
------------------------------   ----------   -------------------------   ---------   --------------------   -----------
Tokyo office and call center 1    538.27 m2   Headquarters, Call center   $  44,701   1/1/2007-12/31/2010      6 months
     Tokyo call center 2          426.00 m2          Call center             38,568    7/1/2007-10/21/09       6 months
     Tokyo call center 3          403.00 m2          Call center             20,743   12/1/2007-11/30/2009     6 months
     Tokyo call center 4          571.65 m2          Call center             24,849    5/7/2008-5/6/2010       6 months
     Tokyo call center 5           1,276.15          Call center             39,137   6/18/2007-6/17/2010      6 months
                                                                          ---------
                                                                          $ 167,999
                                                                          =========

         Global Hotline has provided notice on Tokyo call center two, but
expects to occupy the facility until October 21, 2009. The lease expired on June
30, 2009.

ITEM 3.  LEGAL PROCEEDINGS

         There are no pending legal proceedings against us that will have a
material adverse effect on our cash flows, financial condition or results of
operations.

         On April 30, 2009, Global Hotline entered into negotiations on
$12,379,000 in debt with its Japanese banks. Global Hotline is proposing to
refinance this debt on a long term basis and freeze any payments in the short
term. To date, eight loans have been renegotiated. We expect to adjust the
repayment dates on many loans with our largest lender to a September 30, 2009
due date and then to re-finance the loans on a long term basis.

         On May 26, 2009 IA Global received notices from H Capital. On May 27,
2009, Global Hotline and SG Telecom did not repay the loans as requested by H
Capital. On June 9, 2009, the unlicensed Japanese lender submitted documents
claiming ownership of the Company's 600 shares of Global Hotline.

         After review by Japanese corporate counsel, the Company is challenging
the validity of the loans and the collateral claimed by H Capital. The Company
has discovered that Global Hotline management provided stock certificates to the
unlicensed lender in early March 2009 in violation of the loan agreement the
Company signed. The Company has disputed all notices received from H Capital.
The parties continue to negotiate over the unpaid loans.

         The balance due as of July 31, 2009 is 170,000,000 Yen, or
approximately $1,753,000 at current exchange rates, plus interest of
approximately 15,567,000 Yen, or approximately $160,000 at current exchange
rates. Total interest and fees paid during the three months ended March 31, 2009
was 3,329,000 Yen or approximately $34,000 at current exchange rates.

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

         There were no matters during the fourth quarter of the fiscal year
covered by this report that were submitted to a vote of our stockholders through
solicitation of proxies or otherwise.

                                       13PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND
         ISSUER PURCHASES OF EQUITY SECURITIES

         Our common stock trades on NYSE AMEX under the symbol "IAO". The
following table sets forth the range of the high and low sale prices of the
common stock for the periods indicated:

         QUARTER ENDED                        HIGH            LOW
         -------------                        ----            ---

         June 30, 2008                       $0.330          $0.200
         September 30, 2008                  $0.230          $0.070
         December 31, 2008                   $0.080          $0.030
         March 31, 2009                      $0.090          $0.030

         June 30, 2007                       $0.650          $0.260
         September 30, 2007                  $0.550          $0.340
         December 31, 2007                   $0.520          $0.240
         March 31, 2008                      $0.360          $0.210

         As of September 1, 2009, the closing price of the Company's common
stock was $.05 per share. As of September 1, 2009, there were 225,953,489 shares
of common stock outstanding held by approximately 212 stockholders of record.
The number of stockholders, including the beneficial owners' shares through
nominee names is approximately 1,300.

DIVIDEND POLICY

         We have never paid any cash dividends and intend, for the foreseeable
future, to retain any future earnings for the development of our business. Our
future dividend policy will be determined by the board of directors on the basis
of various factors, including our results of operations, financial condition,
capital requirements and investment opportunities.

RECENT SALES OF UNREGISTERED SECURITIES

         During the three months ended March 31, 2009, the following
unregistered sales of equity securities occurred:

         On January 26, 2009, the Company sold 1,000,000 shares of common stock
to Mr. Mark Gustavson for $50,000 or $0.05 per share, the closing market price
during the negotiations of the subscription memorandum.

Share Repurchase Program

         The following information summarizes the purchases through March 31,
2009 related to our share repurchase plan:

                                                                                 Total No. of         Maximum No. of
                                                                               Share Purchased     Shares that can be
                                          Total No. of     Ave. Price Paid   as part of Publicly    Purchased Under
             Period (1)                 Shares Purchases      Per Share        Announced Plan           the Plan
-------------------------------------   ----------------   ---------------   -------------------   ------------------
April 2, 2007-April 30, 2007                1,866,355          $0.251             1,866,355
July 1, 2007-July 31, 2007                     30,000           0.398                30,000
August 1, 2007-August 31, 2007                135,000           0.437               135,000
September 1, 2007-September 30, 2007           60,000           0.481                60,000
October 1, 2007-October 31, 2007               15,000           0.478                15,000
November 1, 2007-November 30, 2007             31,500           0.427                31,500
December 1, 2007-December 31, 2007            516,400           0.347               516,400
                                        ----------------   ---------------   -------------------   ------------------
Total                                       2,654,255          $0.281             2,654,255             4,000,000
                                        ================   ===============   ===================   ==================

(1) On March 22, 2007, IA Global's Board of Directors authorized and announced a
stock repurchase program for up to four million shares, starting on April 2,
2007. There were no purchases during May-June, 2007, or January- December, 2008
and January- March, 2009.

                                       142008/9 PERFORMANCE GRAPH
                      COMPARISON OF CUMULATIVE TOTAL RETURN

AMONG IA GLOBAL, INC., THE AMEX COMPOSITE INDEX
                 AND THE RUSSELL MICROCAP INDEX WITHOUT DIVIDEND

                         3/31/2004   3/31/2005   3/31/2006   3/31/2007   3/31/2008   3/31/2009
                         ---------   ---------   ---------   ---------   ---------   ---------
IA Global, Inc.          $  100.00   $   66.67   $  109.09   $  118.18   $   84.85   $   15.15

AMEX Composite Index     $  100.00   $  116.15   $  154.05   $  173.06   $  177.59   $  108.16

Russell Microcap Index   $  100.00   $   98.28   $  123.01   $  125.46   $   99.02   $   56.83

         The above assumes that $100 was invested in the common stock and each
index on March 31, 2004. Although the Company has not declared a dividend on its
common stock, the total return for each index assumes the reinvestment of
dividends. Stockholder returns over the periods presented should not be
considered indicative of future returns. The foregoing table shall not be deemed
incorporated by reference by any general statement incorporating by reference
the Form 10-K into any filing under the Securities Act or the Exchange Act,
except to the extent the Company specifically incorporates this information by
reference, and shall not otherwise be deemed filed under the acts.

                      EQUITY COMPENSATION PLAN INFORMATION

         The following table provides information as of March 31, 2009 related
to the equity compensation plans in effect at that time.

                                            (a)                        (b)                       (c)
                               ----------------------------   --------------------   --------------------------
                                                                                        Number of securities
                                                                                        remaining available
                                   Number of securities         Weighted-average        for future issuance
                                    to be issued upon           exercise price of    under equity compensation
                                 exercise of outstanding      outstanding options,   plan (excluding securities
        Plan Category          options, warrants and rights    warrants and rights    reflected in column (a))
----------------------------   ----------------------------   --------------------   --------------------------
Equity compensation plan
approved by shareholders (1)            11,693,512                    0.245                   4,537,638

Equity compensation plans
not approved by shareholders                     -                        -                           -
                               ----------------------------   --------------------   --------------------------
Total                                   11,693,512                    0.245                   4,537,638
                               ============================   ====================   ==========================

(1) Awards granted under the 2007 Plan and the 1999 and 2000 Stock Incentive
Plans (the "Plans"). No further awards may be granted under the Plans.

                                       15ITEM 6.  SELECTED FINANCIAL DATA

         In the following tables, we provide you with our selected consolidated
historical financial and other data. We have prepared the consolidated selected
financial information using our consolidated financial statements for the year
ended March 31, 2009, the three months ended March 31, 2008 and the years ended
December 31, 2007 and 2006. When you read this selected consolidated historical
financial and other data, it is important that you read along with it the
historical financial statements and related notes in our consolidated financial
statements included in this report, as well as Item 7. Management's Discussion
and Analysis of Financial Condition and Results of Operations.

                                                                                             Quarter Ended, (in thousands)
                                                                                   --------------------------------------------------
                                                                       Total       March 31     December 31  September 30     June 30
                                                                     --------      --------     -----------  ------------    --------
Year Ended March 31, 2009
Revenue ........................................................     $ 57,107      $  8,553      $ 13,501      $ 15,365      $ 19,688
Gross profit ...................................................       43,889         4,206        10,860        12,330        16,493
Net loss from continuing operations ............................      (20,241)      (16,331)       (2,941)       (1,698)          729
Net loss .......................................................      (20,241)      (16,331)       (2,941)       (1,698)          729
                                                                     --------      --------      --------      --------      --------

Basic and diluted net loss per share ...........................     $  (0.10)     $  (0.07)     $  (0.01)     $  (0.01)     $      -
                                                                     ========      ========      ========      ========      ========

Three Months Ended March 31, 2008
Revenue ........................................................     $ 16,049      $ 16,049      $      -      $      -      $      -
Gross profit ...................................................       13,099        13,099             -             -             -
Net loss from continuing operations ............................          360           360             -             -             -
Net loss .......................................................          360           360             -             -             -
                                                                     --------      --------      --------      --------      --------

Basic and diluted net loss per share ...........................     $      -      $      -      $      -      $      -      $      -
                                                                     ========      ========      ========      ========      ========

                                                                                             Quarter Ended, (in thousands)
                                                                                   --------------------------------------------------
                                                                       Total       March 31     December 31  September 30     June 30
                                                                     --------      --------     -----------  ------------    --------
Year Ended December 31, 2007
Revenue ........................................................     $ 29,137      $ 10,667      $  6,462      $  5,515      $  6,493
Gross profit ...................................................       21,112         7,481         4,261         3,873         5,497
Net loss from continuing operations ............................       (8,149)       (1,557)       (3,621)       (2,127)         (844)
Net loss .......................................................       (8,259)       (1,667)       (3,621)       (2,127)         (844)
                                                                     --------      --------      --------      --------      --------

Basic and diluted net loss per share (1) .......................     $  (0.05)     $  (0.01)     $  (0.02)     $  (0.01)     $  (0.01)
                                                                     ========      ========      ========      ========      ========

(1) Immaterial discontinued operations of $110,000 for 2007 are not presented.

Year Ended December 31, 2006
Revenue ........................................................     $ 19,139      $  7,742      $  4,483      $  3,243      $  3,671
Gross profit ...................................................       16,244         7,778         3,879         2,435         2,152
Net (loss) profit from continuing operations ...................       (3,977)          547        (1,179)       (1,882)       (1,463)
Gain (loss)  from discontinued operations ......................          207          (332)            -           463            76
Net (loss) profit ..............................................       (3,770)          215        (1,179)       (1,419)       (1,387)
                                                                     --------      --------      --------      --------      --------

Basic net (loss) profit per share from continuing operations ...     $  (0.04)     $   0.01      $  (0.01)     $  (0.02)     $  (0.01)
Basic net (loss) profit per share from discontinued operations .            -             -             -             -             -
                                                                     --------      --------      --------      --------      --------
                                                                     $  (0.03)     $      -      $  (0.01)     $  (0.01)     $  (0.01)
                                                                     ========      ========      ========      ========      ========

Diluted net (loss) profit per share from continuing operations .     $  (0.04)     $      -      $  (0.01)     $  (0.02)     $  (0.01)
Diluted net (loss) profit per share from discontinued operations            -             -             -             -             -
                                                                     --------      --------      --------      --------      --------
                                                                     $  (0.03)     $      -      $  (0.01)     $  (0.01)     $  (0.01)
                                                                     ========      ========      ========      ========      ========

                                       16Three Months
                                                  Year Ended       Ended                     Years Ended December 31,
                                                   March 31,      March 31,     -----------------------------------------------------
                                                     2009           2008          2007           2006           2005           2004
                                                  -----------   ------------    --------       --------       --------       --------
                                                                     (dollars in thousands, except per share data)
STATEMENT OF OPERATIONS DATA:
Revenue .....................................      $ 57,107       $ 16,049      $ 29,136       $ 19,139       $ 15,745             $-
Net loss from continuing operations .........       (20,241)           360        (8,149)        (3,977)          (686)        (1,085)
Net loss ....................................       (20,241)           360        (8,259)        (3,770)        (2,071)        (1,443)
Net loss applicable to common shareholders ..       (20,241)           360        (8,259)        (3,770)        (2,071)        (1,443)
Net loss per share from continuing operations       (20,241)             -         (0.05)         (0.04)         (0.01)         (0.01)
Net loss per share ..........................         (0.10)             -         (0.05)         (0.03)         (0.02)         (0.02)

BALANCE SHEET DATA:
Total assets ................................        24,866         34,940        29,922         21,640         28,134         15,213
Long term liabilities .......................         1,898         10,789         9,560          4,762          2,708              -
Stockholder's (deficit) equity ..............        (6,272)         5,130         4,884          9,259          6,016          4,134


ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

INTRODUCTION

         We had revenues of $57.1 million for the twelve months ended March 31,
2009 as compared to $38.7 million for the twelve months ended March 31, 2008. We
have incurred a net loss $20.2 million for the twelve months ended March 31,
2009 as compared to a net loss of $7.1 million for the twelve months ended March
31, 2008.

         During 2008/9, we entered into loans of $.6 million at IA Global and
$8.9 million at Global Hotline. During 2008/9, we repaid loans of $1.1 million
at IA Global and $12.5 million at Global Hotline.

         As of February 25, 2009, all Global Hotline assets are collateralized
to H Capital. On approximately April 1, 2009, the Company pledged its ownership
in Global Hotline as collateral for the loans, subject to a thirty day notice
period in the case of default under the agreement.

         At March 31, 2009, we had current and long-term indebtedness of $15.3
million. Global Hotline will need to repay or refinance $13.4 million by March
31, 2010, including approximately $4.4 million in September 30, 2009.

         On April 30, 2009, Global Hotline entered into negotiations on
$12,379,000 in debt with its Japanese banks. Global Hotline is proposing to
refinance this debt on a long term basis and freeze any payments in the short
term. To date, eight loans have been renegotiated. We expect to adjust the
repayment dates on many loans with our largest lender to a September 30, 2009
due date and then to re-finance the loans on a long term basis.

         On May 26, 2009 IA Global received notices from H Capital. On May 27,
2009, Global Hotline and SG Telecom did not repay the loans as requested by H
Capital. On June 9, 2009, the unlicensed Japanese lender submitted documents
claiming ownership of the Company's 600 shares of Global Hotline.

         After review by Japanese corporate counsel, the Company is challenging
the validity of the loans and the collateral claimed by H Capital. The Company
has discovered that Global Hotline management provided stock certificates to the
unlicensed lender in early March 2009 in violation of the loan agreement the
Company signed. The Company has disputed all notices received from H Capital.
The parties continue to negotiate over the unpaid loans.

         The balance due as of July 31, 2009 is 170,000,000 Yen, or
approximately $1,753,000 at current exchange rates, plus interest of
approximately 15,567,000 Yen, or approximately $160,000 at current exchange
rates. Total interest and fees paid during the three months ended March 31, 2009
was 3,329,000 Yen or approximately $34,000 at current exchange rates.

                                       17On August 2, 2009, we entered into a Stock Purchase Agreement
("Agreement 1") with Inter Asset Japan LBO No 1 Fund, an existing shareholder
(the "Shareholder"). Under the terms of Agreement 1, we agreed to issue and sell
to the Shareholder 1,500,000 shares of the Company's common stock, par value
$0.01 per share, for an aggregate purchase price of $60,000, or $0.04 per share.
On August 17, 2009, we entered into a Stock Purchase Agreement ("Agreement 2")
with Inter Asset Japan LBO No 1 Fund. Under the terms of Agreement 2, we agreed
to issue and sell to the Shareholder 5,000,000 shares of the our common stock
for an aggregate purchase price of $200,000, or $0.04 per share.

         Also under the terms of the Agreement 2, the Shareholder has committed
to purchase, and we have agreed to issue and sell to the Shareholder, additional
shares of our common stock in accordance with the following schedule:

      o  2,500,000 shares at a purchase price of US$.04 per share, or an
         aggregate price of US$100,000 on or before September 4, 2009.

      o  1,250,000 shares at a purchase price of US$.04 per share, or an
         aggregate price of US$50,000 on or before September 18, 2009.

      o  50,000,000 shares at a purchase price of US$.04 per share, or an
         aggregate price of US$2,000,000 on or before November 10, 2009.

         The Shareholder's obligation to purchase the foregoing shares by the
date specified is conditioned upon the representations and warranties of the
Company contained in the Agreement being accurate as of the date of such
closing.

         Finally, the Shareholder has the option, but not the obligation, to
purchase, on or before December 31, 2009, an additional 50,000,000 shares of
Common Stock at a purchase price of US$.04 per share, or an aggregate price of
US$2,000,000.

         Historically, our losses have been financed primarily by the sale of
equity in our Company, by loans from related and unrelated parties, by the
issuance of convertible debentures and through the issuance of equity for
services.

         IA Global and each subsidiary manage their cash flow independently. IA
Global funds its operations from loans, convertible debentures, inter-company
borrowings, loans collateralized by stock, management service fees and dividends
from its equity investments. Global Hotline funds its operations from bank debt
and at times needs to refinance this bank debt. Global Hotline Philippines funds
its operations from inter-company borrowings.

         Each entity will need to obtain additional financing in order to
continue our current operations. There can be no assurance that we will be able
to secure funding for our existing operations, or that if such funding is
available, whether the terms or conditions would be acceptable to us.

         Volatility and disruption of financial markets could affect our access
to credit. The current difficult economic market environment is causing
contraction in the availability of credit in the marketplace. This could
potentially reduce or eliminate the sources of liquidity for the Company.

         If the Company is unable to obtain additional financing, we may need to
restructure our operations, divest all or a portion of our business or file for
bankruptcy by Global Hotline and/ or IA Global.

CHANGE IN FISCAL YEAR

         On July 25, 2007, the Board of Directors resolved that the fiscal year
of IA Global that began on January 1, 2007 would end on December 31, 2007, and
from that date forward, the fiscal year of the Company will be the period
beginning on April 1 of each year and ending on March 31 of the following year.
The Company filed a Form 10-K for the calendar year ending December 31, 2007 and
filed a Transition Report on Form 10-K to reflect the three month transition
period of January 1, 2008 through March 31, 2008.

                                       18This Annual Report on Form 10-K is the Company's first annual report
for our newly adopted fiscal year-end of March 31, 2009 and covers the twelve
months ended March 31, 2009.

RESULTS OF OPERATIONS

         The following table presents certain consolidated statement of
operations information and presentation of that data as a percentage of change
from year-to-year.

(dollars in thousands)
                                                                            Year Ended March 31,
                                                              ---------------------------------------------
                                                                2009        2008     $ Variance  % Variance
                                                              --------    --------   ----------  ----------

Revenue ...................................................   $ 57,107    $ 38,693    $ 18,414       47.6%
Cost of sales .............................................     13,218       9,978       3,240       32.5%
                                                              --------    --------    --------    --------
Gross profit ..............................................     43,889      28,715      15,174       52.8%
Selling, general and administrative expenses ..............     53,444      35,844      17,600       49.1%
                                                              --------    --------    --------    --------
Operating loss ............................................     (9,555)     (7,129)     (2,426)      34.0%
                                                              --------    --------    --------    --------
Other Income (Expense):
Interest income ...........................................         19          56         (37)     -66.1%
Interest expense and amortization of beneficial conversion
  feature .................................................       (757)     (1,117)        360      -32.2%
Other Income ..............................................        294         691        (397)     -57.5%
Gain (loss) on equity investment in Australia Secured
  Financial Limited .......................................        265        (227)        492      216.7%
Gain on equity investment in GPlus Media Co Ltd ...........         13          20          (7)     -35.0%
(Loss) Gain on equity investment in Slate Consulting Co Ltd        (10)        (44)         34       77.3%
Loss on equity investment in Taicom Securities Co Ltd .....       (422)          -        (422)    -100.0%
Conversion of debenture expense ...........................          -        (120)        120      100.0%
Retirement of debt ........................................        (60)          -         (60)    -100.0%
Loss on sale of Taicom Securities Co Ltd ..................     (1,737)          -      (1,737)    -100.0%
Loss on sale of GPlus Media Co Ltd ........................     (1,287)          -      (1,287)    -100.0%
Impairment of equity investment in Australia Secured
 Financial Limited ........................................     (7,195)          -      (7,195)    -100.0%
Foreign currency transaction adjustment ...................        (66)         10         (76)    -760.0%
                                                              --------    --------    --------    --------
Total other expense .......................................    (10,943)       (731)    (10,212)   1,397.0%
                                                              --------    --------    --------    --------
Loss from continuing operations before income  taxes ......    (20,498)     (7,860)    (12,638)     160.8%
Income taxes:
Current benefit ...........................................       (257)       (916)        659       71.9%
                                                              --------    --------    --------    --------
Net loss from continuing operations .......................    (20,241)     (6,944)    (13,297)     191.5%
Loss from discontinued operations .........................          -        (110)        110      100.0%
                                                              --------    --------    --------    --------
Net loss ..................................................   $(20,241)   $ (7,054)   $(13,187)     186.9%
                                                              ========    ========    ========    ========

YEAR ENDED MARCH 31, 2009 COMPARED TO THE YEAR ENDED MARCH 31, 2008 (UNAUDITED)

         Net revenue for the twelve months ended March 31, 2009 increased
$18,414,000 to $57,107,000, as compared to the year ended March 31, 2008.

         The increase was due to the expansion of the Global Hotline business
with the signing of significant contracts with major telecommunication and
insurance companies in Japan. We experienced a decrease in AIG revenues due to
their financial difficulties. While these contracts are in effect, personnel
have been allocated to other contracts at this time. In addition, we experienced
a softening of our revenues from our telecommunication contracts during the
twelve months ended March 31, 2009.

                                       19The Company booked a charge for approximately $1,498,000 during the
twelve months ended March 31, 2009 in conjunction with termination of a contract
with a significant telecommunications customer. During the twelve months ended
March 31, 2009, we deferred $814,787 in revenues with Tesco. In addition, the
Company recorded deferred revenue of $3.2 million and $0 as of March 31, 2009
and 2008, respectively.

COST OF SALES

         Cost of sales for the twelve months ended March 31, 2009 increased
$3,340,000 to $13,218,000. The increase resulted from outside agent and
outsourcing and other costs of related to the expansion of the Global Hotline
business with the signing of significant contracts with major corporations
discussed above, $1,283,000 in conjunction with termination of a contract with a
significant telecommunications customer and $106,000 related to the Global
Hotline Philippines businesses acquired in April and May 2008.

EXPENSES

         Selling, general and administrative expenses for the twelve months
ended March 31, 2009 increased $17,600,000 to $54,444,000 as compared to the
twelve months ended March 31, 2008. This was due to increased operating expenses
of $354,000 related to the implementation of SFAS 123R at IA Global, $440,000
related to the Global Hotline Philippines businesses acquired in April and May
2008 and $16,719,000 at Global Hotline for additional staff, hiring costs and
training and $2,085,000 in costs associated with downsizing during the three
months ended March 31, 2009. The Global Hotline increase was due to the
expansion of the Global Hotline business with the signing of significant
contracts with major corporations.

         Global Hotline opened a fifth and sixth call center in Tokyo and Osaka,
Japan in late August and October, 2007, respectively to support its new
contracts. In addition, Global Hotline opened four smaller call centers in 2008
to support its customer contracts. During October 2008, Global Hotline sold one
call center.

OTHER INCOME/EXPENSE

         Other income/ expense for the twelve months ended March 31, 2009 was
$10,943,000 as compared to $731,000. The other income/expense increase was
primarily related to a net loss on equity investments of $155,000, a loss on
sale of securities to Taicom of $1,737,000 and GPlus Media of $1,287,000, an
impairment write-down on our ASFL equity investment of $7,195,000, and interest
expense of $757,000, offset by other income of $294,000.

NET LOSS

         Net loss for the twelve months ended March 31, 2009 was $20,241,000 as
compared to $7,054,000 for the twelve months ended March 31, 2008. Increased
gross margin of $15,174,000, was offset by increased operating expenses of
$17,600,000 and increased other expenses of $10,212,000. The increased operating
expenses primarily reflect additional staff, hiring costs and training. The
increase resulted from costs related to the expansion of the Global Hotline
business with the signing of significant multi-year contracts with major
corporations.

         The nature of Global Hotline's business model is such that revenues lag
expenses by approximately 6-8 months.

                                       20(dollars in thousands)
                                                                 3 Months Ended March 31,
                                                       -----------------------------------------------
                                                         2008        2007      $ Variance   % Variance
                                                       --------    --------    ----------   ----------

Revenue ............................................   $ 16,049    $  6,493    $   9,556        147.2%
Cost of sales ......................................      2,950         996        1,954        196.2%
                                                       --------    --------    ---------    ----------
Gross profit .......................................     13,099       5,497        7,602        138.3%
                                                       --------    --------    ---------    ----------
Selling, general and administrative expenses .......     11,064       5,910        5,154         87.2%
                                                       --------    --------    ---------    ----------
Operating income ...................................      2,035        (413)       2,448        592.7%
                                                       --------    --------    ---------    ----------
Other Income (Expense):
Interest income ....................................         39          21           18         85.7%
Interest expense and amortization of beneficial
  conversion feature ...............................       (337)       (196)        (141)        71.9%
Other Income .......................................         86          (1)          87       8700.0%
Loss (gain) on equity investment in Australia
  Secured Financial Limited ........................        (94)         13         (107)       823.1%
Gain on equity investment in GPlus Media Co Ltd ....          8           -            8        100.0%
Loss on equity investment in Slate Consulting Co Ltd        (17)          -          (17)      -100.0%
Foreign currency transaction adjustment ............         (2)          -           (2)      -100.0%
                                                       --------    --------    ---------    ----------
Total other expense ................................       (317)       (163)        (154)        94.5%
                                                       --------    --------    ---------    ----------
Income (loss) before income  taxes .................      1,718        (576)       2,294        398.3%
Income taxes:
Current provision ..................................      1,358         268        1,090        406.7%
                                                       --------    --------    ---------    ----------
Net income (loss) ..................................        360        (844)       1,204        142.7%
                                                       ========    ========    =========    ==========

THREE MONTHS ENDED MARCH 31, 2008 COMPARED TO THE THREE MONTHS ENDED MARCH 31,
2007

         Net revenue for the three months ended March 31, 2008 increased
$9,556,000 to $16,049,000, as compared to the three months ended March 31, 2007.
The increase was due to the expansion of the Global Hotline business with the
signing of the following significant contracts with major corporations:

1. KDDI Network and Solutions signed on January 1, 2007 and was increased
   effective July 1, 2007.

2. NTT signed on May 21, 2007 and was effective October 1, 2007.

3. American Life Insurance Company, a Japanese Company which is a subsidiary of
   AIG, signed and effective on August 8, 2007, September 20, 2007 and December
   1, 2007.

4. Increased revenues from other Global Hotline contracts.

COST OF SALES

         Cost of sales for the three months ended March 31, 2008 increased
$1,954,000 to $2,950,000 as compared to the three months ended March 31, 2007.
The increase resulted from outside agent and outsourcing and other costs related
to the expansion of the Global Hotline business with the signing of significant
contracts with major corporations discussed above.

                                       21EXPENSES

         Selling, general and administrative expenses for the three months ended
March 31, 2008 increased $5,154,000 to $11,064,000 as compared to the three
months ended March 31, 2007. This was due to increased operating expenses of
$60,000 related to the implementation of Statement of Financial Accounting
Standards ("SFAS")No. 123-R, Share-Based Payment ("SFAS 123R") and $5,124,000,
for additional staff, and building infrastructure, which included items such as
PCs, workstations, and software licenses, as well as significant investment in
new staff and training. The increase was due to the expansion of the Global
Hotline business with the signing of significant contracts with major
corporations.

         Global Hotline opened a fifth call center in Tokyo, Japan in late
August 2007 to support its new agreements with AIG. This new call center
employed over 400 full and part-time employees. In addition, Global Hotline
opened a sixth call center in Osaka, Japan on October 1, 2007 to support the NTT
contract. This new call center employed 300 full and part-time employees.

         For 2008 and 2007, the selling, general and administrative expenses
consisted primarily of employee and independent contractor expenses, rent,
overhead, equipment and depreciation, amortization of identifiable intangible
assets and intellectual property, professional and consulting fees, sales and
marketing costs, investor relations, legal, stock option and other general and
administrative costs.

OTHER INCOME/EXPENSE

         Other expense for the three months ended March 31, 2008 was $317,000 as
compared to other expense of $163,000 for the three months ended March 31, 2007.
The March 31, 2008 other expense increase was primarily related to interest
expense and amortization of the beneficial conversion feature of $337,000 and a
loss on equity investment of $103,000 from our equity investments, offset by
other income of $86,000. The ASFL loss was due to the sale of the debenture loan
business in November 2007 and certain loan losses booked during 2007 and 2008.
We expect ASFL to return to profitability during FY 2008/9 with new loans placed
and a new line of credit. The Company expects Slate to return to profitability
in the three months ended June 30, 2008.

         Other expense for the three months ended March 31, 2007 was $163,000.
The 2007 other expense was primarily related to interest expense and
amortization of beneficial conversion feature of $196,000, offset by a gain on
equity investment of $13,000 and interest income of $21,000.

NET INCOME (LOSS)

         Net income for three months ended March 31, 2008 was $360,000 as
compared to a net loss from of $844,000 for the three months ended March 31,
2007. This was due to increased gross margin of $7,602,000, offset by increased
operating expenses of $5,154,000 and income taxes of $1,090,000. The increased
operating expenses reflect additional staff, and building infrastructure, which
included items such as PCs, workstations, and software licenses, as well as
significant investment in new staff and training. The increase resulted from
costs related to the expansion of the Global Hotline business with the signing
of significant multi-year contracts with major corporations.

         The nature of Global Hotline's business model is such that revenues lag
expenses by approximately 6-8 months.

                                       22(dollars in thousands)
                                                                  Year Ended December 31,
                                                       -----------------------------------------------
                                                         2007        2006      $ Variance   % Variance
                                                       --------    --------    ----------   ----------

Revenue ............................................   $ 29,136    $ 19,139    $   9,997         52.2%
Cost of sales ......................................      8,024       2,895        5,129        177.2%
                                                       --------    --------    ---------    ----------
Gross profit .......................................     21,112      16,244        4,868         30.0%
                                                       --------    --------    ---------    ----------
Selling, general and administrative expenses .......     30,690      19,066       11,624         61.0%
                                                       --------    --------    ---------    ----------
Operating loss .....................................     (9,578)     (2,822)      (6,756)       239.4%
                                                       --------    --------    ---------    ----------
Other Income (Expense):
Interest income ....................................         37          92          (55)       -59.8%
Interest expense and amortization of beneficial
  conversion feature ...............................       (975)       (851)        (124)        14.6%
Other Income .......................................        603         179          424        236.9%
Loss (gain) on equity investment in Australia
  Secured Financial Limited ........................       (120)         70         (190)      -271.4%
Gain on equity investment in GPlus Media Co Ltd ....         13           -           13        100.0%
Loss on equity investment in Slate Consulting Co Ltd        (26)          -          (26)      -100.0%
Conversion of debenture expense ....................       (120)          -         (120)      -100.0%
Foreign currency transaction adjustment ............         11        (130)         141        108.5%
                                                       --------    --------    ---------    ----------
Total other expense ................................       (577)       (640)          63         -9.8%
                                                       --------    --------    ---------    ----------
Loss from continuing operations before income taxes     (10,155)     (3,462)      (6,693)       193.3%
Income taxes:
Current (benefit) provision ........................     (2,006)        515       (2,521)      -489.5%
                                                       --------    --------    ---------    ----------
Net loss from continuing operations ................     (8,149)     (3,977)      (4,172)      -104.9%
                                                       --------    --------    ---------    ----------
Loss (gain) from disposal of discontinued operations       (110)        463         (573)      -123.8%
Gain from discontinued operations ..................          -          76          (76)      -100.0%
Loss on impairment of note receivable from sale of
  discontinued operations ..........................          -        (332)         332        100.0%
                                                       --------    --------    ---------    ----------
Total loss (gain) from discontinued operations .....       (110)        207         (317)       153.1%
                                                       --------    --------    ---------    ----------
Net loss ...........................................   $ (8,259)   $ (3,770)   $  (4,489)       119.1%
                                                       ========    ========    =========    ==========

YEAR ENDED DECEMBER 31, 2007 VS. YEAR ENDED DECEMBER 31, 2006

         Net revenue for the year ended December 31, 2007 increased $9,997,000
to $29,136,000, as compared to the year ended December 31, 2006. The increase
was due to the expansion of the Global Hotline business with the signing of the
following significant contracts with major corporations:

1. KDDI Network and Solutions signed on January 1, 2007 and was increased
   effective July 1, 2007.

2. NTT signed on May 21, 2007 and was effective October 1, 2007.

3. American Life Insurance Company, a Japanese Company which is a subsidiary of
   AIG, signed and effective on August 8, 2007, September 20, 2007 and December
   1, 2007.

4. AFLAC signed and effective December 29, 2006.

COST OF SALES

         Cost of sales for the year ended December 31, 2007 increased $5,129,000
to $8,024,000 as compared to the year ended December 31, 2006. The increase
resulted from outside agent and outsourcing and other costs related to the
expansion of the Global Hotline business with the signing of significant
contracts with major corporations discussed above.

                                       23EXPENSES

         Selling, general and administrative expenses for the year ended
December 31, 2007 increased $11,624,000 to $30,690,000, as compared to the year
ended December 31, 2006. This was due to increased operating expenses of
$175,000 related to the implementation of SFAS 123R and $11,400,000, for
additional staff, and building infrastructure, which included items such as PCs,
workstations, and software licenses, as well as significant investment in new
staff and training. The increase was due to the expansion of the Global Hotline
business with the signing of significant contracts with major corporations.

         Global Hotline opened a fifth call center in Tokyo, Japan in late
August 2007 to support these new agreements with AIG. This new call center
employed over 400 full and part-time employees. In addition, Global Hotline
opened a sixth call center in Osaka, Japan on October 1, 2007 to support the NTT
contract. This call center employed employ 300 full and part-time employees. The
Company expects to incurred startup and training costs into three months ending
December 31, 2007 on these call centers.

         For 2007 and 2006, the selling, general and administrative expenses
consisted primarily of employee and independent contractor expenses, rent,
overhead, equipment and depreciation, amortization of identifiable intangible
assets and intellectual property, professional and consulting fees, sales and
marketing costs, investor relations, legal, stock option and other general and
administrative costs.

OTHER INCOME/EXPENSE

         Other expense for the year ended December 31, 2007 was $577,000 as
compared to other expense of $640,000 for the year ended December 31, 2006. The
2007 other expense increase was primarily related to interest expense and
amortization of the beneficial conversion feature of $975,000, conversion of
debenture expense of $120,000 and a loss on equity investment of $120,000 from
ASFL, offset by other income of $603,000. The ASFL loss was due to the payoff of
certain large loans and loan losses booked during 2007. We expect ASFL to return
to profitability during FY 2008/9 with new loans placed and a new line of
credit.

         Other expense for the year ended December 31, 2006 was $640,000. The
2006 other expense was primarily related to interest expense and amortization of
beneficial conversion feature of $851,000 and a foreign currency translation
adjustment of $129,000, offset by other income of $179,000, interest income of
$92,000, and a gain on equity investment of $70,000 from ASFL for the period
October 19, 2006 to December 31, 2006.

NET LOSS FROM CONTINUING OPERATIONS

         Net loss from continuing operations was $8,149,000 for the year ended
December 31, 2007 as compared to a net loss of $3,977,000 for the year ended
December 31, 2006. This was due to increased gross margin of $4,868,000 and
income tax benefit of $2,006,000, offset by increased operating expenses of
$11,624,000, for additional staff, and building infrastructure, which included
items such as PCs, workstations, and software licenses, as well as significant
investment in new staff and training. The increase resulted from costs related
to the expansion of the Global Hotline business with the signing of significant
multi-year contracts with major corporations.

         The nature of Global Hotline's business model is such that revenues lag
expenses by approximately 6-8 months.

NET LOSS

         Net loss was $8,259,000 for the year ended December 31, 2007 as
compared to a net loss of $3,770,000 for the year ended December 31, 2006. The
reasons for the decreased loss were more fully discussed above in "Net Loss From
Continuing Operations."

         In accordance with SFAS 144 "Accounting for the Impairment or Disposal
of Long-Lived Assets" ("SFAS 144"), we accounted for the 2007 Outsourcing
Business loss from disposal of discontinued operations of $110,000 as total loss
from discontinued operations in our consolidated statement of operations.

                                       24In accordance with SFAS 144 "Accounting for the Impairment or Disposal
of Long-Lived Assets" ("SFAS 144"), we accounted for the 2006 Rex Tokyo gain
from disposal of discontinued operations of $463,000 and the income from
discontinued operations of $76,000 as total gain from discontinued operations in
our consolidated statement of operations.

LIQUIDITY AND CAPITAL RESOURCES

         We had cash of approximately $3.6 million, a net working capital
deficit of approximately $14.5 million and debt of $15.3 million as of March 31,
2009.

         During 2008/9, we entered into loans of $.6 million at IA Global and
$8.9 million at Global Hotline. During 2008/9, we repaid loans of $1.1 million
at IA Global and $12.5 million at Global Hotline.

         As of February 25, 2009, all Global Hotline assets, including accounts
receivable are collateralized to H Capital. On approximately April 1, 2009, the
Company pledged its ownership in Global Hotline as collateral for the alleged
loans, subject to a thirty day notice period in the case of default under the
agreement.

         At March 31, 2009, we had current and long-term indebtedness of $15.3
million. Global Hotline will need to repay or refinance $13.4 million by March
31, 2010, including approximately $4.4 million in September 30, 2009.

         On April 30, 2009, Global Hotline entered into negotiations on
$12,379,000 in debt with its Japanese banks. Global Hotline is proposing to
refinance this debt on a long term basis and freeze any payments in the short
term. To date, eight loans have been renegotiated. We expect to adjust the
repayment dates on many loans with our largest lender to a September 30, 2009
due date and then to re-finance the loans on a long term basis.

         On May 26, 2009 IA Global received notices from H Capital. On May 27,
2009, Global Hotline and SG Telecom did not repay the Loan as requested by H
Capital. On June 9, 2009, the unlicensed Japanese lender submitted documents
claiming ownership of the Company's 600 shares of Global Hotline.

         After review by Japanese corporate counsel, the Company is challenging
the validity of the loans and the collateral claimed by H Capital. The Company
has discovered that Global Hotline management provided stock certificates to the
unlicensed lender in early March 2009 in violation of the loan agreement the
Company signed. The Company has disputed all notices received from H Capital.
The parties continue to negotiate over the alleged unpaid loans.

         The balance due as of July 31, 2009 is 170,000,000 Yen, or
approximately $1,753,000 at current exchange rates, plus interest of
approximately 15,567,000 Yen, or approximately $160,000 at current exchange
rates. Total interest and fees paid during the three months ended March 31, 2009
was 3,329,000 Yen or approximately $34,000 at current exchange rates.

         On August 2, 2009, we entered into a Stock Purchase Agreement
("Agreement 1") with Inter Asset Japan LBO No 1 Fund, an existing shareholder
(the "Shareholder"). Under the terms of Agreement 1, we agreed to issue and sell
to the Shareholder 1,500,000 shares of the Company's common stock, par value
$0.01 per share, for an aggregate purchase price of $60,000, or $0.04 per share.
On August 17, 2009, we entered into a Stock Purchase Agreement ("Agreement 2")
with Inter Asset Japan LBO No 1 Fund. Under the terms of Agreement 2, we agreed
to issue and sell to the Shareholder 5,000,000 shares of the our common stock
for an aggregate purchase price of $200,000, or $0.04 per share.

         Also under the terms of the Agreement 2, the Shareholder has committed
to purchase, and we have agreed to issue and sell to the Shareholder, additional
shares of our common stock in accordance with the following schedule:

      o  2,500,000 shares at a purchase price of US$.04 per share, or an
         aggregate price of US$100,000 on or before September 4, 2009.

      o  1,250,000 shares at a purchase price of US$.04 per share, or an
         aggregate price of US$50,000 on or before September 18, 2009.

                                       25o  50,000,000 shares at a purchase price of US$.04 per share, or an
         aggregate price of US$2,000,000 on or before November 10, 2009.

         The Shareholder's obligation to purchase the foregoing shares by the
date specified is conditioned upon the representations and warranties of the
Company contained in the Agreement being accurate as of the date of such
closing.

         Finally, the Shareholder has the option, but not the obligation, to
purchase, on or before December 31, 2009, an additional 50,000,000 shares of
Common Stock at a purchase price of US$.04 per share, or an aggregate price of
US$2,000,000.

         IA Global and each subsidiary manage their cash flow independently. IA
Global funds its operations from loans, convertible debentures, inter-company
borrowings, loans collateralized by stock, management service fees and dividends
from its equity investments. Global Hotline funds its operations from bank debt
and at times needs to refinance this bank debt. Global Hotline Philippines funds
its operations from inter-company borrowings.

         Each entity will need to obtain additional financing in order to
continue our current operations, service our debt repayments and acquire
businesses. There can be no assurance that we will be able to secure funding, or
that if such funding is available, whether the terms or conditions would be
acceptable to us.

         Each entity will need to obtain additional financing in order to
continue our current operations. There can be no assurance that we will be able
to secure funding for our existing operations, or that if such funding is
available, whether the terms or conditions would be acceptable to us.

         Volatility and disruption of financial markets could affect our access
to credit. The current difficult economic market environment is causing
contraction in the availability of credit in the marketplace. This could
potentially reduce or eliminate the sources of liquidity for the Company.

         If the Company is unable to obtain additional financing, we may need to
restructure our operations, divest all or a portion of our business or file for
bankruptcy.

         Since inception, we have financed our operations primarily through
sales of our equity securities in our initial public offering and from several
private placements, loans and capital contributions, primarily from related
parties. Net cash proceeds from these items have totaled approximately $20.9
million as of March 31, 2009, with approximately $8.8 million raised in the
initial public offering, $8.6 million raised in private placements, $4.0 million
raised in the conversion of debt and $0.7 million used for the share repurchase
program. In addition, we have issued equity for non-cash items totaling $32.1
million, including $7.0 million from the ASFL equity investment, $4.1 million
from the Taicom equity investment, $1.4 million each from the GPlus and Slate
equity investments, $.3 and $.2 million related to the Asia Premier and Shift
acquisition, respectively, $7.1 million issued for services, $3.6 million
related to a beneficial conversion feature, $3.9 million from debenture
conversions, and $3.1 million related to the Global Hotline acquisition.
Additional funding was obtained from notes payable and long term debt of
approximately $15.3 million.

OPERATING ACTIVITIES

         Net cash provided by operating activities for the twelve months ended
March 31, 2009 was $6.2 million. This amount was primarily related to a net loss
of $20.2 million, offset by depreciation and amortization and other non-cash
expenses of $2.2 million, a loss on disposal of equity investment of $3.0
million, an impairment of equity investment of $7.2 million, a decrease in
accounts receivable of $6.8 million, an increase in accounts payable of $1.4
million, an increase in accrued liabilities and payroll taxes of $1.7 million
and an increase in deferred revenue of $3.5 million.

INVESTING ACTIVITIES

         Net cash provided by investing activities for the twelve months ended
March 31, 2009 was $.2 million. This amount relates to capital expenditures of
$.7 million, offset by sale of fixed assets of $.6 million.

                                       26FINANCING ACTIVITIES

         Net cash used in financing activities for the twelve months ended March
31, 2009 was $3.4 million.

         During 2008/9, we entered into loans of $.6 million at IA Global and
$8.9 million at Global Hotline. During 2008/9, we repaid loans of $1.1 million
at IA Global and $12.5 million at Global Hotline.

         Other Material Commitments. The Company's contractual cash obligations
as of March 31, 2009 are summarized in the table below (1):

Contractual Cash                      Less Than                              Greater Than
Obligations               Total        1 Year      1-3 Years     3-5 Years      5 Years
--------------------   -----------   -----------   ----------   ----------   ------------
Operating leases       $ 2,914,005   $ 1,765,279   $1,018,394   $  130,332   $          0
Note payable            15,289,602    13,391,371    1,284,368      538,941         74,922
Capital expenditures       100,000       100,000            0            0              0
Acquisitions                     0             0            0            0              0
                       -----------   -----------   ----------   ----------   ------------
                       $18,303,607   $15,256,650   $2,302,762   $  669,273   $     74,922
                       ===========   ===========   ==========   ==========   ============

(1) Based on the end of period exchange rate.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

         The application of GAAP involves the exercise of varying degrees of
judgment. On an ongoing basis, we evaluate our estimates and judgments based on
historical experience and various other factors that are believed to be
reasonable under the circumstances. Actual results may differ from these
estimates under different assumptions or conditions. We believe that of our
significant accounting policies (see summary of significant accounting policies
more fully described in Note 2 of notes to consolidated financial statements),
the following policies involve a higher degree of judgment and/or complexity:

INCOME TAXES

         We are subject to income taxes in both the U.S. and foreign (Japan and
Philippines) jurisdictions. Significant judgment is required in determining the
provision for income taxes. We recorded a valuation for the deferred tax assets
from our net operating losses carried forward in the US due to IA Global, Inc.
not demonstrating any consistent profitable operations. In Japan, Global Hotline
has a deferred tax asset which we expect to realize from future income. In the
event that the actual results differ from these estimates or we adjust these
estimates in future periods, we may need to adjust the recorded valuation.

STOCK-BASED COMPENSATION

         Effective January 1, 2006, we began recording compensation expense
associated with stock-based awards and other forms of equity compensation in
accordance with SFAS 123R as interpreted by SEC Staff Accounting Bulletin No.
107. We adopted the modified prospective transition method provided for under
SFAS 123R and consequently has not retroactively adjusted results from prior
periods. Under this transition method, compensation cost associated with
stock-based awards recognized in 2006 includes 1) quarterly amortization related
to the remaining unvested portion of stock-based awards granted prior to
December 15, 2005, based on the grant date fair value estimated in accordance
with the original provisions of SFAS 123; and 2) quarterly amortization related
to stock-based awards granted subsequent to January 1, 2006 based on the grant
date fair value estimated in accordance with the provisions of SFAS 123R. In
addition, we record expense over the vesting period in connection with stock
options granted. The compensation expense for stock-based awards includes an
estimate for forfeitures and is recognized over the expected term of the award
on a straight line basis.

                                       27REVENUE RECOGNITION

         Global Hotline revenue was derived from its multiple call centers
undertaking the telemarketing of telecommunications products and services, and a
range of insurance products and services in Japan. Revenue is considered
realized when the services have been provided to the customer, the work has been
accepted by the customer and collectability is reasonably assured. Furthermore,
if an actual measurement of revenue cannot be determined, we defer all revenue
recognition until such time that an actual measurement can be determined. If
during the course of a contract management determines that losses are expected
to be incurred, such costs are charged to operations in the period such losses
are determined.

         Revenues are deferred when cash has been received from the customer but
the revenue has not been earned. We recorded deferred revenue of $3.2 million
and $0 as of March 31, 2009 and 2008, respectively.

ACCOUNTS RECEIVABLE AND ALLOWANCE FOR DOUBTFUL ACCOUNTS

         Accounts receivable consists primarily of amounts due us from our
normal business activities. We maintain reserves to reflect the expected
non-collection of accounts receivable based on past collection history and
specific risks identified within our portfolio. If the financial condition of
our customers were to deteriorate resulting in an impairment of their ability to
make payments, or if payments from customers are significantly delayed,
additional allowances might be required.

DEBT AND EQUITY FINANCING OF CAPITAL TRANSACTIONS - BENEFICIAL CONVERSION
FEATURES

         We have adopted EITF issues 98-5, ACCOUNTING FOR CONVERTIBLES
SECURITIES WITH BENEFICIAL CONVERSION FEATURES OR CONTINGENTLY ADJUSTABLE
CONVERSION RATIOS, and 00-27, APPLICATION OF ISSUE NO. 98-5 TO CERTAIN
CONVERTIBLE SECURITIES in accounting for convertible debt. EITF 00-27 requires
recognition of the intrinsic value of the conversion option and is recognized as
a reduction to the carrying amount of the convertible debt and as an addition to
paid-in capital. The intrinsic value of the conversion feature is the difference
between the conversion price and the fair value of the stock into which the
security is convertible into, multiplied by the number of shares. The conversion
price used in calculating the intrinsic value is the most favorable conversion
price up to maturity, assuming there are no changes to the current circumstances
except for the passage of time. Changes to the conversion terms that would be
triggered by future events not controlled by the issuer should be accounted for
as contingent conversion options, and the intrinsic value of such conversion
options would not be recognized until and unless the triggering event occurs.
According to EITF 00-27, the issuance proceeds should not be reduced by issuance
costs when calculating the intrinsic value of the conversion feature. The
beneficial conversion feature of debt or equity instruments, depending on the
specific facts and circumstances, will determine whether such beneficial
conversion feature is to be recorded as an expense to be amortized over a period
of time, expensed immediately or recorded as a deemed dividend.

EQUITY INVESTMENT

         We account for our investments using the equity method unless its value
has been determined to be other than temporarily impaired, in which case we
write the investment down to its impaired value. We review these investments
periodically for impairment and make appropriate reductions in carrying value
when an other-than-temporary decline is evident; however, for non-marketable
equity securities, the impairment analysis requires significant judgment. During
our review, we evaluate the financial condition of the issuer, market
conditions, and other factors providing an indication of the fair value of the
investments. Adverse changes in market conditions or operating results of the
issuer that differ from expectation, could result in additional other-than-
temporary losses in future periods. Our equity investments for Slate and Taicom
were not considered permanently impaired as of March 31, 2009.

                                       28RECENT ACCOUNTING PRONOUNCEMENTS

         In December 2007, the FASB issued SFAS No. 141 (revised 2007),
"Business Combinations" ("SFAS 141(R)"). SFAS 141(R) will change the accounting
for business combinations. Under SFAS No. 141(R), an acquiring entity will be
required to recognize all the assets acquired and liabilities assumed in a
transaction at the acquisition-date fair value with limited exceptions. SFAS No.
141(R) will change the accounting treatment and disclosure for certain specific
items in a business combination. SFAS No. 141(R) applies prospectively to
business combinations for which the acquisition date is on or after the
beginning of the first annual reporting period beginning on or after December
15, 2008. SFAS 141(R) is expected to impact us in the event of any future
acquisitions.

         In December 2007, the FASB issued SFAS No. 160, "Non-controlling
Interests in Consolidated Financial Statements--an amendment of Accounting
Research Bulletin No. 51" ("SFAS 160"). SFAS 160 establishes new accounting and
reporting standards for the non-controlling interest in a subsidiary and for the
deconsolidation of a subsidiary. SFAS No. 160 is effective for fiscal years
beginning on or after December 15, 2008. We are currently evaluating the
provisions of SFAS 160 to determine the impact on the Company's consolidated
financial statements. The adoption of SFAS 160 is not expected to have a
material impact on our results of operations, financial position or liquidity.

         In March 2008, the FASB issued SFAS No. 161, "Disclosures about
Derivative Instruments and Hedging Activities--an amendment of FASB Statement
No. 133" ("SFAS 161"). SFAS 161 changes the disclosure requirements for
derivative instruments and hedging activities. Entities are required to provide
enhanced disclosures about (a) how and why an entity uses derivative
instruments, (b) how derivative instruments and related hedged items are
accounted for under Statement 133 and its related interpretations, and (c) how
derivative instruments and related hedged items affect an entity's financial
position, financial performance, and cash flows. The guidance in SFAS 161 is
effective for financial statements issued for fiscal years and interim periods
beginning after November 15, 2008, with early application encouraged. This
Statement encourages, but does not require, comparative disclosures for earlier
periods at initial adoption. The adoption of SFAS 161 is not expected to have a
material impact on our results of operations, financial position or liquidity.

         In May 2008, FASB issued FASB Staff Position ("FSP") APB 14-1,
Accounting for Convertible Debt Instruments That May Be Settled in Cash upon
Conversion (Including Partial Cash Settlement). FSP APB 14-1 clarifies that
convertible debt instruments that may be settled in cash upon either mandatory
or optional conversion (including partial cash settlement) are not addressed by
paragraph 12 of APB Opinion No. 14, Accounting for Convertible Debt and Debt
issued with Stock Purchase Warrants. Additionally, FSP APB 14-1 specifies that
issuers of such instruments should separately account for the liability and
equity components in a manner that will reflect the entity's non-convertible
debt borrowing rate when interest cost is recognized in subsequent periods. FSP
APB 14-1 is effective for financial statements issued for fiscal years beginning
after December 15, 2008, and interim periods within those fiscal years. We will
adopt FSP APB 14-1 beginning in the first quarter of fiscal 2009, and this
standard must be applied on a retrospective basis. The adoption of FSP APB 14-1
is not expected to have a material impact on our results of operations,
financial position or liquidity.

         In May 2008, the FASB issued SFAS No. 162, The Hierarchy of Generally
Accepted Accounting Principles. This standard is intended to improve financial
reporting by identifying a consistent framework, or hierarchy, for selecting
accounting principles to be used in preparing financial statements that are
presented in conformity with generally accepted accounting principles in the
United States for non-governmental entities. SFAS No. 162 is effective 60 days
following approval by the SEC of the Public Company Accounting Oversight Board's
amendments to AU Section 411, The Meaning of Present Fairly in Conformity with
Generally Accepted Accounting Principles. The adoption of SFAS No. 162 is not
expected to have a material impact on the preparation of its consolidated
financial statements.

                                       29On June 16, 2008, the FASB issued final Staff Position No. EITF 03-6-1,
"Determining Whether Instruments Granted in Share-Based Payment Transactions Are
Participating Securities," to address the question of whether instruments
granted in share-based payment transactions are participating securities prior
to vesting. The FSP determines that unvested share-based payment awards that
contain rights to dividend payments should be included in earnings per share
calculations. The guidance will be effective for fiscal years beginning after
December 15, 2008. The adoption of EITF 03-6-1 is not expected to have a
material impact on our results of operations, financial position or liquidity.

         In January 2009, the FASB issued FSP EITF 99-20-1, "Amendments to the
Impairment Guidance of EITF Issue No. 99 - Recognition of Interest Income and
Impairment on Purchased and Retained Beneficial Interests in Securitized
Financial Assets". FSP EITF 99-20-1 changes the impairment model included within
EITF 99-20 to be more consistent with the impairment model of SFAS No. 115. FSP
EITF 99-20-1 achieves this by amending the impairment model in EITF 99-20 to
remove its exclusive reliance on "market participant" estimates of future cash
flows used in determining fair value. Changing the cash flows used to analyze
other-than-temporary impairment from the "market participant" view to a holder's
estimate of whether there has been a "probable" adverse change in estimated cash
flows allows companies to apply reasonable judgment in assessing whether
another-than-temporary impairment has occurred. The adoption of FSP EITF 99-20-1
did not have a material impact on our results of operations, financial position
or liquidity.

         In April 2009 the FASB issued FSP No. 141R-1 Accounting for Assets
Acquired and Liabilities Assumed in a Business Combination That Arise from
Contingencies, or FSP 141R-1. FSP 141R-1 amends the provisions in SFAS 141R for
the initial recognition and measurement, subsequent measurement and accounting,
and disclosures for assets and liabilities arising from contingencies in
business combinations. The FSP eliminates the distinction between contractual
and non-contractual contingencies, including the initial recognition and
measurement criteria in SFAS 141R and instead carries forward most of the
provisions in SFAS 141 for acquired contingencies. FSP 141R-1 is effective for
contingent assets and contingent liabilities acquired in business combinations
for which the acquisition date is on or after the beginning of the first annual
reporting period beginning on or after December 15, 2008. The adoption of FSP
No. 141R-1 did not have a material impact on our results of operations,
financial position or liquidity.

         In April 2009 the FASB issued three related Staff Positions: (i) FSP
No. 157-4, Determining Fair Value When the Volume and Level of Activity for the
Asset or Liability have Significantly Decreased and Identifying Transactions
That Are Not Orderly, or FSP 157-4, (ii) FSP 115-2 and FSP No. 124-2,
Recognition and Presentation of Other-Than-Temporary Impairments , or FSP 115-2
and FSP 124-2, and (iii) FSP 107-1 and APB No. 28-1, Interim Disclosures about
Fair Value of Financial Instruments, or FSP 107 and APB 28-1, which are
effective for interim and annual periods ending after June 15, 2009. FSP 157-4
provides guidance on how to determine the fair value of assets and liabilities
under SFAS 157 in the current economic environment and reemphasizes that the
objective of a fair value measurement remains an exit price. If we were to
conclude that there has been a significant decrease in the volume and level of
activity of the asset or liability in relation to normal market activities,
quoted market values may not be representative of fair value and the Company may
conclude that a change in valuation technique or the use of multiple valuation
techniques may be appropriate. FSP 115-2 and FSP 124-2 modify the requirements
for recognizing other-than-temporarily impaired debt securities and revise the
existing impairment model for such securities, by modifying the current intent
and ability indicator in determining whether a debt security is
other-than-temporarily impaired. FSP 107 and APB 28-1 enhance the disclosure of
instruments under the scope of SFAS 157 for both interim and annual periods.

                                       30In May 2009 the FASB issued SFAS No. 165, Subsequent Events, or SFAS
165. SFAS 165 establishes general standards of accounting for and disclosure of
events that occur after the balance sheet date but before financial statements
are issued or are available to be issued. SFAS 165 requires the disclosure of
the date through which an entity has evaluated subsequent events and the basis
for that date, that is, whether the date represents the date the financial
statements were issued or were available to be issued. SFAS 165 is effective in
the first interim period ending after June 15, 2009. We expects SFAS 165 will
have an impact on disclosures in our consolidated financial statements, but the
nature and magnitude of the specific effects will depend upon the nature, terms
and value of the any subsequent events occurring after adoption.

         In June 2009 the FASB issued SFAS No. 167, Amendments to FASB
Interpretation No. 46(R), or SFAS 167, that will change how we determine when an
entity that is insufficiently capitalized or is not controlled through voting
(or similar rights) should be consolidated. Under SFAS No. 167, determining
whether a company is required to consolidate an entity will be based on, among
other things, an entity's purpose and design and a company's ability to direct
the activities of the entity that most significantly impact the entity's
economic performance. SFAS 167 is effective for financial statements after
January 1, 2010. We are currently evaluating the requirements of SFAS 167 and
the impact of adoption on their consolidated financial statements, if any.

         In June 2009 the FASB issued SFAS No. 168, The FASB Accounting
Standards Codification and the Hierarchy of Generally Accepted Accounting, or
SFAS 168. SFAS 168 represents the last numbered standard to be issued by FASB
under the old (pre-Codification) numbering system, and amends the GAAP hierarchy
established under SFAS 162. On July 1, 2009 the FASB launched FASB's new
Codification entitled The FASB Accounting Standards Codification, or FASB ASC.
The Codification will supersede all existing non-SEC accounting and reporting
standards. SFAS 168 is effective in the first interim and annual periods ending
after September 15, 2009. This pronouncement will have no effect on our
consolidated financial statements upon adoption other than current references to
GAAP which will be replaced with references to the applicable codification
paragraphs.

         A variety of proposed or otherwise potential accounting standards are
currently under study by standard setting organizations and various regulatory
agencies. Due to the tentative and preliminary nature of those proposed
standards, management has not determined whether implementation of such proposed
standards would be material to the consolidated financial statements.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

FOREIGN CURRENCY RISK

         We were exposed to foreign currency risks due to our operations in
Japan and the Philippines and our equity investments in Japan and Australia. We
do not trade in hedging instruments or "other than trading" instruments and we
are exposed to foreign currency exchange risks.

INTEREST RATE RISK

         We are exposed to interest rate risk at Global Hotline. As of March 31,
2009, total debt was $15,289,602. Debt totaling $1,672,310 is exposed to
variable interest rates with current interest rates of 2.13% to 4.25%.

         The Company does not trade in hedging instruments or "other than
trading" instruments and is exposed to interest rate risks. We believe that the
impact of a 10% increase or decline in interest rates would not be material to
our financial condition and results of operations.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

         Reference is made to our consolidated financial statements beginning on
page F-1 of this report.

                                       31ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

         None.

ITEM 9A. CONTROLS AND PROCEDURES

CONCLUSION REGARDING THE EFFECTIVENESS OF DISCLOSURE CONTROLS AND PROCEDURES

         Our management, with the participation of our Chief Executive Officer
and Chief Operating and Financial Officer, evaluated the effectiveness of our
disclosure controls and procedures as of March 31, 2009. The term "disclosure
controls and procedures," as defined in Rules 13a-15(e) and 15d-15(e) under the
Exchange Act, means controls and other procedures of a company that are designed
to ensure that information required to be disclosed by a Company in the reports
that it files or submits under the Exchange Act is recorded, processed,
summarized and reported, within the time periods specified in the SEC's rules
and forms. Disclosure controls and procedures include, without limitation,
controls and procedures designed to ensure that information required to be
disclosed by a company in the reports that it files or submits under the
Exchange Act is accumulated and communicated to the company's management,
including its principal executive and principal financial officers, as
appropriate to allow timely decisions regarding required disclosure. Our
management recognizes that any controls and procedures, no matter how well
designed and operated, can provide only reasonable assurance of achieving their
objectives and our management necessarily applies its judgment in evaluating the
cost-benefit relationship of possible controls and procedures. Based on the
evaluation of our disclosure controls and procedures as of March 31, 2009, our
Chief Executive Officer and Chief Operating and Financial Officer concluded
that, as of such date, our disclosure controls and procedures were effective at
the reasonable assurance level.

MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

         Our management is responsible for establishing and maintaining adequate
internal control over financial reporting, as such term is defined in Exchange
Act Rule 13a-15(f). Under the supervision and with the participation of our
management, including our principal executive officer and principal financial
officer, we conducted an evaluation of the effectiveness of our internal control
over financial reporting based on the framework in Internal Control--Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway
Commission. Based on our evaluation under the framework in Internal
Control--Integrated Framework, our management concluded that our internal
control over financial reporting was effective as of March 31, 2009.

         The effectiveness of our internal control over financial reporting as
of March 31, 2009 has not been audited by Sherb & Co., LLP, an independent
registered public accounting firm, as stated in their report which is included
herein.

CHANGES IN INTERNAL CONTROL

         There has been no change in our internal control over financial
reporting during the quarter ended March 31, 2009 that has materially effected
or is likely to materially affect our internal control over financial reporting.

ITEM 9B. OTHER INFORMATION

         There were no disclosures of any information required to be filed on
Form 8-K during the three months ended March 31, 2009 that were not filed.

                                       32PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE

         The names and ages of IA Global's executive officers, as of September
1, 2009, as well as certain biographical information, is set forth below.

Derek Schneideman
Chief Executive Officer, Chairman of the Board of Directors

Age 54
Director since 2007

New Zealander Derek Schneideman has 30 years experience working in the Asia
Pacific region and North America. He brings a wealth of experience to IA Global,
including President of Gateway Japan Inc.; Senior Executive Advisor to the
Softbank Asia Pacific Investment Fund; President and CEO of CTR Ventures Co.,
Ltd; Executive Vice President of an Electronic Data Systems Corporation Japan,
Inc., (EDS) joint venture company (EDS-NII); and Managing Director for Computer
Associates, Inc., (CAI) in Japan, Korea and New Zealand. He also serves or has
served as Director and Executive Operations Officer for AdMark International
Executive Search, Inc; Executive Consultant to Uniscope Co., Ltd; Senior Partner
of SICS Co., Ltd; and Japan Representative of Illinois Superconductor, Inc.

Derek serves on the boards of several companies in Japan, the U.S., and New
Zealand. A Japanese speaker, he is widely involved in community service
activities and industry forums.

Board of Directors: Chairman
Merger and Acquisition Committee: Member

Mark Scott
Chief Financial Officer and Secretary

Age 56
Secretary since 2004

American Mark Scott has served as COO since August 2005, a Director from January
2004 to December 2008 and Chief Financial Officer since October 2003. He has
wide experience in executive financial positions in the United States including
most recently with Digital Lightwave; Network Access Solutions; and Teltronics,
Inc. He has also held senior financial positions at Protel, Inc., Crystals
International, Inc., Ranks Hovis McDougall, LLP and Brittania Sportswear, and
worked at Arthur Andersen. As a member of the National Association of Corporate
Directors he is a certified corporate director.

Board of Directors: Secretary

Hideki Anan
Chief Executive Officer of Global Hotline, Inc.

Age 38

Mr. Anan founded Global Hotline, Inc. in 2004 and serves as its Chief Executive
Officer. Previously, Mr. Anan was an executive with Hikari-Tsushin Co Ltd. from
1997 to 2004. Hikari-Tsushin is a Japanese alternative telecommunication
company. Mr. Anan has extensive sales and marketing experience in the Japanese
telecommunication industry.

Kyo Nagae
Chief Financial Officer of Global Hotline, Inc.

Age 39

Mr. Nagae co-founded Global Hotline, Inc. in 2004 and serves as its Chief
Financial Officer. Previously, Mr. Nagae was an executive with Hikari-Tsushin Co
Ltd. from 2000 to 2004. Hikari-Tsushin is a Japanese alternative
telecommunication Company. Mr. Nagae has extensive financial experience in the
Japanese telecommunication industry.

                                       33Audit Committee

         The Audit Committee has two members and met six times during the year
ended March 31, 2009. The Audit Committee is comprised solely of non-employee
Directors, all of whom the Board has determined are independent pursuant the
independence standards set forth in Section 803A of AMEX's Company Guide. The
Board has determined that all the members of the Audit Committee are financially
literate pursuant to the AMEX rules. The Board also has determined that Mr. La
Cara, Chairman of the Audit Committee, is an Audit Committee Financial Expert
under SEC regulations adopted under the Sarbanes-Oxley Act of 2002. The Board
has adopted a charter for the Audit Committee, which was revised by the Audit
Committee at its meeting on July 10, 2009, and approved by the full Board at its
meeting on July 10, 2009. The charter is available on the Company's website at
www.iaglobalinc.com.

         The Audit Committee's responsibilities, discussed in detail in the
charter include, among other duties, the responsibility to:

      o  appoint the independent registered accounting firm;

      o  review the arrangements for and scope of the audit by independent
         registered accounting firm;

      o  review the independence of the independent registered accounting firm;

      o  consider the adequacy and effectiveness of the system of internal
         accounting and financial controls and review any proposed corrective
         actions;

      o  review and monitor our policies regarding business ethics and conflicts
         of interest;

      o  discuss with management and the independent auditors our draft
         quarterly interim and annual financial statements and key accounting
         and reporting matters; and

      o  review the activities and recommendations of our accounting department.

CODE OF CONDUCT AND ETHICS

         The Company has adopted conduct and ethics standards titled the Code of
Conduct and Ethics (the "Code of Conduct"), which are available at
www.iaglobalinc.com. These standards were adopted by the Board to promote
transparency and integrity of the Company. The standards apply to the Board,
executives and employees. Waivers of the requirements of the Code of Conduct or
associated polices with respect to members of the Board or executive officers
are subject to approval of the full Board.

         The Company's Code of Conduct includes the following:

      o  promotes honest and ethical conduct, including the ethical handling of
         actual or apparent conflicts of interest;

      o  promotes the full, fair, accurate, timely and understandable disclosure
         of the Company's financial results in accordance with applicable
         disclosure standards, including, where appropriate, standards of
         materiality;

      o  promotes compliance with applicable SEC, AMEX and governmental laws,
         rules and regulations;

      o  deters wrongdoing; and

      o  require prompt internal reporting of breaches of, and accountability
         for adherence to, the Code of Conduct.

                                       34On an annual basis, each director and executive officer is obligated to
complete a Director and Officer Questionnaire which requires disclosure of any
transactions with the Company in which the director or executive officer, or any
member of his or her immediate family, have a direct or indirect material
interest. Pursuant to the Code of Conduct, the Audit Committee and the Board are
charged with resolving any conflict of interest involving management, the Board
and employees on an ongoing basis.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

         The Company's executive officers, directors and 10% stockholders are
required under the Exchange Act to file reports of ownership and changes in
ownership with the SEC. Copies of these reports must also be furnished to the
Company.

         Based solely on a review of copies of reports furnished to the Company,
or written representations that no reports were required, the Company believes
that during 2009 its executive officers, directors and 10% holders complied with
all filing requirements.

ITEM 11. EXECUTIVE COMPENSATION

COMPENSATION DISCUSSION AND ANALYSIS

OVERVIEW OF COMPENSATION PROGRAM

         This Compensation Discussion and Analysis describes the material
elements of compensation awarded to, earned by or paid to each of our named
executive officers who served during the year ended March 31, 2009. This
compensation discussion primarily focuses on the information contained in the
following tables and related footnotes and narrative for the last completed
fiscal year, but we also describe compensation actions taken after the last
completed fiscal year to the extent that it enhances the understanding of our
executive compensation disclosure.

         The compensation committee (for purposes of this analysis, the
"committee") of the Board has responsibility for establishing, implementing and
continually monitoring adherence with the Company's compensation philosophy. In
August 2006, as part of a review of the Company's practices, the committee
implemented processes to evaluate and determine compensation and these processes
were in place during fiscal year 2009. The committee believes that the total
compensation paid to the executive officers is fair, reasonable and competitive.
The committee does not use a peer group of publicly-traded and privately-held
companies in structuring the compensation packages. The committee awards stock
options based on market data, including the National Association of Corporate
Directors.

         Throughout this proxy statement, the individuals who served as the
Company's chief executive officer and chief operating and financial officer
during the year ended March 31, 2009, as well as the other individuals included
in the Summary Compensation Table on page 18, are referred to as the "named
executive officers".

COMPENSATION PHILOSOPHY AND OBJECTIVES

         The committee believes that the most effective executive compensation
program is one that is designed to reward the achievement of specific Company
annual and strategic goals, and that aligns executives' interests with those of
the stockholders by rewarding performance for achieving goals. During the year
ended March 31, 2009, the goals were raising additional capital, share price
improvement and achieving profitability, with the ultimate objective of
improving stockholder value. Therefore, the committee has established objectives
for executive compensation: (1) to enhance the long-term value of the Company;
(2) to assist the Company in attracting and retaining high quality talent; (3)
to reward past performance and motivate future performance; and (4) to align
executives' long term interests with those of the Company's stockholders. The
committee has established goals for executive compensation: raising additional
capital, achieving Company profitability and improving the common stock share

                                       35price. The committee subjectively evaluates both performance and compensation to
ensure, based on the achievement of goals that the Company maintains, its
ability to attract and retain superior employees in key positions and believes
that compensation provided to key employees remains competitive relative to the
compensation paid other executive officers. The committee believes executive
compensation packages provided by the Company to its executives, including the
named executive officers should include both cash and equity-based compensation
that reward performance as measured against established goals.

ROLE OF CHIEF EXECUTIVE OFFICER IN COMPENSATION DECISIONS

         The Board approves all compensation for the chief executive officer.
The committee makes recommendations on the compensation for the chief executive
officer and approves all compensation decisions, including equity awards, for
the named executive officers of the Company. Mr. Schneideman, the Company's
chief executive officer makes recommendations regarding the base salary and
non-equity compensation of other named executive officers that are approved by
the committee in its discretion.

         The committee reviewed the performance of the chief executive officer
and chief operating and financial officer prior to the automatic renewal on
September 7, 2008 of their employment agreements dated September 5, 2007 for the
period September 5, 2008 through September 5, 2010.

SETTING EXECUTIVE COMPENSATION

         The committee structures the Company's annual incentive-based cash and
non-cash executive compensation to motivate executives to achieve the business
goals set by the Company and reward the executives for achieving such goals. The
committee does not use a peer group of publicly-traded and privately-held
companies in structuring the compensation packages.

EXECUTIVE COMPENSATION COMPONENTS FOR THE YEAR ENDED MARCH 31, 2009

         The committee did not use a formula for allocating compensation among
the elements of total compensation during the year ended March 31, 2009. The
committee believes that in order to attract and retain highly effective people
it must maintain a flexible compensation structure. For the year ended March 31,
2009, the principal components of compensation for named executive officers were
base salary, performance-based incentive compensation, stock awards and stock
option grants.

Base Salary

         Base salary is intended to ensure that the Company's employees are
fairly and equitably compensated. Base salary is used to appropriately recognize
and reward the experience and skills that employees bring to the Company and
provides motivation for career development and enhancement. During their tenure,
base salary ensures that all employees continue to receive a basic level of
compensation that reflects any acquired skills which are competently
demonstrated and are consistently used at work.

         Base salaries for the Company's named executive officers are initially
established based on their prior experience, the scope of their responsibilities
and the applicable competitive market compensation paid by other companies for
similar positions. The salary level for the chief executive officer was
established on February 8, 2007 when the Company entered into a one year
Employment Agreement with Mr. Schneideman as Chief Executive Officer and
Chairman of the Board of the Company effective as of February 13, 2007. On
November 27, 2006, the majority of the independent directors began a search for
a Chief Executive Officer and retained a recruiter to assist with the search.
The recruiter was only able to locate five potential candidates who had the
necessary skills and experience for a Chief Executive Officer position and were
willing to relocate to or live in Tokyo, Japan. Based on the candidate's prior
experience and current market conditions, the committee set Mr. Schneideman's
salary at $250,000 per year. During the year ended March 31, 2009, he received a
$38,106 INCREASE in his base salary with the issuance of 131,400 shares common
stock. The increase is based on his 2007 performance in increasing the share
price.

                                       36Salary levels for the chief operating and financial Officer was
increased from $183,000 to $200,000 effective January 1, 2007 based on his
annual review, his performance in 2006 and the market rates for this position.
During the year ended March 31, 2009, he received a $35,478 increase in his base
salary with the issuance of 131,400 shares of common stock. The increase is
based on his 2007 performance in increasing the share price.

         Salary levels for the Chief Executive Officer of Global Hotline
remained at 33,600,000 Yen in 2009, 2008 and 2007, or approximately $334,000,
$294,000 and $289,000 during the years ended March 31, 2009 and 2008 and
December 31, 2007, respectively, at current exchange rates.

         Salary levels for the Chief Financial Officer of Global Hotline was
increased from 17,760,000 Yen to 20,460,000 Yen effective April 1, 2007 or
approximately $212,000, $187,000 and $174,000 during the years ended March 31,
2009 and 2008 and December 31, 2007, respectively, at current exchange rates.

Performance-Based Incentive Compensation

         The committee believes the payment of incentive compensation rewards
performance benefits our business, and is consistent with the creation of
stockholder value. All of the Company's named executive officers are eligible to
receive performance-based incentive compensation. During the year ended March
31, 2009, bonuses were paid to all named executives in common stock based on the
achievement of established goals, with the ultimate objective of improving
stockholder value. The goals were primarily for closed capital raises, achieving
profitability and share price improvement.

         Mr. Schneideman's incentive compensation during the year ended March
31, 2009 includes the following potential bonuses:

Closed capital raises - Bonuses of $30,000 for raising $2,000,000, $4,000,000
and $6,000,000 in capital and a bonus of $50,000 for the sale of a minority
interest in Global Hotline in excess of $5,000,000.

Achievement of profitability - 2% of after tax net income for the quarters
ending June 30, 2008, September 30, 2008 and December 31, 2008 and March 31,
2009, respectively.

Share price improvement - A bonus of $15,000 for achieving five closes on AMEX
at $0.40 per share. Bonuses of $20,000 for achieving five closes on AMEX at
$0.60, $0.80 and $1.00 per share. A bonus of $40,000 for achieving five closes
at $1.20 per share. Bonuses of $25,000 for achieving five closes at $1.25,
$1.50, $1.75, $2.00 and $2.25 per share.

         The total incentive compensation was targeted at $255,000 for 2008. In
addition, stock options would be granted based on achievement of certain
targets. In fiscal year 2009, Mr. Schneideman received a bonus of $10,617 with
the issuance of 151,670 shares common stock for achieving profitability targets
of $730,844 for the quarter ended June 30, 2009.

         Mr. Scott's incentive compensation during the year ended March 31, 2009
includes the following potential bonuses:

Closed capital raises - Bonuses of $15,000 for raising $2,000,000, $4,000,000
and $6,000,000 in capital and a bonus of $25,000 for the sale of a minority
interest in Global Hotline in excess of $5,000,000.

Achievement of profitability - 1.5% of after tax net income for the quarters
ending June 30, 2008, September 30, 2008 and December 31, 2008 and March 31,
2009, respectively.

Share price improvement - A bonus of $10,000 for achieving five closes on AMEX
at $0.40 per share. Bonuses of $15,000 for achieving five closes on AMEX at
$0.60, $0.80 and $1.00 per share. A bonus of $30,000 for achieving five closes
at $1.20 per share. Bonuses of $15,000 for achieving five closes at $1.25,
$1.50, $1.75, $2.00 and $2.25 per share.

                                       37The total incentive compensation was targeted at $155,000 for 2009. In
addition, stock options would be granted based on achievement of certain
targets. In fiscal year 2009, Mr. Scott received a bonus of $7,963 with the
issuance of 113,752 shares common stock for achieving profitability targets of
$730,844 for the quarter ended June 30, 2009.

         Mr. Anan's incentive compensation during the year ended March 31, 2009
includes the following components:

Discretionary bonuses - $159,166 in discretionary bonuses based on the sales
growth of Global Hotline.

         Mr. Nagae's incentive compensation during the year ended March 31, 2009
includes the following components:

Discretionary bonuses - $29,844 discretionary bonuses based on the sales growth
of Global Hotline.

OWNERSHIP GUIDELINES

         The committee does not require our named executive officers to hold any
minimum number of our shares. However, to directly align the interests of
executive officers with the interests of the stockholders, the committee
encourages each named executive officer to maintain an ownership interest in the
Company.

STOCK OPTION PROGRAM

         Stock options are an integral part of our executive compensation
program. They are intended to encourage ownership and retention of the Company's
common stock by named executive officers and employees, as well as non-employee
members of the board. Through stock options, the objective of aligning
employees' long-term interest with those of stockholders may be met by providing
employees with the opportunity to build a meaningful stake in the Company.

         The Stock Option Program assists the Company by:

      o  enhancing the link between the creation of stockholder value and
         long-term executive incentive compensation;

      o  providing an opportunity for increased equity ownership by executives;
         and

      o  maintaining competitive levels of total compensation.

         Stock option award levels are determined based on market data,
including the National Association of Corporate Directors, vary among
participants based on their positions within the Company and are granted at the
committee's regularly scheduled meetings. Newly hired executive officers or
promoted executive officers are awarded stock options at the next regularly
scheduled compensation committee meeting on or following their hire or promotion
date. In addition, such executives are eligible to receive additional stock
option grants after their anniversary date, after Annual Shareholder Meetings
and on a discretionary basis after performance criteria are achieved.

         Options are awarded at the closing price of the Company's common stock
on the date of the grant or last trading day prior to compensation committee
meetings. The committee's policy is not to grant options with an exercise price
that is less than the closing price of the Company's common stock on the grant
date.

         The majority of the options granted by the committee vest quarterly
over three years of the ten-year option term. Vesting and exercise rights cease
upon termination of employment, except in the case of death (subject to a one
year limitation), disability or retirement. Stock options vest immediately upon
termination of employment without cause or an involuntary termination following
a change of control. Prior to the exercise of an option, the holder has no
rights as a stockholder with respect to the shares subject to such option,
including voting rights and the right to receive dividends or dividend
equivalents.

                                       38Mr. Schneideman received the following stock option grants during the
year ended March 31, 2009:

         On May 16, 2008, the Board, upon the recommendation of the committee,
granted stock options to purchase common stock of 500,000 shares to Mr.
Schneideman. The options were granted at the fair market price of $0.29 per
share based on the adjusted closing price on May 9, 2008, the day the Board
approved the grant. The stock options vest quarterly over three years and expire
on May 8, 2018. This grant was issued to provide adequate stock option to Mr.
Schneideman based on market compensation paid by other companies for similar
positions. The committee does not use specific peer companies as examples to
determine this compensation because of the unique nature of its business.

         On July 29, 2008, the committee granted stock options to purchase
common stock of 200,000 shares each to Mr. Schneideman for his election to the
Board. The options were granted at the fair market price of $0.12 per share
based on the adjusted closing price on July 29, 2008, the day the directors were
elected to the Board. The stock options vest quarterly over three years and
expire on July 28, 2018. This grant was issued to Mr. Schneideman based on an
annual award issued after the Annual Shareholder Meeting.

         Mr. Scott received the following stock option grants during the year
ended March 31, 2009:

         On May 16, 2008, the Board, upon the recommendation of the committee,
granted stock options to purchase common stock of 500,000 shares to Mr. Scott
The options were granted at the fair market price of $0.29 per share based on
the adjusted closing price on May 9, 2008, the day the Board approved the grant.
The stock options vest quarterly over three years and expire on May 8, 2018.
This grant was issued to provide adequate stock option to Mr. Scott based on
market compensation paid by other companies for similar positions. The committee
does not use specific peer companies as examples to determine this compensation
because of the unique nature of its business.

         On July 29, 2008, the committee granted stock options to purchase
common stock of 200,000 shares each to Mr. Scott for his election to the board
of directors. The options were granted at the fair market price of $0.12 per
share based on the adjusted closing price on July 29, 2008, the day the
directors were elected to the Board. The stock options vest quarterly over three
years and expire on July 28, 2018. This grant was issued to Mr. Scott based on
an annual award issued after the Annual Shareholder Meeting.

         On January 30, 2009, the committee granted stock options to purchase
common stock of 250,000 shares to Mr. Scott. The options were granted at the
fair market price of $0.06 per share based on the adjusted closing price on
January 30, 2009, the day the board of directors agreed on the grant. The stock
options vest quarterly over three years and expire on January 29, 2019. This
grant was for legal services provided to the Company.

         Mr. Anan received the following stock option grants during the year
ended March 31, 2009:

         On July 29, 2008, the committee granted stock options to purchase
common stock of 200,000 shares each to Mr. Anan for his election to the board of
directors. The options were granted at the fair market price of $0.12 per share
based on the adjusted closing price on July 29, 2008, the day the directors were
elected to the board of directors. The stock options vest quarterly over three
years and expire on July 28, 2018. This grant was issued to Mr. Schneideman
based on an annual award issued after the Annual Shareholder Meeting.

         Mr. Nagae did not receive the following stock option grants during the
year ended March 31, 2009.

RETIREMENT AND OTHER BENEFITS

         The Company has no other retirement, savings, long-term stock award or
other type of plans for the named executive officers.

                                       39PERQUISITES AND OTHER PERSONAL BENEFITS

         During the year ended March 31, 2009, the Company provided the named
executive officers with perquisites and other personal benefits that the Company
and the committee believe are reasonable and consistent with its overall
compensation program to better enable the Company to attract and retain superior
employees for key positions. The committee expects to review the levels of
perquisites and other personal benefits provided to named executive officers. In
addition, the Company paid $15,704 for a Tokyo apartment for the Chief Executive
Officer. During fiscal year 2009, since he spent a considerable amount of time
working in Japan at the Company's subsidiary Global Hotline and other
businesses, the Company paid for a Tokyo apartment.

         Currently, the Company has Employment Agreements with Derek
Schneideman, the Company's CEO and Mark Scott, the chief operating and financial
officer, see page 43 for a description of these agreements. These Employment
Agreements contain potential payments upon termination and certain payments in
the event of a change of control, see page 45 for further discussion of these
payments.

TAX AND ACCOUNTING IMPLICATIONS

Deductibility of Executive Compensation

         Subject to certain exceptions, Section 162(m) of the Internal Revenue
Code of 1986, as amended (the "Code") generally denies a deduction to any
publicly held corporation for compensation paid to its chief executive officer
and its three other highest paid executive officers (other than the principal
financial officer) to the extent that any such individual's compensation exceeds
$1 million. "Performance-based compensation" (as defined for purposes of Section
162(m)) is not taken into account for purposes of calculating the $1 million
compensation limit, provided certain disclosure, shareholder approval and other
requirements are met. We periodically review the potential consequences of
Section 162(m) and may structure the performance-based portion of our executive
compensation to comply with certain exceptions to Section 162(m). However, we
may authorize compensation payments that do not comply with the exceptions to
Section 162(m) when we believe that such payments are appropriate and in the
best interests of the stockholders, after taking into consideration changing
business conditions or the officer's performance.

         Section 409A is a relatively recent provision of the Code. If an
executive is entitled to nonqualified deferred compensation benefits that are
subject to Section 409A of the Code, and such benefits do not comply with
Section 409A of the Code, the executive would be subject to adverse tax
treatment, including accelerated income recognition (in the first year that
benefits are no longer subject to a substantial risk of forfeiture) and an
additional income tax of 20% of the amount so recognized.

Accounting for Stock-Based Compensation

         Beginning on January 1, 2006, the Company began accounting for
stock-based payments including its Stock Option Program in accordance with the
requirements of Financial Accounting Standard 123-R ("FAS 123-R").

COMPENSATION COMMITTEE REPORT

         The Compensation Committee, composed entirely of independent directors
in accordance with the applicable laws, regulations and AMEX listing
requirements, sets and administers policies that govern the Company's executive
compensation programs, and incentive and stock programs. The Compensation
Committee of the Company has reviewed and discussed the Compensation Discussion
and Analysis required by Item 402(b) of Regulation S-K with management and,
based on such review and discussions, the Compensation Committee recommended to
the Board that the Compensation Discussion and Analysis be included in this
Proxy Statement.

         THE COMPENSATION COMMITTEE

         Eric La Cara, Chairman
         Masazumi Ishii

                                       40REMUNERATION OF EXECUTIVE OFFICERS

         The following table provides information concerning remuneration of the
chief executive officer, the chief operating and financial officer and the two
other most highly compensated executive officers of the Company during the
fiscal years ended March 31, 2009 and 2008 and December 31, 2007.

         On July 25, 2007, the Board resolved that the fiscal year of the
Company that began on January 1, 2007 will end on December 31, 2007, and from
that date forward, the fiscal year of the Company will be the period beginning
on April 1 of each year and ending on March 31 of the following year.

SUMMARY COMPENSATION TABLE
                                                                                                         Change In
                                                                                                          Pension
                                                                                                         Value and
                                                                                           Non-Equity  Non-qualified
                                                                                           Incentive     Deferred
                                                                     Stock       Option       Plan      Compensation  All Other
         Name and               Year      Salary   Bonus   Awards   Awards   Compensation   Earnings   Compensation     Total
    Principal Position         Ending       ($)     ($)   ($) (4)   ($) (2)      ($) (1)      ($)        ($) (3)         ($)
---------------------------  ----------  --------  -----  -------  --------  ------------  ----------  -------------  ---------

Derek Schneideman             3/31/2009  $250,000  $   -  $48,723  $169,000    $      -       $ -         $15,704      $483,427
Chief Executive Officer       3/31/2008  $250,000  $   -  $     -  $417,000    $ 30,000       $ -         $     -      $697,000
                             12/31/2007  $221,634  $   -  $     -  $487,000    $ 74,509       $ -         $     -      $783,143

Mark Scott                    3/31/2009  $200,000  $   -  $43,441  $ 97,000    $      -       $ -         $     -      $340,441
Chief Operating and           3/31/2008  $200,000  $   -  $     -  $314,250    $ 24,000       $ -         $     -      $538,250
Financial Officer            12/31/2007  $200,000  $   -  $     -  $351,750    $ 19,000       $ -         $ 4,513      $575,263

Hideki Anan                   3/31/2009  $334,249  $   -  $     -  $ 24,000    $159,166       $ -         $     -      $517,415
CEO of Global Hotline, Inc.   3/31/2008  $293,880  $   -  $     -  $217,500    $ 69,971       $ -         $     -      $581,351
                             12/31/2007  $285,194  $   -  $     -  $170,000    $ 67,903       $ -         $     -      $523,097

Kyo Nagae                     3/31/2009  $212,487  $   -  $     -  $      -    $ 29,844       $ -         $     -      $242,331
CFO of Global Hotline, Inc.   3/31/2008  $186,824  $   -  $     -  $145,000    $ 13,120       $ -         $     -      $344,944
                             12/31/2007  $173,663  $   -  $     -   $64,000    $ 12,732       $ -         $     -      $250,395

(1) The March 31, 2009 amounts reflect bonuses earned and paid for the year
ended March 31, 2009 for Mr. Anan and Mr. Nagae. The March 31, 2008 amounts
reflect bonuses earned and paid for the year ended March 31, 2008 for Mr.
Schneideman, Mr. Scott, Mr. Anan and Mr. Nagae. The 2007 amounts reflect bonuses
earned and paid for during the year ended December 31, 2007 for Mr. Schneideman,
Mr. Scott, Mr. Anan and Mr. Nagae.

(2) These amounts reflects the dollar amount recognized for financial statement
reporting purposes for the fiscal year ended March 31, 2009 and 2008 and
December 31, 2007, in accordance with FAS 123-R of awards pursuant to the 2007
Stock Incentive Plan. Assumptions used in the calculation of this amount are
included in footnote 2 to the Company's audited financial statements for the
fiscal years ended March 31, 2009 and 2008 and December 31, 2007 included in the
Company's Annual Report on Form 10-K filed with the SEC on July 14, 2009.

(3) The year ended March 31, 2009 amounts reflect a Tokyo apartment for Mr.
Schneideman. The year ended December 31, 2007 amounts reflect a Tokyo apartment
for Mr. Scott.

(4) The amounts for 2009 for Mr. Schneideman include a $38,106 increase in his
base salary with the issuance of 131,400 shares common stock and a bonus of
$10,617 with the issuance of 151,670 shares common stock for achieving
profitability targets of $730,844 for the quarter ended June 30, 2009. The
amounts for 2009 for Mr. Scott include a $35,478 increase in his base salary
with the issuance of 131,400 shares of common stock and a bonus of $10,617 with
the issuance of 151,670 shares common stock for achieving profitability targets
of $730,844 for the quarter ended June 30, 2009.

                                       41GRANTS OF PLAN BASED AWARDS IN FISCAL YEAR ENDED MARCH 31, 2009

                                                                                                          All Other
                                Estimated Future Payouts     Estimated Future Payouts     All Other     Option Awards;
                               Under Non-Equity Incentive     Under Equity Incentive     Stock Awards;     Number of
                                       Plan Awards                  Plan Awards           Number of       Securities     Exercise or    Grant Date
                              ----------------------------  --------------------------    Shares of       Underlying    Base Price of  Fair Value of
                     Grant    Threshold   Target   Maximum  Threshold  Target  Maximum  Stock or Units     Options      Option Awards    Stock and
      Name           Date        ($)        ($)      ($)       (#)       (#)     (#)       (#) (2)         (#) (1)         ($/Sh)      Option Awards
-----------------  ---------  ---------  --------  -------  ---------  ------  -------  --------------  --------------  -------------  -------------

Derek Schneideman   5/9/2008     $ -     $255,000    $ -        -         -       -         283,070         500,000         $0.29         $145,000
                   7/29/2008     $ -     $      -    $ -        -         -       -               -         200,000         $0.12         $ 24,000

Mark Scott          5/9/2008     $ -     $155,000    $ -        -         -       -         245,152         200,000         $0.29         $ 58,000
                   7/29/2008     $ -     $      -    $ -        -         -       -               -         200,000         $0.12         $ 24,000
                   1/30/2009     $ -     $      -    $ -        -         -       -               -         250,000         $0.06         $ 15,000

Hideki Anan        7/29/2008     $ -     $      -    $ -        -         -       -               -         200,000         $0.12         $ 24,000

Kyo Nagae                        $ -     $      -    $ -        -         -       -               -               -         $   -         $      -

(1)  The amount shown in this column reflects the number of options granted
     pursuant to the 2007 Stock Incentive Plan and vest quarterly over three
     years.

(2)  The amounts for Mr. Schneideman include a $38,106 increase in his base
     salary with the issuance of 131,400 shares common stock and a bonus of
     $10,617 with the issuance of 151,670 shares common stock for achieving
     profitability targets of $730,844 for the quarter ended June 30, 2009. The
     amounts for 2009 for Mr. Scott include a $35,478 increase in his base
     salary with the issuance of 131,400 shares of common stock and a bonus of
     $7,963 with the issuance of 113,752 shares common stock for achieving
     profitability targets of $730,844 for the quarter ended June 30, 2009.

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR ENDED MARCH 31, 2009

                                           Option Awards (2)                                                     Stock Awards
                   ----------------------------------------------------------------  --------------------------------------------------------------------
                                Equity Incentive                                                                       Equity Incentive  Equity Incentive
                                  Plan Awards:                                                                           Plan Awards:      Plan Awards:
                    Number of       Number of      Number of                                                               Number of         Market or
                   Securities      Securities     Securities                            Number of      Market Value    Unearned Shares,   Payout Value of
                   Underlying      Underlying     Underlying                         Shares or Units   of Shares or     Units or Other   Unearned Shares,
                   Unexercised     Unexercised    Unexercised   Option                   of Stock        Units of         Rights That     Units, or Other
                     Options         Options       Unearned    Exercise    Option     That Have Not     Stock That         Have Not      Rights That Have
                   Exercisable   Unexerciseable     Options      Price   Expiration       Vested      Have Not Vested       Vested          Not Vested
           Name      (#) (1)         (#) (1)          (#)         ($)       Date           (#)              ($)               (#)               ($)
-----------------  -----------  ----------------  -----------  --------  ----------  ---------------  ---------------  ----------------  ----------------

Derek Schneideman    333,333         166,667           -        $0.14     2/12/2017         -               $ -                -                $ -
                     500,000         500,000           -        $0.37     7/10/2017         -               $ -                -                $ -
                      41,667          58,333           -        $0.47     10/2/2017         -               $ -                -                $ -
                     125,000         375,000           -        $0.29      5/8/2018         -               $ -                -                $ -
                      33,333         166,667           -        $0.12     7/28/2018         -               $ -                -                $ -

Mark Scott           400,000               -           -        $0.30     1/11/2014         -               $ -                -                $ -
                     100,000               -           -        $0.20     5/16/2014         -               $ -                -                $ -
                     100,000               -           -        $0.24    11/18/2014         -               $ -                -                $ -
                     100,000               -           -        $0.26     7/31/2015         -               $ -                -                $ -
                     208,333          41,667           -        $0.16     8/14/2016         -               $ -                -                $ -
                     166,667          83,333           -        $0.15     2/22/2017         -               $ -                -                $ -
                     250,000         250,000           -        $0.37     7/10/2017         -               $ -                -                $ -
                     114,583         160,417           -        $0.47     10/2/2017         -               $ -                -                $ -
                      50,000         150,000           -        $0.29      5/8/2018         -               $ -                -                $ -
                      33,333         166,667           -        $0.12     7/28/2018         -               $ -                -                $ -
                           -         250,000           -        $0.06     1/29/2019         -               $ -                -                $ -

Hideki Anan          500,000               -           -        $0.20     6/22/2015         -               $ -                -                $ -
                     400,000         200,000           -        $0.16     2/27/2017         -               $ -                -                $ -
                     100,000         100,000           -        $0.37     7/10/2017         -               $ -                -                $ -
                     250,000         500,000           -        $0.29      3/4/2018         -               $ -                -                $ -
                      33,333         166,667           -        $0.12     7/28/2018         -               $ -                -                $ -

Kyo Nagae            350,000               -           -        $0.20     6/22/2015         -               $ -                -                $ -
                     266,667         133,333           -        $0.16     2/27/2017         -               $ -                -                $ -
                     166,667         333,333           -        $0.29      3/4/2018         -               $ -                -                $ -

                                       42(1)  All options listed above vest quarterly over a three year term, except for
     Mr. Scott's option award dated January 12, 2004. This option award vests
     annually over three years. All option awards have a ten year life.

(2)  On June 17, 2009, the Change of Control Provision 8.2 (d) was triggered
     under the Scott Agreement (as defined below) because during any period of
     twenty-four consecutive months, individuals who at the beginning of such
     period constituted the Board (including for this purpose any new director
     whose election or nomination for election by the Company's shareholders was
     approved by a vote of at least two-thirds (2/3) of the directors then still
     in office who were directors at the beginning of such period) cease for any
     reason to constitute at least a majority of the Board. All stock options
     were vested as of June 17, 2009.

OPTION EXERCISES AND STOCK VESTED

                      Option Awards (1)     Stock Awards (2)
                   ---------------------  ---------------------
                    Number of     Value    Number of     Value
                     Shares     Realized    Shares     Realized
                   Acquired on     on     Acquired on     on
                    Exercise    Exercise    Vesting    Vesting
   Name                (#)         ($)      (#)(4)       ($)
-----------------  -----------  --------  -----------  --------
Derek Schneideman       0           0       283,070     $48,723
Mark Scott              0           0       245,152     $43,441

(1) The Company's named executive officers did not exercise any stock options
during the year ended March 31, 2009 and 2008 and December 31, 2007.

(2) The amounts for Mr. Schneideman include a $38,106 increase in his base
salary with the issuance of 131,400 shares common stock and a bonus of $10,617
with the issuance of 151,670 shares common stock for achieving profitability
targets of $730,844 for the quarter ended June 30, 2009. The amounts for Mr.
Scott include a $35,478 increase in his base salary with the issuance of 131,400
shares of common stock and a bonus of $7,963 with the issuance of 113,752 shares
common stock for achieving profitability targets of $730,844 for the quarter
ended June 30, 2009.

PENSION BENEFITS

         The Company does not provide any pension benefits.

NONQUALIFIED DEFERRED COMPENSATION

         The Company's does not have a nonqualified deferral program.

EMPLOYMENT AGREEMENTS

         The committee reviewed the performance of the chief executive officer
and chief operating and financial officer prior to the automatic renewal on
September 7, 2008 of their employment agreements dated September 5, 2007 for the
period September 5, 2008 through September 5, 2010.

Derek Schneideman's Employment Agreement

         On September 5, 2007, the Company entered into new employment agreement
with Derek Schneideman, the Company's Chief Executive Officer. Derek
Schneideman's Employment Agreement ("Schneideman Agreement") has a two year term
beginning on September 5, 2007, and is renewable on an annual basis one year
prior to the termination of the prior term. On September 5, 2008, his employment
agreement automatically renewed for the period September 5, 2008 through
September 5, 2010.

         The Company pays Mr. Schneideman an annual base salary of $250,000, and
will provide for participation in the Company's benefit programs available to
other senior executives (including group insurance arrangements). Also under the
Schneideman Agreement, Mr. Schneideman may be paid a bonus up to $255,000, as
may be declared by the Company's compensation committee based on Mr. Schneideman
raising additional capital for the Company and the Company's profitability and
share price improvement.

                                       43If Mr. Schneideman's employment is terminated without cause (as defined
below), Mr. Schneideman will be entitled to a payment equal to one year's annual
base salary, and the full vesting of any previously granted and unexpired
options. If Mr. Schneideman's employment is terminated without cause within one
year following a change of control (as defined below), or if Mr. Schneideman
terminates his employment for good reason (as defined below), Mr. Schneideman
will be entitled to a payment equal to two times the sum of his annual base
salary plus the highest annual bonus earned by Mr. Schneideman for any of the
three fiscal years, and the full vesting of any previously granted and unexpired
options. Mr. Schneideman is required to provide not less than twelve (12) months
written notice to the Company to terminate his employment with the Company at
any time for any reason.

         On June 17, 2009, the Change of Control Provision 8.2 (d) was triggered
under the Scott Agreement because during any period of twenty-four consecutive
months, individuals who at the beginning of such period constituted the Board
(including for this purpose any new director whose election or nomination for
election by the Company's shareholders was approved by a vote of at least
two-thirds (2/3) of the directors then still in office who were directors at the
beginning of such period) cease for any reason to constitute at least a majority
of the Board. All stock options were vested as noted as of June 17, 2009. All
other rights and benefits are to be handled in accordance with the Employment
Agreement dated September 5, 2007.

Mark Scott's Employment Agreement

         On September 5, 2007, the Company entered into new employment agreement
with Mark Scott, the Company's Chief Operating and Financial Officer. Mark
Scott's Employment Agreement ("Scott Agreement") has a two year term beginning
on September 5, 2007, and is renewable on an annual basis one year prior to the
termination of the prior term. On September 5, 2008, his employment agreement
automatically renewed for the period September 5, 2008 through September 5,
2010.

         The Company pays Mr. Scott an annual base salary of $200,000, and will
provide for participation in the Company's benefit programs available to other
senior executives (including group insurance arrangements). Also under the Scott
Agreement, Mr. Scott may be paid a bonus up to $155,000, as may be declared by
the Company's compensation committee based on Mr. Scott raising additional
capital for the Company and the Company's profitability and share price
improvement.

         If Mr. Scott's employment is terminated without cause (as defined
below), Mr. Scott will be entitled to a payment equal to one year's annual base
salary, and the full vesting of any previously granted and unexpired options. If
Mr. Scott's employment is terminated without cause within one year following a
change of control (as defined below), or if Mr. Scott terminates his employment
for good reason (as defined below), Mr. Scott will be entitled to a payment
equal to two times the sum of his annual base salary plus the highest annual
bonus earned by Mr. Scott for any of the three fiscal years, and the full
vesting of any previously granted and unexpired options. Mr. Scott is required
to provide not less than twelve (12) months written notice to the Company to
terminate his employment with the Company at any time for any reason.

         On June 17, 2009, the Change of Control Provision 8.2 (d) was triggered
under the Scott Agreement because during any period of twenty-four consecutive
months, individuals who at the beginning of such period constituted the Board
(including for this purpose any new director whose election or nomination for
election by the Company's shareholders was approved by a vote of at least
two-thirds (2/3) of the directors then still in office who were directors at the
beginning of such period) cease for any reason to constitute at least a majority
of the Board. All stock options were vested as of June 17, 2009. All other
rights and benefits are to be handled in accordance with the Employment
Agreement dated September 5, 2007.

                                       44Definitions Used in Employment Agreements

For purposes of the Employment Agreements described above, the following
definitions apply:


1. "Termination without Cause" means the Company involuntarily terminates the
executive's at any time and for any reason, or no reason whatsoever, upon thirty
(30) days written notice to the executive.

2. "Change in control" means any of the following:

   o  the acquisition by any person or entity of our common stock so that such
      person or entity holds or controls 50% or more of our outstanding common
      stock;

   o  the merger or consolidation of the Company with or into any other entity
      in circumstances where the holders of the Company's outstanding shares of
      capital stock before the transaction do not retain stock representing a
      majority of the voting power of the surviving entity;

   o  a sale of all or substantially all of the assets of the Company to a third
      party;

   o  within any 24-month period, the change in 50% or more of the Company's
      directors.

3. "Cause": means:

   o  the executive's performance of the duties in a grossly negligent manner,

   o  the executive's repeated failure to perform the duties as the Company
      reasonably requires or to abide by the Company's polices and/or procedures
      for the operation of its business and the continuation thereof after the
      receipt by the executive of written notice from the Company,

   o  the Executive's willful and material breach of a provision of his
      Employment Agreement, or actions or omissions by the Executive that are
      criminal, fraudulent, or involve dishonesty, or constitute intentional
      breach of fiduciary obligation or intentional wrongdoing or malfeasance,
      and, in each instance, result in harm to the operations or reputation of
      the Company.

4. "Good Reason" means the initial existence of any of the following during the
one year period following a Change in Control without the executive's consent:

   o  a material diminution in the executive's compensation; or

   o  a material change in the geographic location at which the executive must
      perform the services. For this purpose, a material change will include a
      requirement that the executive regularly perform services at a location
      more than 50 miles from his primary place of employment.

POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE OF CONTROL

         The Company's Employment Agreements with the Named Executive Officers
have the following Change of Control or severance payments.

                                       45Derek Schneideman

         The following table shows the potential payments upon termination for
Derek Schneideman, the Company's Chief Executive Officer:

                                                                    Involuntary
                                                                     for Good
                              Voluntary                               Reason
                                Or For       Early    Involuntary   Termination
        Executive               Cause      or Normal  Not For Good  (Change In   Disability
      Payments Upon          Termination  Retirement  Termination     Control     or Death
       Separation             on 3/31/09  on 3/31/09   on 3/31/09   on 3/31/09   on 3/31/09
---------------------------  -----------  ----------  ------------  -----------  ----------
Compensation:
Base salary (1) ...........  $         -  $        -  $    288,106  $   576,212  $        -
Performance-based incentive
    compensation (2) ......  $         -  $        -  $          -  $    90,000  $        -
Stock options .............  $         -  $        -  $          -  $         -  $        -

Benefits and Perquisites:
Health and welfare benefits  $         -  $        -  $          -  $         -  $        -
Accrued vacation pay (3) ..  $    29,780  $   29,780  $     29,780  $    29,780  $   29,780
                             -----------  ----------  ------------  -----------  ----------

Total .....................  $    29,780  $   29,780  $    317,886  $   695,992  $   29,780
                             ===========  ==========  ============  ===========  ==========

(1) Reflects twelve months severance to be paid upon termination without cause
    and twenty-four months' severance to be paid for involuntary termination
    following a change in control.

(2) Reflects two times the highest bonus paid in the last three years. (3)
    Reflects the value of vacation pay accrued as of March 31, 2009.

Mark Scott

         The following table shows the potential payments upon termination for
Mark Scott, the Company's Chief Operating and Financial Officer:

                                                                    Involuntary
                                                                     for Good
                                                                      Reason
                                                      Involuntary   Termination
        Executive             Voluntary      Early    Not For Good  (Change In
      Payments Upon          Termination  Retirement  Termination     Control    Disability
       Separation             on 3/31/09  on 3/31/09   on 3/31/09   on 3/31/09   on 3/31/09
---------------------------  -----------  ----------  ------------  -----------  ----------
Compensation:
Base salary (1) ...........  $         -  $        -  $    235,478  $   470,956  $        -
Performance-based incentive
    compensation (2) ......  $         -  $        -  $          -  $   119,856  $        -
Stock options .............  $         -  $        -  $          -  $         -  $        -

Benefits and Perquisites:
Health and welfare benefits  $         -  $        -  $          -  $         -  $        -
Accrued vacation pay (3) ..  $    42,001  $   42,001  $     42,001  $    42,001  $   42,001
                             -----------  ----------  ------------  -----------  ----------

Total .....................  $    42,001  $   42,001  $    277,479  $   632,813  $   42,001
                             ===========  ==========  ============  ===========  ==========

(1) Reflects twelve months severance to be paid upon termination without cause
    and twenty-four months' severance to be paid for involuntary termination
    following a change in control.

(2) Reflects two times the highest bonus paid in the last three years.

(3) Reflects the value of vacation pay accrued as of March 31, 2008.

                                       46Hideki Anan

         The Company does not have a termination or change in control agreement
with Hideki Anan, Chief Executive Officer of Global Hotline.

Kyo Nagae

         The Company does not have a termination or change in control agreement
with Kyo Nagae, Chief Financial Officer of Global Hotline, Inc.

DIRECTOR COMPENSATION

         The Company uses a combination of cash and stock-based incentive
compensation to attract and retain qualified candidates to serve on the Board.
In setting director compensation, the Company considers the significant amount
of time that Directors expend in fulfilling their duties to the Company as well
as the skill-level required by the Company of members of the Board. During the
year ended March 31, 2009, Derek Schneideman, the Company's Chief Executive
Officer and Mark Scott, the Company's Chief Operating and Financial Officer,
also served on the Board, but they did not receive any compensation for their
service as a director, The compensation disclosed in the Summary Compensation
Table on page 18 represents their total compensation.

DIRECTOR SUMMARY COMPENSATION TABLE

         The table below summarizes the compensation paid by the Company to
non-employee directors during the year ended March 31, 2009.

                                                                            Change In
                                                                             Pension
                                                                            Value and
                                                            Non-Equity    Nonqualified
                  Fees Earned                             Incentive Plan    Deferred      All Other
                   Or Paid In    Stock        Option       Compensation   Compensation   Compensation
     Name           Cash ($)   Awards ($)  Awards ($)(1)        ($)        Earnings ($)       ($)      Total ($)
----------------  -----------  ----------  -------------  --------------  -------------  ------------  ---------
Masazumi Ishii      $33,000       $ -         $24,000           $ -             $ -           $ -       $57,000
Eric La Cara        $40,500       $ -         $24,000           $ -             $ -           $ -       $64,500
Brian Nelson (2)    $18,700       $ -         $24,000           $ -             $ -           $ -       $42,700
Mae Towada (3)      $30,407       $ -         $24,000           $ -             $ -           $ -       $54,407

(1) Reflects the dollar amount recognized for financial statement reporting
    purposes for the year ended March 31, 2008 in accordance with SFAS 123-R.
    The assumptions used in the valuation of options is included in Footnote 2
    of the Form 10-K as filed with the SEC on July 14, 2009. As of March 31,
    2009, each director has the following number of options outstanding to
    purchase the indicated number of shares of the Company's common stock:
    Masazumi Ishii: 650,000 and Eric La Cara: 750,583.

(2) On December 11, 2008, Mr. Nelson resigned from the Board. On March 11, 2009,
    Mr. Nelson forfeited stock options totaling 400,000 shares.

(3) On February 23, 2009, Ms. Towada resigned from the Board. On May 24, 2009,
    Ms. Towada forfeited stock options totaling 400,000 shares.

COMPENSATION PAID TO BOARD MEMBERS

         Our independent non-employee directors are compensated at a base rate
of $1,700 per month. In addition, for serving as committee chairman they are
paid $500 per month for the Nominations and Governance Committee and the
Compensation Committee and $1,000 per month for the Audit Committee. All
independent non-employee directors' fees are paid in cash or in Company stock.

STOCK OPTION PROGRAM

         Each non-employee Director receives stock option grants having a
calculated Black-Scholes value that approximates the value of their annual cash
and committee chairman compensation. Each non-employee Director received a grant
of 200,000 options at $.12 per share on July 29, 2008. Options received by
non-employee Directors are granted at the fair market price of the Company's
Common Stock on the date of the grant and vest quarterly over three years.

                                       47ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
         RELATED STOCKHOLDER MATTERS

RELATED PARTY TRANSACTIONS WITH INTER ASSET JAPAN AND ITS AFFILIATES, AND OUR
CONTROLLING SHAREHOLDER GROUP

         The following table sets forth certain information regarding the
ownership of our common stock as of September 1, 2009 by:

      o  each director and nominee for director;

      o  each person known by us to own beneficially 5% or more of our common
         stock;

      o  each officer named in the summary compensation table elsewhere in this
         report; and

      o  all directors and executive officers as a group.

         The amounts and percentages of common stock beneficially owned are
reported on the basis of regulations of the SEC governing the determination of
beneficial ownership of securities. Under the rules of the SEC, a person is
deemed to be a "beneficial owner" of a security if that person has or shares
voting power," which includes the power to vote or to direct the voting of such
security, or "investment power," which includes the power to dispose of or to
direct the disposition of such security. A person is also deemed to be a
beneficial owner of any securities of which that person has the right to acquire
beneficial ownership within 60 days. Under these rules more than one person may
be deemed a beneficial owner of the same securities and a person may be deemed
to be a beneficial owner of securities as to which such person has no economic
interest.

         Unless otherwise indicated below, each beneficial owner named in the
table has sole voting and sole investment power with respect to all shares
beneficially owned, subject to community property laws where applicable. Unless
otherwise indicated, the address of each beneficial owner of more than 5% of
common stock is IA Global. Inc., 101 California Street, Suite 2450, San
Francisco, California 94111.

                                                      Amount     Percentage
                                                    ----------   ----------
Directors and Officers-
Hideki Anan .....................................    9,159,976         4.1%
Masazumi Ishii ..................................      202,000            -
Eric La Cara ....................................      233,962            -
Derek Schneideman ...............................      609,670            -
Mark Scott ......................................      770,652            -
Kyo Nagae .......................................    1,500,000         0.7%

                                                    ----------   ----------
Total Directors and Officers as a Group (5 total)   12,476,260         5.5%
                                                    ==========   ==========

The symbol - means less than 1%.

                                       48Number     Percentage
                                                    ----------   ----------
Greater Than 5% Ownership

Inter Asset Japan Co., Ltd-

Inter Asset Japan LBO No. 1 Fund ("IAJ LBO")- ...   36,233,146        16.0%  (1)
35F Atago Green Hills Mori Tower
2-5-1 Atago, Minato-Ku
Tokyo, 105-6235 Japan

PBAA Fund, Ltd ("PBAA") .........................   24,104,152        10.7%  (1)
Woodbourne Hall
PO Box 3162
Road Town, Tortola
British Virgin Islands

Terra Firma Fund , Ltd. ("Terra Firma")- ........   13,100,000         5.8%  (1)
Woodbourne Hall
PO Box 3162
Road Town, Tortola
British Virgin Islands

Inter Asset Japan Co. Ltd. ("IAJ")- .............   2,200,000          1.0%  (1)
35F Atago Green Hills Mori Tower
2-5-1 Atago, Minato-Ku
Tokyo, 105-6235 Japan

IA Turkey Equity Portfolio Ltd. ("IA Turkey") ...   2,500,000          1.1%  (1)
Mill Mall, Suite 6 Wickhams Cay
PO Box 3085
Road Town, Tortola
British Virgin Islands

Hiroki Isobe ....................................   5,194,147          2.3%  (1)
Inter Asset Japan Co. Ltd.
35F Atago Green Hills Mori Tower
2-5-1 Atago, Minato-Ku
Tokyo, 105-6235 Japan
                                                    ----------   ----------
                                                    83,331,445        36.9%
                                                    ==========   ==========

Michael Ning and Affiliates-
Taicom Securities Co Ltd and Affiliates .........   26,000,000        11.5%  (2)
1-5-5 Nishi Shinsaibashi
Urban Building Shinsaibashi 10th Floor
Chuo-ku, Osaka 542-0086 Japan

Michael Ning ....................................    2,590,000         1.1%
c/o ArqueMax Ventures, LLC
27520 Hawthorne Blvd., Suite 290
Rolling Hills Estates, CA 90274  USA
                                                    ----------   ----------
                                                    28,590,000        12.6%
                                                    ==========   ==========

The symbol - means less than 1%.

(1) Reflects the shares beneficially owned by IAJ, IAJ LBO No. 1, PBAA, Terra
    Firma, IA Turkey and Hiroki Isobe. These entities stated in a Schedule 13D
    filed with the SEC on February 24, 2009 and have subsequently confirmed
    orally, that they may be deemed to constitute a "group" for the purposes of
    Rule 13d-3 under the Securities Exchange Act of 1934 ("Exchange Act"). Mr.
    Hiroki Isobe controls each of IAJ, IAJ LBO Fund, PBAA, Terra Firma and IA
    Turkey.

                                       49(2) Reflects the shares beneficially owned by Taicom and Michael Ning. These
    entities stated in a Schedule 13D filed with the SEC on July 18, 2008 and
    have subsequently confirmed orally, that they may be deemed to constitute a
    "group" for the purposes of Rule 13d-3 under the Exchange Act. Mr. Michael
    Ning controls Taicom.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
         INDEPENDENCE

RELATED PARTY TRANSACTIONS WITH INTER ASSET JAPAN AND ITS AFFILIATES, AND OUR
CONTROLLING SHAREHOLDER GROUP

         During the year ended March 31, 2009, the Company had the following
related party transactions with Inter Asset Japan Co Ltd ("IAJ") and affiliates,
and IAJ LBO Fund, PBAA Fund Limited, Terra Firma, IAJ, IA Turkey and Hiroki
Isobe (collectively, the "Controlling Shareholder Group"):

Kyo Nagae Relationship with IAJ

         In January 2006, Mr. Kyo Nagae, CFO of Global Hotline, Inc. ("Global
Hotline") became President of IAJ and IAJ LBO Fund. On January 28, 2009, Mr.
Nagae resigned from this position effective July 31, 2008.

Inter Asset Japan Relationship with Tesco Co Ltd

         IAJ owns a 23% minority ownership percentage in Tesco. Global Hotline
has an agent agreement with Tesco to sell their lighting products. Tesco owes
Global Hotline approximately $2,310,110 and $2,046,513 as of March 31, 2009 and
2008, respectively. Hideki Anan and Kyo Nagae are directors of Tesco. During the
twelve months ended March 31, 2009, we deferred $814,787 in revenues with Tesco.

DEREK SCHNEIDEMAN LOAN TO MICHAEL NING

         On June 23, 2009, Derek Schneideman, our CEO, loaned Michael Ning, a
shareholder who owns or controls approximately 12.6 % of the Company, $35,000.

REVIEW AND APPROVAL OF RELATED PERSON TRANSACTIONS.

         The Company has operated under a Code of Conduct for many years. The
Company's Code of Conduct requires all employees, officers and directors,
without exception, to avoid the engagement in activities or relationships that
conflict, or would be perceived to conflict, with the Company's interests or
adversely affect its reputation. It is understood, however, that certain
relationships or transactions may arise that would be deemed acceptable and
appropriate upon full disclosure of the transaction, following review and
approval to ensure there is a legitimate business reason for the transaction and
that the terms of the transaction are no less favorable to the Company than
could be obtained from an unrelated person.

         The Audit Committee is responsible for reviewing and approving, as
appropriate, all transactions with related persons. The Company has not adopted
a written policy for reviewing related person transactions. The Company reviews
all relationships and transactions in which the Company and our directors and
executive officers or their immediate family members are participants to
determine whether such persons have a direct or indirect material interest. As
required under SEC rules, transactions, if any, that are determined to be
directly or indirectly material to the Company or a related person are
disclosed.

Director Independence

         In accordance with AMEX rules, the Board affirmatively determines the
independence of each director and nominee for election as a director in
accordance with AMEX's independence standards as set forth in Section 803A of
the AMEX Company Guide.

                                       50Based on these standards, at its meeting held on July 10, 2009, the
Board determined that each of the following non-employee Directors are
independent and has no relationship with the Company, except as a Director and
stockholder of the Company:

         o Masazumi Ishii
         o Eric La Cara

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

AUDIT COMMITTEE PRE-APPROVAL POLICY

         The Audit Committee has established a pre-approval policy and
procedures for audit, audit-related and tax services that can be performed by
the independent auditors without specific authorization from the Audit Committee
subject to certain restrictions. The policy sets out the specific services
pre-approved by the Audit Committee and the applicable limitations, while
ensuring the independence of the independent auditors to audit the Company's
financial statements is not impaired. The pre-approval policy does not include a
delegation to management of the Audit Committee responsibilities under the
Exchange Act. During fiscal year ended March 31, 2009, the Audit Committee
pre-approved all audit and permissible non-audit services provided by our
independent auditors.

SERVICE FEES PAID TO THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

         The Audit Committee engaged Sherb and Co LLP to perform an annual audit
of the Company's financial statements for the fiscal year ended March 31, 2009
and 2008 and December 31, 2007. The following is the breakdown of aggregate fees
paid to the auditors for the Company for the last three fiscal years:

                             Year Ended        Year Ended         Year Ended
                           March 31, 2009    March 31, 2008    December 31, 2007
                           --------------    --------------    -----------------
Audit fees ............       $120,000          $125,000           $105,000
Audit related fees              48,000            33,100             30,000
Tax fees ..............          6,000             9,300              6,000
All other fees ........            138                 -             65,284
                              --------          --------           --------
                              $174,138          $167,400           $206,284
                              ========          ========           ========

   o  "Audit fees" are fees paid for professional services for the audit of our
      financial statements.

   o  "Audit Related fees" are fees billed by Sherb and Co. LLP. to us for
      services not included in the first two categories, specifically, SAS 100
      reviews, SEC filings and consents, and accounting consultations on matters
      addressed during the audit or interim reviews, and review work related to
      quarterly filings.

   o  "Tax fees" are fees primarily for tax compliance in connection with filing
      US income tax returns.

   o  "All other fees" are fees paid to Horwath, Sakura and Co for the audit of
      our subsidiary Rex Tokyo in 2004, which the Company agreed to pay as part
      of the sale in April 2006. PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

(a) FINANCIAL STATEMENTS:

         Our financial statements, as indicated by the Index to Consolidated
Financial Statements set forth below, begin on page F-1 of this Form 10-K, and
are hereby incorporated by reference. Financial statement schedules have been
omitted because they are not applicable or the required information is included
in the financial statements or notes thereto.

                                       51INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

                                                                         Page
                                                                      ----------

Report of Independent Registered Public Accounting Firm ..........       F-1

Consolidated Balance Sheets
     as of March 31, 2009 and 2008 ...............................       F-2

Consolidated Statements of Operations
     for the year ended March 31, 2009, the transition period for
     the three months ended March 31, 2008 and for the years ended
     December 31, 2007 and 2006 ..................................       F-3

Consolidated Statement of Stockholders' Equity (Deficiency)
     for the year ended March 31, 2009, the transition period for
     the three months ended March 31, 2008 and for the years ended
     December 31, 2007 and 2006 ..................................       F-4

Consolidated Statement of Cash Flows
     for the year ended March 31, 2009, the transition period for
     the three months ended March 31, 2008 and for the years ended
     December 31, 2007 and 2006 ..................................       F-5

Notes to Consolidated Financial Statements .......................    F-6 - F-55

(b) EXHIBITS:

EXHIBIT
NUMBER   EXHIBIT DESCRIPTION
-------  -------------------

3.1      Amended and Restated Certificate of Incorporation of IA Global, Inc.
         dated July 10, 2007. (2)

3.2      Amended and Restated Bylaws of IA Global, Inc. dated July 29, 2008. (3)

3.3      Certificate of Designation of Preferences and Rights of the
         Registrant's Series A Convertible Preferred Stock. (4)

3.4      Certificate of Designation of Preferences and Rights of the
         Registrant's Series B Convertible Preferred Stock. (5)

3.5      Certificate of Designations, Rights and Preferences of the Series A-1
         Preferred Stock of IA Global, Inc. dated October 18, 2006. (6)

3.6      Certificate Eliminating Reference to a Series B Convertible Preferred
         Shares of Stock from the Certificate of Incorporation of IA Global,
         Inc. dated October 18, 2006. (6)

3.7      Certificate Eliminating Reference to a Series A-1 Convertible Preferred
         Shares of Stock from the Certificate of Incorporation of IA Global,
         Inc. dated March 29, 2007. (7)

3.8      Certificate of Designations, Rights and Preferences of the ArqueMax
         Ventures, LLC Series Preferred Stock of IA Global, Inc. dated April 20,
         2009. (10)

4.1      Specimen of Stock Certificate. (8)

4.2      IA Global, Inc. 2007 Incentive Plan, as amended. (9) *

4.3      1999 and 2000 Stock Option Plans. (11)*

                                       5210.1     Outsource Business Services Agreement dated December 28, 2006 by and
         between Global Hotline, Inc. and KDDI Network and Solutions, Inc.
         Appendix to Outsource Business Services Agreement dated December 28,
         2006 between Global Hotline, Inc. and KDDI Network and Solutions, Inc.
         (Translated From Japanese). (12) +

10.2     Articles of Agreement, dated August 8, 2007, by Inforidge Co Ltd
         (Translated From Japanese). (13)

10.3     Agency Agreement for Offering Life Insurance, dated July 7, 2007, by
         and between Inforidge Co Ltd and American Life Insurance. (Translated
         From Japanese). (13)

10.4     Call Center Service Agency Agreement, dated May 21, 2007, by and
         between IA Partners Co Ltd and NTT Co Ltd. (Translated From Japanese)
         (3)

10.5     Attachment Agreement, dated May 21, 2007, by and between IA Partners Co
         Ltd and NTT Co Ltd. (Translated From Japanese) (3)

10.6     Confidentiality Agreement, dated May 21, 2007, by and between IA
         Partners Co Ltd and NTT Co Ltd. Co Ltd. (Translated From Japanese) (3)

10.7     Covenant for Data Management, dated May 21, 2007, by IA Partners Co
         Ltd. (Translated From Japanese) (3)

10.8     Outbound Telemarketing Program, dated November 30, 2007, by and between
         Inforidge Co Ltd and American Life Insurance Company. Translated From
         Japanese (14)

10.9     Partner Contract dated December 22, 2005 between IA Partners Co Ltd and
         Internet Service Partners. (Translated From Japanese) (15)

10.10    Agency Contract, dated April 14, 2006, by and between Japan Telecom
         Invoicing, Inc. and Global Hotline, Inc. (Translated From Japanese)
         (16)

10.11    Agency Ordering Agreement, dated May 10, 2006, by and between IA
         Partners Co Ltd and AFLAC Co Ltd. (Translated From Japanese) (17)

10.12    Business Agency Contract, dated May 10, 2006, by and between IA
         Partners Co Ltd and AFLAC Co Ltd. (Translated From Japanese) (17)

10.13    Financial Support for Direct Marketing Agreement, by and between IA
         Partners Co Ltd and AFLAC Co Ltd. (Translated From Japanese) (18) +

10.14    Call Center Usage Facility Agreement, dated January 10, 2008, by and
         between IA Partners Co Ltd and OMC Card, Inc. (Translated From
         Japanese) (14)

10.15    Basic Agreement, dated January 10, 2008, by and between Inforidge Co
         Ltd and OMC Card, Inc. (Translated From Japanese) (14)

10.16    Amendment to Binding Term Sheet dated April 16, 2008, by and between IA
         Global, Inc. and the sellers of Asia Premier Business Suites, Inc. (20)

10.17    Amendment Agreement, dated April 25, 2008, by and between IA Global,
         Inc. and Esprit Co Ltd. (21)

10.18    Request For Use of Overdraft Facility dated April 30, 2008, by and
         between Global Hotline, Inc. and Mitsui Sumitomo Banking Corporation.
         (Translated From Japanese) (21)

10.19    Deed of Variation, dated April 24, 2008, by and between IA Global, Inc.
         and Frontier Mortgages Pty Ltd. (21)

                                       5310.20    Request For Loan With Draft Loan (Change), dated April 24, 2008, by and
         between IA Partners, Inc. and Mitsui Sumitomo Co Ltd. (Translated From
         Japanese). (22)

10.21    Subscription Agreement, dated April 24, 2008, by and between IA Global,
         Inc. and Michael Ning. (22)

10.22    Subscription Agreement, dated May 8, 2008, by and between IA Global,
         Inc. and Michael Ning. (22)

10.23    Form of Warrant, dated May 8, 2008, by and between IA Global, Inc. and
         Michael Ning. (22)

10.24    Form of Warrant, dated May 8, 2008, by and between IA Global, Inc. and
         Michael Ning. (22)

10.25    Restricted Stock Agreement, dated April 27, 2008, by and between IA
         Global, Inc. and Mark Scott. (22) *

10.26    Restricted Stock Agreement, dated May 16, 2008, by and between IA
         Global, Inc. and Derek Schneideman. (19) *

10.27    CEO Compensation/Bonus Package, dated May 16, 2008, by and between IA
         Global, Inc. and Derek Schneideman. (23) *

10.28    Share Exchange Agreement, dated May 27, 2008, by and between IA Global,
         Inc. and Asia Premier Executive Suites, Inc., Jonathan Miller and Renee
         Rilloraza. (24)

10.29    Notes Payable for $100,000, dated May 27, 2008, by and between IA
         Global, Inc. and Jonathan Miller and Renee Rilloraza. (24)

10.30    Notes Payable for $131,000, dated May 27, 2008, by and between IA
         Global, Inc. and Jonathan Miller and Renee Rilloraza. (24)

10.31    Notes Payable for $37,000, dated May 27, 2008, by and between IA
         Global, Inc. and Jonathan Miller and Renee Rilloraza. (24)

10.32    Share Exchange Agreement, dated June 3, 2008, by and between IA Global,
         Inc. and Taicom Securities Co Ltd. (25)

10.33    CFO Compensation/Bonus Package, dated May 16, 2008, by and between IA
         Global, Inc. and Mark Scott. (23) *

10.34    Loan Agreement, dated June 4, 2008, by and between Global Hotline, Inc
         and Mizuho Bank Co Ltd. (Translated From Japanese) (19)

10.35    Request For Loan With Draft Loan (Change), dated June 19, 2008, by and
         between IA Partners, Inc. and Mitsui Sumitomo Co Ltd. (Translated From
         Japanese) (19)

10.36    Form of Warrant, dated July 28, 2008, by and between IA Global, Inc.
         and Michael Ning. (27)

10.37    KDDI AU Cell Phone Service Contract, dated April 1, 2008 between Global
         Hotline, Inc. and KDDI, Inc. (Translated From Japanese) (27) +

10.38    KDDI AU Cell Service Agreement, dated April 1, 2008 between Global
         Hotline, Inc. and KDDI, Inc. (Translated From Japanese) (27) +

10.39    Share Exchange Agreement, dated April 10, 2008, by and between IA
         Global, Inc. and P. Scott Valley and John Engel. (26)

10.40    Services Agreement, dated April 10, 2008, by and between IA Global,
         Inc. and IA Global, Inc. and Paper.com LLC. (26)

10.41    Loan Agreement dated August 1, 2008 by and between Global Hotline, Inc.
         and Mitsui Sumitomo Banking Corporation. (Translated From Japanese) (3)

                                       5410.42    Contract on Sales by and between Global Hotline, Inc. and KDDI
         Corporation. (Translated From Japanese) (3) +

10.43    Business Consignment Agreement by and between Global Hotline, Inc. and
         KDDI Corporation. (Translated From Japanese) (3) +

10.44    Amendment to Monetary Loan Agreement dated September 5, 2008 by and
         between IA Partners, Inc. and Mitsui Sumitomo Bank Co Ltd. (Translated
         From Japanese) (3)

10.45    Amendment to Monetary Loan Agreement dated September 5, 2008 by and
         between IA Partners, Inc. and Mitsui Sumitomo Bank Co Ltd. (Translated
         From Japanese) (3)

10.46    Memorandum Concerning Mail Order Support Program dated October 21, 2008
         by and between IA Partners, Inc. and AFLAC. (Translated From Japanese)
         (33) +

10.47    Special Contract Agreement signed October 2008 and dated August 2008 by
         and between IA Partners, Inc. and AFLAC. (Translated from Japanese)
         (33) +

10.48    Business Processing and Marketing Services Agreement dated January 9,
         2009 by and between IA Global, Inc. and HTMT Global Solutions Limited.
         (28)

10.49    Contract on Sales by and between Global Hotline, Inc. and KDDI
         Corporation. (Translated From Japanese) (3)

10.50    Business Consignment Agreement by and between Global Hotline, Inc. and
         KDDI Corporation. (Translated From Japanese) (3)

10.51    Non-Binding Term sheet dated December 8, 2008 from Golden Century
         Wealth Investment (HK) Ltd. (30)

10.52    Amendment to Share Exchange Agreement dated December 12, 2008 by and
         between IA Global, Inc. and Taicom Securities Co Ltd. (31)

10.53    Form of Performance Warrant dated December 12, 2008 by and between IA
         Global, Inc. and Michael Ning. (31)

10.54    Amendment to Golden Century Wealth Investment (HK) Ltd Non-Binding Term
         sheet dated December 8, 2008 by and between IA Global, Inc. and Golden
         Century Wealth Investment (HK) Ltd. (32)

10.55    Money Loan dated December 15, 2009 by and between Global Hotline, Inc.
         and Globacks Co Ltd. Translated From Japanese (33)

10.56    Loan Rate Change Agreement dated February 5, 2009 by and between Global
         Hotline, Inc. and Mitsui Sumitomo Bank Co Ltd. (Translated From
         Japanese) (1)

10.57    Loan Rate/ Discharge Method/ Interest Payment Method Agreement dated
         February 6, 2009 by and between Global Hotline, Inc. and Mitsui
         Sumitomo Bank Co Ltd. (Translated From Japanese) (1)

10.58    Loan Rate/ Discharge Method/ Interest Payment Method Agreement dated
         February 6, 2009 by and between IA Partners, Inc. and Mitsui Sumitomo
         Bank Co Ltd. (Translated From Japanese) (1)

10.59    Business Assignment Agreement Concerning Myline and Myline Plus dated
         January 15, 2009 by and between Global Hotline, Inc. and KDDI
         Corporation. (Translated From Japanese) (1)+

10.60    Contract on Entrusting Sales concerning AU Corporate Cellphone Services
         dated January 15, 2009 by and between Global Hotline, Inc. and KDDI
         Corporation. (Translated From Japanese) (1)+

                                       5510.61    Business Assignment Contract dated January 28, 2009 by and between
         Global Hotline, Inc. and KDDI Corporation. (Translated From Japanese)
         (1)+

10.62    Loan Agreement dated February 25, 2009 by and between Global Hotline,
         Inc and subsidiaries and officers and directors of Global Hotline, Inc
         and H Capital, Inc. (Translated from Japanese) (1)

10.63    Contract of Security of Transferred Shares dated February 25, 2009 by
         and between IA Global, Inc. and H Capital, Inc.(Translated from
         Japanese) (1)

10.64    Loan Agreement dated February 25, 2009 by and between Global Hotline,
         Inc and subsidiaries and officers and directors of Global Hotline, Inc
         and H Capital, Inc. (Translated from Japanese) (1)

10.65    Loan Agreement dated February 27, 2009 by and between Global Hotline,
         Inc and subsidiaries and officers and directors of Global Hotline, Inc
         and H Capital, Inc. (Translated from Japanese) (1)

10.66    Loan Agreement dated April 24, 2009 by and between Kyo Nagae and Global
         Hotline, Inc. and subsidiaries H Capital, Inc. (Translated from
         Japanese) (1)

10.67    Amendment to Golden Century Wealth Investment (HK) Ltd Non-Binding Term
         sheet dated March 2, 2009 by and between IA Global, Inc. and Golden
         Century Wealth Investment (HK) Ltd. (34)

10.68    Amendment to Share Exchange Agreement dated March 6, 2009 by and
         between IA Global, Inc. and Erik Gain and Peter Wilson. (34)

10.69    Amendment to Share Exchange Agreement dated April 1, 2009 by and
         between IA Global, Inc., Taicom Securities Co Ltd and ArqueMax
         Ventures, LLC. (35)

10.70    Form of Performance Warrant dated April 1, 2009 by and between IA
         Global, Inc. and Michael Ning. (35)

10.71    Services Agreement dated April 1, 2009 by and between IA Global, Inc.
         and ArqueMax Ventures , LLC. (35)

10.72    Application Form for (Change to) Loan on Bills dated March 31, 2009 by
         and between Global Hotline, Inc. and Mitsui Sumitomo Bank Co Ltd.
         (Translated From Japanese) (1)

10.73    Application Form for (Change to) Loan on Bills dated March 31, 2009 by
         and between IA Partners, Inc. and Mitsui Sumitomo Bank Co Ltd.
         (Translated From Japanese) (1)

10.74    Application Form for (Change to) Loan on Bills dated April 23, 2009 by
         and between Global Hotline, Inc. and Mitsui Sumitomo Bank Co Ltd.
         (Translated From Japanese) (1)

10.75    Application Form for (Change to) Loan on Bills dated April 23, 2009 by
         and between IA Partners, Inc. and Mitsui Sumitomo Bank Co Ltd.
         (Translated From Japanese) (1)

10.76    Extension of Services Agreement dated May 31, 2009 by and between IA
         Global, Inc. and ArqueMax Ventures , LLC. (36)

10.77    Services Agreement dated June 8, 2009 by and between IA Global, Inc.
         and ArqueMax Ventures, LLC. (38)

10.78    Form of Performance Warrant dated June 2, 2009, but effective June 8,
         2009 by and between IA Global, Inc. and ArqueMax Ventures , LLC. (38)

10.79    Application Form for (Change to) Loan on Bills dated June 30, 2009 by
         and between IA Partners, Inc. and Mitsui Sumitomo Bank Co Ltd.
         (Translated From Japanese) (1)

                                       5610.80    Application Form for (Change to) Loan on Bills dated June 30, 2009 by
         and between Global Hotline, Inc. and Mitsui Sumitomo Bank Co Ltd.
         (Translated From Japanese) (1)

10.81    Loan Rate/ Discharge Method/ Interest Payment Method Agreement dated
         June 22, 2009 by and between IA Partners, Inc. and Mitsui Sumitomo Bank
         Co Ltd. (Translated From Japanese) (1)

10.82    Monetary Loan Agreement dated June 22, 2009 by and between IA Partners,
         Inc. and Mitsui Sumitomo Bank Co Ltd. (Translated From Japanese) (1)

10.83    Agreement on Change to Loan Contract by and between Global Hotline,
         Inc. and Mitsui Sumitomo Bank Co Ltd. (Translated From Japanese)(1)

10.84    Consent Form dated April 7, 2008 and September 1, 2008 by and between
         Global Hotline, Inc. and SG Telecom, Inc. and Softbank Telecom Co Ltd.
         (1)+

10.85    Loan Agreement dated October 14, 2008 by and between Global Hotline,
         Inc. and KT Factory Ltd (1)

14.1     Code of Conduct Ethics dated July 10, 2009. (38)

21.1     Subsidiaries of the Registrant (1)

23.1     Consent of Sherb and Co LLP (1)

31.1     Section 302 Certifications. (1)

31.2     Section 302 Certifications. (1)

32.1     Section 902 Certifications. (1)

32.2     Section 902 Certifications. (1)

99.1     Audit Committee Charter dated July 10, 2009. (38)

99.2     Compensation Committee Charter dated July 10, 2009. (38)

99.3     Nominations and Governance Committee Charter dated July 10, 2009. (38)

99.4     Merger and Acquisition Committee Charter dated July 10, 2009. (38)

99.5     The audited financial statements of Taicom Securities Co Ltd as of
         March 31, 2008, 2007 and 2006, respectively, and for the respective
         years then ended. (29)

99.6     The unaudited Pro Forma Combined Condensed Consolidated Balance Sheet,
         with Taicom Securities Co Ltd, as of March 31, 2008, and the unaudited
         Pro Forma Combined Consolidated Statement of Operations of the Company,
         with Taicom, for the year ended March 31, 2008, and the three months
         ended June 30, 2008. (29)

99.7     The audited financial statements of Taicom Securities Co Ltd as of
         March 31, 2009 (1)
__________________

* Indicates management contract or compensatory plan.

+  Certain confidential material contained in the document has been omitted and
   filed separately with the Securities and Exchange Commission pursuant to Rule
   406 of the Securities Act of 1933, as amended or Rule 24b-2 of the Securities
   and Exchange Act of 1934, as amended.
__________________

(1)   Filed herewith.

                                       57(2)   Filed as an exhibit to Registrant's Quarterly Report on Form 10-Q for the
      period ending June 30, 2007, and filed on August 20, 2007, and
      incorporated herein by reference.

(3)   Filed as an exhibit to Registrant's Quarterly Report on Form 10-Q/A for
      the period ending September 30, 2008, and filed on November 20, 2008, and
      incorporated herein by reference.

(4)   Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      November 8, 2001, and incorporated herein by reference.

(5)   Filed as an exhibit to Registrant's Quarterly Report on Form 10-Q for the
      period ending March 31, 2006, and filed on May 15, 2006, and incorporated
      herein by reference.

(6)   Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      October 19, 2006 and filed on October 24, 2006, and incorporated herein by
      reference.

(7)   Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      March 29, 2007 and filed on March 30, 2007, and incorporated herein by
      reference.

(8)   Filed as an exhibit to Registrant's Registration Statement on Form S-1, as
      amended (File No. 333-71733), and incorporated herein by reference.

(9)   Filed as Exhibit 4.1 to the Company's Form S-8 filed on September 5, 2008,
      and incorporated herein by reference.

(10)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      April 20, 2009 and filed on April 20, 2009, and incorporated herein by
      reference.

(11)  Filed as an exhibit to Registrant's From S-8, dated June 21, 2004, and
      incorporated herein by reference.

(12)  Filed as an exhibit to Registrant's Form 10-K dated December 31, 2006 and
      filed on April 2, 2007.

(13)  Filed as an exhibit to Registrant's Current Report on Form 8-K/A, dated
      August 8, 2007 and filed on August 30, 2007, and incorporated herein by
      reference.

(14)  Filed as an exhibit to Registrant's Annual Report on Form 10-K for the
      year ended December 31, 2007 and filed on April 15, 2008 and incorporated
      herein by reference.

(15)  Filed as an exhibit to Registrant's Annual Report on Form 10-K, dated
      April 17, 2006 and filed April 17, 2006, and incorporated herein by
      reference.

(16)  Filed as an exhibit to Registrant's Quarterly Report on Form 10-Q for the
      quarter ended March 31, 2006 and filed May 15, 2006, and incorporated
      herein by reference.

(17)  Filed as an exhibit to Registrant's Quarterly Report on Form 10-Q for the
      quarter ended June 30, 2006 and filed August 11, 2006, and incorporated
      herein by reference.

(18)  Filed as an exhibit to Registrant's Annual Report on Form 10-K for the
      year ended December 31, 2006 and filed on April 2, 2007 and incorporated
      herein by reference.

(19)  Filed as an exhibit to Registrant's Transition Annual Report on Form 10-K
      for the year ended March 31, 2008 and filed on July 15, 2008 and
      incorporated herein by reference.

                                       58(20)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      April 16, 2008 and filed on April 18, 2008, and incorporated herein by
      Reference.

(21)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      April 24, 2008 and filed on April 30, 2008, and incorporated herein by
      reference.

(22)  Filed as an exhibit to Registrant's Quarterly Report on Form 10-Q for the
      quarter ended March 31, 2008 and filed May 15, 2008, and incorporated
      herein by reference.

(23)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated May
      16, 2008 and filed on May 20, 2008, and incorporated herein by reference.

(24)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated May
      27, 2008 and filed on June 2, 2008, and incorporated herein by reference.

(25)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated June
      3, 2008 and filed on June 5, 2008, and incorporated herein by reference.

(26)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      April 10, 2008 and filed on April 14, 2008, and incorporated herein by
      reference.

(27)  Filed as an exhibit to Registrant's Quarterly Report on Form 10-Q for the
      quarter ended June 30, 2008 and filed August 19, 2008, and incorporated
      herein by reference.

(28)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      January 9, 2009 and filed on January 9, 2009, and incorporated herein by
      reference.

(29)  Filed as an exhibit to Registrant's Current Report on Form 8-K/A, dated
      June 3, 2008 and filed on November 3, 2008, and incorporated herein by
      reference.

(30)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      December 17, 2008 and filed on December 17, 2008, and incorporated herein
      by reference.

(31)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      December 12, 2008 and filed on December 17, 2008, and incorporated herein
      by reference.

(32)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      February 4, 2009 and filed on February 9, 2009 and incorporated herein by
      reference.

(33)  Filed as an exhibit to Registrant's Quarterly Report on Form 10-Q for the
      quarter ended December 31, 2008 and filed February 23, 2009, and
      incorporated herein by reference.

(34)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      March 2, 2009 and filed on March 11, 2009 and incorporated herein by
      reference.

(35)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      April 1, 2009 and filed on April 6, 2009 and incorporated herein by
      reference.

(36)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated May
      31, 2009 and filed on June 4, 2009 and incorporated herein by reference.

(37)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated June
      8, 2009 and filed on June 10, 2009 and incorporated herein by reference.


(38)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated July
      14, 2009 and filed on July 15, 2009 and incorporated herein by reference.

                                       59REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To the Stockholders and Board of Directors
IA Global, Inc.

We have audited the accompanying consolidated balance sheets of IA Global, Inc.
(the "Company") as of March 31, 2009 and 2008 and the related consolidated
statement of operations, stockholders' equity and cash flows for the year ended
March 31, 2009, the transition period for the three months ended March 31, 2008,
and for the years ended December 31, 2007 and 2006. These consolidated financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.

We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. The Company is not required to
have, nor were we engaged to perform, an audit of its internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's internal control over financial
reporting. Accordingly we express no such opinion. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of the Company as of
March 31, 2009 and 2008 and the results of their operations and their cash flows
for the for the year ended March 31, 2009, the transition period for the three
months ended March 31, 2008, and for the years ended December 31, 2007 and 2006,
in conformity with accounting principles generally accepted in the United States
of America.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. The Company has incurred
significant operating losses, and has a working capital deficit as of March 31,
2009, as more fully described in Note 1. These issues raise substantial doubt
about the Company's ability to continue as a going concern. Management's plans
in regard to these matters are also described in Note 1. The consolidated
financial statements do not include any adjustments that might result from the
outcome of this uncertainty. In addition, in connection with loans that the
Company's fully owned subsidiary, Global Hotline, Inc., entered into, the equity
shares of this subsidiary currently held by the lender of these loans is being
challenged by IA Global, Inc. If these shares should not be successfully
recovered, the Company's claim of ownership in this subsidiary may be limited.


/s/Sherb & Co., LLP
Certified Public Accountants
New York, New York
September 2, 2009

                                      F-1IA GLOBAL, INC. AND SUBSIDIARIES
                                         CONSOLIDATED BALANCE SHEETS

                                                                                          March 31,
                                                                                ----------------------------
                                                                                   2009             2008
                                                                                ------------    ------------
ASSETS

CURRENT ASSETS:
  Cash and cash equivalents .................................................   $  3,614,731    $  1,626,862
  Accounts receivable, net of allowance of $909,984 and $674,886, respectively     5,994,117      12,746,290
  Prepaid expenses ..........................................................      1,184,572       1,967,164
  Notes receivable ..........................................................      2,353,153       1,484,519
  Other current assets ......................................................        124,308         462,709
  Refundable taxes - foreign ................................................      1,419,418       1,477,580
                                                                                ------------    ------------
    Total current assets ....................................................     14,690,299      19,765,124

EQUIPMENT, NET ..............................................................      2,207,849       2,431,954

OTHER ASSETS
  Intangible assets, net ....................................................        555,870         331,129
  Investment in Taicom Securities Co Ltd ....................................      2,861,365               -
  Equity investment in Australia Secured Financial Limited ..................              -       6,930,355
  Equity investment in GPlus Media Co Ltd ...................................              -       1,380,386
  Equity investment in Slate Consulting Co Ltd ..............................      1,386,054       1,396,481
  Other assets ..............................................................      3,164,127       2,704,752
                                                                                ------------    ------------

                                                                                $ 24,865,564    $ 34,940,181
                                                                                ============    ============

LIABILITIES AND STOCKHOLDER'S EQUITY

CURRENT LIABILITIES:
  Accounts payable - trade ..................................................   $  1,578,029    $    197,943
  Accrued payroll taxes and social insurance taxes - delinquent .............      4,850,887       1,203,108
  Accrued liabilities - other ...............................................      4,657,363       6,648,528
  Consumption taxes received ................................................      1,307,455         460,067
  Note payable - current portion of long term debt ..........................     13,391,371      10,510,655
  Deferred revenue ..........................................................      3,454,692               -
                                                                                ------------    ------------
    Total current liabilities ...............................................     29,239,797      19,020,301
                                                                                ------------    ------------

LONG TERM  LIABILITIES:
  Long term debt ............................................................      1,898,231       8,593,594
  Convertible debentures ....................................................              -       2,195,833
                                                                                ------------    ------------
                                                                                   1,898,231      10,789,427
                                                                                ------------    ------------
STOCKHOLDER'S (DEFICIT) EQUITY:
  Preferred stock, $.01 par value, 5,000 authorized, none outstanding .......              -               -
  Common stock, $.01 par value, 300,000,000 shares authorized,
    219,113,889 and 165,303,543, issued and outstanding, respectively .......      2,191,140       1,653,035
  Additional paid in capital ................................................     53,056,216      43,882,701
  Accumulated deficit .......................................................    (59,572,442)    (39,330,512)
  Accumulated other comprehensive loss ......................................     (1,694,471)       (821,864)
                                                                                ------------    ------------
                                                                                  (6,019,557)      5,383,360
  Less common stock in treasury, at cost ....................................       (252,907)       (252,907)
                                                                                ------------    ------------
    Total stockholder's (deficit) equity ....................................     (6,272,464)      5,130,453
                                                                                ------------    ------------

                                                                                $ 24,865,564    $ 34,940,181
                                                                                ============    ============

                               See notes to consolidated financial statements.

                                                     F-2IA GLOBAL, INC. AND SUBSIDIARIES
                                                              CONSOLIDATED STATEMENTS OF OPERATIONS

                                                                                                                   Transition
                                                                                                                 Period For The
                                                                                    Year Ended March 31,          Three Months        Year Ended December 31,
                                                                               ------------------------------        Ended        ------------------------------
                                                                                    2009             2008        March 31, 2008        2007             2006
                                                                               -------------    -------------    --------------   -------------    -------------
                                                                                                 (Unaudited)
REVENUE ....................................................................   $  57,107,050    $  38,692,616    $  16,048,904    $  29,136,435    $  19,139,004

COST OF SALES ..............................................................      13,217,643        9,977,798        2,949,833        8,024,085        2,894,727
                                                                               -------------    -------------    -------------    -------------    -------------

GROSS PROFIT ...............................................................      43,889,407       28,714,818       13,099,071       21,112,350       16,244,277

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES ...............................      53,444,034       35,844,189       11,063,815       30,690,192       19,066,699
                                                                               -------------    -------------    -------------    -------------    -------------

OPERATING LOSS .............................................................      (9,554,627)      (7,129,371)       2,035,256       (9,577,842)      (2,822,422)
                                                                               -------------    -------------    -------------    -------------    -------------

OTHER INCOME (EXPENSE):
  Interest income ..........................................................          19,065           56,094           39,418           37,259           92,307
  Interest expense and amortization of beneficial  conversion feature ......        (757,478)      (1,116,966)        (337,368)        (975,336)        (850,873)
  Other income .............................................................         294,483          690,820           86,375          603,119          178,640
  Gain (loss) on equity investment in Australia Secured Financial Limited ..         265,039         (227,412)         (94,261)        (119,562)          69,540
  Gain on equity investment in GPlus Media Co Ltd ..........................          12,510           20,386            7,582           12,804                -
  Loss on equity investment in Slate Consulting Co Ltd .....................         (10,427)         (43,519)         (17,178)         (26,341)               -
  Loss on equity investment in Taicom Securities Co Ltd ....................        (421,702)               -                -                -                -
  Conversion of debenture expense ..........................................               -         (120,046)               -         (120,046)               -
  Loss on retirement of debt ...............................................         (60,395)               -                -                -                -
  Loss on sale of Taicom Securities Co Ltd .................................      (1,736,934)               -                -                -                -
  Loss on sale of GPlus Media Co Ltd .......................................      (1,286,500)               -                -                -                -
  Impairment of equity investment in Australia Secured Financial Limited ...      (7,195,394)               -                -                -                -
  Loss (Gain) on Foreign currency transaction adjustment ...................         (66,025)           9,520           (1,861)          11,381         (129,448)
                                                                               -------------    -------------    -------------    -------------    -------------
    Total other expense ....................................................     (10,943,758)        (731,123)        (317,293)        (576,722)        (639,834)
                                                                               -------------    -------------    -------------    -------------    -------------

LOSS (INCOME) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES ...............     (20,498,385)      (7,860,494)       1,717,963      (10,154,564)      (3,462,256)

Income taxes - current (benefit) provision .................................        (256,455)        (916,046)       1,357,598       (2,005,601)         515,000
                                                                               -------------    -------------    -------------    -------------    -------------

NET LOSS FROM CONTINUING OPERATIONS ........................................     (20,241,930)      (6,944,448)         360,365       (8,148,963)      (3,977,256)

  Loss (gain) from disposal of discontinued operations .....................               -         (110,000)               -         (110,000)         463,375
  Gain from discontinued operations ........................................               -                -                -                -           76,054
  Loss on impairment of note receivable from sale of discontinued operations               -                -                -                -         (331,917)
                                                                               -------------    -------------    -------------    -------------    -------------
    Total (loss) / gain from discontinued operations .......................               -         (110,000)               -         (110,000)         207,512
                                                                               -------------    -------------    -------------    -------------    -------------

NET (LOSS) PROFIT ..........................................................   $ (20,241,930)   $  (7,054,448)   $     360,365    $  (8,258,963)   $  (3,769,744)
                                                                               =============    =============    =============    =============    =============

Basic and diluted loss per share of common-
  Basic loss per share from continuing operations ..........................   $       (0.10)   $       (0.04)   $           -    $       (0.05)   $       (0.04)
  Basic loss per share from discontinued operations ........................               -                -                -                -                -
                                                                               -------------    -------------    -------------    -------------    -------------
  Total basic loss per share ...............................................   $       (0.10)   $       (0.04)   $           -    $       (0.05)   $       (0.04)
                                                                               =============    =============    =============    =============    =============

  Diluted profit (loss) per share from continuing operations ...............   $           *    $           *    $           -    $           *    $           *
  Diluted profit (loss) per share from discontinued operations .............               *                *                -                *                *
                                                                               -------------    -------------    -------------    -------------    -------------
  Total diluted profit (loss) per share ....................................   $           *    $           *    $           -    $           *    $           *
                                                                               =============    =============    =============    =============    =============

  Weighted average shares of common stock outstanding- basic ...............     205,833,118      158,696,823      164,980,626      151,229,245      107,718,970
  Weighted average shares of common stock outstanding- diluted .............               *                *      167,481,049                *                *

  * Diluted calculation is not presented as it is anti-dilutive.

                                                         See notes to consolidated financial statements.

                                                                               F-3IA GLOBAL, INC. AND SUBSIDIARIES
                                                                          CONSOLIDATED STATEMENTS OF STOCKHOLDER'S EQUITY (DEFICIENCY)

                                                                                                                                                                   Accumulated
                                                                                                                                                                      Other                           Total
                                                                         Preferred Stock                  Common Stock             Additional                     Comprehensive                   Stockholder's
                                                                  ----------------------------    ----------------------------      Paid in       Accumulated        Income         Treasury        (Deficit)
                                                                     Shares          Amount          Shares          Amount         Capital         Deficit          (Loss)           Stock          Equity
                                                                  ------------    ------------    ------------    ------------    ------------    ------------    -------------   ------------    -------------

Balance as of December 31, 2005 ...............................          1,158    $         12      97,425,181    $    974,251    $ 32,992,589    $(27,662,170)   $   (238,547)   $    (50,000)   $  6,016,135

  Conversion of preferred stock to common stock ...............         (1,158)            (12)     11,580,000         115,800        (115,788)              -               -               -               -
  Conversion of note payable to common stock ..................              -               -        (840,024)         (8,400)       (233,094)              -               -               -        (241,494)
  Issuance of preferred stock for ASFL equity investment ......          4,375       7,000,000               -               -               -               -               -               -       7,000,000
  123R compensation expense ...................................              -               -               -               -         122,007               -               -               -         122,007
  Exercise of stock options ...................................              -               -       1,000,000          10,000          70,000               -               -               -          80,000

  Other comprehensive income - foreign currency translation ...              -               -               -               -               -               -          51,933               -          51,933
  Net loss - for the year ended December 31, 2006 .............              -               -               -               -               -      (3,769,744)              -               -      (3,769,744)
                                                                  ------------    ------------    ------------    ------------    ------------    ------------    ------------    ------------    ------------
    Comprehensive loss ........................................                                                                                                                                     (3,717,811)
                                                                                                                                                                                                  ------------

Balance as of December 31, 2006 ...............................          4,375       7,000,000     109,165,157       1,091,651      32,835,714     (31,431,914)       (186,614)        (50,000)      9,258,837

  Conversion of preferred stock to common stock ...............         (4,375)     (7,000,000)     43,750,000         437,500       6,562,500               -               -               -               -
  123R compensation expense ...................................              -               -               -               -         174,514               -               -               -         174,514
  Exercise of stock options ...................................              -               -         434,166           4,342          83,575               -               -               -          87,917
  Proceeds from sale of common stock ..........................              -               -       1,189,703          11,896         367,981               -               -               -         379,877
  Equity investment in GPLus Media Co Ltd for common stock ....              -               -       3,885,713          38,857       1,321,143               -               -               -       1,360,000
  Equity investment in Slate Consulting Co Ltd for common stock              -               -       3,600,000          36,000       1,404,000               -               -               -       1,440,000
  Conversion of debentures to common stock ....................              -               -       4,885,367          48,854       1,485,241               -               -               -       1,534,095
  Repurchase of common stock ..................................              -               -      (2,026,355)        (20,263)       (521,269)              -               -        (202,907)       (744,439)

  Other comprehensive income - foreign currency translation ...              -               -               -               -               -               -        (347,542)              -        (347,542)
  Net loss - for the year ended December 31, 2007 .............              -               -               -               -               -      (8,258,963)              -               -      (8,258,963)
                                                                  ------------    ------------    ------------    ------------    ------------    ------------    ------------    ------------    ------------
    Comprehensive loss ........................................                                                                                                                                     (8,606,505)
                                                                                                                                                                                                  ------------

Balance as of December 31, 2007 ...............................              -               -     164,883,751       1,648,837      43,713,399     (39,690,877)       (534,156)       (252,907)      4,884,296

  123R compensation expense ...................................              -               -               -               -          60,000               -               -               -          60,000
  Exercise of stock options ...................................              -               -          86,458             865          12,635               -               -               -          13,500
  Conversion of debentures to common stock ....................              -               -         333,334           3,333          96,667               -               -               -         100,000
  Repurchase of common stock ..................................              -               -               -               -               -               -               -               -               -

  Other comprehensive income - foreign currency translation ...              -               -               -               -               -               -        (287,708)              -        (287,708)
  Net loss - for the transition period the three months ended
   March 31, 2008 .............................................              -               -               -               -               -         360,365               -               -         360,365
                                                                  ------------    ------------    ------------    ------------    ------------    ------------    ------------    ------------    ------------
    Comprehensive income ......................................                                                                                                                                         72,657
                                                                                                                                                                                                  ------------

Balance as of March 31, 2008 ..................................              -               -     165,303,543       1,653,035      43,882,701     (39,330,512)       (821,864)       (252,907)      5,130,453

  123R compensation expense ...................................              -               -               -               -         473,620               -               -               -         473,620
  Exercise of stock options ...................................              -               -          62,958             630          10,170               -               -               -          10,800
  Issuance of common stock for services .......................              -               -         963,222           9,633         181,681               -               -               -         191,314
  Conversion of debt ..........................................              -               -       6,632,500          66,325         283,778               -               -               -         350,103
  Conversion of debentures to common stock ....................              -               -      13,992,971         139,931       2,238,890               -               -               -       2,378,821
  Common stock issued for Shift Resources Inc. acquisition ....              -               -         826,086           8,260         181,740               -               -               -         190,000
  Common stock issued for Asia Premier Inc. acquisition .......              -               -       1,250,000          12,500         287,500               -               -               -         300,000
  Proceeds from sale of common stock ..........................              -               -       4,082,609          40,826         576,136               -               -               -         616,962
  Equity investment in Taicom Securities Co Ltd ...............              -               -      26,000,000         260,000       4,940,000               -               -               -       5,200,000

  Other comprehensive income - foreign currency translation ...              -               -               -               -               -               -        (872,607)              -        (872,607)
  Net loss - for the year ended March 31, 2009 ................              -               -               -               -               -     (20,241,930)              -               -     (20,241,930)
                                                                  ------------    ------------    ------------    ------------    ------------    ------------    ------------    ------------    ------------
    Comprehensive loss ........................................                                                                                                                                    (21,114,537)
                                                                                                                                                                                                  ------------

  Balance as of March 31, 2009 ................................              -    $          -     219,113,889    $  2,191,140    $ 53,056,216    $(59,572,442)   $ (1,694,471)   $   (252,907)   $ (6,272,464)
                                                                  ============    ============    ============    ============    ============    ============    ============    ============    ============

                                                                                See notes to consolidated financial statements.

                                                                                                      F-4IA GLOBAL, INC. AND SUBSIDIARIES
                                                                 CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                                                                                      Transition
                                                                                                                    Period For The
                                                                                                                     Three Months          Year Ended December 31,
                                                                                                    Year Ended          Ended          ------------------------------
                                                                                                  March 31, 2009    March 31, 2008         2007              2006
                                                                                                  --------------    --------------     ------------      ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net (loss) income ..........................................................................     $(20,241,930)     $    360,365      $ (8,258,963)     $ (3,769,744)
  Adjustments to reconcile net income (loss) to net cash used in operating activities
    Depreciation and amortization ............................................................        1,354,599           588,571         1,758,524         1,979,875
    Amortization of beneficial conversion feature ............................................          104,167           104,166           416,667           416,667
    Amortization of prepaid financing ........................................................           79,593                 -                 -                 -
    Stock based compensation .................................................................          473,620            60,000           174,514           122,007
    Stock issued for services ................................................................          191,313                 -                 -                 -
    Conversion of debenture expense ..........................................................                -                 -           120,047                 -
    Gain on sale of fixed assets .............................................................          (37,804)                -                 -                 -
    Loss (gain) on equity investments ........................................................          154,580           103,857           135,307           (69,540)
    Loss on disposal of equity investment ....................................................        3,023,434                 -                 -                 -
    Impairment of equity investment ..........................................................        7,195,394                 -                 -                 -
    Impairment of notes receivable for sale of discontinued operations .......................                -                 -                 -           331,917
  Changes in operating assets and liabilities:
    Accounts receivable ......................................................................        6,762,927        (4,640,217)       (3,089,745)       (4,406,108)
    Prepaid expenses .........................................................................          722,196          (987,728)         (455,703)          (93,399)
    Notes receivable .........................................................................         (868,634)         (414,461)         (660,493)         (247,568)
    Other current assets .....................................................................          351,196          (188,492)          (71,501)          (12,933)
    Refundable taxes - foreign ...............................................................           58,162         1,261,044        (2,738,624)                -
    Other assets .............................................................................         (459,375)         (202,512)       (1,311,420)         (454,961)
    Accounts payable - trade .................................................................        1,420,718           (55,111)          148,481          (391,875)
    Accrued liabilities and payroll taxes ....................................................        1,653,285         2,940,395         2,747,780           (49,649)
    Consumption taxes received ...............................................................          847,388           444,982          (249,429)         (115,443)
    Income taxes payable - foreign ...........................................................                -                 -          (416,724)          163,604
    Deferred revenue .........................................................................        3,454,692                 -        (1,297,046)       (2,292,486)
                                                                                                   ------------      ------------      ------------      ------------
    Net cash provided by (used in) continuing operations .....................................        6,239,521          (625,141)      (13,048,328)       (8,889,636)
    (Gain) from discontinued operations ......................................................                -                 -                 -          (539,429)
    Net cash used in discontinued operations .................................................                -                 -                 -          (854,895)
    Net decrease in assets of discontinued operations ........................................                -                 -                 -        12,606,044
    Net decrease in liabilities of discontinued operations ...................................                -                 -                 -       (11,939,787)
                                                                                                   ------------      ------------      ------------      ------------
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES ..........................................        6,239,521          (625,141)      (13,048,328)       (9,617,703)
                                                                                                   ------------      ------------      ------------      ------------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Capital expenditures .......................................................................         (725,946)         (945,886)       (1,437,859)         (221,656)
  Sale of fixed assets .......................................................................          623,275                 -                 -                 -
  Sale of marketable securities ..............................................................                -                 -           250,638                 -
  Acquisition of subsidiary Shift Resources, Inc. ............................................          (35,000)                -                 -                 -
  Acquisition of investment in Australian Secured Financial Limited ..........................                -                 -          (250,000)                -
  Cash from acquisition of Shift Resources, Inc. and Asia Premier Executive Suites, Inc. .....           12,158                 -                 -                 -
  Dividend from equity investment ............................................................           32,464                 -                 -                 -
  Cash from disposal of equity investment ....................................................          253,932                 -                 -                 -
  Repayment of loan receivable from affiliate of controlling shareholder group ...............                -                 -                 -         3,394,000
  Proceeds from sale of Rex Tokyo Co, Ltd. ...................................................                -                 -                 -         1,300,000
  Cash portion used in acquisition of Investment - Australian
   Secured Financial Limited .................................................................                -                 -                 -          (250,000)
  Purchase of marketable securities ..........................................................                -                 -                 -          (250,638)
                                                                                                   ------------      ------------      ------------      ------------
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES: .........................................          160,883          (945,886)       (1,437,221)        3,971,706
                                                                                                   ------------      ------------      ------------      ------------

CASH FROM FINANCING ACTIVITIES:
  Proceeds from debt .........................................................................        9,564,415         1,507,099        17,153,095         9,276,671
  Repayments of debt .........................................................................      (13,575,961)          (69,132)       (4,182,116)       (4,581,366)
  Proceeds from exercise of options ..........................................................           10,800            13,500            87,917                 -
  Proceeds from sale of common stock .........................................................          616,962                 -           379,877            80,000
  Purchase of common shares for treasury .....................................................                -                 -          (744,439)                -
  Proceeds from cash dividend from investment in Australia Secured Financial Limited .........                -                 -                 -           425,666
                                                                                                   ------------      ------------      ------------      ------------
NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES ..........................................       (3,383,784)        1,451,467        12,694,334         5,200,971
                                                                                                   ------------      ------------      ------------      ------------

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS .........................................        3,016,620          (119,560)       (1,791,215)         (445,026)

EFFECT OF EXCHANGE RATE CHANGES ON CASH ......................................................       (1,378,853)         (287,708)         (347,542)          156,929

CASH AND CASH EQUIVALENTS, beginning of period ...............................................        1,626,862         2,034,130         4,172,889         4,460,986
                                                                                                   ------------      ------------      ------------      ------------

CASH AND CASH EQUIVALENTS, end of period .....................................................     $  3,264,629      $  1,626,862      $  2,034,132      $  4,172,889
                                                                                                   ============      ============      ============      ============

Supplemental disclosures of cash flow information:
  Interest paid ..............................................................................     $    483,396      $    228,269      $    222,358      $     67,563
  Taxes paid .................................................................................     $    385,180      $          -      $  1,004,406      $    233,528

Non-cash investing and financing activities:
  Conversion of debentures into Common Stock .................................................     $  2,300,000      $    100,000      $          -      $          -
  Conversion of interest payable on debentures into Common Stock .............................     $     78,822      $          -      $          -      $          -
  Issuance of Common Stock for acquisition of Subsidiary -
   Asia Premier Executive Suites, Inc. .......................................................     $    300,000      $          -      $          -      $          -
  Issuance of Common Stock for acquisition of Subsidiary - Shift Resources, Inc. .............     $    190,000      $          -      $          -      $          -
  Issuance of Common Stock for acquisition of Investment - Taicom Securities Co., Ltd. .......     $  5,200,000      $          -      $          -      $          -
  Issuance of Note Payable for acquisition of Subsidiary - Asia Premier Executive Suites, Inc.     $    268,000      $          -      $          -      $          -
  Settlement of note payable for common stock ................................................     $    350,103      $          -      $          -      $          -
  Conversion of Series A-1 Preferred Stock into common stock .................................     $          -      $          -      $  7,000,000      $          -
  Equity investment in Slate Consulting Co Ltd for common stock ..............................     $          -      $          -      $  1,440,000      $          -
  Equity investment in GPlus Media Co Ltd for common stock ...................................     $          -      $          -      $  1,360,000      $          -
  Conversion of debentures and accrued interest into common stock ............................     $          -      $          -      $  1,414,048      $          -
  Common stock surrendered to company in payment of note receivable ..........................     $          -      $          -      $          -      $    241,494
  Conversion of Series B Preferred stock into common stock ...................................     $          -      $          -      $          -      $    115,800
  Adjustment of intangible asset due to recognition of tax asset related to NOL
   carryforward from acquisition of Global Hotline, Inc. .....................................     $          -      $          -      $          -      $    486,870
  Issuance of Series A-1 Preferred stock for equity investment in Australian Secured .........     $          -      $          -      $          -      $          -
   Financial Limited .........................................................................     $          -      $          -      $          -      $  7,000,000

                                                            See notes to consolidated financial statements.

                                                                                  F-5IA GLOBAL, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1.  BUSINESS

THE COMPANY AND OUR BUSINESS

         IA Global, Inc. ("IA Global" or the "Company") is a broad based
services Company with a dedicated focus on growth of existing business, together
with expansion through mergers and acquisitions in the Pacific Rim region. Our
mission is to identify and invest in business opportunities, apply our skills
and resources to nurture and enhance the performance of those businesses across
key business metrics, and to deliver accelerating shareholder value.

         To realize this plan, the Company is expanding investments in the
business process outsourcing ("BPO") and financial services sectors. These
sectors demonstrate long-term growth prospects in which we, by applying our
skills and resources, can add significant value to our investments. Beyond
Japan, we are expanding our reach to encompass, the Philippines, Southeast Asia
and the outstanding growth opportunities and synergies these markets present.

         IA Global takes a long-term "Buy to Hold" approach to its acquisitions
and partnerships. It is built on the belief that our people, combining pragmatic
hands-on management with extensive operations and financial experience, have the
expertise to grow the businesses we invest in, to optimize their potential and
provide increasing returns on investment over the long run. IA Global has
acquired a select portfolio of investments in Japan, Australia and the
Philippines/Singapore area, targeted and developed with a sharp eye for
producing outstanding growth and profitability. This has laid the foundation for
an aggressive medium term plan to establish a broad network of complementary
subsidiaries and majority-owned investments in the greater Pacific Rim region.

BUSINESS PROCESS OUTSOURCING

         In Japan, IA Global is 100% owner of Global Hotline ("Global Hotline"
or "GHI"), except as disclosed, a Business Process Outsourcing organization,
operating several major call centers providing outbound telemarketing services
for telecommunications, insurance, credit card and catalog products. Since our
acquisition of Global Hotline in June 2005, this business has expanded rapidly
with the signing of multi-year contracts with major corporations.

         This growth is being driven by new contracts, process improvements,
infrastructure expansion, and macro economic trends such as the ongoing gains in
the Japanese economy, consistent year on year growth in targeted industries,
higher disposable incomes, and the increasingly rapid growth of the senior
citizen demographic. As of March 31, 2009, Global Hotline employed 885 full and
part-time personnel to support these multi-million dollar contracts. In the
Philippines, the Company acquired 100% of Shift on April 10, 2008 and Asia
Premier on May 27, 2008, multi-service call center operations that have now been
merged into a single Company operating as Global Hotline Philippines Inc.

HUMAN CAPITAL AND RESOURCES

         IA Global has a 20.25% equity investment in Slate Consulting Co Ltd
("Slate"). Slate is a Japan headquartered Executive Search firm with operations
and business entities in Tokyo, and a call center in Manila, Philippines.

FINANCIAL SERVICES

         In Japan, the Company has a 12.6% stake as of September 1, 2009 in
Taicom Securities Co Ltd ("Taicom"), a Japanese securities firm. Taicom is a
financial services Company in Japan providing a broad range of value-added
financial services and competitive products. These currently include the
brokerage of Japanese commodities, derivative options, foreign currency,
equities and investment trusts as well as the offering of investment consulting
services to diversified clients such as individuals and corporations. Taicom
offers creative solutions that meet the sophisticated trading requirements of
its online and offline clients, who utilize Taicom's cutting-edge proprietary
trading platform called TradePro, as well as its broad news and information
gathering network.

         Taicom is a member of the Osaka Stock Exchange. Taicom is headquartered
in Tokyo and in Osaka and has three branch offices in Japan.

                                      F-6CORPORATE INFORMATION

         The Company was incorporated in Delaware on November 12, 1998. The
Company's executive offices are located at 101 California Street, Suite 2450,
San Francisco, CA 94111, with its operating units being located primarily in
Japan, Philippines and Australia. The Company's telephone number is (415)
946-8828 and its primary website is located at www.iaglobalinc.com. The
information on our website is not a part of this Form 10-K.

         The Company's charters for the Audit Committee, the Compensation
Committee, and the Nominating Committee; and the Code of Conduct & Ethics are
also available on the Company's website.

GOING CONCERN

         These consolidated financial statements have been prepared by
management in accordance with accounting principles generally accepted in the
United States on a "going concern" basis, which presumes that the Company will
be able to realize its assets and discharge its liabilities in the normal course
of business for the foreseeable future.

         The Company has incurred operating losses for the years ended March 31,
2009, the transition period the three months ended March 31, 2008, and for the
years ended December 31, 2007 and 2006, as well as an accumulated deficit of
approximately $59,600,000 and a working capital deficit of approximately
$14,549,000 as of March 31, 2009. Furthermore, the Company has not remitted and
is delinquent payroll tax withholding and expenses on a timely basis for their
Japanese subsidiary Global Hotline.

         The Company's ability to continue as a going concern is dependent upon
continued development of their business outsource processing business, as well
as upon obtaining additional financing to develop the these businesses, the
ultimate realization of profits through future BPO business, and the success of
the Company's business plan. The outcome of these matters cannot be predicted at
this time. These consolidated financial statements do not include any
adjustments to the amounts and classifications of assets and liabilities that
might be necessary should the Company be unable to continue its business.

         In addition, in connection with loans payable that the Company's fully
owned subsidiary, Global Hotline, Inc., entered into, the equity shares of this
subsidiary currently held by the lender of these loans as collateral, is being
challenged by IA Global, Inc. If these shares should not be successfully
recovered, the Company's claim of ownership in this subsidiary may be limited.

RECLASSIFICATIONS

         Certain reclassifications have been made to the prior periods'
financial statements to conform to the current year classification. Thee
reclassifications had no effect on previously reported results of operations or
retained earnings.

CHANGE OF FISCAL YEAR END

         In June 2007, the Company's Board of Directors authorized the Company
changed the fiscal year end of the Company from a December 31st year end to a
March 31st year end. Per management, this change in fiscal year was made to
align the Company with the fiscal year end of their wholly owned subsidiary
Global Hotline. The change in fiscal year end commenced in the quarter ended
March 31, 2008, which is presented as the transition period for the three months
ended March 31, 2008. The first full fiscal year under the newly adopted year
end is that of year ended March 31, 2009.

INCREASE AUTHORIZED SHARES

On June 1, 2009, the shareholders of the Company approved the increase in the
number of authorized common shares from 300,000,000 to 450,000,000 shares.

NOTE 2.  SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES

PRINCIPLES OF CONSOLIDATION - The consolidated financial statements include the
accounts of the Company and its wholly owned and majority-owned subsidiaries.
Inter-Company items and transactions have been eliminated in consolidation.

CASH AND CASH EQUIVALENTS - The Company classifies highly liquid temporary
investments with an original maturity of three months or less when purchased as
cash equivalents.

                                      F-7The Company maintains cash balances at various financial institutions.
Balances at US banks are insured by the Federal Deposit Insurance Corporation up
to $250,000. Balances in Japanese banks are generally insured by the Deposit
Insurance Corporation of Japan up to 10,000,000 Yen per depositor per bank or
approximately $81,000 at current exchange rates. At times during the year ended
March 31, 2009, the Company's cash in bank deposit accounts exceed federally
insured limits with regards to certain accounts in the United States, and
exceeded Japanese statutory limits with regards to certain accounts in Japan. As
of March 31, 2009, the Company's cash accounts have not exceeded their United
States statutory limits. The Company has not experienced any losses in such
accounts and believes it is not exposed to any significant risk for cash on
deposit.

ACCOUNTS RECEIVABLE AND ALLOWANCE FOR DOUBTFUL ACCOUNTS - Accounts receivable
consists primarily of amounts due to the Company from normal business
activities. The Company maintains an allowance for doubtful accounts to reflect
the expected non-collection of accounts receivable based on past collection
history and specific risks identified within the portfolio. If the financial
condition of the customers were to deteriorate resulting in an impairment of
their ability to make payments, or if payments from customers are significantly
delayed, additional allowances might be required.

EQUIPMENT - Equipment represents machinery, equipment and software, which are
stated at cost less accumulated depreciation and amortization. Depreciation of
machinery and equipment is computed by the accelerated or straight-line methods
over the estimated useful lives of the related assets, generally 2-5 years.
Software developed or obtained for internal use is amortized using the
straight-line method over the estimated useful life of the software, generally
2-3 years.

INTANGIBLE ASSETS / INTELLECTUAL PROPERTY - The Company amortizes the intangible
assets and intellectual property acquired in connection with the acquisition of
Global Hotline, over thirty six months on a straight-line basis, which was the
time frame that the management of the Company was able to project forward for
future revenue, either under agreement or through expected continued business
activities with significant telecommunications companies. The Company amortizes
the intangible assets and intellectual property acquired in connection with the
acquisition of Global Hotline Philippines, Inc., over sixty months on a straight
- line basis, which was the time frame that the management of the Company was
able to project forward for future revenue, either under agreement or through
expected continued business activities with its customers.

LONG - LIVED ASSETS - The Company reviews its long-lived assets for impairment
when changes in circumstances indicate that the carrying amount of an asset may
not be recoverable. Long-lived assets under certain circumstances are reported
at the lower of carrying amount or fair value. Assets to be disposed of and
assets not expected to provide any future service potential to the Company are
recorded at the lower of carrying amount or fair value less cost to sell. To the
extent carrying values exceed fair values, an impairment loss is recognized in
operating results.

EQUITY INVESTMENTS - The company accounts for equity investments using the
equity method unless its value has been determined to be other than temporarily
impaired, in which case we write the investment down to its impaired value. The
company reviews these investments periodically for impairment and makes
appropriate reductions in carrying value when an other-than-temporary decline is
evident; however, for non-marketable equity securities, the impairment analysis
requires significant judgment. During its review, the company evaluates the
financial condition of the issuer, market conditions, and other factors
providing an indication of the fair value of the investments. Adverse changes in
market conditions or operating results of the issuer that differ from
expectation, could result in additional other-than-temporary losses in future
periods.

FAIR VALUE OF FINANCIAL INSTRUMENTS - The Company has adopted SFAS No. 157,
"Fair Value Measurements" ("SFAS 157"), for assets and liabilities measured at
fair value on a recurring basis. SFAS 157 establishes a common definition for
fair value to be applied to existing generally accepted accounting principles
that require the use of fair value measurements, establishes a framework for
measuring fair value and expands disclosure about such fair value measurements.
The adoption of SFAS 157 did not have an impact on the Company's financial
position or operating results, but did expand certain disclosures.

                                      F-8SFAS 157 defines fair value as the price that would be received to sell an asset
or paid to transfer a liability in an orderly transaction between market
participants at the measurement date. Additionally, SFAS 157 requires the use of
valuation techniques that maximize the use of observable inputs and minimize the
use of unobservable inputs. These inputs are prioritized below:

      Level 1: Observable inputs such as quoted market prices in active markets
               for identical assets or liabilities

      Level 2: Observable market-based inputs or unobservable inputs that are
               corroborated by market data

      Level 3: Unobservable inputs for which there is little or no market data,
               which require the use of the reporting entity's own assumptions.

Cash and cash equivalents of approximately $3,615,000, include money market
securities and commercial paper that are considered to be highly liquid and
easily tradable as of March 31, 2009. These securities are valued using inputs
observable in active markets for identical securities and are therefore
classified as Level 1 within our fair value hierarchy.

In addition to SFAS 157 as noted above, SFAS No. 159, "The Fair Value Option for
Financial Assets and Financial Liabilities," was effective for the year ended
March 31, 2009 and the transition period for the three months ended March 31,
2008. SFAS 159 expands opportunities to use fair value measurements in financial
reporting and permits entities to choose to measure many financial instruments
and certain other items at fair value. The Company did not elect the fair value
options for any of its qualifying financial instruments.

DEBT AND EQUITY FINANCING OF CAPITAL TRANSACTIONS - BENEFICIAL CONVERSION
FEATURES - The Company has adopted Emerging Issues Task Force ("EITF") issues
98-5, ACCOUNTING FOR CONVERTIBLES SECURITIES WITH BENEFICIAL CONVERSION FEATURES
OR CONTINGENTLY ADJUSTABLE CONVERSION RATIOS, and 00-27, APPLICATION OF ISSUE
NO. 98-5 TO CERTAIN CONVERTIBLE SECURITIES in accounting for convertible debt.
EITF 00-27 requires recognition of the intrinsic value of the conversion option
and is recognized as a reduction to the carrying amount of the convertible debt
and as an addition to paid-in capital. The intrinsic value of the conversion
feature is the difference between the conversion price and the fair value of the
stock into which the security is convertible, multiplied by the number of
shares. The conversion price used in calculating the intrinsic value is the most
favorable conversion price up to maturity, assuming there are no changes to the
current circumstances except for the passage of time. Changes to the conversion
terms that would be triggered by future events not controlled by the issuer
should be accounted for as contingent conversion options, and the intrinsic
value of such conversion options would not be recognized until and unless the
triggering event occurs. According to EITF 00-27, the issuance proceeds should
not be reduced by issuance costs when calculating the intrinsic value of the
conversion feature. The beneficial conversion feature of debt or equity
instruments, depending on the specific facts and circumstances, will determine
whether such beneficial conversion feature is to be recorded as an expense to be
amortized over a period of time, expensed immediately or recorded as a deemed
dividend.

REVENUE RECOGNITION - Global Hotline's revenue is derived from its multiple call
centers undertaking the telemarketing of telecommunications products and
services, and a range of insurance products and services in Japan and other
products and services in the Philippines. Revenue is considered realized when
the services have been provided to the customer, the work has been accepted by
the customer and collectability is reasonably assured. Furthermore, if an actual
measurement of revenue cannot be determined, we defer all revenue recognition
until such time that an actual measurement can be determined. If during the
course of a contract management determines that losses are expected to be
incurred, such costs are charged to operations in the period such losses are
determined.

         Revenues are deferred when cash has been received from the customer but
the revenue has not been earned. The Company recorded deferred revenue of $3.2
million and $0 as of March 31, 2009 and 2008, respectively.

ADVERTISING COSTS - Advertising costs are expensed as incurred. There were
minimal advertising costs incurred for the year ended March 31, 2009, the
transition period the three months ended March 31, 2008, and the years ended
December 31, 2007 and 2006.

                                      F-9FOREIGN CURRENCY TRANSLATION - Foreign entities whose functional currency is the
local currency translate net assets at the end of period rates and income and
expense accounts at average exchange rates for the periods ended. Adjustments
resulting from these translations are reflected in the consolidated balance
sheet under other comprehensive income and the statement of operations under
other income (expense).

STOCK BASED COMPENSATION - Effective January 1, 2006, the Company began
recording compensation expense associated with stock-based awards and other
forms of equity compensation in accordance with Statement of SFAS 123R as
interpreted by SEC Staff Accounting Bulletin No. 107. The Company adopted the
related to stock-based awards granted subsequent to January 1, 2006 based on the
grant date fair value estimated in accordance with the provisions of SFAS 123R.
In addition, the Company records expense over the vesting period in connection
with stock options granted. The compensation expense for stock-based awards
includes an estimate for forfeitures and is recognized over the expected term of
the award on a straight line basis.

         The Company received stockholder approval of the 2007 Stock Incentive
Plan ("2007 Plan") on June 29, 2007. Under this 2007 Plan, the Company grants
stock options for shares of common stock to employees, directors and
consultants. In accordance with the 2007 Plan, the stock options are granted at
the fair market value of the common stock. The 2007 Plan provides that the
options will have a life of up to ten years from the date of grant. The options
granted under the 2007 Plan vest quarterly or annually over a period of three
years. Certain options granted under the 2007 Plan vest over shorter periods.
Under the 2007 Plan, the Company may grant options, restricted stock or other
awards for the purchase of up to 20 million shares. On July 29, 2008, the
stockholders voted to increase the number of shares authorized under the 2007
Stock Incentive Plan from 20,000,000 to 27,500,000 at the Company's annual
shareholder meeting.

         A total of 11,693,512 shares of common stock are available for future
grants under the 2007 Plan as of March 31, 2009. Options for the purchase of
9,126,042 shares are outstanding as of March 31, 2008. Shares underlying options
that expire, or are cancelled without delivery of shares, generally become
available for future re-issuance under the 2007 Plan.

         When the stock options are granted, the fair value of each option grant
is estimated on the date of grant using the Black-Scholes valuation model and
the weighted assumptions noted in the following table.

                                           the Transition
                                               Period
                               For the       the Three       For the Years Ended
                             Year Ended     Months Ended         December 31,
                              March 31,       March 31,      -------------------
                                2009            2008          2007         2006
                             ----------    --------------    ------       ------
Risk free interest rate .        3.96%          3.73%         5.39%        4.96%
Expected life ...........       8 yrs.         8 yrs.        8 yrs.       8 yrs.
Dividend rate ...........        0.00%          0.00%         0.00%        0.00%
Expected volatility .....         112%           122%          111%         107%

         The Company recorded $473,620 of compensation expense, net of related
tax effects, relative to stock options for the twelve months ended March 31,
2009 in accordance with SFAS 123R. Net loss per share basic and diluted for this
expense was approximately ($0.00).

         The Company recorded $60,000 of compensation expense, net of related
tax effects, relative to stock options for the transition period three months
ended March 31, 2008, respectively in accordance with Financial Accounting
Standards No. 123-R, Share-Based Payment, ("SFAS 123R"). Net loss per share
basic and diluted for this expense was approximately ($0.00).

         The Company recorded $174,514 and $122,007 of compensation expense, net
of related tax effects, relative to stock options for the year ended December
31, 2007 and 2006, respectively in accordance with SFAS 123R. Net loss per share
basic and diluted for this expense was approximately ($0.00).

                                      F-10As of March 31, 2009, there is approximately $1,097,000 of total
unrecognized costs related to employee granted stock options that are not
vested. These costs are expected to be recognized over a period of approximately
three years.

         The Company accounts for non-employee stock transactions in accordance
with SFAS No. 123R and EITF 96-18. The Company issued grants for 21,429 shares
of common stock at an average exercise price of $.28 per share to non-employment
consultant during the twelve months ended March 31, 2009. The grants were
expensed immediately. There are 273,929 stock options outstanding for
non-employees as of March 31, 2009 at an average exercise price of $.342 per
share.

         The Company issued grants for 55,000 shares of common stock at an
average exercise price of $.267 per share to non-employee consultants during the
three months ended March 31, 2008. The grants were expensed immediately. There
are 227,500 stock options outstanding for non-employees as of March 31, 2008 at
an average exercise price of $.356 per share.

         The Company issued grants for 172,500 shares of common stock at $.384
per share in the year ended December 31, 2007. The grants were expensed
immediately. There are 172,500 stock options at $.384 per share outstanding as
of December 31, 2007. There were no non-employee stock options outstanding as of
December 31, 2006.

         Prior to January 1, 2006, the Company accounted for stock-based awards
using the intrinsic value method of accounting in accordance with Accounting
Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees"
("APB 25"). Under the intrinsic value method of accounting, no compensation
expense was recognized in the Company's consolidated statements of operations
when the exercise price of the Company's employee stock option grant equaled the
market price of the underlying common stock on the date of grant and the
measurement date of the option grant is certain. The total exercise value of all
options granted to employees and directors of the Company in the year ended
December 31, 2007 was approximately $425,000. Under SFAS 123R, the Company
remeasures the intrinsic value of the options at the end of each reporting
period until the options are exercised, cancelled or expire unexercised. As of
March 31, 2008, there are 5.5 million options with a weighted average exercise
price of $0.29 and a weighted average remaining life of 9.15 years, which remain
outstanding and continue to be remeasured at the intrinsic value over their
remaining vesting period ranging from 3 months to 3 years. Compensation expense
in any given period is calculated as the difference between total earned
compensation at the end of the period, less total earned compensation at the
beginning of the period. Compensation earned is calculated on a straight line
basis over the requisite service period for any given option award. A total of
approximately $756,000 in compensation expense remains unearned as of March 31,
2008.

         Prior to January 1, 2006, the Company accounted for stock-based awards
using the intrinsic value method of accounting in accordance with Accounting
Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees"
("APB 25"). Under the intrinsic value method of accounting, no compensation
expense was recognized in the Company's consolidated statements of operations
when the exercise price of the Company's employee stock option grant equaled the
market price of the underlying common stock on the date of grant and the
measurement date of the option grant is certain. The total value of all options
granted to employees and directors of the Company for the year ended December
31, 2007 was approximately $1,312,000. Under SFAS 123R, the Company remeasures
the intrinsic value of the options at the end of each reporting period until the
options are exercised, cancelled or expire unexercised. As of December 31, 2007,
there are 8.1 million options with a weighted average exercise price of $0.261
and a weighted average remaining life of 8.81 years, remain outstanding and
continue to be remeasured at the intrinsic value over their remaining vesting
period ranging from 3 months to 3 years. Compensation expense in any given
period is calculated as the difference between total earned compensation at the
end of the period, less total earned compensation at the beginning of the
period. Compensation earned is calculated on a straight line basis over the
requisite service period for any given option award. A total of approximately
$415,000 in compensation expense remains unearned as of December 31, 2007.

                                      F-11Previously, the Company had the 1999 and 2000 stock option plans (the
"Plans"), in which the Company granted stock options for shares of common stock
to employees and directors. In accordance with the Plans, the stock options were
granted at the fair market value of the common stock. The Plans provided that
the options will have a life of up to ten years from the date of grant. The
options granted under the Plans vested quarterly or annually over a period of
three years. Certain options granted under the Plans vested over shorter
periods. Under the Plans, the Company may grant options for the purchase of up
to 12,000,000 shares. A total of 1,530,000 shares of common stock have been
purchased, through the exercise of options issued under the Plans, since the
Plans were implemented. Shares underlying options that expire, or are cancelled
without delivery of shares, generally became available for future re-issuance
under the Plans. No additional shares will be issued under the Plans.

COMPREHENSIVE INCOME - The Company has adopted SFAS No. 130 "Reporting
Comprehensive Income." This statement establishes rules for the reporting of
comprehensive income and its components. Comprehensive income consists of net
loss to common shareholders and foreign currency transaction adjustments and is
presented in the Consolidated Statements of Operations and Stockholder's Equity.

INCOME TAXES - Income tax provision (benefit) is based on reported income (loss)
before income taxes. Deferred income taxes reflect the effect of temporary
differences between asset and liability amounts that are recognized for
financial reporting purposes and the amounts that are recognized for income tax
purposes. These deferred taxes are measured by applying currently enacted tax
laws in the countries and locations where that company operates out of. The
Company recognizes refundable and deferred assets to the extent that management
has determined their realization. As of March 31, 2009 and 2008, the Company had
refundable tax assets of $1,419,418 and 1,477,580, respectively, based on
prepayments that the Company has made that are available to offset future
taxable income.

The following (benefits) provision for income taxes by geographic operations is
as follows:

                                                                             Transition
                                                                               Period
                                               For the         For the       the Three         For the Years Ended
                                             Year Ended      Year Ended     Months Ended             March 31,
                                              March 31,       March 31,       March 31,    ------------------------------
                                                2009            2009            2008            2007            2006
                                            -------------   -------------   ------------   -------------    -------------
(Loss) Income from operations                                (Unaudited)     (Unaudited)
before income taxes:
    US operations ........................  $ (13,035,389)  $  (3,156,745)  $   (803,243)  $  (3,025,217)   $  (1,904,804)
    Japan operations .....................     (7,462,996)     (4,703,749)     2,521,206      (7,129,347)      (1,557,452)
                                            -------------   -------------   ------------   -------------    -------------
Total (loss) profit from operations before
    income taxes .........................    (20,498,385)     (7,860,494)     1,717,963     (10,154,564)      (3,462,256)
(Loss) gain from discontinued operations .              -        (110,000)             -        (110,000)         207,512
                                            -------------   -------------   ------------   -------------    -------------
                                            $ (20,498,385)  $  (7,970,494)  $  1,717,963   $ (10,264,564)   $  (3,254,744)
                                            =============   =============   ============   =============    =============

The (benefits) provision for income taxes by geographic operations is as
follows:

                                                                             Transition
                                                                               Period
                                               For the         For the       the Three         For the Years Ended
                                             Year Ended      Year Ended     Months Ended             March 31,
                                              March 31,       March 31,       March 31,    ------------------------------
                                                2009            2009            2008            2007            2006
                                            -------------   -------------   ------------   -------------    -------------
                                                             (unaudited)
US operations ............................  $           -   $           -   $          -   $           -    $           -
Japan operations .........................       (256,455)       (916,046)     1,357,598      (2,005,601)         515,000
                                            -------------   -------------   ------------   -------------    -------------
Total (benefit) provision for income taxes  $    (256,455)  $    (916,046)  $  1,357,598   $  (2,005,601)   $     515,000
                                            =============   =============   ============   =============    =============

                                      F-12The components of the (benefits) provision for income taxes by taxing
jurisdiction is as follows:

                                                                             Transition
                                                                               Period
                                               For the         For the       the Three         For the Years Ended
                                             Year Ended      Year Ended     Months Ended             March 31,
                                              March 31,       March 31,       March 31,    ------------------------------
                                                2009            2009            2008            2007            2006
                                            -------------   -------------   ------------   -------------    -------------
                                                             (unaudited)
US Federal, State and Local:
        Current ..........................  $           -   $           -   $          -   $           -    $           -
        Deferred .........................  $           -   $           -   $          -   $           -    $           -
Japan:
        Current (benefit) provision ......  $    (256,455)  $    (916,046)  $  1,357,598   $  (2,005,601)   $     515,000
        Deferred .........................  $           -   $           -   $          -   $           -    $           -

A reconciliation of the Company's effective tax rate to the statutory US Federal
tax rate is as follows:

                                                                             Transition
                                                                               Period
                                               For the         For the       the Three         For the Years Ended
                                             Year Ended      Year Ended     Months Ended             March 31,
                                              March 31,       March 31,       March 31,    ------------------------------
                                                2009            2009            2008            2007            2006
                                            -------------   -------------   ------------   -------------    -------------
                                                             (unaudited)
Statutory rate ...........................      35.0%           35.0%           35.0%           35.0%           35.0%
Foreign tax differential .................       6.0%            6.0%            6.0%            6.0%            6.0%
State and Local ..........................       5.7%            5.7%            5.7%            5.7%            5.7%
                                            -------------   -------------   ------------   -------------    -------------
Effective Rate ...........................      46.7%           46.7%           46.7%           46.7%           46.7%
                                            =============   =============   ============   =============    =============

The effect of tax law changes on deferred tax assets and liabilities did not
have a significant effect on the company's effective tax rate.

The significant components of activities that gave rise to refundable income tax
assets that are recorded in the consolidated balance sheets were as follows:

                                             For the Year Ended March 31,
                                            -----------------------------
                                                 2009            2008
                                            -------------   -------------
Deferred Income taxes ....................  $           -   $           -
Refundable Income taxes ..................      1,419,000       1,478,000
Operating loss carry forwards ............     13,000,000       9,750,000
                                            -------------   -------------
Gross Tax Asset ..........................     14,419,000      11,228,000
Less: Valuation Allowance ................    (13,000,000)     (9,750,000)
                                            -------------   -------------
Refundable Tax Asset, net of Allowance ...  $   1,419,000   $   1,478,000
                                            =============   =============

         The valuation allowance at March 31, 2009, principally applies the net
operating loss ("NOL") carry forwards that, in the opinion of management, are
more likely than not to expire before the Company can use them. Total Deferred
Taxes - foreign (Japan) were approximately $4,800,000. Total Deferred Taxes - US
were approximately $8,200,000.

         For tax return purposes, the Company has available US and Japanese NOL
carry forwards of approximately $35.3 million which expire in various years
through 2029, subject to any potential Section 382 of the Internal Revenue Code
of 1986, as amended (the "Code") due to ownership changes in IA Global and
statutory Japanese limitations. In general, an ownership change, as defined by
Section 382, results from transactions increasing the ownership of certain
shareholders or public groups in the stock of a corporation by more than 50
percentage points over a three-year period. IA Global has raised capital through
the issuance of capital stock on several occasions which, combined with the

                                      F-13purchasing shareholders' subsequent disposition of those shares, may have
resulted in a change of control, as defined by Section 382, or could result in a
change of control in the future upon subsequent disposition. The Company has not
currently completed a study to assess whether a change of control has occurred
or whether there have been multiple changes of control since the company's
formation due to the significant complexity and cost associated with such study
and that there could be additional changes in control in the future. If the
Company has experienced a change of control at any time since the Company
formation, utilization of our NOL credit carry forwards would be subject to an
annual limitation under Section 382. Any limitation may result in expiration of
a portion of the NOL credit carry forwards before utilization. Further, until a
study is completed and any limitation known, no amounts are being presented as
an uncertain tax position under FIN 48.

NET LOSS PER SHARE - The Company has adopted SFAS No. 128, "Earnings per Share."
Loss per common share is computed by dividing income available to common
shareholders by the weighted average number of common shares outstanding during
the period. The common stock equivalents have not been included as they are
anti-dilutive. As of March 31, 2009, there were options outstanding for the
purchase of 11,693,512 common shares, warrants for 38,962,243 common shares and
shares issued as collateral for loans of 3,554,546 shares of common stock which
could potentially dilute future earnings per share. As of March 31, 2008, there
were options outstanding for the purchase of 9,126,042 common shares,
convertible debentures convertible into 7,666,679 common shares and warrants for
62,243 shares of common stock which could potentially dilute future earnings per
share.

DIVIDEND POLICY - The Company has never paid any cash dividends and intends, for
the foreseeable future, to retain any future earnings for the development of our
business. Our future dividend policy will be determined by the board of
directors on the basis of various factors, including our results of operations,
financial condition, capital requirements and investment opportunities.

USE OF ESTIMATES - The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.

RECENT ACCOUNTING PRONOUNCEMENTS

         In December 2007, the FASB issued SFAS No. 141 (revised 2007),
"Business Combinations" ("SFAS 141(R)"). SFAS 141(R) will change the accounting
for business combinations. Under SFAS No. 141(R), an acquiring entity will be
required to recognize all the assets acquired and liabilities assumed in a
transaction at the acquisition-date fair value with limited exceptions. SFAS No.
141(R) will change the accounting treatment and disclosure for certain specific
items in a business combination. SFAS No. 141(R) applies prospectively to
business combinations for which the acquisition date is on or after the
beginning of the first annual reporting period beginning on or after December
15, 2008. SFAS 141(R) is expected to impact the Company in the event of any
future acquisitions.

         In December 2007, the FASB issued SFAS No. 160, "Non-controlling
Interests in Consolidated Financial Statements--an amendment of Accounting
Research Bulletin No. 51" ("SFAS 160"). SFAS 160 establishes new accounting and
reporting standards for the non-controlling interest in a subsidiary and for the
deconsolidation of a subsidiary. SFAS No. 160 is effective for fiscal years
beginning on or after December 15, 2008. The Company is currently evaluating the
provisions of SFAS 160 to determine the impact on the Company's consolidated
financial statements. The adoption of SFAS 160 is not expected to have a
material impact on the Company's results of operations, financial position or
liquidity.

         In March 2008, the FASB issued SFAS No. 161, "Disclosures about
Derivative Instruments and Hedging Activities--an amendment of FASB Statement
No. 133" ("SFAS 161"). SFAS 161 changes the disclosure requirements for
derivative instruments and hedging activities. Entities are required to provide
enhanced disclosures about (a) how and why an entity uses derivative

                                      F-14instruments, (b) how derivative instruments and related hedged items are
accounted for under Statement 133 and its related interpretations, and (c) how
derivative instruments and related hedged items affect an entity's financial
position, financial performance, and cash flows. The guidance in SFAS 161 is
effective for financial statements issued for fiscal years and interim periods
beginning after November 15, 2008, with early application encouraged. This
Statement encourages, but does not require, comparative disclosures for earlier
periods at initial adoption. The adoption of SFAS 161 is not expected to have a
material impact on the Company's results of operations, financial position or
liquidity.

         In May 2008, FASB issued FASB Staff Position ("FSP") APB 14-1,
Accounting for Convertible Debt Instruments That May Be Settled in Cash upon
Conversion (Including Partial Cash Settlement). FSP APB 14-1 clarifies that
convertible debt instruments that may be settled in cash upon either mandatory
or optional conversion (including partial cash settlement) are not addressed by
paragraph 12 of APB Opinion No. 14, Accounting for Convertible Debt and Debt
issued with Stock Purchase Warrants. Additionally, FSP APB 14-1 specifies that
issuers of such instruments should separately account for the liability and
equity components in a manner that will reflect the entity's non-convertible
debt borrowing rate when interest cost is recognized in subsequent periods. FSP
APB 14-1 is effective for financial statements issued for fiscal years beginning
after December 15, 2008, and interim periods within those fiscal years. The
Company will adopt FSP APB 14-1 beginning in the first quarter of fiscal 2009,
and this standard must be applied on a retrospective basis. The adoption of FSP
APB 14-1 is not expected to have a material impact on the Company's results of
operations, financial position or liquidity.

         In May 2008, the FASB issued SFAS No. 162, The Hierarchy of Generally
Accepted Accounting Principles. This standard is intended to improve financial
reporting by identifying a consistent framework, or hierarchy, for selecting
accounting principles to be used in preparing financial statements that are
presented in conformity with generally accepted accounting principles in the
United States for non-governmental entities. SFAS No. 162 is effective 60 days
following approval by the SEC of the Public Company Accounting Oversight Board's
amendments to AU Section 411, The Meaning of Present Fairly in Conformity with
Generally Accepted Accounting Principles. The adoption of SFAS No. 162 did not
Have a material impact on the preparation of its consolidated financial
statements.

         On June 16, 2008, the FASB issued final Staff Position No. EITF 03-6-1,
"Determining Whether Instruments Granted in Share-Based Payment Transactions Are
Participating Securities," to address the question of whether instruments
granted in share-based payment transactions are participating securities prior
to vesting. The FSP determines that unvested share-based payment awards that
contain rights to dividend payments should be included in earnings per share
calculations. The guidance will be effective for fiscal years beginning after
December 15, 2008. The adoption of EITF 03-6-1 did not have a material impact on
the Company's results of operations, financial position or liquidity.

         In January 2009, the FASB issued FSP EITF 99-20-1, "Amendments to the
Impairment Guidance of EITF Issue No. 99 - Recognition of Interest Income and
Impairment on Purchased and Retained Beneficial Interests in Securitized
Financial Assets". FSP EITF 99-20-1 changes the impairment model included within
EITF 99-20 to be more consistent with the impairment model of SFAS No. 115. FSP
EITF 99-20-1 achieves this by amending the impairment model in EITF 99-20 to
remove its exclusive reliance on "market participant" estimates of future cash
flows used in determining fair value. Changing the cash flows used to analyze
other-than-temporary impairment from the "market participant" view to a holder's
estimate of whether there has been a "probable" adverse change in estimated cash
flows allows companies to apply reasonable judgment in assessing whether
another-than-temporary impairment has occurred. The adoption of FSP EITF 99-20-1
did not have a material impact on our results of operations, financial position
or liquidity.

         In April 2009 the FASB issued FSP No. 141R-1 Accounting for Assets
Acquired and Liabilities Assumed in a Business Combination That Arise from
Contingencies, or FSP 141R-1. FSP 141R-1 amends the provisions in SFAS 141R for
the initial recognition and measurement, subsequent measurement and accounting,
and disclosures for assets and liabilities arising from contingencies in
business combinations. The FSP eliminates the distinction between contractual
and non-contractual contingencies, including the initial recognition and
measurement criteria in SFAS 141R and instead carries forward most of the

                                      F-15provisions in SFAS 141 for acquired contingencies. FSP 141R-1 is effective for
contingent assets and contingent liabilities acquired in business combinations
for which the acquisition date is on or after the beginning of the first annual
reporting period beginning on or after December 15, 2008. The adoption of FSP
No. 141R-1 did not have a material impact on the Company's results of
operations, financial position or liquidity.

         In April 2009 the FASB issued three related Staff Positions: (i) FSP
No. 157-4, Determining Fair Value When the Volume and Level of Activity for the
Asset or Liability have Significantly Decreased and Identifying Transactions
That Are Not Orderly, or FSP 157-4, (ii) FSP 115-2 and FSP No. 124-2,
Recognition and Presentation of Other-Than-Temporary Impairments , or FSP 115-2
and FSP 124-2, and (iii) FSP 107-1 and APB No. 28-1, Interim Disclosures about
Fair Value of Financial Instruments, or FSP 107 and APB 28-1, which are
effective for interim and annual periods ending after June 15, 2009. FSP 157-4
provides guidance on how to determine the fair value of assets and liabilities
under SFAS 157 in the current economic environment and reemphasizes that the
objective of a fair value measurement remains an exit price. If the Company were
to conclude that there has been a significant decrease in the volume and level
of activity of the asset or liability in relation to normal market activities,
quoted market values may not be representative of fair value and the Company may
conclude that a change in valuation technique or the use of multiple valuation
techniques may be appropriate. FSP 115-2 and FSP 124-2 modify the requirements
for recognizing other-than-temporarily impaired debt securities and revise the
existing impairment model for such securities, by modifying the current intent
and ability indicator in determining whether a debt security is
other-than-temporarily impaired. FSP 107 and APB 28-1 enhance the disclosure of
instruments under the scope of SFAS 157 for both interim and annual periods.

         In May 2009 the FASB issued SFAS No. 165, Subsequent Events, or SFAS
165. SFAS 165 establishes general standards of accounting for and disclosure of
events that occur after the balance sheet date but before financial statements
are issued or are available to be issued. SFAS 165 requires the disclosure of
the date through which an entity has evaluated subsequent events and the basis
for that date, that is, whether the date represents the date the financial
statements were issued or were available to be issued. SFAS 165 is effective in
the first interim period ending after June 15, 2009. The Company expects SFAS
165 will have an impact on disclosures in their consolidated financial
statements, but the nature and magnitude of the specific effects will depend
upon the nature, terms and value of the any subsequent events occurring after
adoption.

         In June 2009 the FASB issued SFAS No. 167, Amendments to FASB
Interpretation No. 46(R), or SFAS 167, that will change how we determine when an
entity that is insufficiently capitalized or is not controlled through voting
(or similar rights) should be consolidated. Under SFAS No. 167, determining
whether a company is required to consolidate an entity will be based on, among
other things, an entity's purpose and design and a company's ability to direct
the activities of the entity that most significantly impact the entity's
economic performance. SFAS 167 is effective for financial statements after
January 1, 2010. The Company is currently evaluating the requirements of SFAS
167 and the impact of adoption on their consolidated financial statements, if
any.

         In June 2009 the FASB issued SFAS No. 168, The FASB Accounting
Standards Codification and the Hierarchy of Generally Accepted Accounting, or
SFAS 168. SFAS 168 represents the last numbered standard to be issued by FASB
under the old (pre-Codification) numbering system, and amends the GAAP hierarchy
established under SFAS 162. On July 1, 2009 the FASB launched FASB's new
Codification entitled The FASB Accounting Standards Codification, or FASB ASC.
The Codification will supersede all existing non-SEC accounting and reporting
standards. SFAS 168 is effective in the first interim and annual periods ending
after September 15, 2009. This pronouncement will have no effect on the
Company's consolidated financial statements upon adoption other than current
references to GAAP which will be replaced with references to the applicable
codification paragraphs.

         A variety of proposed or otherwise potential accounting standards are
currently under study by standard setting organizations and various regulatory
agencies. Due to the tentative and preliminary nature of those proposed
standards, management has not determined whether implementation of such proposed
standards would be material to the consolidated financial statements.

                                      F-16NOTE 3.  ACQUISITION, EQUITY INVESTMENT AND DIVESTITURES

Business Process Outsourcing ("BPO")

GLOBAL HOTLINE, INC. AND ITS SUBSIDIARIES

         The acquisition of Global Hotline, a privately held Japanese Company,
closed on June 15, 2005. The transaction was structured as a share exchange in
which the Company issued 15,000,000 shares of its common stock in exchange for
100% of Global Hotline's equity. The common stock of the Company had a value of
$0.207 per share, which was the average close price during the twenty days prior
to the signing of the April 20, 2005 Share Exchange Agreement, or an aggregate
value of $3,097,500.

         Global Hotline was acquired because it held two significant contracts
with a major Japanese telecommunications Company in a constantly growing key
industry sector, and the expected continuance of telemarketing services
subsequent to these two contracts. The size of these contracts contributed to a
purchase price which resulted in identifiable intangible assets. Global Hotline
results are included in the financial statements of IA Global for the period
June 15, 2005 to December 31, 2008. There were no contingent payments, options
or commitments in the acquisition agreement. There was no purchased research and
development assets acquired or written off with the acquisition.

         Global Hotline was established on September 7, 2004, as an operator of
major call centers providing outbound telemarketing services for
telecommunications and insurance products. Since our acquisition of Global
Hotline in June 2005, this business has expanded rapidly with the signing of
multi-year contracts with major corporations and the addition of credit card and
catalog products. As of March 31, 2009 they operate eight call centers in Japan
and employ approximately 885 full time and part time employees.

         On January 1, 2007, Global Hotline entered into a new agreement with
KDDI. Pursuant to this agreement, which is governed by the Business Outsourcing
Basic Agreement entered into in September 2004, Global Hotline agreed to sell
telephone products on behalf of KDDI. Global Hotline will be paid an hourly
rate, with payment due in 30 days after the prior month is billed. The agreement
covered the period January 1, 2007 through March 31, 2007. This agreement was
automatically renewed for the period April 1, 2007 through June 30, 2007 and was
renewable for additional three month periods. The agreement may be cancelled
under certain conditions.

         On July 25, 2007, Global Hotline announced that it had closed an
Agreement with KDDI for the three month period ending September 30, 2007. Global
Hotline agreed to sell telephone products on behalf of KDDI and will be paid an
hourly rate, with payment due in 30 days after the month billed. Subsequently,
the Company renewed its agreements with KDDI to September 30, 2008.

         On October 20, 2008, Global Hotline announced that it had signed
Agreements with KDDI for the three month period from October 1, 2008 to December
31, 2008. Global Hotline has agreed to sell telephone and wireless products on
behalf of KDDI and will be paid an hourly rate for products sold with a possible
bonus on wireless sales if certain volume targets are achieved, with payments
due in 30 days after the month billed. The Agreement may be cancelled under
certain conditions.

         On January 15, 2009, Global Hotline announced that it had signed
Agreements with KDDI for the three month period from January 1, 2009 to March
31, 2009. Global Hotline agreed to sell telephone and wireless products on
behalf of KDDI and will be paid primarily on an incentive basis for telephone
lines sold and an hourly rate for wireless products sold with possible bonuses
if certain volume targets are achieved, with payments due in 30 days after the
month billed. The Agreements may be cancelled under certain conditions.

                                      F-17On April 14, 2009, Global Hotline announced that it had signed
Agreements with KDDI for the three month period from April 1, 2009 to June 30,
2009. Global Hotline agreed to sell telephone and wireless products on behalf of
this customer and will be paid primarily on an incentive basis for telephone
lines sold and an hourly rate for wireless products sold with possible bonuses
if certain volume targets are achieved, with payments due in 30 days after the
month billed. The Agreements may be cancelled under certain conditions. On July
1, 2009, Global Hotline signed Agreements with KDDI for the three month period
from July 1, 2009 to September 30, 2009.

         On December 22, 2005, a wholly owned subsidiary of Global Hotline, IA
Partners Co Ltd ("IA Partners"), entered into an agreement (the "Partner
Contract") with QA Marketing Corporation ("QA"), a Japanese Company. Pursuant to
this agreement, IA Partners sells various internet and broadband products on
behalf of NTT and QA, with sales commissions payable from 30-120 days after
confirmation by Internet Service Partners. The Partner Contract was
automatically renewed on December 22, 2006, and continues to be automatically
renewable for an additional year unless it is terminated by either party upon
sixty days notice before the expiration date. On October 22, 2008, the parties
automatically renewed this agreement and it will expire on December 22, 2009.
The Partner Contract may be cancelled under certain conditions. On February 24,
2009, the parties cancelled the Partner Contract.

         On February 24, 2009, IA Partners entered into an agreement (the
"Outsourcing Agreement") with Japan Hotline Co Ltd("Japan Hotline"), a Japanese
Company. Pursuant to this agreement, IA Partners sells various internet and
broadband products on behalf of NTT and Japan Hotline on an hourly rate for
products sold. On March 31, 2009 the parties automatically renewed this
agreement and it will expire on March 31, 2010. The Agreement may be cancelled
under certain conditions.

         On April 14, 2006, a 100% owned subsidiary of Global Hotline
established on April 4, 2006, SG Telecom Inc. ("SG"), entered into an Agency
Contract ("Agency Contract") with Japan Telecom Invoice Co., Ltd., a Japanese
Company ("Japan Telecom"). Pursuant to this agreement, SG sells various internet
and broadband products on behalf of Japan Telecom, with sales commissions
payable within 30-90 days after confirmation by Japan Telecom. The Agency
Contract is automatically renewable for an additional year unless it is
terminated by either party upon thirty days notice before the expiration date.
The Agency Contract was automatically renewed through April 14, 2010. The Agency
Contract may be cancelled under certain conditions.

         On April 7, 2008 and September 1, 2008, SG entered into a Consent
Agreement ("Consent Agreement") with Softbank Telecom Co Ltd., a Japanese
Company ("Softbank"). Pursuant to this agreement, SG received payments in April,
June and September, 2008 for expanding telemarketing operations related to prior
agreements with Japan Telecom. The payments may require repayment in March 2011
if certain sales targets are not achieved. Based on sales for the twelve months
ended March 31, 2009, SG does not expect to repay any payments under the Consent
Agreements. The Consent Agreement may be cancelled under certain conditions.

         On May 10, 2006, IA Partners entered into an Agency Agreement with
AFLAC Co Ltd, a Japanese Company ("AFLAC"). Pursuant to this Agency Agreement,
IA Partners agreed to sell insurance products starting on approximately June 1,
2006, on behalf of AFLAC, with sales commissions payable from 30-120 days and
ongoing commissions for up to ten years, to the extent the customer continues to
maintain the insurance. The Agency Agreement is automatically renewed each year
unless it is terminated by either party upon thirty days notice before the
expiration date. The Agency Agreement was automatically renewed on May 2, 2007,
May 1, 2008 and April 14, 2009 through May 2, 2010. The Agency Agreement may be
cancelled under certain conditions.

         On October 21, 2008, IA Partners announced that a Memorandum on
Telemarketing Support and an Agency Agreement (together, the "Agreements") were
signed with AFLAC for the period June 1, 2008 through May 31, 2009. The IA
Partners has agreed to sell insurance products on behalf of AFLAC, with fees
payable based on booths operated and a percentage of the annual premium sold,
with payments due in 30 days after the month billed. The Agreements were
automatically renewed on April 1, 2009 through May 31, 2010. The Agreements may
be cancelled under certain conditions.

                                      F-18On October 16, 2006, IA Partners announced an Agency Agreement with
American Home Assurance Ltd ("AHA"), a Japanese Company and a division of
American Insurance Group ("AIG"). Pursuant to this Agency Agreement, IA Partners
agreed to sell health and cancer insurance products on behalf of AHA, with sales
commission's payable from 30-120 days and ongoing commissions to the extent the
customer continues to maintain the insurance. The Agency Agreement has no
expiration date, but may be cancelled under certain conditions.

         On May 21, 2007, IA Partners entered into a Call Center Business
Service Agency Agreement with NTT, a Japanese Company. IA Partners sells various
internet and broadband products on behalf of NTT, with sales commissions payable
from 30 days after confirmation by NTT. The Agency Agreement expires on May 20,
2008. The Agency Agreement can be terminated by either party upon ninety days
Notice and may be cancelled under certain conditions. Sales activities started
in October 2007. On October 1, 2008, the parties cancelled the Business Service
Agency Agreement.

         On August 15, 2007, Inforidge Co Ltd ("Inforidge"), a wholly owned
subsidiary of Global Hotline received notice of a signed Agency Agreement
("Agency Agreement") with American Life Insurance Company, ("Alico"), a Japanese
Company which is a subsidiary of AIG. Pursuant to this Agency Agreement,
Inforidge agreed to sell insurance products starting on August 8, 2007 on behalf
of Alico, with sales commissions payable from 30-120 days. The Agency Agreement
expires on August 8, 2008, and is automatically renewable for an additional year
unless it is terminated by either party upon thirty days notice prior to the
expiration date. The Agency Agreement may be cancelled under certain conditions.
The Agency Agreement was automatically renewed July 8, 2008 for the period and
August 8, 2008 through August 7, 2009. While the Alico contracts are in effect,
due to the AIG financial difficulties, personnel were allocated to other
contracts during the three months ended December 31, 2008 and March 31, 2009.

         On January 7, 2008, Inforidge entered into an Outbound Telemarketing
Agreement, effective as of November 30, 2007, with Alico. Pursuant to this
agreement, Inforidge will receive payments for expanding telemarketing
operations related to prior agreements with Alico. The Agreement expired on
March 31, 2008, but was extended through March 31, 2009. Due to the AIG
financial difficulties, personnel were allocated to other contracts during the
three months ended December 31, 2008 and March 31, 2009.

         On September 20, 2007, Inforidge received notice of a signed Agency
Agreement ("Agreement") with Ace Insurance Company Co Ltd, ("Ace"), a Japanese
Company. Pursuant to this Agreement, Inforidge agreed to sell medical insurance
products on behalf of Ace, with sales commissions payable from 30-120 days. The
Agreement has no expiration date and may be cancelled under certain conditions.

         On January 10, 2008, IA Partners and Inforidge entered into Call Center
Facility Agreements ("Facility Agreements") with OMC Card, Inc., a Japanese
Company ("OMC"). Pursuant to these agreements, IA Partners and Inforidge agreed
to rent facilities and equipment to OMC, with revenues payable in thirty days
from the invoice date. The Facility Agreements expire on January 10, 2009, and
is automatically renewable for an additional year unless it is terminated by
either party upon ninety days notice prior to the expiration date. The Facility
Agreements were automatically renewed on January 9, 2009 for the period January
9, 2009 through January 9, 2010. The Facility Agreements may be cancelled under
certain conditions.

         On May 9, 2008, Global Hotline entered into Sales and Promotion
Agreements with Belluna Co. Ltd., a Japanese Company ("Belluna"). Global Hotline
agreed to represent Belluna in its mail order business, with sales commissions
payable in thirty days. The Agreements were automatically renewed on April 14,
2009 through May 8, 2010, and are automatically renewable for an additional
year. The Agreements may be cancelled with 90 or 120 days notice, respectively.
The Agreements may be cancelled under certain other conditions.

         On May 9, 2008, Inforidge entered into Recruiting Agreements with
Belluna. Inforidge agreed to assist Belluna in temporary hiring for its mail
order business, with commissions payable in thirty days. The Agreements were
automatically renewed on April 14, 2009 through May 8, 2010 and is automatically
renewable for an additional year. The Agreements may be cancelled under certain
conditions.

                                      F-19On May 7, 2008, Global Hotline and Inforidge entered into Agreements
with Zurich Japan Co Ltd., a Japanese Company ("Zurich"). Pursuant to these
Agreements, Global Hotline and Inforidge agreed to sell insurance products on
behalf of Zurich, with sales commissions payable in thirty days. The Agreements
have no expiration date, but can be cancelled with sixty days notice by either
party. The Agreements may be cancelled under certain other conditions.

         On April 14, 2009, Global Hotline and Inforidge entered into Agreements
with Zurich for the period May 7, 2009 through May 6, 2010. Pursuant to these
Agreements, Global Hotline and Inforidge agreed to sell insurance products on
behalf of the customer, with sales commissions payable in thirty days. The
Agreements have no expiration date, but can be cancelled with sixty days notice
by either party. The Agreements may be cancelled under certain other conditions.

ACQUISITION OF GLOBAL HOTLINE, INC.

         The Company acquired its 100% ownership of Global Hotline from Mr.
Hideki Anan (67%), Mr. Kyo Nagae (10%) and Mr. Hiroki Isobe (23%). Mr. Anan is
the CEO of Global Hotline and is an experienced Japanese telecommunications
executive. Mr. Isobe is affiliated with our majority shareholders.

         The cost to acquire these assets was allocated to the assets acquired
according to estimated fair values as follows:

Purchase price:
Stock ..............................................................  $3,097,500
                                                                      ----------
Net assets acquired (6/15/05):
Cash ...............................................................   1,240,037
Accounts receivable ................................................   1,782,900
Other assets .......................................................   1,370,153
Recovery of tax benefit of net operating loss acquired with
   acquisition of Global Hotline. This recovery occurred
   during the three months ended September 30, 2006 ................     486,869
                                                                      ----------
                                                                       4,879,959
                                                                      ----------
Net liabilities acquired (6/15/05):
Accrued liabilities ................................................   1,903,246
Deferred revenue ...................................................   4,196,493
Other liabilities ..................................................     628,750
                                                                      ----------
                                                                       6,728,489
                                                                      ----------
Net liabilities acquired (6/15/05) .................................   1,848,530
                                                                      ----------
Identifiable customer contracts and related customer relationships .  $4,946,030
                                                                      ==========

GLOBAL HOTLINES PHILIPPINES INC. (Unaudited)

         In the Philippines, IA Global is the 100% owner of Asia Premier
Executive Suites Inc. ("Asia Premier") and Shift Resources Inc. ("Shift"),
companies who have now been merged into a single organization and operate as
Global Hotline Philippines Inc ("Global Hotline Philippines").

         On May 27, 2008, the Company acquired 100% of Asia Premier. Asia
Premier provides flexible in-bound and out-bound call center, lead generation,
and co-location service solutions on a very competitive basis to international
companies. Asia Premier facilities are equipped with a fully redundant,
world-class internet and network facilities, are capable of handling 300 or more
seats, has a 24-hour back-up to ensure clients have seamless service, consistent
high-quality bandwidth and technical support 365 days a year.

         The transaction was structured as a share exchange in which IA Global
issued 1,250,000 shares of its common stock at $.24 per share, the close price
during the negotiations, totaling $300,000; plus three Notes Payable totaling
$268,000, of which $262,000 was paid as of September 1, 2009. An earn-out of
$50,000 based on profitability of the Asia Premier business through January 27,
2009 was not earned as of March 31, 2009. The transaction was valued at
$618,000.

                                      F-20On April 10, 2008, the Company acquired the 100% acquisition of Shift.
Shift provides a range of in-bound and out-bound call centers, lead generation
and customer service solutions for international companies across multiple time
zones.

         The transaction was structured as a share exchange in which the Company
issued 826,086 shares of its common stock at $.23 per share, the close price
during the negotiations, totaling $190,000 plus a payment of $35,000 at closing.
The transaction was valued at $225,000.

         Both the Asia Premier and the Global Hotline Philippines acquisition
resulted in intangibles having been acquired by the Company.

         As of March 31, 2009, Global Hotline Philippines operates one call
center in the Philippines and employs 20 full time and part time employees and
has an 81 additional revenue generating seats. In addition, it signed a long
term Business Processing and Marketing Services Agreement with HTMT Global
Solutions Limited ("HTMT") on January 9, 2009. Global Hotline Philippines will
also extensively use HTMT's world class infrastructure, certifications, and
extensive call center facilities to deliver services to Global Hotline
Philippines' growing client base. Under a revenue sharing and collocation basis
Global Hotline Philippines can now undertake large scale outsourcing projects
without the need to infuse new capital to build out additional call center
facilities.

Human Capital and Resources

EQUITY INVESTMENT IN GPLUS MEDIA CO LTD

         On August 24, 2007, the Company closed a 25.0% equity investment in
GPlus by agreeing to issue 3,885,713 shares of common stock with a total value
of $1,360,000 or $.35 per share, which was the closing price on August 20, 2007,
the day negotiations were completed.

         For the twelve months ended March 31, 2009, the Company recorded a gain
on our investment in GPlus of $12,510 that increased our investment in GPlus. On
March 6, 2009, the Company sold its 25% interest in GPlus to the management of
GPlus for $73,931 and recorded a loss on sale of $1,286,500 during the three
months ended March 31, 2009.

EQUITY INVESTMENT IN SLATE CONSULTING CO LTD

         On August 24, 2007, the Company closed a 20.25% equity investment in
Slate by agreeing to issue 3,600,000 shares of common stock with a total value
of $1,440,000 or $0.40 per share, which was the average closing market price on
August 17, 2007, the day negotiations were completed. In addition, the Company
has the option to increase its equity holding in Slate to 75% based on mutually
agreeable terms.

         Slate is a Japan headquartered Executive Search firm with operations
and business entities in Tokyo and a call center in Manila, Philippines.

         For the twelve months ended March 31, 2009, the Company recorded a loss
on our investment in Slate of $10,427 that decreased our investment in Slate.
The investment in Slate was valued at $1,386,054 as of March 31, 2009.

Financial Services Equity Investments

EQUITY INVESTMENT IN AUSTRALIAN SECURED FINANCIAL LIMITED

         On October 19, 2006, the Company closed its 36% equity investment in
ASFL, a group of Australian companies. The transaction was structured as a share
exchange in which the Company issued 4,375 of Series A-1 Convertible Preferred
Stock ("Series A-1 Preferred Stock") that was convertible into 43,750,000 shares
of common stock in exchange for 36% of ASFL's outstanding common shares. The
parties agreed to value the Company's common stock at $0.16 per share, which was
the closing market price on October 2, 2006, the day before the signing of the
initial term sheet on October 3, 2006. In addition, the Company paid $250,000 at
closing and $125,000 on January 19, 2007 and $125,000 in April 2007. The Series
A-1 Preferred Stock were converted into 43,750,000 shares of common stock on
February 7, 2007.

                                      F-21ASFL raised funds through the issuance of private loans and bank debt
within Australia and provided short term, secured, real property loans to
businesses and investors in Australia. The bank line of credit used to fund the
business has been terminated effective November 2009 and ASFL was not able to
replace the bank line of credit with any funding and is expected to be
liquidated.

         For the twelve months ended March 31, 2009, the Company recorded a
profit on our investment in ASFL of $265,039 that increased our investment in
ASFL. The investment in ASFL was considered impaired as of March 31, 2009 and
write-down on our ASFL equity investment of approximately $7,195,000 was booked
during the twelve months ended March 31, 2009.

EQUITY INVESTMENT IN TAICOM SECURITIES CO LTD

         In Japan, we have a 12.6% equity investment as of July 10, 2009 in
Taicom Securities Co Ltd ("Taicom"), a Japanese securities firm. Taicom provides
a broad range of value-added financial services and competitive products. These
services currently include the brokerage of Japanese commodities, options
derivatives trading, foreign currency, equities and margin as well as offering
wealth management and investment consulting services to diversified clients. In
addition to offering a broad news and information gathering network, Taicom
offers creative solutions that meet the sophisticated trading needs of its
clients.

         For the fourth quarter ended in the year ended March 31, 2009, the
Company has accounted for Taicom under the cost method. Under the cost method, a
long-term investment is recorded at cost and carried at that amount until it is
sold or otherwise disposed of or until it is written down. A write-down from
cost, subsequent to becoming a cost method investment, is appropriate when
dividends received represent a liquidating dividend, that is, a dividend
received in excess of earnings subsequent to investment date. Otherwise, any
dividends received should be recorded as investment income.

         Taicom is a member of the Osaka Stock Exchange. Taicom is headquartered
in Tokyo and in Osaka and has three branch offices in Japan.

June 3, 2008 Exchange Agreement
-------------------------------

         On June 3, 2008, the Company announced that it had closed a 20% equity
investment in Taicom, a Japanese securities firm. This equity investment was an
expansion of the financial services business of IA Global.

         Taicom is a financial services Company in Japan providing a broad range
of value-added financial services and competitive products. These services
currently include the brokerage of Japanese commodities, derivative options,
foreign currency, equities and investment trusts as well as the offering of
investment consulting services to diversified clients such as individuals and
corporations. Taicom offers creative solutions that meet the sophisticated
trading needs of its online and offline clients, who utilize Taicom's
cutting-edge proprietary trading platform called TradePro, as well as its broad
news and information gathering network.

         Taicom is a member of the Osaka Stock Exchange. Taicom is headquartered
in Tokyo and in Osaka and has three branch offices in Japan.

         The transaction between the Company and Taicom was structured as a
share exchange in which the Company issued 26,000,000 shares of its common stock
at $.20 per share, the close price during the negotiations in exchange for
1,389,750 Class B Preferred Shares of Taicom. The transaction was valued at
$5,200,000.

December 12, 2008 Amendment to Share Exchange Agreement
-------------------------------------------------------

         On December 12, 2008, the Company and Taicom entered into an Amendment
to Share Exchange Agreement (the "Amendment"). Pursuant to this Amendment, the
Company agreed to return 302,100 of its Taicom Preferred Shares on each of
December 12, 2008, January 20, 2009 and February 20, 2009 or 906,300 in total,
in exchange for three $130,000 cash payments or $390,000 in total. Upon the
completion of these payments, the Company's 20% interest in Taicom would be
reduced to approximately 8% or 483,450 Class B Preferred Shares of Taicom. The
February 13, 2009 share return may be adjusted on a pro-rata basis if the
average closing share price of the common stock for the period December 12, 2008
to February 13, 2009 is below $.038 per share.

                                      F-22As of February 13, 2009, Taicom paid a total of $180,000 to the Company
and the Company has returned 302,100 Taicom shares to Taicom, reducing the
Company's interest in Taicom to 16%. Taicom has paid $50,000 toward their
January 20, 2009 payment. The remaining $80,000 due on the January 20, 2009
payment has not been made. In addition, the entire February 20, 2008 payment was
not received.

December 12, 2008 Form of Performance Warrant
---------------------------------------------

         On December 12, 2008, the Company issued a Performance Warrant to Mr.
Ning, the Chairman of Taicom. The Performance Warrant requires Mr. Ning to raise
$500,000 by each of March 31, 2009, May 31, 2009, July 31, 2009 and September
30, 2009 or $2,000,000 in total. If the funds are raised by this timetable, Mr.
Ning earns the Performance Warrant for 8,125,000 common shares exercisable at
$.04 per share or 32,500,000 in total and such warrant expires on December 11,
2013. If the funds are not raised by the indicated date, the Performance Warrant
for the date indicated is forfeited. The Company agreed to register the common
stock issuable upon the exercise of the Performance Warrants with NYSE AMEX once
such Performance Warrant is earned. The Performance Warrant was issued to an
accredited investor in a transaction that will be exempt from registration
pursuant to Section 4(2) of the Securities Act, and/or Regulation D promulgated
under the Securities Act.

April 1, 2009 Amendment to Share Exchange Agreement
---------------------------------------------------

         On April 1, 2009, the, Taicom and ArqueMax Ventures, LLC ("AMV"), an
entity controlled by Michael Ning, the Chairman of Taicom, entered into an
Amendment to Share Exchange Agreement (the "Amendment No. 2"). Pursuant to this
Amendment NO. 2, the Company returned the following Taicom Preferred Class B
Stock ("Taicom Stock") for the indicated payments by Taicom:

$ Paid By                   Shares
  Taicom         Date      Returned
---------    ----------    --------
$ 130,000    12/12/2008     302,100
   50,000      2/2/2009     116,192
   41,000      4/1/2009      95,278
---------                  --------
$ 221,000                   513,570
=========                  ========

         The return of these shares of Taicom Stock reduced the Company's 20%
interest in Taicom to 876,180 shares or 16%, 14% and 12.6% as of December 12,
2008, February 2, 2009 and April 1, 2009, respectively.

         The Company recorded a loss on sale of $996,777 during the three months
ended December 31, 2008 and recorded a loss on sale of $725,166 during the three
months ended March 31, 2009 related to the return of the Taicom Stock.

         In addition, the Company agreed to issue preferred stock ("IAO
Preferred Stock"), at $1.000 per share, to AMV for the following additional
payments: $140,000 to be paid on or about April 7, 2009, $67,000 to be paid on
or about April 15, 2009 and $110,000 to be paid on or about April 30, 2009. The
three payments are independent of each other and the payment or non-payment of
one or more payments is not dependent on the payment or non-payment of any one
or more of the other payments. All payments were paid.

         At AMV's sole discretion, AMV may either (1) convert some or all of its
IAO Preferred Stock into 12,800,000 shares of the Company's common stock pro
rata at $0.025 per share; or (2) exchange IAO Preferred Stock for 971,458 Taicom
Stock owned by the Company pro rata. The conversion of IAO Preferred Stock into
Taicom Stock is automatically triggered in the case of certain events, including
delisting from NYSE AMEX, bankruptcy or insolvency.

                                      F-23April 1, 2009 Form of Performance Warrant
-----------------------------------------

         On April 1, 2009, the Company amended the Form of Performance Warrant
with Mr. Ning that was signed on December 12, 2008 ("Amended Warrant"). The
Amended Warrant reduced the number of shares of common stock that Taicom could
receive upon the closing of financings to 3,591,250 from 32,500,000 common
shares. The Company agreed to register the common stock issuable upon the
exercise of the Amended Warrant with NYSE AMEX and file a registration statement
on Form S-3 within sixty days of approval by NYSE AMEX. The Amended Warrant was
issued to an accredited investor in a transaction that will be exempt from
registration pursuant to Section 4(2) of the Securities Act, and/or Regulation D
promulgated under the Securities Act.

April 1, 2009 Services Agreement
--------------------------------

         On April 1, 2009, the Company also entered into a Services Agreement
("Services Agreement") with AMV. Pursuant to the Services Agreement, the Company
agreed to close a stock exchange with Taicom whereby 67,000,000 shares of the
Company's common stock will be issued for 877,557 shares of Taicom Stock. The IA
Global shares would be valued at $.035 per share, the price during the
negotiations. The Taicom Stock will be valued at the book value for Taicom. The
Taicom Stock are restricted securities and may not be resold, distributed,
collateralized liquidated or transferred to any person or entity.

         In addition, AMV or an affiliate has agreed to loan $300,000 to the
Company on or before June 3, 2009, which loan was made to the Company on June 8,
2009. The closing of these transactions are subject to the completion of due
diligence on or before May 31, 2009, and obtaining shareholder approval. In the
event of the unsatisfactory completion of due diligence, AMV shall have a
unilateral option to immediately terminate this Services Agreement and have no
further obligations with respect to this Services Agreement and the terms and
conditions contained herein (hereinafter "Unilateral Termination"). In the event
of Unilateral Termination, the Company shall immediately return all of the then
outstanding shares it holds of Taicom Stock.

         After the closing of the transactions pursuant to the Services
Agreement, the Company expects to own 25.2% of Taicom and Taicom and AMV would
own 36.3% of IA Global.

June 8, 2009 Services Agreement
-------------------------------

         On June 8, 2009, the Company entered into a Services Agreement
("Agreement") with AMV. Pursuant to this agreement, AMV is providing funding to
the Company of $300,000 in exchange for IA Global Convertible Senior Debentures
("Debentures") that carry a 12% interest rate and are due December 8, 2009. The
Debentures are convertible into 10,000,000 shares of IAO Common Stock at $0.030
per share upon issuance. In the event Company is not able to pay back the
principal amount plus accrued interest by December 8, 2009, AMV shall have the
right to convert such Debenture into (1) the proportionate number of
collateralized IAO Common Shares, or (2) 940,121 shares of Taicom Preferred
Class B stock. The $300,000 in funding will be paid in five tranches that are
independent of each other and that payment or non-payment of one or more
tranches is not dependent on the payment or non-payment of any one or more of
the other tranches.

         On July 17, 2009, AMV notified us that we were in default of 5 (h)
under the June 8, 2009 Agreement and as a result did not fund the $60,000 due
June 30, 2009, July 15, 2009 and July 31, 2009. However, AMV was late in funding
as required by June 8, 2009 Agreement. AMV could claim ownership of our Taicom
shares. This would result in a loss on investment of approximately $2,861,000.
Based on the $120,000 in funding under this Agreement, the Company may be
required to issue 4,000,000 shares. The parties are negotiating over the
Agreement.

                                      F-24In addition, the Company agreed to a share exchange with Taicom whereby
10,500,000 shares of the Company's common stock will be issued for 137,528
shares of Taicom Stock at the earlier of July 31, 2009 or the record date for
the 2009 Annual Shareholder Meeting . The IA Global shares would be valued at
$.035 per share, the price during negotiations. The Taicom Stock will be valued
at the book value for Taicom. The Taicom Stock are restricted securities and may
not be resold, distributed, collateralized liquidated or transferred to any
person or entity.

June 2, 2009 Form of Performance Warrant
----------------------------------------

         On June 2, 2009, with an effective date of June 8, 2009, the Company
entered into a Form of Performance Warrant ("Warrant") with AMV. The Warrant
provides for 5,213,105 shares of Company common stock to AMV at $.05 per share.
The Warrant is exercisable for a sixty month period and requires the payment of
$300,000 in funding that is reflected in the June 8, 2009 Services Agreement.
The Company agreed to register the common stock issuable upon the exercise of
the Warrant with NYSE AMEX and file a registration statement on Form S-3 within
sixty days of approval by NYSE AMEX. The Performance Warrant was issued to an
accredited investor in a transaction that will be exempt from registration
pursuant to Section 4(2) of the Securities Act, and/or Regulation D promulgated
under the Securities Act.

         For the twelve months ended March 31, 2009, the Company recorded a loss
on our investment in Taicom of $421,872 that decreased our investment in Taicom.
In addition, subsequent to our return of 513,570 Taicom Class B Preferred Shares
with respect to the above December 12, 2008, February 2, 2009 and April 1, 2009
payments, as per the above amendments, the Company recorded a loss of $1,736,934
on the sale of its equity investment in Taicom. The total value of our
investment in Taicom was valued at $2,861,365 as of March 31, 2009. The Company
accounted for its investment in Taicom under the cost method as of the three
months ended March 31, 2009.

PRO-FORMA FINANCIAL DATA

         The pro-forma financial data for the equity investments the years ended
March 31, 2009 and December 31, 2007 and 2006 were as follows:

Year Ended March 31, 2009 (Unaudited)

                                            Pre-Acquisition   Pre-Acquisition
                                             Operations of     Operations of
                             As Reported         Taicom       Global Hotline     Pro Forma
                            Twelve Months      Securities       Philippines     Twelve Months
                             Ended March       April 1 -       April 1 - May     Ended March
                               31, 2009      June 3, 2008 *     27, 2008 *        31, 2009
                            -------------   ---------------   ---------------   -------------
Revenue .................   $ 57,107,050       $       -         $ 37,525       $ 57,144,575
Net loss before
 extraordinary items ....    (20,241,930)       (260,807)            (679)       (20,503,417)
Net income loss .........    (20,241,930)       (260,807)            (679)       (20,503,416)
Net loss per common share          (0.10)              -                -              (0.10)

* - Taicom equity investment closed on June 3, 2008 and the GHP acquisitions
closed on April 10, 2008 (Shift Resources) and on May 24, 2008 (Asia Premier).

                                      F-25Year Ended December 31, 2007 (Unaudited)

                                                                 Pre-
                                                Pre-         Acquisition
                                            Acquisition     Operations of
                                           Operations of        Slate         For Forma
                           As Reported      GPlus Media      Consulting      Nine Months
                           Twelve Months     January 1-       January 1-        Ended
                           December 31,      August 23,       August 23,     September 30,
                               2007            2007 *           2007 *           2007
                           -------------   -------------    -------------    -------------
Revenue ...............    $ 29,136,435    $           -    $           -    $ 29,136,435
Loss (income) before
 extraordinary items ..      (8,258,963)   $           -           11,224      (8,247,739)
Net loss (income) .....      (8,258,963)   $         932                -      (8,258,031)
Loss per common share .           (0.05)               -                -           (0.05)

* - GPlus and Slate equity investments closed on August 24, 2007.

         The pro-forma financial data for the acquisitions for the year ended
December 31, 2006 were as follows:

Year Ended December 31, 2006 (Unaudited)

Twelve Months Ended December 31, 2006 (Unaudited)

                                                       Pre-
                                                   Acquisition
                                                    Operations
                                  As Reported        of ASFL        For Forma
                                   Year Ended      January 1 -      Year Ended
                                  December 31,     October 19,     December 31,
                                      2006            2006 *           2006
                                  ------------     ------------    ------------
Revenues .....................    $ 19,139,004     $          -    $ 19,139,004
Loss before
    extraordinary items ......      (3,769,744)         332,786      (3,436,958)
Net loss .....................      (3,769,744)         332,786      (3,436,958)
Loss per common share ........           (0.03)               -           (0.03)

* - ASFL equity investment closed on October 19, 2008.

         There were no material, nonrecurring items included in the reported the
pro-forma results.

SUMMARY OF DISCONTINUED OPERATIONS AND ACQUISITION NOT COMPLETED

         Year ended December 31, 2007 discontinued operations are as follows:

         On October 22, 2007, the Company signed definitive agreements to
acquire 100% of the Outsourcing Business Division ("Outsourcing Business
Division") of LINC Media, Inc. ("LINC Media"), a Tokyo, Japan-based Company.

         The acquisition was valued at $4,250,000 and consisted of a combination
of debt and equity financing. The Company paid $80,000 at closing and issued
promissory notes of $720,000, which was due on November 30, 2007, and $1,200,000
and $200,000, which were due on February 28, 2008. In addition, the parties
entered into a Performance Agreement, whereby the Company agreed to issue
5,394,736 shares of its common stock based on the achievement of certain
performance criteria, which will be evaluated by May 15, 2008. The parties
agreed to value the Company's common stock at $0.38 per share, which was the
average closing market price during the period of negotiations. In addition, the
Company agreed to adjust the price by paying cash if the average closing price
during the six months subsequent to October 22, 2007 is 10% less than $0.38 per
share.

                                      F-26On February 22, 2008, the Company and LINC Media entered into an
amendment. Pursuant to the amendment, the $720,000 promissory note was reduced
to $690,000, as $30,000 was paid on January 4, 2008. The payment date on the
$690,000 promissory note was extended to February 29, 2008. In addition, the
Company agreed to increase the number of shares in the Performance Agreement to
9,217,391 shares at $0.23 per share. The Company also agreed to issue 304,348
shares of its common stock at $0.23 per share, which was the closing price on
the day the Amendment was agreed.

         On March 12, 2008, the Company and LINC Media terminated the definitive
agreements due to the U.S. market conditions. LINC Media retains the $110,000
paid to date, less $10,000 deducted for legal fees. There are no additional fees
or cash payments or stock issuances required by the Company or LINC Media. The
$110,000 paid to date has been written off as of December 31, 2007 and is
accounted for as a loss from disposal of a discontinued operation.

         Year ended December 31, 2006 discontinued operations are as follows:

         On April 4, 2006, the Company closed the sale of its 60.5% interest in
Rex Tokyo back to Rex Tokyo. The Company received $1,302,159 in payments during
April to June 2006. The Company divested Rex Tokyo due to operating losses of
approximately $1,552,000 in 2005 and projected losses in 2006 due to industry
conditions. Sales were $29,335,000 in 2005. The Company recorded a gain from
disposal of $463,375 during the year ended December 31, 2006. This gain resulted
from the gross proceeds of $1,302,159 less the net investment in Rex Tokyo after
losses of $838,784. From the operations of Rex Tokyo, the Company realized a
gain of $76,054, a loss of $981,521, and a gain of $142,434 for the years ended
December 31, 2006, 2005 and 2004, respectively.

         As of December 31, 2006, the Company recorded a loss on the impairment
of note receivable, and accrued interest of $331,917 from Ominira Networks LLC,
a Delaware limited liability corporation ("Ominira"). This note receivable,
originally for $620,000, was received on July 15, 2005 as part of the sale and
discontinuance of IA Global Acquisition Co. and use of its intellectual
property. The impairment is based on the lack of payments by Ominira to date and
a decline in the value of the ICG shares held as collateral. Accordingly, the
ICG shares have not been recorded as an asset for purposes of note recovery. The
entire note receivable and accrued interest of $11,917 have been written off as
of December 31, 2006.

         The following table sets forth the discontinued operations for the
Company:

                                                         Year Ended
                                                     December 31, 2006
                                                     -----------------
Revenue ..........................................      $ 7,651,125
Cost of sales ....................................        6,083,120
                                                        -----------
Gross profit .....................................        1,568,005
Operating and non-operating expenses .............        1,427,106
Minority interest ................................           49,655
Income taxes .....................................           15,190
                                                        -----------
Loss from discontinued operations ................           76,054
Gain from disposal of discontinued operations ....          463,375
Loss on impairment of note receivable from
 sale of discontinued operations .................         (331,917)
                                                        -----------
Total gain (loss) from discontinued operations ...      $   207,512
                                                        ===========

                                      F-27NOTE 4.  ACCOUNTS RECEIVABLE/CUSTOMER CONCENTRATION

         Accounts receivable were $5,994,117 and $12,746,290 as of March 31,
2009 and 2008, respectively. The Company had the following customers with sales
in excess of 10%, and these are their respective percentages of consolidated
revenue for the following periods:

                                                             Transition
                                                              period -
                                                            Three Months
                                 Year ended   Year Ended       Ended        Year Ended
                                  March 31,    March 31,      March 31,    December 31,
                                    2009         2008           2008       2007    2006
                                 ----------   -----------   ------------   ----    ----
                                              (Unaudited)
KDDI Network Solutions .......       25%          27%            17%        28%     29%
Internet Service Partners/ NTT       12%          27%            18%        34%     44%
AFLAC.........................        *            *              *         11%     12%
AIG ..........................       10%          21%            10%        12%      *
Softbank .....................       26%          15%            26%         *       *
-% is less than 10%.

         KDDI is a Global Hotline customer. Internet Service Partners/Japan
Hotline /NTT is a IA Partners customer. AIG is an IA Partner and Inforidge
customer. Softbank is a Global Hotline and SG Telecom customer. There were no
other customers, other than the above, in excess of 10% in the respective
periods.

         KDDI accounted for 19% and 11% of accounts receivable as of March 31,
2009 and 2008, respectively. Internet Service Partners/ Japan Hotline/ NTT
accounted for 17% and 23% of total accounts receivable as of March 31, 2009 and
2008, respectively. Softbank accounted for 6% and 31% of total accounts
receivable as of March 31, 2009 and 2008, respectively. The Company anticipates
that significant customer concentration will continue for the foreseeable
future.

NOTE 5.  PREPAID EXPENSES

         Prepaid expenses were $1,184,572 and $1,967,164 as of March 31, 2009
and 2008, respectively. These assets included prepaid insurance, prepaid
financing costs and other costs incurred by the Company and prepaid hiring, rent
and other expenses incurred by Global Hotline.

NOTE 6.  EQUIPMENT

         Equipment, net of accumulated depreciation, was $2,207,849 and
$2,431,954 as of March 31, 2009 and 2008, respectively. Accumulated depreciation
was $2,127,403 and $1,131,248 as of March 31, 2009 and 2008, respectively. Total
depreciation expense was $903,931, $191,219, $211,388 and $335,076 for the
twelve months ended March 31, 2009, three months ended March 31, 2008 and for
the twelve months ended December 31, 2007 and 2006, respectively. All equipment
is used for selling, general and administrative purposes and accordingly all
depreciation is classified in selling, general and administrative expenses.

         Property and equipment is comprised of the following:

                                                         March 31,
                                  Estimated     -------------------------   December 31,
                                 Useful Lives       2009          2008          2007
                                 ------------   -----------   -----------   -----------
Equipment and vehicles .......   24-60 months   $ 3,387,060   $ 2,559,954   $ 1,729,458
Leasehold improvements .......   27-60 months       948,192     1,000,000       814,241
                                                -----------   -----------   -----------
                                                  4,335,252     3,559,954     2,543,699
Less: accumulated depreciation                   (2,127,403)   (1,128,000)     (866,412)
                                                -----------   -----------   -----------
                                                $ 2,207,849   $ 2,431,954   $ 1,677,287
                                                ===========   ===========   ===========

                                      F-28NOTE 7.  INTANGIBLE ASSETS

         Intangible assets as of March 31, 2009 and 2008 consisted of the
following:

                                                        March 31,
                                  Estimated     -------------------------
                                 Useful Lives       2009          2008
                                 ------------   -----------   -----------
Customer contracts ...........    3-5 years     $ 5,621,420   $ 4,946,030
Less: accumulated amortization                   (5,065,550)   (4,614,901)
                                                -----------   -----------
    Intangible assets, net ...                  $   555,870   $   331,129
                                                ===========   ===========

         Total amortization expense was $450,649 and $1,225,828 for the years
ended March 31, 2009 and 2008 (Unaudited), respectively. Total amortization
expense was $397,352 for the transition period the three months ended March 31,
2008. Total amortization expense was $1,589,408 and $1,644,800 for the years
ended December 31, 2007 and 2006, respectively.

         The fair value of the Global Hotline intellectual property acquired was
estimated using a discounted cash flow approach based on future economic
benefits associated with agreements with significant Japanese telecommunications
companies, or through expected continued business activities with significant
telecommunications companies. In summary, the estimate was based on a projected
income approach and related discounted cash flows over three years, with
applicable risk factors assigned to assumptions in the forecasted results. The
entire $4,496,030 has been amortized as of March 31, 2009.

         The fair value of the Global Hotline Philippines intellectual property
acquired was $675,370, estimated by using a discounted cash flow approach based
on future economic benefits associated with agreements with significant Japanese
telecommunications companies, or through expected continued business activities
with its customers. In summary, the estimate was based on a projected income
approach and related discounted cash flows over five years, with applicable risk
factors assigned to assumptions in the forecasted results.

         The cost to acquire Asia Premier and Shift, collectively referred to as
Global Hotline Philippines, and the allocation of its assets is as follows:

                                                     Asia
                                                    Premier             Shift
                                                   ---------          ---------
Purchase price:
     Issuance of common stock ............         $ 300,000          $ 190,000
     Cash ................................                 -             35,000
     Notes payable .......................           268,000                  -
                                                   ---------          ---------
                                                     568,000            225,000
                                                   ---------          ---------
Net assets and liabilities acquired:
     Current assets ......................            29,145             25,777
     Fixed assets ........................            81,768             22,457
     Liabilities .........................            (9,686)           (31,832)
                                                   ---------          ---------
                                                     101,227             16,402
                                                   ---------          ---------
Excess of purchase price over net
     Assets and liabilities acquired
     Classified as intellectual property .         $ 466,773          $ 208,597
                                                   =========          =========

                                      F-29Future amortization expense related to intangible assets is as follows:

Year Ended March 31,
       2010 ........     $ 135,078
       2011 ........       135,078
       2012 ........       135,078
       2013 ........       135,078
       2014 ........        15,558
                         ---------
                         $ 555,870
                         =========

NOTE 8.  OTHER ASSETS

         Other assets were $3,164,127 and $2,704,752 as of March 31, 2009 and
2008, respectively. These assets included loans receivable from Tesco Co Ltd
("Tesco"), employee loans receivable and bonds related to Global Hotline's
leased facilities.

NOTE 9.  ACCRUED PAYROLL TAXES AND SOCIAL INSURANCE TAXES - DELINQUENT

         Accrued payroll taxes and social insurance taxes were $4,850,887 and
$1,203,108 as of March 31, 2009 and 2008, respectively. Such liabilities
primarily consisted of Japanese employee taxes deducted but not paid since
August 2008 and penalties and interest. Global Hotline has negotiated a monthly
payment schedule from March 2009 through March 2011 on $3,426,330 of the taxes
and is negotiating on the remaining taxes. The total estimated unpaid taxes as
of August 31, 2009 is approximately $6,000,000.

NOTE 10. ACCRUED LIABILITIES

         Accrued liabilities were $4,657,362 and $6,648,528 as of March 31, 2009
and 2008, respectively. Such liabilities consisted of the following:

                                                March 31,
                                         -----------------------
                                            2009         2008
                                         ----------   ----------
Accrued salaries .....................   $2,154,315   $1,833,317
Trade debt not in accounts payable ...    1,922,998    4,308,945
Accrued interest .....................      487,960      504,043
Other accrued expenses ...............       92,089        2,222
                                         ----------   ----------
                                         $4,657,362   $6,648,528
                                         ==========   ==========

NOTE 11. NOTES PAYABLE/ LONG TERM DEBT

         Notes payable and long term debt were $15,289,602 and $19,104,249 as of
March 31, 2009 and 2008 consisted of the following:

Global Hotline, Inc.
--------------------

H Capital, Inc.
---------------

         Global Hotline, Inc. and SG Telecom received the loans below from H
Capital, Inc., an unlicensed Japanese lender.

         On February 25, 2009, Global Hotline received a 150,000,000 Yen, or
approximately $1,546,000 at current exchange rates, working capital loan. The
loan required a balloon payment on February 27, 2009.

         On February 27, 2009, Global Hotline received a 100,000,000 Yen, or
approximately $1,031,000 at current exchange rates, working capital loan. The
loan required a balloon payment on March 16, 2009.

                                      F-30A year's interest of 15.0% was paid on February 25 and 27, 2009, with a
default interest rate of 21.9%. A 10% fee was paid for these working capital
loans. The loans were signed by SG Telecom and are guaranteed by the two senior
executives and two directors of Global Hotline and by all Global Hotline
affiliated entities.

         On April 24, 2009, Global Hotline received 90,000,000 Yen, or
approximately $929,000 at current exchange rates, from Kyo Nagae, Chief
Financial Officer of Global Hotline, which was funded by H Capital. The loan
required a balloon on May 15, 2009. Interest of 15.0% is to be paid starting on
April 24, 2009, with a default interest rate of 21.9%. The loan was guaranteed
by all Global Hotline affiliated entities.

         On February 25, 2009, Global Hotline and subsidiaries pledged all
accounts receivable to H Capital and provided H Capital with all bank books and
corporate seals, which allows H Capital to control all cash.

         On approximately April 1, 2009, but effective February 25, 2009, the
Company pledged its ownership in Global Hotline as collateral for the loans
between Global Hotline and H Capital, subject to a thirty day notice period in
the case of Global Hotline's default under the agreements.

         On May 26, 2009, IA Global received notices from H Capital. On May 27,
2009, Global Hotline and SG Telecom did not repay the Loan as requested by H
Capital. On June 9, 2009, the unlicensed Japanese lender submitted documents
claiming ownership of the Company's 600 shares of Global Hotline.

         After review by Japanese corporate counsel, the Company is challenging
the validity of the loans and the collateral claimed by H Capital. The Company
has discovered that Global Hotline management provided stock certificates to the
unlicensed lender in early March 2009 in violation of the loan agreement the
Company signed. The Company has disputed all notices received from H Capital.
The parties continue to negotiate over the alleged unpaid loans.

         The balance due as of July 31, 2009 is 170,000,000 Yen, or
approximately $1,753,000 at current exchange rates, plus interest of
approximately 15,567,000 Yen, or approximately $160,000 at current exchange
rates. Total interest and fees paid during the three months ended March 31, 2009
was 3,329,000 Yen or approximately $34,000 at current exchange rates.

Mitsui Sumitomo Bank Co Ltd.
----------------------------

         On September 29, 2006, Global Hotline received a 30,000,000 Yen, or
approximately $255,000 at current exchange rates, working capital loan from
Mitsui Sumitomo Bank Co Ltd. The loan requires monthly payments of 357,000 Yen
or approximately $3,000 at current exchange rates starting on October 31, 2006
with a final payment of 369,000 Yen or approximately $3,000 due on September 30,
2013. The loan provides for interest at 2.175% payable monthly starting on
September 30, 2006. On July 13, 2009, Global Hotline signed an amendment with
Mitsui Sumitomo Bank Co Ltd. The amendment requires monthly payments of 461,000
Yen or approximately $5,000 at current exchange rates starting on May 31, 2010
with a final payment of 493,000 Yen or approximately $5,000 due on September 30,
2013. A guarantee of 110,095 Yen or approximately $1,100 at current exchange
rates was paid to Tokyo Credit Guarantee Association for this amendment.

         On December 26, 2006, IA Partners received a 200,000,000 Yen, or
approximately $1,683,000 at current exchange rates, working capital loan from
Mitsui Sumitomo Bank Co Ltd. The loan requires a quarterly payment of principal
of 12,500,000 Yen, or approximately $105,000 at current exchange rates, starting
on March 20, 2008 with a final payment due on December 20, 2011. Interest of
2.00% plus the 3 month TIBOR totaling 2.703% was paid quarterly starting on June
20, 2007. On June 22, 2009, IA Partners signed an amendment with Mitsui Sumitomo
Bank Co Ltd adjusting the repayment of the amount due of 137,500,000 Yen, or
approximately $1,432,000 at current exchange rates, to September 22, 2009 and
increasing the interest rate to 4.25%.

                                      F-31On May 16, 2007, Global Hotline received a 50,000,000 Yen, or
approximately $415,400 at current exchange rates, working capital loan from
Mitsui Sumitomo Bank Co Ltd . The loan requires a monthly principal payment of
640,000 Yen, or approximately $5,300 at current exchange rates, starting on
December 31, 2007 with a final payment due on April 30, 2014. Interest of 2.175%
is paid monthly, with the first payment on May 16, 2007 and then monthly
starting on June 30, 2007. The loan is guaranteed by the Tokyo Guarantee
Association for a fee of 2,750,625 Yen or approximately $22,900 at current
exchange rates. On July 13, 2009, Global Hotline signed an amendment with Mitsui
Sumitomo Bank Co Ltd. The amendment requires monthly payments of 798,000 Yen or
approximately $8,000 at current exchange rates starting on May 31, 2010 with a
final payment of 816,000 Yen or approximately $9,000 due on April 30, 2014. A
guarantee of 255,552 Yen or approximately $3,000 at current exchange rates was
paid to Tokyo Credit Guarantee Association for this amendment.

         On June 19, 2007, IA Partners received a 100,000,000 Yen, or
approximately $812,000 at current exchange rates, working capital loan from
Mitsui Sumitomo Bank Co. Ltd. The loan required a balloon payment of 100,000,000
Yen, or approximately $812,000 at current exchange rates, on January 31, 2008.
Interest of 3.0% is paid quarterly starting on June 19, 2007. The parties
subsequently signed amendments extending the term to August 19, 2008. On
September 5, 2008, IA Partners signed an amendment requiring a monthly repayment
of 2,777,000 Yen, or approximately $26,000 at current exchange rates starting on
September 30, 2008. On February 2, 2009, the monthly repayment is reset over the
remaining payment term, which expires on September 30, 2009 or repayment of
88,892,000 Yen or approximately $816,000 at current exchange rates may be
required. Interest of 3.375% is payable monthly starting on September 30, 2008.
On February 5, 2009, IA Partners signed an amendment extending the terms of its
working capital loan with Mitsui Sumitomo Bank Co Ltd to March 31, 2009 and
increasing the interest rate to 3.975%. Subsequently, IA Partners signed
amendments extending the terms of its working capital loan with Mitsui Sumitomo
Bank Co Ltd to June 30, 2009. On June 30, 2009, IA Partners signed an amendment
extending the terms of its working capital loan with Mitsui Sumitomo Bank Co Ltd
to September 30, 2009 and increasing the interest rate to 4.25%.

         On June 19, 2007, Global Hotline received a 100,000,000 Yen, or
approximately $812,000 at current exchange rates, working capital loan from
Mitsui Sumitomo Bank Co Ltd. The loan requires a monthly payment of 1,666,000
Yen, or approximately $14,000 at current exchange rates, starting on August 1,
2007, with a final payment of 1,706,000 Yen or approximately $14,000 on June 19,
2012. Interest of 3.05% is paid monthly starting on June 19, 2007. On June 30,
2009, Global Hotline signed an amendment with Mitsui Sumitomo Bank Co Ltd. The
amendment requires a balloon payments of 63,348,000 Yen or approximately
$672,000 at current exchange rates on September 30, 2009.

         On July 27, 2007, Global Hotline received a 200,000,000 Yen, or
approximately $1,623,000 at current exchange rates, working capital loan from
Mitsui Sumitomo Bank Co Ltd. The loan requires a balloon payment of 200,000,000
Yen, or approximately $1,623,000 at current exchange rates, on January 25, 2008.
Interest of 3.00% was to be paid on January 25, 2008. On April 30, 2008, Global
Hotline signed an amendment extending the term and interest payment to July 25,
2008. On August 1, 2008, Global Hotline amended the loan. The amendment requires
a monthly repayment of 5,555,000 Yen, or approximately $51,000 at current
exchange rates starting on August 31, 2008. On February 2, 2009, the monthly
repayment is reset over the remaining payment term, which expires on September
30, 2009 or repayment of 172,255,000 Yen or approximately $1,581,000 at current
exchange rates may be required. Interest of 3.375% is payable monthly starting
August 31, 2008. On February 5, 2009, Global Hotline signed an amendment
extending the terms of its working capital loan with Mitsui Sumitomo Bank Co Ltd
to March 31, 2009 and increasing the interest rate to 3.975%. Subsequently,
Global Hotline signed amendments extending the terms of its working capital loan
with Mitsui Sumitomo Bank Co Ltd to June 30, 2009. On June 30, 2009, Global
Hotline signed an amendment extending the terms of its working capital loan with
Mitsui Sumitomo Bank Co Ltd to September 30, 2009 and increasing the interest
rate to 4.25%.

                                      F-32On September 14, 2007, Global Hotline received a 300,000,000 Yen, or
approximately $2,616,000 at current exchange rates, working capital loan from
Mitsui Sumitomo Bank Co Ltd. The loan required a balloon payment of 300,000,000
Yen, or approximately $2,616,000 at current exchange rates, on November 30,
2007. Interest of 3.00% was to be paid on January 4, 2008. On November 27, 2007,
the loan was amended, extending the due date to December 28, 2007. Subsequently,
Global Hotline signed amendments requiring monthly payments starting on March
31, 2008 of 25,000,000 Yen plus interest or approximately $235,000 at current
exchange rates, with a final payment due on February 28, 2009. This loan was
repaid.

         On February 29, 2008, Global Hotline received a 30,000,000 Yen, or
approximately $281,000 at current exchange rates, working capital loan from
Mitsui Sumitomo Bank Co Ltd. The loan requires monthly payments of 358,000 Yen,
or approximately $3,400 at current exchange rates starting on March 31, 2008
with a final payment of 286,000 Yen, or approximately $2,700 at current exchange
rates on February 28, 2015. Interest of 2.375% is paid monthly starting on March
31, 2008. The loan is guaranteed by Tokyo Credit Guarantee Association. On July
13, 2009, Global Hotline signed an amendment with Mitsui Sumitomo Bank Co Ltd.
The amendment requires monthly payments of 430,000 Yen or approximately $5,000
at current exchange rates starting on May 31, 2010 with a final payment of
478,000 Yen or approximately $5,000 due on February 28, 2015. A guarantee of
92,526 Yen or approximately $1,000 at current exchange rates was paid to Tokyo
Credit Guarantee Association for this amendment.

Mitsubishi Tokyo UFJ Bank Co Ltd.
---------------------------------

         On July 31, 2007, IA Partners received a 150,000,000 Yen, or
approximately $1,217,000 at current exchange rates, working capital loan from
Mitsubishi Tokyo UFJ Bank Co Ltd. The loan requires a quarterly payment of
7,500,000 Yen, or approximately $61,000 at current exchange rates, starting on
October 31, 2007, with a final payment due on July 25, 2012. Interest of 2.81%
is paid quarterly starting on October 31, 2007.

         On July 31, 2007, Global Hotline received a 350,000,000 Yen, or
approximately $2,840,000 at current exchange rates, working capital loan from
Mitsubishi Tokyo UFJ Bank Co Ltd. The loan requires quarterly payments of
17,500,000 Yen, or approximately $142,000 at current exchange rates, starting on
October 31, 2007, with a final payment due on July 31, 2012. Interest of 2.775%
is paid quarterly starting on October 31, 2007.

         On February 15, 2008, Global Hotline received a 120,000,000 Yen, or
approximately $1,109,000 at current exchange rates, bond from Mitsubishi UFJ
Bank Co Ltd. The loan requires semi-annual payments of 8,400,000 Yen, or
approximately $78,000 at current exchange rates starting on August 31, 2008 with
a final payment of 10,800,000 Yen, or approximately $100,000 at current exchange
rates on February 27, 2015. Interest of 1.36% is paid semi-annually starting on
August 31, 2008. The bond is guaranteed by Mitsubishi UFJ Bank Co Ltd and Tokyo
Credit Guarantee Association at 100% and 80% of the principal, respectively.
Global Hotline paid a bank fee of 8,066,620 Yen or approximately $79,000 at
current exchange rates.

         On June 30, 2008, Global Hotline received a 30,000,000 Yen, or
Approximately $283,000 at current exchange rates working capital loan from
Mitsubishi UFJ Bank Co Ltd. The loan requires a balloon payment of 30,000,000
Yen, or approximately $283,000 at current exchange rates on December 30, 2008.
Interest of 2.375% is to be paid on December 30, 2008. The loan was repaid by
December 30, 2008.

         On June 30, 2008, IA Partners received a 20,000,000 Yen, or
approximately $189,000 at current exchange rates working capital loan from
Mitsubishi UFJ Bank Co Ltd. The loan requires a balloon payment of 20,000,000
Yen, or approximately $189,000 at current exchange rates on December 30, 2008.
Interest of 2.375% is to be paid on December 30, 2008. The loan was repaid by
December 30, 2008.

                                      F-33Mizuho Bank Co Ltd.
-------------------

         On July 6, 2007, IA Partners received a 300,000,000 Yen, or
approximately $2,435,400 at current exchange rates, working capital loan from
Mizuho Bank Co. Ltd. The loan requires a monthly payment of 25,000,000 Yen, or
approximately $203,000 at current exchange rates, starting on July 1, 2007, with
a final payment due on June 30, 2008. Interest of 2.125% is paid monthly
starting on July 1, 2007.

         On July 17, 2007, Global Hotline received a 150,000,000 Yen, or
approximately $1,217,000 at current exchange rates, bond from Mizuho Bank Co.
Ltd. The bond requires a semi-annual payment of 15,000,000 Yen, or approximately
$122,000 at current exchange rates, starting on December 19, 2007, with a final
payment due on June 29, 2012. Interest of 1.64% is paid semi-annually starting
on December 19, 2007. Global Hotline paid a bank fee of 3,388,965 Yen, or
approximately $28,000 at current exchange rates.

         On December 28, 2007, Global Hotline entered into a 150,000,000 Yen, or
approximately $1,313,000 at current exchange rates, working capital loan from
Mizuho Bank Co. Ltd. The loan requires a monthly payment of 25,000,000 Yen, or
approximately $219,000 at current exchange rates, starting on January 31, 2008
with a final payment due on June 30, 2008. Interest of 2.375% is paid monthly
starting on December 31, 2007. This loan was repaid.

         On June 4, 2008, Global Hotline signed a working capital loan agreement
with Mizuho Bank Co Ltd for 270,000,000 Yen, or approximately $2,607,000, at the
then current exchange rate. The loan requires principal monthly payments of
22,500,000 Yen, or approximately $217,000 at the then current exchange rate,
plus interest of 2.375%, starting on July 5, 2008, with a final payment due on
June 5, 2009.

         On March 12, 2009, Global Hotline signed a working capital loan
agreement with Mizuho Bank Co Ltd for 30,000,000 Yen, or approximately $304,000,
at the then current exchange rate. The loan requires principal monthly payments
of 250,000 Yen, or approximately $3,000 at the then current exchange rate, plus
interest of 2.4%, starting on April 12, 2009, with a final payment due on March
12, 2019. The loan is guaranteed by Tokyo Guarantee Association.

Other Banks
-----------

         On December 25, 2006, Global Hotline received a 30,000,000 Yen, or
approximately $252,000 at current exchange rates, working capital loan from
Resona Bank Co. Ltd. The loan requires monthly payments of 910,000 Yen or
approximately $8,000 at current exchange rates starting on April 30, 2007 with a
final payment of 880,000 Yen or approximately $7,000 due on December 25, 2009.
The loan provides for interest at 2.225% with interest payments starting on
April 30, 2007 and is guaranteed by Tokyo Guarantee Association. On July 13,
2009, Global Hotline signed an amendment with Resona Bank Co Ltd. The amendment
requires monthly payments of 910,000 Yen or approximately $10,000 at current
exchange rates starting on June 30, 2010 with a final payment of 880,000 Yen or
approximately $9,000 due on December 27, 2010.

         On August 25, 2008, Global Hotline received a 30,000,000 Yen, or
approximately $272,000 at current exchange rates working capital loan from
Yachiyo Bank Co Ltd. The loan requires a monthly payment of 5,000,000 Yen, or
approximately $45,000 at current exchange rates starting on October 6, 2008 with
a final payment on March 5, 2009. Interest of 2.50% is to be paid starting on
October 6, 2008.

         On August 29, 2008, Global Hotline received a 10,000,000 Yen, or
approximately $95,000 at current exchange rates working capital loan from
Higashi-Nippon Bank Co Ltd. The loan requires a monthly payment of 833,000 Yen,
or approximately $8,000 at current exchange rates starting on September 25, 2008
with a final payment on August 25, 2009. Interest of 2.70% is to be paid
starting on October 6, 2008. The loan is guaranteed by Tokyo Credit Guarantee
Association. Global Hotline paid a bank fee of 68,250 Yen or approximately
$6,000 at current exchange rates.

                                      F-34On September 28, 2007, IA Partners received a 30,000,000 Yen, or
approximately $260,000 at current exchange rates, working capital loan from
Resona Bank Co. Ltd. The loan requires monthly payments of 2,500,000 Yen or
approximately $22,000 at current exchange rates starting on October 31, 2007
with a final payment of 2,500,000 Yen or approximately $22,000 due on September
26, 2008. The loan provides for interest at 1.875% with interest payments
starting on October 31, 2007.

         On October 14, 2008, Global Hotline received an 120,000,000 Yen, or
approximately $1,217,000 at current exchange rates working capital loan from KT
Factory Co Ltd. The loan required a balloon payment and interest of 15% on
November 28, 2008. The loan was guaranteed by Hideki Anan, the CEO of Global
Hotline, Inc. The loan was repaid on November 28, 2008.

         On December 15, 2008, Global Hotline received an 80,000,000 Yen, or
approximately $884,000 at current exchange rates working capital loan from
Globacks Co Ltd. The loan required a balloon payment and interest of 15% on
January 30, 2009. The loan was guaranteed by Hideki Anan, the CEO of Global
Hotline, Inc. and Kyo Nagae, the CFO of Global Hotline. The loan was repaid on
January 31, 2009.

         On January 30, 2009, Global Hotline received a 10,000,000 Yen or
$100,000 at current exchange rates from Customer Relation Telemarketing
("CRTM"), a former customer. The loan requires a balloon payment and interest of
1.875% on January 29, 2010. The loan was repaid on July 3, 2009. The loan was
not secured or guaranteed.

         On February 4, 2009, Global Hotline received a 5,000,000 Yen or $56,000
at current exchange rates from CRTM, a former customer. The loan requires a
balloon payment and interest of 1.875% on January 29, 2010. The loan was repaid
on July 3, 2009. The loan was not secured or guaranteed.

         On March 9, 2009, Global Hotline received a 30,000,000 Yen, or
approximately $304,000 at current exchange rates working capital loan from
Yachiyo Bank Co Ltd. The loan requires a monthly payment of 5,000,000 Yen, or
approximately $53,000 at current exchange rates starting on April 5, 2009 with a
final payment on September 5, 2009. Interest of 2.75% is to be paid starting on
April 5, 2009.

         All of the above loans are also guaranteed by Hideki Anan, the CEO of
Global Hotline. As of February 25, 2009, all Global Hotline assets are
collateralized to H Capital. On approximately April 1, 2009, the Company pledged
its ownership in Global Hotline as collateral for the loans, subject to a thirty
day notice period in the case of default under the agreement.

         At March 31, 2009, we had current and long-term indebtedness of $15.3
million. Global Hotline will need to repay or refinance $13.4 million by March
31, 2010, including approximately $4.4 million in September 30, 2009.

         On April 30, 2009, Global Hotline entered into negotiations on
$12,379,000 in debt with its Japanese banks. Global Hotline is proposing to
refinance this debt on a long term basis and freeze any payments in the short
term. To date, eight loans have been renegotiated. We expect to adjust the
repayment dates on many loans with our largest lender to a September 30, 2009
due date and then to re-finance the loans on a long term basis.

                                      F-35IA Global, Inc.
---------------

         On December 21, 2007, IA Global entered into a $500,000 Loan Agreement
and a Share Mortgage Agreement with Frontier Mortgages Pty Ltd ("Frontier"), an
Australian Company affiliated with a selling shareholder of ASFL, an entity in
which the Company owns a 36% interest.

         On April 24, 2008, the Company entered into a Deed of Variation
Agreement ("Variation Agreement"),amending the terms of its working capital loan
with Frontier for an extension fee of $25,000. Pursuant to the Variation
Agreement, the Company repaid $20,000 of the extension fee, $200,000 of
principal and $300,000 of principal on April 28, 2008, April 29, 2008 and May
12, 2008. The balance of the extension fee and any outstanding interest was
repaid during the three months ending September 30, 2008.

         On June 19, 2008, the Company entered into a three year loan agreement
with GFS Investments, Inc., pursuant to which the Company received a loan in the
principal amount of approximately $350,102 at an interest rate of 11.75% per
annum. The interest is payable quarterly starting on October 2008. The Company
issued 6,000,000 shares of common stock as of September 30, 2008 and 632,500
shares on November 19, 2008, which served as collateral for the loan. In
addition, the Company paid $60,821 in fees, which are being amortized over the
life of the loan. At the termination of the loan, the Company may repay the
loan, forfeit the shares to the lender or renew the loan on a year by year
basis. The loan cannot be terminated without the sole agreement of the lender.

         On December 15, 2008, the Company terminated the loan agreement with
GFS Investments, Inc., which the Company satisfied by releasing the collateral
of 6,632,500 shares of common stock. All unamortized fees were expensed upon
conversion of this loan to common stock. Related to the settlement of this loan,
the Company had a $60,660 expense during the three months ended December 31,
2008. Total interest expense for this loan for the twelve months ended March 31,
2009 was $7,836.

         On July 14, 2008 and August 11, 2008, the Company entered into a three
year loan agreement with Artemis Capital Group LLC, pursuant to which the
Company received loans in the principal amount of approximately $199,500 at an
interest rate of 7.0% per annum. The interest is payable quarterly starting on
October 2008. The Company issued 3,000,000 shares of common stock as of
September 30, 2008 and 554,546 on November 19, 2008, which serve as collateral
for the loans. In addition, the Company paid $34,613 in fees, which are being
amortized over the life of the loan. At the termination of the loan, the Company
may repay the loan, forfeit the shares to the lender or renew the loan on a year
by year basis based on mutually agreeable terms. The loan cannot be terminated
within the first eighteen months of the loan and after this period, it can be
repaid with a 10% penalty. Total interest expense for these loans for the twelve
months ended March 31, 2009 was $8,756.

         All the loans were used for working capital.

Future principal repayments for all long term debt as of March 31, 2009 is as
follows:

Years Ended March 31,
       2010 .........   $13,391,371
       2011 .........       774,736
       2012 .........       509,631
       2013 .........       357,557
       2014 .........       181,384
    Thereafter ......        74,922
                        -----------
                        $15,289,602
                        ===========

                                      F-36NOTE 12. CONVERTIBLE DEBENTURES

         On June 28, 2005, the Company announced that it had received
commitments totaling $3,750,000 for convertible debentures. The Company used the
proceeds from this financing to continue its merger and acquisition strategy,
and for general corporate purposes. This financing included a beneficial
conversion feature, which increased the stockholders' equity by $1,250,000. The
beneficial conversion will be amortized over the life of the debentures, or
until such time that they are converted. During the twelve months ended March
31, 2009, the three months ended March 31, 2008 and the years ended December 31,
2007 and 2006, the Company expensed $100,000, $104,000, $417,000 and $417,000,
respectively, of this beneficial conversion feature as interest expense. The
Company closed the sale of $3,750,000 of convertible debentures on July 29,
2005, and realized net proceeds of $3,483,000.

                                                 March 31,
                                            2009          2008
                                        -----------   -----------
Convertible debentures ..............   $ 3,750,000   $ 3,750,000
Beneficial conversion ...............    (1,250,000    (1,250,000)
                                        -----------   -----------
                                          2,500,000     2,500,000
Amortization of beneficial conversion      (200,000)    1,145,833
Conversion of debentures ............    (2,300,000)   (1,450,000)
                                        -----------   -----------
                                        $         -   $ 2,195,833
                                        ===========   ===========

         In June 2005, the Company received subscription agreements from
thirty-four private Japanese investors. The terms of the convertible notes
provide for a conversion price of $0.30 per share, or 12,500,018 shares, until
June 28, 2008, with an automatic conversion on June 28, 2008 at a 25% discount
based on the trailing five day price prior to June 28, 2008. The coupon rate is
7.5% per annum payable in cash at the earlier of the conversion date or June 28,
2008. The Company filed a registration statement, which became effective in
August 2005, covering the shares issuable upon conversion. JPB (Switzerland)
A.G., a party affiliated with our majority shareholder, advised the Company on
the transaction and was paid a $267,000 fee upon funding.

         On July 30, 2007, the Company made an Offer to our debenture holders
("Offer"). Pursuant to this Offer, the debenture holders could convert their
debentures and accrued interest into common stock at a 10% discount of $0.27 per
share and would receive shares of common stock for any accrued interest at $0.27
per share. The Offer expired on August 31, 2007, and $400,000 of debentures and
$64,048 of accrued interested were converted into 1,718,696 shares of common
stock. The total cost of this early conversion was $120,046 and this was
recorded as conversion of debenture expense in the three months ended September
30, 2007. Additional shares of common stock totaling 385,362 related to the
discount and interest were registered in January 2008.

         On June 28, 2008, the Company converted $2,300,000 of debentures by
issuing 7,666,579 shares of common stock. In addition, the Company issued an
additional 5,862,734 shares during the three months ended December 31, 2008
based on the June 23-27, 2008 average closing price of $.22 per share less 25%
due to the resetting of the pricing for these outstanding debentures. On
September 22, 2008, the Company issued 463,658 shares of common stock to certain
debenture holders related to the conversion of $78,822 of interest at $.17 per
share.

NOTE 13. RELATED PARTY RELATIONSHIPS WITH INTER ASSET JAPAN AND AFFILIATES

         As of March 31, 2009, IAJ LBO Fund, PBAA Fund Limited, Terra Firma,
Inter Asset Japan Co Ltd ("IAJ"), IA Turkey and Hiroki Isobe, (collectively, the
"Controlling Shareholders") collectively hold approximately 35.2% of our common
stock. These Controlling Shareholders have stated in a Schedule 13D that they
may be deemed to constitute a "group" for the purposes of Rule 13d-3 under the
Exchange Act. Hiroki Isobe and controls each of our Controlling Shareholders.

                                      F-37The following table provides details on the affiliated parties owned or
controlled by each of the Company's controlling stockholders and certain other
entities, as of March 31, 2009, that are relevant for purposes of understanding
the related party transactions that have taken place:


Ownership:

IA Global, Inc. owns:
      Global Hotline, Inc........................................... 100.0%
      Global Hotline Philippines, Inc............................... 100.0%  (1)
      IA Global Japan Co Ltd........................................ 100.0%
      Slate Consulting Co Ltd.......................................  20.25%
      Australian Secured Financial Limited..........................  36.0%
      Taicom Securities Co Ltd......................................  14.0%  (2)

Global Hotline, Inc. owns:
      Inforidge Co Ltd.............................................. 100.0%
      IA Partners Co Ltd............................................ 100.0%
      SG Telecom, Inc............................................... 100.0%

Inter Asset Japan LBO No. 1 Fund owns:
      IA Global, Inc................................................  13.6%

PBAA Fund Ltd. owns:
      IA Global, Inc................................................  11.0%

Terra Firma Fund Ltd. owns:
      IA Global, Inc................................................   6.0%

Inter Asset Japan Co., Ltd. owns:
      IA Global, Inc................................................   1.0%

IA Turkey Equity Portfolio Ltd owns:
      IA Global, Inc................................................   1.1%

Mr. Hiroki Isobe owns:
      IA Global, Inc................................................   2.4%
      Tesco Co Ltd..................................................  23.0%

(1) Established on July 4, 2008.

(2) Equity investment of 20% closed June 3, 2008 and was reduced to 16% on
    December 12, 2008, 14% on February 2, 2009 and 12.6% on April 1, 2009.

KYO NAGAE RELATIONSHIP WITH IAJ

         In January 2006, Mr. Kyo Nagae, CFO of Global Hotline, became President
of IAJ and IAJ LBO Fund. On January 28, 2009, Mr. Nagae resigned from this
position effective July 31, 2008.

INTER ASSET JAPAN RELATIONSHIP WITH TESCO CO LTD

         IAJ owns a 23% minority ownership percentage in Tesco. Global Hotline
has an agent agreement with Tesco to sell their lighting products. Tesco owes
Global Hotline approximately $2,310,110 and $2,046,513 as of March 31, 2009 and
2008, respectively. Hideki Anan and Kyo Nagae are directors of Tesco. During the
twelve months ended March 31, 2009, we deferred $814,787 in revenues with Tesco.

DEREK SCHNEIDEMAN LOAN TO MICHAEL NING

         On June 23, 2009, Derek Schneideman, our CEO, loaned Michael Ning
$35,000.

                                      F-38NOTE 14. EQUITY TRANSACTIONS

         During the period subsequent to March 31, 2009, the following
stockholder equity events occurred:

         On May 12, 2009, the Company sold 600,000 shares of common stock to A
to B Capital Special Situations Fund LP for $30,000 or $0.05 per share, the
closing price on May 12, 2009, the date the subscription agreement was signed.
On May 12, 2009, the Company issued warrants for a total of 428,571 shares of
common stock to A to B Capital Special Situations Fund LP related to the common
stock they purchased on May 12, 2009. The warrants are exercisable at $.07 per
share, above the market price on May 12, 2009, and expire on May 14, 2012.

         On May 21, 2009, the Company issued 750,000 performance warrants to
acquire shares of common stock to the Sterling Group, Inc. for consulting
services. The warrants are exercisable at $.10 per share and expire on May 20,
2012. If registered, the warrants maybe called by the Company if the share price
closes above $.20 for five days.

         On May 21, 2009, the Company issued 250,000 performance warrants to
acquire shares of common stock to Marc Page for consulting services. The
warrants are exercisable at $.10 per share and expire on May 20, 2012.

         On June 10, 2009, the Company sold 167,500 shares of common stock to
Derek Schneideman, its Chief Executive Officer, for $10,050 or $0.06 per share,
the closing price on June 10, 2009, the date the subscription agreement was
signed.

         The common stock was issued to the accredited investors in a
transaction that will be exempt from registration pursuant to Section 4(2) of
the Securities Act, and/or Regulation D promulgated under the Securities Act.

         On August 2, 2009, the Company entered into a Stock Purchase Agreement
("Agreement 1") with Inter Asset Japan LBO No 1 Fund, an existing shareholder of
the Company (the "Shareholder"). Under the terms of the Agreement 1, the Company
agreed to issue and sell to the Shareholder 1,500,000 shares (the "Shares") of
the Company's common stock, par value $0.01 per share, for an aggregate purchase
price of $60,000, or $0.04 per share (the "Purchase Price"). The Company issued
and sold the Shares to the Shareholder in reliance on the exemption from the
registration requirements set forth in the Securities Act of 1933 (the
"Securities Act") provided under Section 4(2) of the Securities Act and
Regulation D promulgated by the Securities and Exchange Commission (the "SEC")
under the Securities Act.

         Agreement 1 contains certain representations and warranties of the
Shareholder and the Company, including customary investment-related
representations provided by the Shareholder, as well as acknowledgements by the
Shareholder that it has reviewed certain disclosures of the Company (including
the periodic reports that the Company has filed with the SEC) and that the
Company's issuance of the Shares has not been registered with the SEC or
qualified under any state securities laws. The Company provided customary
representations regarding, among other things, its organization, capital
structure, subsidiaries, disclosure reports, absence of certain legal or
governmental proceedings, financial statements, tax matters, insurance matters,
real property and other assets, and compliance with applicable laws and
regulations.

         Agreement 1 also grants the Shareholder registration rights that it may
exercise at its option and provides the Shareholder with a right of first offer
if the Company proposes to issue securities in the future (subject to certain
customary exceptions). Finally, the Shareholder has the right to demand that the
Company redeem all or any portion of the Shares at any time on or after October
31, 2009, for a redemption price equal to the greater of the Purchase Price or
the listed market price for the Company's common stock as of the redemption
date.

                                      F-39On August 17, 2009, the Company entered into a Stock Purchase Agreement
("Agreement 2") with Inter Asset Japan LBO No 1 Fund. Under the terms of
Agreement 2, the Company agreed to issue and sell to the Shareholder 5,000,000
shares of the our common stock for an aggregate purchase price of $200,000, or
$0.04 per share.

         Also under the terms of the Agreement, the Shareholder has committed to
purchase, and the Company agreed to issue and sell to the Shareholder,
additional shares of the Company's common stock in accordance with the following
schedule:

   o  2,500,000 shares at a purchase price of US$.04 per share, or an aggregate
      price of US$100,000 on or before September 4, 2009.

   o  1,250,000 shares at a purchase price of US$.04 per share, or an aggregate
      price of US$50,000 on or before September 18, 2009.

   o  50,000,000 shares at a purchase price of US$.04 per share, or an aggregate
      price of US$2,000,000 on or before November 10, 2009.

         The Shareholder's obligation to purchase the foregoing shares by the
date specified is conditioned upon the representations and warranties of the
Company contained in Agreement 2 being accurate as of the date of such closing.

         Finally, the Shareholder has the option, but not the obligation, to
purchase, on or before December 31, 2009, an additional 50,000,000 shares of
Common Stock at a purchase price of US$.04 per share, or an aggregate price of
US$2,000,000.

         The Company issued and sold the shares of common stock to the
Shareholder in reliance on the exemption from the registration requirements set
forth in the Securities Act of 1933 (the "Securities Act") provided under
Section 4(2) of the Securities Act and Regulation D promulgated by the
Securities and Exchange Commission (the "SEC") under the Securities Act.

         Agreement 2 contains certain representations and warranties of the
Shareholder and the Company, including customary investment-related
representations provided by the Shareholder, as well as acknowledgements by the
Shareholder that it has reviewed certain disclosures of the Company (including
the periodic reports that the Company has filed with the SEC) and that the
Company's issuance of the shares has not been registered with the SEC or
qualified under any state securities laws. The Company provided customary
representations regarding, among other things, its organization, capital
structure, subsidiaries, disclosure reports, absence of certain legal or
governmental proceedings, financial statements, tax matters, insurance matters,
real property and other assets, and compliance with applicable laws and
regulations.

         Agreement 2 also grants the Shareholder registration rights that it may
exercise at its option and provides the Shareholder with a right of first offer
if the Company proposes to issue securities in the future (subject to certain
customary exceptions).

         During the twelve months ended March 31, 2009, the following
stockholder equity events occurred:

         On April 1, 2008, the Company issued 200,000 shares of common stock to
two consultants for financing and other services. The shares were valued at $.28
per share, the closing price on March 31, 2008.

                                      F-40On April 10, 2008, the Company signed definitive agreements and closed
the 100% acquisition of Shift. The transaction was structured as a share
exchange in which the Company issued 826,086 shares of its common stock at $.23
per share, the close price during the negotiations, totaling $190,000 plus a
payment of $35,000. The transaction was valued at $225,000.

         On April 16, 2008, the Company agreed to issue 120,000 shares of common
stock to a consultants for investor relation services. The shares were valued at
$.25 per share, the closing price on April 7, 2008, the date the agreement was
reached.

         On April 24, 2008 and May 8, 2008, the Company sold 1,000,000 and
1,500,000, shares of our common stock, respectively, to Michael Ning for
$200,000 and $300,000, respectively, or $.20 per share. In connection with the
purchase of the common stock, on May 8, 2008, the Company issued warrants for a
total of 5,000,000 shares of common stock to Mr. Ning. The warrants are
exercisable at $.20 per share and expire on May 7, 2013. The Company agreed to
register the shares and warrants within two months after approval by NYSE AMEX
market. The shares of common stock were issued to the accredited investors in a
transaction that will be exempt from registration pursuant to Section 4(2) of
the Securities Act, and/or Regulation D promulgated under the Securities Act.

         On May 27, 2008, the Company acquired 100% of Asia Premier. The
transaction was structured as a share exchange in which IA Global issued
1,250,000 shares of its common stock at $.24 per share, the close price during
the negotiations, totaling $300,000; plus three Notes Payable totaling $268,000,
which become due over the next nine months, and an earn-out capped at $50,000
based on profitability of the Asia Premier business over the next nine months.
The transaction was valued at $618,000.

         On June 3, 2008, the Company announced that it had closed a 20% equity
investment in Taicom. The transaction between the Company and Taicom was
structured as a share exchange in which the Company issued 26,000,000 shares of
its common stock at $.20 per share, the close price during the negotiations in
exchange for 1,389,750 Class B Preferred Shares of Taicom. The transaction was
valued at $5,200,000.

         On June 28, 2008, the Company converted $2,300,000 of debentures by
issuing 7,666,579 shares of common stock. In addition, the Company issued an
additional 5,862,734 shares during the three months ended December 31, 2008
based on the June 23-27, 2008 average closing price of $.22 per share less 25%
due to the resetting of the pricing for these outstanding debentures. On
September 22, 2008, the Company issued 463,658 shares of common stock to certain
debenture holders related to the conversion of $78,822 of interest at $.17 per
share.

         On July 9, 2008, the Company filed a registration statement on Form S-3
covering 33,112,422 shares, related to equity investments, acquisitions and
service agreements which was declared effective by the SEC on July 23, 2008.

         On July 23, 2008, the Company issued 15,000 shares at $.20 per share or
$3,000 to Anna Alioto, above the closing market price of $0.14 per share, for
investor relation services.

         On July 28, 2008, the Company issued warrants for a total of 1,900,000
shares of common stock to Mr. Ning related to the common stock he purchased on
April 24, 2008 and May 8, 2008. The warrants are exercisable at $.17 per share
and expire on July 27, 2013.

         On July 31, 2008, the Company filed a shelf registration statement on
Form S-3, which was declared effective by the SEC on August 7, 2008. This
registration statement allows for the issuance of preferred stock, common stock
and warrants valued up to $5 million, limited to no more than 33% of our public
float in any twelve month period.

         On August 21, 2008 and August 26, 2008, the Company sold 582,609 shares
of common stock to Mr. La Cara, Mr. Ishii, Mr. Nelson and Ms. Towada for
$66,962, or $0.11 per share, the closing market price on the day preceding the
signing of the private placement memorandum.

                                      F-41On September 12, 2008, the Company issued 100,000 shares at $.10 per
share to Financial West Investment Group, Inc., the closing market price on
September 11, 2008, for financing and investor relation services.

         On January 26, 2009, the Company sold 1,000,000 shares of common stock
to Mr. Mark Gustavson for $50,000 or $0.05 per share, the closing market price
during the negotiations of the subscription memorandum.

         On February 3, 2009, the Company issued 750,000 warrants to acquire
shares of common stock to the Sterling Group, Inc. for consulting services. The
warrants are exercisable at $.05 per share and expire on February 2, 2012. On
February 3, 2009, the Company issued 750,000 performance warrants to acquire
shares of common stock to the Sterling Group, Inc. for consulting services. The
warrants are exercisable at $.10 per share and expire on February 2, 2012. If
registered, the warrants maybe called by the Company if the share price closes
above $.20 for five days.

         On February 3, 2009, the Company issued 250,000 warrants to acquire
shares of common stock to Marc Page for consulting services. The warrants are
exercisable at $.05 per share and expire on February 2, 2012. On February 3,
2009, the Company issued 250,000 performance warrants to acquire shares of
common stock to Marc Page for consulting services. The warrants are exercisable
at $.10 per share and expire on February 2, 2012.

         The common stock was issued to the accredited investors in a
transaction that will be exempt from registration pursuant to Section 4(2) of
the Securities Act, and/or Regulation D promulgated under the Securities Act.

         During the three months ended March 31, 2008, the following stockholder
equity events occurred:

         On March 22, 2007, the Company announced a stock repurchase program.
Starting on April 2, 2007, the Company may repurchase up to 4,000,000 shares at
market prices in open market or private transactions. As of March 31, 2008 and
December 31,2007, the Company repurchased 2,654,255 shares in public and private
transactions at an average price of $0.281 per share. The Company reused
2,026,355 shares as part of our Slate equity investment at an average cost of
$.267 per share. The Company owns 627,900 shares at an average cost of $.323 per
share as of March 31, 2008. The shares are valued using the cost method of
accounting for treasury stock.

         On January 18, 2008, the Company filed a registration statement on Form
S-3 covering 7,870,355 shares, related to equity investments and convertible
Debentures, which was declared effective by the SEC on February 1, 2008.

         On March 14, 2008, Eric La Cara, a director, exercised stock options
totaling 86,458 shares of common stock for $13,500 or $.156 per share.

         During the year ended December 31, 2007, the following stockholder
equity events occurred:

         On January 3, 2007, the Company filed an Information Statement on
Schedule 14C, whereby, the Company acted by majority shareholder consent in
approving (1) the issuance of 43,750,000 of the Company's common stock in
conjunction with the ASFL equity investment; and (2) the increase in the
Company's number of authorized shares of common stock from 200 million to 250
million shares. This Information Statement indicated that these actions shall
not become effective until at least twenty (20) calendar days after this
Information Statement was sent to stockholders. The actions contemplated by this
Information Statement were effected on or about the close of business on January
29, 2007.

         The 4,375 shares of Series A-1 Preferred Stock were converted into
43,750,000 shares of common stock on February 7, 2007.

         On February 8, 2007, the Company filed a registration statement on Form
S-3 covering 43,775,000 shares, including the 4,375 shares of Series A-1
Preferred Stock issued in conjunction with the ASFL equity investment.

                                      F-42On March 26, 2007, the Company announced an odd lot tender offer.
Starting on April 2, 2007, the Company will repurchase odd lots from
stockholders who own fewer than 100 shares. The program was for thirty days and
may be extended in 30 day increments. On May 2, 2007, the Company extended this
odd lot program until June 15, 2007. On June 15, 2007, this program expired and
no shares were tendered under the program.

         On March 29, 2007, the Company filed a Certificate of Elimination with
the Secretary of State of the State of Delaware to eliminate the Certificate of
Designation, Preferences and Rights of the Series A-1 Preferred Stock.

         On April 27, 2007, Mr. Jun Kumamoto, a former director of the Company
currently functioning as a consultant, exercised 30,000 stock options at an
average price of $0.183 per share and forfeited 520,000 stock options at $0.201
per share.

         During the three months ended June 30, 2007, we sold 547,281 shares of
our common stock in private placements for $200,000 or approximately $0.365 per
share. During November and December 2007, we sold 642,422 shares of our common
stock in private placements for $179,878 or approximately $.28 per share.

         On June 29, 2007, the shareholders of IA Global authorized an increase
in the number of authorized shares to 300,000,000 shares.

         On July 30, 2007, the Company made an Offer to our debenture holders
("Offer"). Pursuant to this Offer, the debenture holders could convert their
Debentures into common stock at a 10% discount of $0.27 per share and would
receive shares of common stock for any accrued interest at $0.27 per share. The
Offer expired on August 31, 2007, and $400,000 of debentures and $64,048 of
accrued interested were converted into 1,718,696 shares of common stock. The
additional shares of common stock totaling 385,362 related to the discount and
interest were registered in January 2008.

         During August and September 2007, $500,000 of debentures was converted
into 1,666,669 shares of common stock. During November and December 2007,
$450,000 of debentures was converted into 1,500,002 shares of common stock.

         On August 24, 2007, the Company closed a 25.0% equity investment in
GPlus Media Co Ltd by agreeing to issue 3,885,713 shares of common stock with a
total value of $1,360,000 or $.35 per share, which was the closing price on
August 20, 2007, the day negotiations were completed.

         On August 24, 2007, the Company closed a 20.25% equity investment in
Slate Consulting by agreeing and has issued 3,600,000 shares of common stock
with a total value Of $1,440,000 or $0.40 per share, which was the average
closing market price on August 17, 2007, the day negotiations were completed.

         For the August 24, 2007 equity investments, the shares of common stock
will be issued to the accredited investors in a transaction that will be exempt
from registration pursuant to Section 4(2) of the Securities Act, and/or
Regulation D promulgated under the Securities Act.

         On August 31, 2007, the Company filed a registration statement on Form
S-3 covering 5,059,476 shares, related to various private placements.

         On September 7, 2007, the Company filed a registration statement on
Form S-3 covering 29,773,146 shares, related to a debt conversion and various
private placements.

         On September 22, 2007, Raymond Christinson, a former director,
exercised stock options totaling 404,166 shares of common stock for $82,417 or
$.204 per share. Mr. Christinson forfeited stock options totaling 245,834 shares
of common stock.

         On October 12, 2007, the Company filed a registration statement on Form
S-8 covering 20,000,000 shares, related to the 2007 Plan.

                                      F-43During November and December 2007, the Company sold 642,422 shares of
our common stock in private placements for $179,878 or approximately $.28 per
share. The Company incurred a fee of $14,390 in conjunction with the private
placements. The Company agreed to register the shares within six months of the
closing of the private placement. In addition, on April 1, 2008, the Company
issued warrants for 62,243 shares of common stock. The warrants are exercisable
at $.28 per share and expire five (5) years after the closing of the private
placement. The shares of common stock were issued to the accredited investors in
a transaction that will be exempt from registration pursuant to Section 4(2) of
the Securities Act, and/or Regulation D promulgated under the Securities Act.

         During the year ended December 31, 2006, the following stockholder
equity events occurred:

         On January 30, 2006, Inter Asset Japan LBO No 1 Fund converted 1,158
shares of Series B Convertible Preferred Stock into 11,580,000 shares of the
Company's common stock.

         On March 10, 2006, Mr. Anan, President and Chief Executive Officer of
Global Hotline, agreed to repay a note receivable of 29,679,135 Yen or
approximately $241,000 plus interest, by transferring 840,024 shares of IA
Global common stock to the Company. The stock was valued at $.30 per share, the
closing price of the common stock on March 9, 2006 and the shares were
cancelled.

         On September 7, 2006, Alan Margerison, a former director of the
Company, exercised a stock option grant totaling 1,000,000 shares at $.08 per
share. Mr. Margerison forfeited a stock option grant totaling 1,000,000 shares
at $.20 per share.

NOTE 15. STOCK INCENTIVE PLAN

         Under the 2007 Plan as amended, the Company may grant options,
restricted stock or other awards for the purchase of up to 27.5 million shares.
A total of 11,693,512 shares of common stock are available for future grants
under the 2007 Plan as amended as of March 31, 2009. Options for the purchase of
9,126,042 shares were outstanding as of March 31, 2008. Shares underlying
options that expire, or are cancelled without delivery of shares, generally
become available for future re-issuance under the 2007 Plan.

         The following option activity occurred subsequent to the twelve months
ended March 31, 2009:

         On June 17, 2009, certain key executives, employees, and directors of
IA the Company voluntarily cancelled stock option grants to purchase common
stock totaling 5,439,583 shares. The grants were previously issued on various
dates and prices above $.13 per share.

         On June 17, 2009, the compensation committee awarded stock option
grants totaling 5,439,583 shares to certain key executives, employees, and
directors. The grants were priced at $.05 per share, the close price on June 16,
2009, the date before the scheduled compensation committee meeting. In
accordance with the 2007 Stock Incentive Plan, the grants are vested immediately
and expire on June 16, 2019. The stock options were granted to provide a proper
incentive for employees, officers and directors and to reduce the cost of the
stock option grants over the next three years.

         On August 24, 2009, the board of directors awarded Mr. Scott an option
to purchase 300,000 shares of the Company's common stock. The award were granted
at the fair market price of $0.05 per share based on the adjusted closing price
on August 20, 2009, the last trading day before the board of director meeting.
In accordance with the 2007 Stock Incentive Plan, the stock option vests
quarterly over three years and expires on August 23, 2019.

                                      F-44The following option activity occurred during the twelve months ended
March 31, 2009:

         On April 27, 2008, the Company's compensation committee granted
performance stock option grants for 135,000 shares of common stock to the
employees of GPlus at an average price of $.280 per share, the close price on
April 26, 2008, the last day before the compensation committee meeting. The
stock option grants vest on March 31, 2009 if GPlus achieves revenues of
$3,200,000 for the period of April 1, 2008 to March 31, 2009 and are being
awarded to employees of an equity investment.

         On May 16, 2008, the board of directors, upon the recommendation of the
compensation committee, granted stock options to purchase common stock of
700,000 shares to our executive officers. The options were granted at the fair
market price of $0.29 per share based on the adjusted closing price on May 9,
2008, the day the board of directors agreed on the grant. In accordance with the
IA Global, Inc. 2007 Stock Incentive Plan, as amended (the "2007 Stock Incentive
Plan") the stock options vest quarterly over three years and expire on May 8,
2018.

         On May 30, 2008, the Company's board of directors granted stock options
to purchase common stock of 656,000 shares to Global Hotline Philippines Inc.
The options were granted at the fair market price of $0.28 per share based on
the adjusted closing price on May 30, 2008, the day the board of directors
approved the grant. In accordance with the 2007 Stock Incentive Plan, the stock
options vest quarterly over three years and expire on May 29, 2018.

         On July 29, 2008, the Company's compensation committee, granted stock
options to purchase common stock of 200,000 shares each to Mr. Anan, Mr. Ishii,
Mr. La Cara, Mr. Nelson, Mr. Schneideman, Mr. Scott and Ms. Towada for their
election to the board of directors. The options were granted at the fair market
price of $0.12 per share based on the adjusted closing price on July 29, 2008,
the day the directors were elected to the board of directors. In accordance with
the 2007 Stock Incentive Plan the stock options vest quarterly over three years
and expire on July 28, 2018.

         On July 29, 2008, the stockholders voted to increase the number of
shares authorized under the 2007 Stock Incentive Plan from 20,000,000 to
27,500,000 at the Company's annual shareholder meeting.

         On July 31, 2008, Eric La Cara, a director, exercised stock options
totaling 62,958 shares of common stock for $10,800 or $.172 per share.

         On September 4, 2008, the Company's compensation committee ratified a
stock option grant to purchase common stock of 200,000 shares to Raul Rabe, a
director of Global Hotline Philippines Inc. The options were granted at the fair
market price of $0.28 per share based on the adjusted closing price on August
29, 2008, the day the grant was committed to Mr. Rabe. In accordance with the
2007 Stock Incentive Plan, the stock options vest quarterly over three years and
expire on August 28, 2018.

         On January 30, 2009, the compensation committee granted stock options
to purchase common stock of 250,000 shares to Mr. Scott, the Company's COO/CFO.
The options were granted at the fair market price of $0.06 per share based on
the adjusted closing price on January 30, 2009, the day the board of directors
agreed on the grant. In accordance with the 2007 Stock Incentive Plan, the stock
options vest quarterly over three years and expire on January 29, 2019.

         The following option activity occurred during the three months ended
March 31, 2008:

         On January 3, 2008, the compensation committee granted to Mr. Brian
Nelson, a new director, stock options to purchase 200,000 shares of common
stock. The options were granted at the fair market price of $.31 per share,
which was the adjusted closing price on January 3, 2008, the day prior to the
compensation committee meeting. In accordance with the 2007 Plan, the stock
options will vest quarterly over three years and expire on January 2, 2018.

                                      F-45On March 5, 2008, the compensation committee granted to Mr. Hideki
Anan, CEO of Global Hotline and Mr. Kyo Nagae, CFO of Global Hotline, stock
options to purchase 750,000 and 500,000 shares of common stock, respectively.
The options were granted at the fair market price of $0.29 per share based on
the adjusted closing price on February 4, 2008, the last trading day before the
compensation committee meeting. In accordance with the 2007 Plan, the stock
options vest quarterly over three years and expire on March 4, 2018.

         The following option activity occurred during the year ended December
31, 2007:

         On February 13, 2007, the compensation committee granted to Mr. Derek
Schneideman, CEO and Chairman of the Board, stock options to purchase 500,000
shares of common stock. The options were granted at the fair market price of
$0.14 per share based on the adjusted closing price on February 13, 2007, his
date of employment. In accordance with the 2000 Stock Option Plan, the stock
options vest quarterly over three years and expire on February 13, 2017.

         On February 22, 2007, the compensation committee granted to Mr. John
Margerison, a Director, stock options to purchase 200,000 shares of common
stock. The options were granted at the fair market price of $0.15 per share
based on the adjusted closing price on February 21, 2007 and 110% of the
intraday price on February 21, 2007, the last trading day before the
compensation committee meeting. In accordance with the 2000 Stock Option Plan,
the stock options vest quarterly over three years and expire on February 21,
2017. Subsequent to the grant of stock options, Mr. Margerison resigned from the
board of directors on April 17, 2007 and forfeited the stock options on July 16,
2007.

         On February 23, 2007, the compensation committee granted to Mr.
Christinson, Mr. Ishii and Mr. La Cara, Directors, stock options for each
director to purchase 100,000 shares of common stock. In addition, the
compensation committee granted to Mr. Mark Scott, the Company's COO and CFO,
stock options to purchase 250,000 shares of common stock. These options were
granted at the fair market price of $0.15 per share based on the adjusted
closing price on February 22, 2007, the last trading day before the compensation
committee meeting. In accordance with the 2000 Stock Option Plan, the stock
options vest quarterly over three years and expire on February 22, 2017.

         On February 28, 2007, the compensation committee granted to Mr. Hideki
Anan, CEO of Global Hotline and Mr. Kyo Nagae, CFO of Global Hotline, stock
options to purchase 600,000 and 400,000 shares of common stock, respectively.
The options were granted at the fair market price of $0.16 per share based on
the adjusted closing price on February 27, 2007, the last trading day before the
compensation committee meeting. In accordance with the 2000 Stock Option Plan,
the stock options vest quarterly over three years and expire on February 27,
2017.

         On March 29, 2007, the compensation committee granted to Mr. Clifford
J. Bernstein, a Director, stock options to purchase 200,000 shares of common
stock. The options were granted at the fair market price of $0.31 per share
based on the adjusted closing price on March 29, 2007, the date of his
appointment. In accordance with the 2000 Stock Option Plan, the stock options
vest quarterly over three years and expire on March 28, 2017. Subsequent to the
grant of stock options, Mr. Bernstein resigned from the board of directors on
December 22, 2007 and forfeited the stock options on March 22, 2008.

         On July 11, 2007, the compensation committee granted stock options to
purchase common stock of (i) 200,000 shares to Mr. Anan and Ms. Towada, new
Directors; (ii) 150,000 shares to Mr. Bernstein, Mr. Ishii and Mr. La Cara,
Directors; (iii) 1,000,000 shares to Mr. Schneideman, the Company's CEO and
Chairman of the Board of Directors; and (iv) 500,000 shares to Mr. Scott, the
Company's COO and CFO.

         These options were granted at the fair market price of $0.37 per share
based on the adjusted closing price on July 10, 2007, the last trading day
before the compensation committee meeting. In accordance with the 2007 Plan, the
stock options vest quarterly over three years and expire on July 10, 2017.

                                      F-46On October 3, 2007, the Company's compensation committee granted stock
options to purchase common stock of (i) 100,000 shares to Mr. Schneideman, the
Company's Chief Executive Officer and Chairman of the Board of Directors and
(ii) 275,000 shares to Mr. Scott, the Company's Chief Operating and Financial
Officer.

         The options were granted at the fair market price of $0.47 per share
based on the adjusted closing price on October 3, 2007, the last trading day
before the compensation committee meeting. In accordance with the 2007 Stock
Incentive Plan, the stock options vest quarterly over three years and expire on
October 2, 2017.

         At various times during the year ended December 31, 2007, the Company
granted options for the purchase of 172,500 shares of the Company's common
stock, to various consultants at an average exercise price of $0.384 per share.
Of these options granted, 42,500 were exercisable upon their date of grant. The
remaining 130,000 granted, vest quarterly over three years from the date of
grant. These options were value at $66,295, and were all expensed on the date of
their grant. The Company valued these options using a Black-Scholes valuation
model with the following weighted assumptions: an expected average life of 8.48
years, a risk free interest rate of 5.30%, an expected volatility of 111.26%,
and an expected dividend rate of 0.00%.

         The following option activity occurred during the year ended December
31, 2006:

         On July 31, 2006, the compensation committee granted to Mr. Ishii, a
director, stock options to purchase 200,000 shares of common stock. The options
were granted at the fair market price of $0.16 per share based on the adjusted
closing price on July 28, 2006, the last trading day before the compensation
committee meeting. In accordance with the 2000 Stock Option Plan, the stock
options vest quarterly over three years and expire on July 30, 2016.

         On August 15, 2006, the compensation committee granted to each Mr.
Christinson, Kumamoto and La Cara, Directors, stock options to purchase 150,000
shares of common stock, for a total of 450,000 shares. In addition, the
compensation committee granted to Mr. Scott, the Company's President, CFO and a
Director, stock options to purchase 250,000 shares of common stock. The options
were granted at the fair market price of $0.16 per share, based on the adjusted
closing price on August 14, 2006, the last trading day before the compensation
committee meeting. In accordance with the 2000 Stock Option Plan, the stock
options vest quarterly over three years and expire on August 14, 2016.

         On September 7, 2006, Alan Margerison, a former director of the
Company, exercised a stock option grant totaling 1,000,000 shares at $.08 per
share, for proceeds of $80,000. Mr. Margerison forfeited a stock option grant
totaling 1,000,000 shares at $.20 per share during the year ended December 31,
2006.

         During the year ended December 31, 2006, options that had been granted
to employees of Rex Tokyo, a discontinued operation from our divestiture on
April 4, 2006, subsequently expired. Such expired options included (i) a grant
of 30,000 stock options from February 7, 2005, at an exercise price of $.29, and
(ii) from a grant of 2,300,000 stock options from the year ended December 31,
2004, at exercise prices ranging from $0.26 to $0.34, a total of 2,270,000 were
cancelled in the year ended December 31, 2006.

                                      F-47Stock option activity, for options granted under the 2007 Stock
Incentive Plan as amended, for the year ended March 31, 2009, three months ended
March 31, 2008 and the years ended December 31, 2007 and 2006 are summarized as
follows:

                                                                Weighted Average
                                                 Options         Exercise Price
                                               -----------       --------------
Outstanding as of December 31, 2005 .....        7,600,000          $ 0.225
Granted .................................          900,000            0.160
Exercised ...............................       (1,000,000)          (0.080)
Forfeitures .............................       (3,300,000)          (0.264)
                                               -----------          -------
Outstanding as of December 31, 2006 .....        4,200,000            0.214
Granted .................................        5,347,500            0.284
Exercised ...............................         (434,166)          (0.202)
Forfeitures .............................       (1,055,834)          (0.211)
                                               -----------          -------
Outstanding as of December 31, 2007 .....        8,057,500            0.261
Granted .................................        1,505,000            0.292
Exercised ...............................          (86,458)          (0.156)
Forfeitures .............................         (350,000)          (0.336)
                                               -----------          -------
Outstanding as of March 31, 2008 ........        9,126,042            0.264
Granted .................................        3,387,429            0.190
Exercised ...............................          (62,959)          (0.172)
Forfeitures .............................         (757,000)          (0.245)
                                               -----------          -------
Outstanding as of March 31, 2009 ........       11,693,512          $ 0.245
                                               ===========          =======

         The following table summarizes information about stock options
outstanding and exercisable at March 31, 2009:

                                                                               Weighted
                                           Weighted    Weighted                 Average
                                           Average      Average                 Exercise
        Range of              Number      Remaining    Exercise     Number       Price
     Exercise Prices       Outstanding  Life In Years    Price   Exercisable  Exercisable
------------------------   -----------  -------------  --------  -----------  -----------
$0.06 to $0.16 .........     4,070,833    8.03 years     $0.14     1,904,166     $0.15
$0.20 to $0.28 .........     2,520,179    6.91 years     $0.22     2,182,596     $0.21
$0.29 to $0.31 .........     2,385,000    8.29 years     $0.29     1,024,583     $0.29
$0.37 to $0.51 .........     2,717,500    8.33 years     $0.39     1,273,750     $0.39
                           -----------  -------------  --------  -----------  -----------
                            11,693,512    7.99 years     $0.25     6,835,095     $0.24
                           ===========  =============  ========  ===========  ===========

There is no aggregate intrinsic value of the exercisable options as of March 31,
2009.

NOTE 16. COMMITMENTS, CONTINGENCIES AND LEGAL PROCEEDINGS

Legal Proceedings

         There are no pending legal proceedings against the Company that will
have a material adverse effect on our cash flows, financial condition or results
of operations.

         On June 9, 2009, H Capital submitted documents claiming ownership of
the Company's 600 shares of Global Hotline. The Company is pursuing all legal
means to maintain its 100% ownership of Global Hotline. In addition, the parties
continue to negotiate over the alleged unpaid loans.

                                      F-48Employment Agreements

Agreements with Derek Schneideman

         On September 5, 2007, the Company entered into new employment
agreements with each of Derek Schneideman, the Company's Chief Executive Officer
and Chairman of the Board of Directors, and Mark Scott, the Company's Chief
Operating and Financial Officer, which replace their prior employment agreements
with the Company.

         Derek Schneideman's Employment Agreement ("Schneideman Agreement") has
a two year term beginning on September 5, 2007, and is renewable on an annual
basis one year prior to the termination of the prior term. On September 4, 2008,
the Schneideman Agreement automatically renewed through September 4, 2009. The
Company will pay Mr. Schneideman an annual base salary of $250,000, and will
provide for participation in the Company's benefit programs available to other
senior executives (including group insurance arrangements). Also under the
Schneideman Agreement, Mr. Schneideman may be paid a bonus up to $230,000, as
may be declared by the Company's compensation committee based on Mr. Schneideman
raising additional capital for the Company and the Company's profitability and
share price improvement.

         If Mr. Schneideman's employment is terminated without cause (as defined
in the Schneideman Agreement), Mr. Schneideman will be entitled to a payment
equal to one year's annual base salary, and the full vesting of any previously
granted and unexpired options. If Mr. Schneideman's employment is terminated
without cause within one year following a change of control (as defined in the
Schneideman Agreement), or if Mr. Schneideman terminates his employment for good
reason (as defined in the Schneideman Agreement), Mr. Schneideman will be
entitled to a payment equal to two times the sum of his annual base salary plus
the highest annual bonus earned by Mr. Schneideman for any of the three fiscal
years, and the full vesting of any previously granted and unexpired options. Mr.
Schneideman is required to provide not less than twelve (12) months written
notice to the Company to terminate his employment with the Company at any time
for any reason.

         On May 16, 2008, the board of directors, upon the recommendation of the
compensation committee, approved the 2008/9 compensation and bonus package for
Derek Schneideman. Pursuant to this package, Mr. Schneideman may be paid a bonus
in common stock up to $255,000, as may be declared by the Company's compensation
committee, based on Mr. Schneideman raising capital, certain profitability
targets and achieving share price improvement for the Company. In addition, Mr.
Schneideman was awarded an annual salary increase of $37,500 issued in common
stock and was granted stock options to purchase common stock of 500,000 shares.
The options were granted at the fair market price of $0.29 per share based on
the adjusted closing price on May 9, 2008, the day the board of directors agreed
on the grant. In accordance with the 2007 Stock Incentive Plan, the stock
options vest quarterly over three years and expire on May 8, 2018.

         On May 15, 2008, Mr. Schneideman was awarded 131,400 shares of common
stock registered under the 2007 Stock Incentive Plan. The board of directors,
upon the recommendation of the compensation committee, awarded the shares in
lieu of an annual salary increase. The number of shares awarded was based on his
$250,000 base compensation for 2007 or 15.0% and was for his 2007 performance.
The compensation committee believes the issuance of shares of common stock more
closely aligns management with its shareholders. The Company and Mr. Schneideman
entered into a Restricted Stock Agreement for this award.

         The shares were valued at $.29 per share, the close price on May 15,
2008, the last day before the compensation committee meeting. The shares will
have a three month restriction under the 2007 Stock Incentive Plan, and were
fully vested on August 15, 2008.

         On October 22, 2008, Mr. Schneideman was awarded 151,670 shares of
common stock registered under the 2007 Stock Incentive Plan. The compensation
committee awarded the shares based on his achievement of a bonus included in his
2008 bonus program. The Company and Mr. Schneideman entered into a Restricted
Stock Agreement for this award.

                                      F-49The shares were valued at $.07 per share, the close price on October
21, 2008, the last day before the compensation committee meeting. The shares
will have a three month restriction under the 2007 Stock Incentive Plan, and
were fully vested on January 20, 2009.

         On August 2, 2009, Derek Schneideman resigned as the Company's Chief
Executive Officer and as a member of the Board, effective immediately upon the
Company's filing of the 2009 Form 10-K, which the Company currently anticipates
will occur on September 3, 2009. Mr. Schneideman did not resign from the Board
due to any disagreement with the Company relating to the Company's operations,
policies or practices.

         In connection with Mr. Schneideman's resignation, he and the Company
entered into a Separation Agreement and Full Release of Claims (the "Separation
Agreement"), which is effective as of August 2, 2009, subject to Mr.
Schneideman's limited right to revoke the agreement for a period of seven days.
Pursuant to the Separation Agreement, the Company agreed to make the following
severance payments to Mr. Schneideman:

      o  $100,000 payable upon the Company's filing of the 2009 Form 10-K with
         the SEC, provided that Mr. Schneideman executes the certifications
         required in connection with filing the 2009 Form 10-K; and

      o  $100,000 payable 60 days following the effective date of Mr.
         Schneideman's resignation, provided that (i) the Company's filings with
         the SEC are not determined to contain materially inaccurate
         information, material representations or material omissions, (ii)
         evidence of fraud or illegal acts on the part of Mr. Schneideman is not
         discovered, and (iii) Mr. Schneideman has not made any
         misrepresentations in connection with its purchase of the Shares, as
         described above.

         If Mr. Schneideman exercises his limited right to revoke the Separation
Agreement, he will not be entitled to receive either of the payments described
above. Mr. Schneideman will also be paid a total of $52,827 for accrued but
unpaid salary, benefits and business expense reimbursements as of the date of
the Separation Agreement.

         The Separation Agreement provides that Mr. Schneideman will continue to
provide services to the Company as a consultant for a period of 12 months
following the effective date of his resignation as Chief Executive Officer. In
exchange for such services (which include services related to preparing the
Company's proxy statement for its 2009 Annual Meeting of Stockholders), the
Company will pay Mr. Schneideman $2,000 per month. The Company is entitled to
terminate the consulting relationship upon 30 days advance notice and payment of
the consulting fee to which Mr. Schneideman would be entitled in the 30 days
following such notice.

         In consideration of and for the severance payments and consulting
arrangement described above, Mr. Schneideman provided a broad release in favor
of the Company with respect to any and all rights, claims, demands, causes of
actions and liabilities of any nature relating to his employment with the
Company, the termination of such employment, and/or his entry into the
Separation Agreement.

         Finally, the Separation Agreement also contains customary provisions
with respect to confidentiality, non-disclosure, non-solicitation,
non-disparagement and Mr. Schneideman's return of any property of the Company in
his possession.

                                      F-50Agreements with Mark Scott

         Mark Scott's Employment Agreement ("Scott Agreement") has a two year
term beginning on September 5, 2007, and is renewable on an annual basis one
year prior to the termination of the prior term. On September 4, 2008, the Scott
Agreement automatically renewed through September 4, 2009. The Company will pay
Mr. Scott an annual base salary of $200,000, and will provide for participation
in the Company's benefit programs available to other senior executives
(including group insurance arrangements). Also under the Scott Agreement, Mr.
Scott may be paid a bonus up to $105,000, as may be declared by the Company's
compensation committee based on Mr. Scott raising additional capital for the
Company and the Company's profitability and share price improvement.

         If Mr. Scott's employment is terminated without cause (as defined in
the Scott Agreement), Mr. Scott will be entitled to a payment equal to one
year's annual base salary, and the full vesting of any previously granted and
unexpired options. If Mr. Scott's employment is terminated without cause within
one year following a change of control (as defined in the Scott Agreement), or
if Mr. Scott terminates his employment for good reason (as defined in the Scott
Agreement), Mr. Scott will be entitled to a payment equal to two times the sum
of his annual base salary plus the highest annual bonus earned by Mr. Scott for
any of the three fiscal years, and the full vesting of any previously granted
and unexpired options. Mr. Scott is required to provide not less than twelve
(12) months written notice to the Company to terminate his employment with the
Company at any time for any reason.

         On April 27, 2008, Mr. Scott was awarded 131,400 shares of common stock
registered under the 2007 Stock Incentive Plan. The compensation committee
awarded the shares in lieu of an annual salary increase. The number of shares
awarded was based on his $200,000 base compensation for 2007 or 17.7% and was
for his 2007 performance. The compensation committee believes the issuance of
shares of common stock more closely aligns management with its shareholders. The
Company and Mr. Scott entered into a Restricted Stock Agreement for this award.

         The shares were valued at $.27 per share, the close price on April 25,
2008, the last day before the compensation committee meeting. The shares will
have a three month restriction under the 2007 Stock Incentive Plan, and were
fully vested on July 25, 2008.

         On October 22, 2008, Mr. Scott was awarded 113,752 shares of common
stock registered under the 2007 Stock Incentive Plan. The compensation committee
awarded the shares based on his achievement of a bonus included in his 2008
bonus program. The Company and Mr. Scott entered into a Restricted Stock
Agreement for this award.

         The shares were valued at $.07 per share, the close price on October
21, 2008, the last day before the compensation committee meeting. The shares
will have a three month restriction under the 2007 Stock Incentive Plan, and
were fully vest on January 20, 2009.

         On May 16, 2008, the Company's board of directors, upon the
recommendation of the compensation committee, ratified the 2008/9 compensation
and bonus package for Mark Scott. Pursuant to this package, Mr. Scott may be
paid a bonus in common stock up to $155,000, as may be declared by the Company's
compensation committee, based on Mr. Scott raising capital, certain
profitability targets and achieving share price improvement for the Company. In
addition, Mr. Scott was awarded an annual salary increase of $35,500 issued in
common stock and was granted stock options to purchase common stock of 200,000
shares. The options were granted at the fair market price of $0.29 per share
based on the adjusted closing price on May 9, 2008, the day the board of
directors agreed on the grant. In accordance with the 2007 Stock Incentive Plan,
the stock options vest quarterly over three years and expire on May 8, 2018.

         On August 24, 2009, the Company entered into a new Employment Agreement
with Mark Scott, which replaces his Employment Agreement dated September 5,
2007.

                                      F-51Mark Scott's Employment Agreement ("Scott Agreement") has a one year
term beginning on August 24, 2009, and is renewable on a mutually agreeable
basis. The Company will pay Mr. Scott an annual base salary of $96,000, and will
provide for participation in the Company's benefit programs available to other
senior executives (including group insurance arrangements). Also under the Scott
Agreement, Mr. Scott is eligible for discretionary performance bonuses based
upon performance criteria to be determined by the Company's Compensation
Committee based on criteria under development. If Mr. Scott's employment is
terminated without Cause (as defined in the Scott Agreement), Mr. Scott will be
entitled to a payment equal to one year's annual base salary paid at the
Company's discretion in a lump sum or over the next year.

         On August 24, 2009, the board of directors awarded Mr. Scott 200,000
shares of Restricted Stock. The award was granted at the fair market price of
$0.05 per share based on the adjusted closing price on August 20, 2009, the last
trading day before the board of director meeting. In accordance with the 2007
Stock Incentive Plan, the Restricted Stock vests on November 23, 2009.

Leases

         The Company is obligated under various non-cancelable operating leases
for their various facilities and certain equipment. Certain facilities have
cancellation options of 1-6 months notice.

         The aggregate future minimum lease payments, to the extent the leases
have early cancellation options and excluding escalation charges, are as
follows:

Years Ended March 31,
        2009 ........   $1,765,279
        2010 ........      618,664
        2011 ........      399,731
        2012 ........      117,974
        2013 ........       12,357
                        ----------
        Total .......   $2,914,005
                        ==========

         Rent expense, for the twelve months ended March 31, 2009 and three
months ended March 31, 2008 was $3,379,165 and $595,643, respectively. Rent
expense for the years ended December 31, 2007 and 2006 was $1,818,570 and
$1,233,789, respectively.

                                      F-52NOTE 17. INDUSTRY SEGMENT AND GEOGRAPHIC INFORMATION

         The Company operates as a strategic holding Company with a dedicated
focus on growth of existing business, together with expansion mergers and
acquisitions in the Pacific Rim region. It is organized by subsidiary or equity
investment. Each subsidiary or equity investment reported to the Chief Executive
Officer who has been designated as the Chief Operating Decision Maker ("CODM")
as defined by SFAS No. 131 "Disclosures About Segments of an Enterprise and
Related Information"("SFAS 131"). The CODM allocates resources to each of the
companies using information regarding revenues, operating income (loss) and
total assets.

         The following subsidiaries are the only reportable segments under the
criteria of SFAS 131 (i) IA Global, the parent company, operates as a strategic
holding company with a dedicated focus on growth of existing business, together
with expansion mergers and acquisitions in the Pacific Rim region, (ii) Global
Hotline, which operates exclusively in Japan, and is an operator of major call
centers providing business process outsourcing of telemarketing for
telecommunications and insurance products, (iii) Slate, our equity investments
in the human capital and resource sector, (iv) ASFL, our equity investment,
which raises funds through the issuance of debentures in Australia and the
providing of short term, secured, real property loans to businesses or investors
in Australia and (v) Taicom, our equity investment in the Japanese securities
sector.

         The following table presents revenues, operating income (loss) and
total assets by Company for the twelve months ended March 31, 2009, the
transition period for the three months ended March 31, 2008 and the years ended
December 31, 2007 and 2006:

(dollars in thousands)
                                                                      Global
                                                       Global        Hotlines
                                      IA Global,      Hotline,     Philippines       Equity                    Discontinued
Company                                  Inc.           Inc.           Inc.        Investments      Total       Operations       Total
                                      ----------      --------     -----------     -----------    --------     ------------     --------
Year Ended March 31, 2009
     Revenue ....................      $      -       $ 56,555       $    552         $    -      $ 57,107          $ -         $ 57,107
     Operating loss .............        (2,465)        (6,716)          (374)             -        (9,555)           -           (9,555)
     Total assets ...............          (274)        19,836            700          4,604        24,866            -           24,866

Transition Period For The
Three Months Ended March 31, 2008
     Revenue ....................      $      -       $ 16,049              -         $    -      $ 16,049          $ -         $ 16,049
     Operating (loss) profit ....          (502)         2,537              -              -         2,035            -            2,035
     Total assets ...............           269         24,964              -          9,707        34,940            -           34,940

Year Ended December 31, 2007
     Revenue ....................      $      -       $ 29,136              -         $    -      $ 29,136          $ -         $ 29,136
     Operating loss .............        (2,040)        (7,538)             -              -        (9,578)           -           (9,578)

Year Ended December 31, 2006
     Revenue ....................      $      -       $ 19,139              -         $    -      $ 19,139          $ -         $ 19,139
     Operating loss .............        (1,779)        (1,043)             -              -        (2,822)           -           (2,822)


Geographic Region                        U.S.          Japan       Philippines      Australia       Total
                                       --------       --------     -----------      ---------     --------
Year Ended March 31, 2009
     Revenue ....................      $      -       $ 56,555       $    552         $    -      $ 57,107
     Operating loss .............        (2,465)        (6,716)          (374)             -        (9,555)
     Total assets ...............          (274)        24,440            700              -        24,866

Transition Period For The
Three Months Ended March 31, 2008
     Revenue ....................      $      -       $ 16,049              -         $    -      $ 16,049
     Operating (loss) profit ....          (502)         2,537              -              -         2,035
     Total assets ...............           132         27,878              -          6,930        34,940

Year Ended December 31, 2007
     Revenue ....................      $      -       $ 29,136              -         $    -      $ 29,136
     Operating loss .............        (2,040)        (7,538)             -              -        (9,578)

Year Ended December 31, 2007
     Revenue ....................      $      -       $ 19,139              -         $    -      $ 19,139
     Operating loss .............        (1,779)        (1,043)             -              -        (2,822)

                                      F-53The following reconciles operating loss to net loss:

(dollars in thousands)                                            Transition
                                                                Period For The
                                                   Year Ended    Three Months     Year Ended December, 31,
                                                    March 31,   Ended March 31,   ------------------------
                                                      2009          2008            2007           2006
                                                   ----------   ---------------   --------       --------
Operating loss ...............................      $ (9,555)      $  2,035       $ (9,578)      $ (2,822)
Other expense ................................       (10,943)          (317)          (577)          (640)
                                                    --------       --------       --------       --------
Loss from continuing operations
  before income taxes ........................       (20,498)         1,718        (10,155)        (3,462)
Income tax (benefit) provision ...............          (257)         1,358         (2,006)           515
                                                    --------       --------       --------       --------
Net loss from continuing operations ..........       (20,241)           360         (8,149)        (3,977)
Total (loss) gain from discontinued operations             -              -           (110)           207
                                                    --------       --------       --------       --------
Net loss .....................................      $(20,241)      $    360       $ (8,259)      $ (3,770)
                                                    ========       ========       ========       ========

NOTE 18. SELECTED QUARTERLY FINANCIAL DATA (Unaudited)

         The following table sets forth certain unaudited quarterly financial
information:

                                            Summarized Quarterly Financial Data (Unaudited)
(in thousands)
                                                                                             Quarter Ended, (in thousands)
                                                                                   --------------------------------------------------
                                                                       Total       March 31     December 31  September 30     June 30
                                                                     --------      --------     -----------  ------------    --------
Year Ended March 31, 2009
Revenue ........................................................     $ 57,107      $  8,553      $ 13,501      $ 15,365      $ 19,688
Gross profit ...................................................       43,889         4,206        10,860        12,330        16,493
Net loss from continuing operations ............................      (20,241)      (16,331)       (2,941)       (1,698)          729
Net loss .......................................................      (20,241)      (16,331)       (2,941)       (1,698)          729
                                                                     --------      --------      --------      --------      --------

Basic and diluted net loss per share ...........................     $  (0.10)     $  (0.07)     $  (0.01)     $  (0.01)     $      -
                                                                     ========      ========      ========      ========      ========

Three Months Ended March 31, 2008
Revenue ........................................................     $ 16,049      $ 16,049      $      -      $      -      $      -
Gross profit ...................................................       13,099        13,099             -             -             -
Net loss from continuing operations ............................          360           360             -             -             -
Net loss .......................................................          360           360             -             -             -
                                                                     --------      --------      --------      --------      --------

Basic and diluted net loss per share ...........................     $      -      $      -      $      -      $      -      $      -
                                                                     ========      ========      ========      ========      ========

                                                                                             Quarter Ended, (in thousands)
                                                                                   --------------------------------------------------
                                                                       Total       March 31     December 31  September 30     June 30
                                                                     --------      --------     -----------  ------------    --------
Year Ended December 31, 2007
Revenue ........................................................     $ 29,137      $ 10,667      $  6,462      $  5,515      $  6,493
Gross profit ...................................................       21,112         7,481         4,261         3,873         5,497
Net loss from continuing operations ............................       (8,149)       (1,557)       (3,621)       (2,127)         (844)
Net loss .......................................................       (8,259)       (1,667)       (3,621)       (2,127)         (844)
                                                                     --------      --------      --------      --------      --------

Basic and diluted net loss per share (1) .......................     $  (0.05)     $  (0.01)     $  (0.02)     $  (0.01)     $  (0.01)
                                                                     ========      ========      ========      ========      ========

(1) Immaterial discontinued operations of $110,000 for 2007 are not presented.

Year Ended December 31, 2006
Revenue ........................................................     $ 19,139      $  7,742      $  4,483      $  3,243      $  3,671
Gross profit ...................................................       16,244         7,778         3,879         2,435         2,152
Net (loss) profit from continuing operations ...................       (3,977)          547        (1,179)       (1,882)       (1,463)
Gain (loss)  from discontinued operations ......................          207          (332)            -           463            76
Net (loss) profit ..............................................       (3,770)          215        (1,179)       (1,419)       (1,387)
                                                                     --------      --------      --------      --------      --------

Basic net (loss) profit per share from continuing operations ...     $  (0.04)     $   0.01      $  (0.01)     $  (0.02)     $  (0.01)
Basic net (loss) profit per share from discontinued operations .            -             -             -             -             -
                                                                     --------      --------      --------      --------      --------
                                                                     $  (0.03)     $      -      $  (0.01)     $  (0.01)     $  (0.01)
                                                                     ========      ========      ========      ========      ========

Diluted net (loss) profit per share from continuing operations .     $  (0.04)     $      -      $  (0.01)     $  (0.02)     $  (0.01)
Diluted net (loss) profit per share from discontinued operations            -             -             -             -             -
                                                                     --------      --------      --------      --------      --------
                                                                     $  (0.03)     $      -      $  (0.01)     $  (0.01)     $  (0.01)
                                                                     ========      ========      ========      ========      ========

                                      F-54NOTE 19. SUBSEQUENT EVENTS

IA Global, Inc. announced the following results of its Special Shareholder
Meeting held on June 1, 2009:

(i) Approved the Amendment of our Certificate of Incorporation increasing in the
number of authorized common shares from 300,000,000 to 450,000,000 by the
following vote:

For 118,852,425 Against 2,567,300 Abstain 44,300

(ii) Rejected the Issuance of Shares of Common Stock in Connection with Certain
Transactions by the following vote:

For 52,218,263 Against 69,201,562 Abstain 44,200

REPORT OF MANAGEMENT

IA Global, Inc. and Subsidiaries

         IA Global, Inc. is responsible for the preparation, integrity, and fair
presentation of the consolidated financial statements included in this annual
report. The consolidated financial statements and notes included in this annual
report have been prepared in conformity with United States generally accepted
accounting principles and necessarily include some amounts that are based on
management's best estimates and judgments.

         We, as management of IA Global, Inc., are responsible for establishing
and maintaining effective adequate control over financial reporting that is
designed to produce reliable financial statements in conformity with United
States generally accepted accounting principles. The system of internal control
over financial reporting as it relates to the financial statements is evaluated
for effectiveness by management and tested for reliability through a program of
internal audits. Actions are taken to correct potential deficiencies as they are
identified. Any system of internal control, no matter how well designed, has
inherent limitations, including the possibility that a control can be
circumvented or overridden and misstatements due to error or fraud may occur and
not be detected. Also, because of changes in conditions, internal control
effectiveness may vary over time. Accordingly, even an effective system of
internal control will provide only reasonable assurance with respect to
financial statement preparation.

         The Audit Committee, consisting entirely of independent directors,
meets regularly with management, internal auditors and the independent
registered public accounting firm, and reviews audit plans and results, as well
as management's actions taken in discharging responsibilities for accounting,
financial reporting and internal control. Sherb & Co., LLP, independent
registered public accounting firm, and the internal auditors have direct and
confidential access to the Audit Committee at all times to discuss the results
of their examinations.

REPORT ON MANAGEMENT'S ASSESSMENT OF INTERNAL CONTROL OVER FINANCIAL REPORTING

         Management assessed the corporation's system of internal control over
financial reporting as of March 31, 2009, in relation to criteria for effective
internal control over financial reporting as described in "Internal
Control--Integrated Framework," issued by the Committee of Sponsoring
Organizations of the Treadway Commission. Based on this assessment, management
concludes that, as of March 31, 2009, its system of internal control over
financial reporting is effective based on the criteria of the "Internal
Control--Integrated Framework".


/s/ Derek Schneideman                   /s/ Mark Scott
Derek Schneideman                       Mark Scott
Chief Executive Officer                 Chief Operating and
                                        Financial Officer

San Francisco, CA
September 3, 2009

                                      F-55SIGNATURES

         Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, IA Global, Inc. (the "Registrant") has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized.

                                        IA GLOBAL, INC.

Date: September 3, 2009             By: /s/ Derek Schneideman
                                        ---------------------
                                        Derek Schneideman
                                        Chief Executive Officer and
                                        Director

                                    By: /s/  Mark Scott
                                        ---------------
                                        Mark Scott
                                        Chief Financial Officer and
                                        Secretary

         Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated:

SIGNATURES                             TITLE                           DATE
----------                             -----                           ----

/s/ Derek Schneideman    Chief Executive Officer and Director      September 3, 2009
---------------------    (Principal Executive Officer)
Derek Schneideman

/s/ Mark Scott           Chief Operating and Financial Officer     September 3, 2009
--------------           and Secretary
Mark Scott               (Principal Financial and Accounting
                         Officer)

/s/ Masazumi Ishii       Independent Director                      September 3, 2009
------------------
Masazumi Ishii

/s/ Eric La Cara         Independent Director                      September 3, 2009
----------------
Eric La Cara

                         Independent Director                      September 3, 2009
----------------
Brian Hoekstra

                         Independent Director                      September 3, 2009
----------------
Ryuhei Senda