SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-K
(Mark One)

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

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

        For the transition period from January 1, 2008 to March 31, 2008

                         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: (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 July 11, 2008 was approximately $24,363,848.

         The number of shares of the registrant's common stock outstanding as of
July 11, 2008: 209,363,942 shares of Common stock.   DOCUMENTS INCORPORATED BY REFERENCE

         Portions of the definitive proxy statement for the Registrant's Annual
Meeting of Shareholders to be held on July 29, 2008, which was filed with the
Securities and Exchange Commission on June 23, 2008, are incorporated by
reference into Part III of the Form 10-K.


                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----
                                     PART I

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

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

Item 1B. Unresolved Staff Comments .........................................  11

Item 2.  Properties ........................................................  11

Item 3.  Legal Proceedings .................................................  11

Item 4.  Submission of Matters to a Vote of Security Holders ...............  11


                                     PART II

Item 5.  Market for Registrant's Common Equity, Related Stockholder Matters
         and Issuer Purchases of Equity Securities .........................  12

Item 6.  Selected Financial Data ...........................................  14

Item 7.  Management's Discussion and Analysis of Financial Condition
         and Results of Operations .........................................  15

Item 7A. Quantitative and Qualitative Disclosures about Market Risk ........  26

Item 8.  Financial Statements and Supplementary Data .......................  27

Item 9.  Changes in and Disagreements With Accountants on Accounting
         and Financial Disclosure ..........................................  27

Item 9A. Controls and Procedures ...........................................  27

Item 9B. Other Information .................................................  27


                                    PART III

Item 10. Directors, Executive Officers and Corporate Governance ............  28

Item 11. Executive Compensation ............................................  29

Item 12. Security Ownership of Certain Beneficial Owners
         and Management and Related Stockholder Matters ....................  29

Item 13. Certain Relationships and Related Transactions,
         and Director Independence .........................................  29

Item 14. Principal Accounting Fees and Services ............................  29


                                     PART IV

Item 15. Exhibits, Financial Statement Schedules ...........................  30

SIGNATURESPART I

TRANSITION REPORT

         On July 25, 2007, the Board of Directors resolved that the fiscal year
of IA Global 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.
The company filed a Form 10-K for the calendar year ending December 31, 2007 and
is filing this Form 10-K transition report to reflect the three month transition
period of January 1, 2008 through March 31, 2008.

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 and the Australian Dollar. At March 31, 2008, the exchange rate for
the Japanese Yen was US $1= Yen [99.2914], the US $1= Australian $[1.0908] and
US $1= Philippine Peso [42.038]. 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. ("IA Global") 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 actively expanding investments in the
business process outsourcing (which includes human resources elements necessary
to recruit and train the very large numbers of people), B2B 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, Hong Kong/China, Singapore, and India 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, Inc. ("Global
Hotline") a Business Process Outsourcing organization, operating several 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 significant multi-year
contracts with major corporations.

         This growth trajectory 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, 2008, Global Hotline
employed 1,145 full and part-time personnel to support these multi-million
dollar contracts. In the Philippines, we acquired 100% of Shift Resources, LLC
on April 10, 2008 and Asia Premier Executive Suites, Inc. on May 27, 2008,
multi-service call center operations that have now been merged into a single
company named Global Hotline Philippines Inc.

HUMAN CAPITAL AND RESOURCES

         During August 2007, we closed two equity investments. These investments
provide "human capital" services in the human resources sector, a sector which
offers excellent growth opportunities throughout the Asia Pacific region. IA
Global continues to seek additional companies and partnerships in the staffing,
training, employee/ organization evaluation and assessments business throughout
the region, but with a focus on Japan. Linking these investments in a network
under the IA Global umbrella will generate synergies of expertise and resources,
creating a regional value-chain of services to further drive aggressive growth.
Our investments in Human Capital and Resources are as follows:

         IA Global has a 25% stake in GPlus Media Co Ltd ("GPlus"). GPlus is a
Japan based corporation with offices in Tokyo, Japan, Hong Kong and Shanghai,
China. GPlus owns and operates several of Japan's best known English-Japanese
websites, including GaijinPot.com, and Ecentral.jp, the official jobsite of the
American Chamber of Commerce in Japan. GPlus also operates CareerEngine.org,
which is a powerful network of jobsites with partners who include
ShanghaiExpat.com, the American Chambers of Commerce in Shanghai and Hong Kong,
as well as the Canada China Business Council.

         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, Hong Kong, Surrey, Canada; a call center in
Manila, Philippines; and an early stage call center in Bucharest, Romania.

                                        2FINANCIAL SERVICES

         In Australia, we have a 36% stake in Australian Secured Financial
Limited and its affiliates, Ausec Finance Limited, ADJ Services Pty Ltd. and
Auslink Ltd (collectively, "ASFL"), which raises funds through the issuance of
private loans and bank debt within Australia and provide short term, secured,
real property loans to businesses and investors in Australia. Through this group
of companies, ASFL has created a strong financial services network leveraging
its knowledge and presence in local communities to cater to a sector of the
market neglected by larger financial institutions.

         In Japan, we have a 20% stake 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 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, the Tokyo Commodity
Exchange, the Tokyo Grain Exchange and the Chubu (Central Japan) Commodity
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, Hong Kong 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 COMMON STOCK

         Our common stock currently trades on the American Stock Exchange
("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 continued growth of our existing investments and present
us with an increasing number of quality investment opportunities.

         Our principal Japanese subsidiary, Global Hotline is demonstrating
significant growth. This growth trajectory is being driven by the ongoing
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.

                                        3Annual 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 aggressively grow our existing business entities during
FY 2008/9.

         - We intend to expand our reach to encompass Hong Kong/China, the
Philippines/Singapore, and India and the outstanding 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 actively expand our investments in the business process
Outsourcing in Japan and the Philippines, human capital and resources, and B2B
sectors.

         - We intend to deliver greater profitability during FY 2008/9.

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

         - We intend to increase investor relation activities to increase the
trading volume and share price.

PRIMARY RISKS AND UNCERTAINTIES

         We are exposed to various risks related to our need for additional
financing, our level of indebtedness, our ASFL investment, our AMEX listing, our
controlling shareholder groups, the sale of significant numbers of our shares, a
volatile market price for our common stock, our Global Hotline business and our
mergers and acquisitions and other matters. 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. The Japanese telecommunications market is experiencing significant
growth in alternative carriers due to recent regulatory changes that now permit
individuals and companies to change their telephone service provider while at
the same time retaining their existing telephone numbers.

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.

                                        4GEOGRAPHICAL MARKETS

         Global Hotline currently operates only in Japan, but the company
continues to evaluate the expansion of its operations in the Asia region. ASFL
operates in Australia. GPlus is a Japan based corporation with offices in Tokyo,
Japan, Hong Kong and Shanghai, China. Slate is a Japan based corporation with
operations and business entities in Tokyo, Hong Kong, Surrey, Canada; a call
center in Manila, Philippines; an early stage call center in Bucharest, Romania.

INTELLECTUAL 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, 2008.

EMPLOYEES

         As of March 31, 2008, we had 562 full-time and 585 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.

                                        5Forward-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.

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

         We will need to obtain additional financing in order to continue our
current operations, including the cash flow needs of IA Global, Global Hotline
and its subsidiaries, to acquire businesses, make equity investments and
maintain the $6 million in stockholder's equity required to maintain our AMEX
listing. There can be no assurance that we will be able to secure additional
funding or that if such funding is available, whether the terms or conditions
would be acceptable to us, our major shareholders or otherwise. 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 is likely that 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 AND LIMIT OUR GROWTH.

         At March 31, 2008, we have current and long-term indebtedness of $19.1
million. However, we will need to incur additional indebtedness and amend our
debt indebtedness in order to fund a portion of current operations and acquire
businesses. In addition, we are seeking to refinance some of outstanding loans
on more favorable terms to the Company, but may not be successful. See also our
risk factor "We will need additional financing to support our operations and
acquire businesses," above.

WE ARE EXPOSED TO CHANGES IN THE AUSTRALIAN FINANCE INDUSTRY

         The Australian finance industry is experiencing significant change. We
own 36% of ASFL which raises funds through the issuance of bank debt in
Australia and provides short term, secured, real property loans to businesses or
investors in Australia. ASFL may be affected by the following factors that would
impact its ability to operate as a short term lender in Australia and could
impair our investment:

         o Risks related to mortgage lending, including customers may not be
able to repay the loans, the value of the underlying security may decline, ASFL
is reliant on property valuations to ensure collectability of the loans and we
rely on customers maintaining adequate insurance on the real property;

         o Risks related to world-wide mortgage lending;

         o Decreased market demand for high interest loans;

         o The bank line of credit used to fund the business could be
terminated;

         o Market perception of ASFL and ASFL's competitors may have a major
impact on ASFL's reputation as well;

         o General economic conditions and changes in interest rates;

         o The loan portfolio is concentrated in a small number of significant
loans;

         o New competitors;

                                        6o Decreased pricing;

         o Litigation risk; and

         o Loss of key personnel.

         The ASFL business is also dependent upon their ability to operate
efficiently by maintaining tight control on cash flows and raising funds from
private investors or a bank line of credit. Any change in these factors could
adversely affect their ability to operate as a short term lender in Australia.
This could have a material adverse effect on ASFL's business, prospects,
financial condition and results of operations.

OUR STOCKHOLDERS' EQUITY MUST EXCEED $6 MILLION TO MAINTAIN OUR LISTING ON THE
AMERICAN STOCK EXCHANGE

         As of March 31, 2008, we were not in compliance with the AMEX continued
listing standards with stockholders' equity in excess of $6 million and our
common stock continues to trade on AMEX. To maintain this listing, we must
maintain stockholders' equity of $6 million. As of June 30, 2008, we are in
compliance with this standard.

         We anticipate that we will maintain our AMEX listing. However, if our
common stock were to be de-listed by AMEX, we believe that our stock would
continue to be traded as a bulletin board stock. If we do not maintain our AMEX
listing it would materially affect the ability of our shareholders to dispose of
their shares of common stock, reduce the liquidity of their investment and
affect our ability to obtain financing to support future operations and
acquisitions.

OUR CONTROLLING SHAREHOLDER GROUP HAS SUBSTANTIAL INFLUENCE OVER OUR COMPANY

         As of June 28, 2008, IAJ LBO Fund, PBAA Fund Limited, Terra Firma,
Inter Asset Japan Co Ltd ("IAJ"), IA Turkey, Hiroki Isobe, Kyo Nagae
(collectively, the "Controlling Shareholders") and Derek Schneideman
collectively hold approximately 39.7% of our common stock. The share ownership
percentages excludes 811,285 shares of common stock held by GMB Holdings Ltd,
and other shareholders for which Mr. Isobe has personal signing authority,
7,666,679 shares of our common stock issuable upon conversion of the convertible
debentures, an additional potential 5,862,709 shares issuable upon conversion of
the convertible debentures and 627,900 shares of treasury 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 Kyo Nagae control each of our Controlling Shareholders. In
addition, Mr. Schneideman in his capacity as Chairman and CEO of the company has
sole voting power and dispositive power with respect to 77,613,470 shares of
common stock or approximately 47.1% of the outstanding shares of common stock of
the company for all of the company's 2008 shareholder meetings pursuant to a
proxy granted on February 21, 2008.

         IAJ could cause a change of control of our board of directors by
electing candidates of its 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 has
significant influence over our affairs, 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 June 28, 2008, 195.8 million shares
of common stock were outstanding. Significant shares of common stock are held by
our controlling 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 controlling 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.

                                        7THE 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 Quarterly variations in our operating results,

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

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

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

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

         o Investor relation activities,

         o 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 General market and economic conditions,

         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. While we expect to be
profitable in FY 2008/9, there can be no assurance that we will achieve or
maintain profitability.

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

         The Japanese telecommunications market is experiencing significant
growth due to recent regulatory changes that now permit individuals and
companies to choose their preferred telephone service provider. 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.

         o The business has a concentration with five major customers;

         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;

                                        8o 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.

         Our 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.

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.

                                        9From 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.

THE 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.

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 we have equity
investments that operate in Australia, Hong Kong, China and the Philippines. 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.

                                       10WE 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. 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.

ITEM 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.
We maintain a regional office in Atlanta, Georgia. The office is leased on a
month to month basis for $525 per month effective April 1, 2007. We maintain a
regional office in Tampa, Florida. The office is leased on a month to month
basis for $211 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   $  48,598    1/1/2007-12/31/2008     6 months
     Tokyo call center 2          426.00 m2          Call center             33,314     7/1/2007-6/30/2009     6 months
     Tokyo call center 3          403.00 m2          Call center             20,606   12/1/2007-11/30/2009     6 months
     Tokyo call center 4          571.65 m2          Call center             24,685      5/7/2008-5/6/2010     6 months
     Tokyo call center 5           1,276.15          Call center             48,598    6/18/2007-6/17/2010     6 months
     Osaka call center 6           980.298           Call center             38,893    5/07/2007-7/31/2009     6 months
     Osaka call center 6          500.84 m2          Call center             19,022    10/1/2007-9/30/2009     6 months
                                                                          ---------
                                                                          $ 238,717
                                                                          =========

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.

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.

                                       11PART II

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

         Our common stock trades on 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, 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

         June 30, 2006                       $0.370          $0.170
         September 30, 2006                  $0.140          $0.250
         December 31, 2006                   $0.100          $0.240
         March 31, 2007                      $0.400          $0.080

         As of July 11, 2008, the closing price of the company's common stock
was $.20 per share. As of July 11, 2008, there were 209,363,942 shares of common
stock outstanding held by approximately 219 stockholders of record. The number
of stockholders, including the beneficial owners' shares through nominee names
is approximately 1,500.

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

Share Repurchase Program

         The following information summarizes the purchases through March 31,
2008 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-March 2008.

                                       122007/8 PERFORMANCE GRAPH
                      COMPARISON OF CUMULATIVE TOTAL RETURN

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

The above assumes that $100 was invested in the common stock and each index on
March 31, 2003. 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.

                         3/31/2003   3/31/2004   3/31/2005   3/31/2006   3/31/2007   3/31/2008
                         ---------   ---------   ---------   ---------   ---------   ---------
IA Global, Inc.          $  100.00   $  330.00   $  220.00   $  360.00   $  390.00   $  280.00

AMEX Composite Index     $  100.00   $  151.92   $  176.45   $  234.02   $  262.90   $  269.79

Russell Microcap Index   $  100.00   $  179.91   $  176.82   $  221.32   $  225.72   $  178.15


                      EQUITY COMPENSATION PLAN INFORMATION

         The following table provides information as of March 31, 2008 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)              9,126,042                   0.264                   10,383,334

Equity compensation plans
not approved by shareholders                      -                       -                            -
                               ----------------------------   --------------------   --------------------------
Total                                     9,126,042                   0.264                   10,383,334
                               ============================   ====================   ==========================

(1) Awards granted under the 2007 Plan and the Plans. No further awards may be
granted under the Plans.

                                       13ITEM 6.  SELECTED FINANCIAL DATA

         In the following table, 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 three
months ended March 31, 2008 and the five years ended December 31, 2007. 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.

                                           Summarized Quarterly Financial Data (Unaudited)
(in thousands)
                                                                                           Quarter Ended, (in thousands)
                                                                                ---------------------------------------------------
                                                                     Total     December 31   September 30     June 30      March 31
                                                                   --------    -----------   ------------    --------      --------
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 ...........................   $      -      $      -      $      -      $      -      $      -
                                                                   ========      ========      ========      ========      ========

Year Ended December 31, 2007
----------------------------
Revenue ........................................................   $ 29,136      $ 10,667      $  6,461      $  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)
                                                                   ========      ========      ========      ========      ========

Year Ended December 31, 2005
----------------------------
Revenue ........................................................   $ 15,745      $  7,746      $  7,106      $    893      $      -
Gross profit ...................................................     10,174         4,728         4,980           466             -
Net (loss) profit from continuing operations ...................       (686)         (510)          571          (463)         (284)
(Loss) profit  from discontinued operations ....................     (1,385)         (860)          162          (427)         (260)
Net profit (loss) ..............................................     (2,071)       (1,370)          734          (891)         (544)
                                                                   --------      --------      --------      --------      --------

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

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

                                       14ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

INTRODUCTION

         We had revenues of $16.0 million and $6.5 for the three months ended
March 31, 2008 and 2007, respectively and $29.1 million, $19.1 million and $15.7
million for the years ended December 31, 2007, 2006 and 2005, respectively. We
have incurred net losses from continuing operations of $8.1 million, $4.0
million and $0.7 million for the years ended December 31, 2007, 2006 and 2005,
respectively. 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.

         In Japan, IA Global is 100% owner of Global Hotline, Inc. ("Global
Hotline"), a Business Process Outsourcing organization, operating several 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 significant multi-year
contracts with major corporations.

         During 2007, Global Hotline entered into loans of approximately $17.2
million and repaid loans of approximately $4.2 million. During 2006, Global
Hotline entered into loans of approximately $9.3 million and repaid loans of
approximately $4.6 million. The net loans were used to expand the business
infrastructure for current and anticipated major new client contracts, including
opening four call centers in Japan to service these client contracts. We expect
to reduce debt during FY 2008/9 with the improvement in Global Hotline operating
results starting January 1, 2008.

         We will need to obtain additional financing in order to continue our
current operations, including the cash flow needs of Global Hotline and its
subsidiaries, to acquire businesses, make equity investments and maintain the $6
million in stockholder's equity required to maintain our AMEX listing. There can
be no assurance that we will be able to secure additional funding or that if
such funding is available, whether the terms or conditions would be acceptable
to us, our major shareholders or otherwise.

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 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.

                                       15RESULTS 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.

                                                                 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.

                                       16EXPENSES

         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 employs
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 employs 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.

                                       17(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%
                                                       ========    ========    =========    ==========

                                       18(dollars in thousands)
                                                                  Year Ended December 31,
                                                       -----------------------------------------------
                                                         2006        2005      $ Variance   % Variance
                                                       --------    --------    ----------   ----------

Revenue ............................................   $ 19,139    $ 15,745    $   3,394         21.6%
Cost of sales ......................................      2,895       5,571       (2,676)       -48.0%
                                                       --------    --------    ---------    ----------
Gross profit .......................................     16,244      10,174        6,070         59.7%
                                                       --------    --------    ---------    ----------
Selling, general and administrative expenses .......     19,066       9,694        9,372         96.7%
                                                       --------    --------    ---------    ----------
Operating (loss) income ............................     (2,822)        480       (3,302)      -687.9%
                                                       --------    --------    ---------    ----------
Other Income (Expense):
Interest income ....................................         92          53           39         73.6%
Interest expense and amortization of beneficial
  conversion feature ...............................       (851)       (390)        (461)       118.2%
Other Income .......................................        179         121           58         47.9%
Gain on equity investment in Australia Secured
  Financial Limited ................................         70           -           70        100.0%
Foreign currency transaction adjustment ............       (130)       (125)          (5)        -4.0%
                                                       --------    --------    ---------    ----------
Total other expense ................................       (640)       (341)        (299)        87.7%
                                                       --------    --------    ---------    ----------
Loss (profit) from continuing operations before
   income taxes ....................................     (3,462)        139       (3,601)      2590.6%
Income taxes:
Current provision ..................................        515         825         (310)       -37.6%
                                                       --------    --------    ---------    ----------
Net loss from continuing operations ................     (3,977)       (686)      (3,291)      -479.7%
                                                       --------    --------    ---------    ----------
Gain from disposal of discontinued operations ......        463         308          155         50.3%
Gain (loss) from discontinued operations ...........         76      (1,393)       1,469        105.5%
Loss on impairment of note receivable from sale of
  discontinued operations ..........................       (332)       (300)         (32)        10.7%
                                                       --------    --------    ---------    ----------
Total gain (loss) from discontinued operations .....        207      (1,385)       1,592        114.9%
                                                       --------    --------    ---------    ----------
Net loss ...........................................   $ (3,770)   $ (2,071)   $  (1,699)        82.0%
                                                       ========    ========    =========    ==========

                                       19YEAR 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.

EXPENSES

         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
currently employs 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 employs 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.

                                       20NET 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.

         In 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.

YEAR ENDED DECEMBER 31, 2006 VS. YEAR ENDED DECEMBER 31, 2005

         Net revenue for the year ended December 31, 2006 increased $3,394,000
to $19,139,000, as compared to the year ended December 31, 2005. During 2006,
Global Hotline executed major contracts with three tier 1 telecommunication
companies and two major health insurance companies in Japan. Global Hotline was
acquired on June 15, 2005.

         As of March 31, 2006, Global Hotline did not achieve the required
target of lines to be sold under a contract with KDDI and reclassified
$3,889,000 from deferred revenue to accrued liabilities. On December 29, 2006,
we finalized negotiations with KDDI and repaid $1,019,000 of the accrued
liability and recognized the balance of $2,870,000 as revenue.

         On December 29, 2006, IA Partners entered into a Direct Marketing
Agreement with AFLAC. Pursuant to this Agreement, Global Hotline recorded
$727,524 as revenue and deferred $727,524 as of December 31, 2006.

COST OF SALES

         Cost of sales for the year ended December 31, 2006 decreased $2,676,000
to $2,895,000 as compared to the year ended December 31, 2005. The decrease
resulted from reduced outsourced call center operations, better management, and
more effective utilization of resources by Global Hotline to support the KDDI
contracts.

EXPENSES

         Selling, general and administrative expenses for the year ended
December 31, 2006 increased $9,372,000 to $19,066,000, as compared to the year
ended December 31, 2005. This was due to increased operating expenses of
$122,000 related to the implementation of SFAS 123 R and $9,236,000, including
additional staff, and building infrastructure, which included items such as PCs,
workstations, and software licenses, as well as significant investment in new
staff training. This expense was necessary to leverage Global Hotline's growing
revenues.

                                       21During 2006, Global Hotline executed major contracts with three tier 1
telecommunication companies and two major health insurance companies in Japan.
In connection with these new contracts, Global Hotline established two new call
centers and incurred the above noted startup and training costs through
September 30, 2006 prior to sales activities commencing.

         For 2006 and 2005, 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. The difference in the current periods compared to the
prior periods is primarily due to the acquisition of Global Hotline on June 15,
2005 and expenses related to the implementation of SFAS 123 R.

OTHER INCOME/EXPENSE

         Other expense for the year ended December 31, 2006 was $640,000 as
compared to $341,000 for the year ended December 31, 2005. 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.

         The 2005 other expense was primarily related to interest expense and
amortization of beneficial conversion feature of $390,000 and a foreign currency
transaction adjustment of $125,000, offset by other income of $121,000 and
interest income of $52,000.

NET LOSS FROM CONTINUING OPERATIONS

         Net loss from continuing operations was $3,977,000 for the year ended
December 31, 2006 as compared to a net loss of $686,000 for the year ended
December 31, 2005. The reasons for the increased loss were due to the increased
expenses from implementing new accounting pronouncements and Global Hotline's
investment into infrastructure and staffing to fulfill the business requirements
of its new major contracts as more fully discussed above. The nature of Global
Hotline's business model is such that revenues lag expenses by approximately 6-8
months.

NET LOSS

         Net loss was $3,770,000 for the year ended December 31, 2006 as
compared to a net loss of $2,071,000 for the year ended December 31, 2005. The
reasons for the increased loss were due to the increased operating expenses of
Global Hotline, as more fully discussed above.

         For the year ended December 31, 2006, in accordance with SFAS 144, we
accounted for the Rex Tokyo gain from disposal of discontinued of operations of
$463,000 and gain from discontinued operations from Rex Tokyo of $76,000 and a
loss on impairment of note receivable of $332,000, as total gain from
discontinued operations in our consolidated statement of operations.

         In accordance with SFAS 144, we accounted for the Rex Tokyo loss of
$982,000, Fan Club loss of $257,000 and the IA Global Acquisition Co loss of
$154,000 and the net gain on disposal of discontinued operations of $308,000 and
a loss on impairment of note receivable of $300,000 for the year ended December
31, 2005 as total loss from discontinued operations in our consolidated
statement of operations.

                                       22LIQUIDITY AND CAPITAL RESOURCES

         We had cash of approximately $1.6 million, net working capital of
approximately $745,000 million and debt of $19.1 million as of March 31, 2008.

         During 2007, Global Hotline entered into loans of approximately $17.2
million and repaid loans of approximately $4.2 million. The net loans were used
to expand the business infrastructure for current and anticipated major new
client contracts, including opening two call centers in Japan to service these
client contracts. We expect to reduce debt during FY 2008/9 with the improvement
in Global Hotline operating results starting January 1, 2008.

         We will need to obtain additional financing in order to continue our
current operations, including the cash flow needs of Global Hotline and its
subsidiaries, to acquire businesses, make equity investments and maintain the $6
million in stockholder's equity required to maintain our AMEX listing. There can
be no assurance that we will be able to secure additional funding or that if
such funding is available, whether the terms or conditions would be acceptable
to us, our major shareholders or otherwise.

         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 $20.0
million as of March 31, 2008, with approximately $8.8 million raised in the
initial public offering, $8.0 million raised in private placements, $3.6 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 $24.9
million, including $7.0 million from the ASFL equity investment, $1.4 million
each from the GPlus and Slate equity investments, $6.9 million issued for
services, $3.6 million related to a beneficial conversion feature, $1.5 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 $18.6 million and convertible debentures with
approximately $2.2 million outstanding as of March 31, 2008.

         As the results of Global Hotline's operations continue to improve, we
expect better utilization of net cash. 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.

OPERATING ACTIVITIES

         Net cash used in operating operations for the three months ended March
31, 2008 was $625,000. This amount was primarily related to a net income of
$360,000, depreciation and amortization of $588,000, a decrease in deferred
Taxes-foreign of $1,261,000 and an increase in accrued liabilities of
$2,940,000, offset by an increase in accounts receivable of $4,640,000 and an
increase in prepaid expenses of $988,000.

INVESTING ACTIVITIES

         Net cash used in investing activities for the three months ended March
31, 2008 was $946,000 for capital expenditures.

FINANCING ACTIVITIES

         Net cash provided by financing activities for the three months ended
March 31, 2008 was $1,507,000 from Global Hotline entering into loans. The
increase was due to the expansion of the Global Hotline business with the
signing of significant contracts with major corporations.

                                       23Other Material Commitments. The company's contractual cash obligations
as of March 31, 2008 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       $ 3,437,937   $ 2,064,846   $1,084,909   $  288,182             $0
Note payable            19,104,249    10,510,655    5,154,162    3,439,432              0
Capital expenditures       250,000       250,000            0            0              0
Acquisitions               318,000       318,000            0            0              0
                       -----------   -----------   ----------   ----------   ------------
                       $23,110,186   $13,143,501   $6,239,071   $3,727,614             $0
                       ===========   ===========   ==========   ==========   ============

(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)
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 due to us not demonstrating any consistent
profitable operations. 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.

INTANGIBLE ASSETS

         Intangible assets primarily relate to 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.

                                       24REVENUE 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. The company has not recorded any deferred
revenue as of March 31, 2008 and December 31, 2007, 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 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 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 were not considered
impaired as of March 31, 2008.

                                       25RECENT ACCOUNTING PRONOUNCEMENTS

         In September 2006, the FASB issued SFAS No. 157; "Fair Value
Measurements" ("SFAS 157"). This statement defines fair value, establishes a
framework for measuring fair value in generally accepted accounting principles
(GAAP), and expands disclosures about fair value measurements. This statement
applies under other accounting pronouncements that require or permit fair value
measurements, the FASB having previously concluded in those accounting
pronouncements that fair value is a relevant measurement attribute. Accordingly,
this statement does not require any new fair value measurements. However, for
some entities, the application of this Statement will change current practices.
This Statement is effective for financial statements for fiscal years beginning
after November 15, 2007. Earlier application is permitted provided that the
reporting entity has not yet issued financial statements for that fiscal year.
We are currently evaluating the provisions of SFAS 157 to determine the impact
on the company's consolidated financial statements.

         In December 2006, the FASB approved FASB Staff Position ("FSP") No.
EITF 00-19-2, "Accounting for Registration Payment Arrangements" ("FSP EITF
00-19-2"), which specifies that the contingent obligation to make future
payments or otherwise transfer consideration under a registration payment
arrangement, whether issued as a separate agreement or included as a provision
of a financial instrument or other agreement, should be separately recognized
and measured in accordance with SFAS No. 5, "Accounting for Contingencies". FSP
EITF 00-19-2 also requires additional disclosure regarding the nature of any
registration payment arrangements, alternative settlement methods, the maximum
potential amount of consideration and the current carrying amount of the
liability, if any. The guidance in FSP EITF 00-19-2 amends FASB Statements No.
133, "Accounting for Derivative Instruments and Hedging Activities", and No.
150, "Accounting for Certain Financial Instruments with Characteristics of both
Liabilities and Equity", and FASB Interpretation No. 45, "Guarantor's Accounting
and Disclosure requirement for Guarantees, Including Indirect Guarantees of
Indebtedness of Others", to include scope exceptions for registration payment
arrangements. FSP EITF 00-19-2 is effective immediately for registration payment
arrangements and the financial instruments subject to those arrangements that
are entered into or modified subsequent to the issuance date of this FSP, or for
financial statements issued for fiscal years beginning after December 15, 2006,
and interim periods within those fiscal years, for registration payment
arrangements entered into prior to the issuance date of this FSP. We have
determined the impact of FSP EITF 00-19-2 on our financial statements was not
material.

         In February 2007, the FASB issued SFAS No. 159, "The Fair Value Option
for Financial Assets and Financial Liabilities-including an amendment of FAS
115" ("SFAS 159"). SFAS 159 allows entities to choose, at specified election
dates, to measure eligible financial assets and liabilities at fair value that
are not otherwise required to be measured at fair value. If a company elects the
fair value option for an eligible item, changes in that item's fair value in
subsequent reporting periods must be recognized in current earnings. SFAS 159 is
effective for fiscal years beginning after November 15, 2007. The adoption of
SFAS No 159 is not expected to have a significant impact on our consolidated
financial statements.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

FOREIGN CURRENCY

         We were exposed to foreign currency risks due to our ownership of
Global Hotline and our equity investments in GPlus and Slate in Japan and our
equity investments in ASFL and our loan with Frontier Mortgages in Australia,
GPlus in Hong Kong and China and Shift Resourcing and Slate in the Philippines.

         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,
2008, total debt was $19,104,249. Debt totaling $4,306,456 is exposed to
variable interest rates with current interest rates of 2.0% to 3.25%.

                                       26The 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.

ITEM 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, 2008. 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, 2008, 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, 2008.

         The effectiveness of our internal control over financial reporting as
of March 31, 2008 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, 2008 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, 2008 that were not filed.

                                       27PART III

         Except as otherwise indicated, the following information required by
the Instructions to Form 10-K is incorporated herein by reference from various
sections of the IA Global, Inc. Proxy Statement for the annual meeting of
shareholders to be held on July 29, 2008, as summarized below:

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE

         "Election of Directors;" "Section 16(a) Beneficial Ownership Reporting
Compliance;" "Corporate Governance;" and "Meetings and Committees of the Board
of Directors."

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

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

Age 53
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.

Mr. Schneideman 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 Operating and Financial Officer and Director

Age 54
Director since 2004

American Mark Scott has served as COO since August 2005, a Director since
January 2004 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.

Merger and Acquisition Committee: Member

                                       28Hideki Anan
Chief Executive Officer of Global Hotline, Inc.

Age 37
Director since 2007

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.

Merger and Acquisition Committee: Member


Kyo Nagae
Chief Financial Officer of Global Hotline, Inc.

Age 37

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.

ITEM 11. EXECUTIVE COMPENSATION

         "Executive Compensation;" "Director Compensation;" "Compensation
Committee Interlocks and Insider Participation;" and "Compensation Committee
Report."

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

         "Security Ownership of Certain Beneficial Owners and Management."

         Information regarding "Securities Authorized for Issuance Under Equity
Compensation Plans" is incorporated by reference to the end of Item 5 of this
report.

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

         "Review and Approval of Related Person Transactions" and "Director
Independence."

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

         Fees paid to the Company's independent registered public accounting
firm are disclosed under the caption "The Ratification of Appointment of Sherb
and Co LLP as the Company's Independent Registered Public Accounting Firm
(Independent Auditors) for the fiscal year ended March 31, 2009."

                                       29PART 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.

                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

                                                                    Page
                                                                    ----

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

    Consolidated Balance Sheets
         as of March 31, 2008 and December 31, 2007 and 2006 ..      F-2

    Consolidated Statements of Operations
         for the three months ended March 31, 2008 and 2007 and
         for the years ended December 31, 2007, 2006 and 2005 .      F-3

    Consolidated Statement of Stockholders' Equity (Deficiency)
         for the years ended December 31, 2007, 2006 and 2005
         and for the three months ended March 31, 2008 ........      F-4

    Consolidated Statement of Cash Flows
         for the three months ended March 31, 2008 and 2007 and
         for the years ended December 31, 2007, 2006 and 2005 .      F-5

    Notes to Consolidated Financial Statements ................   F-6 - F-45

(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 November 10, 2007
         (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)

4.1      Specimen of Stock Certificate (8)

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

4.3      1999 and 2000 Stock Option Plans (26)*

                                       3010.1     Amendment to Employment Agreement dated January 24, 2007 by and between
         IA Global, Inc. and Mark Scott. (10)*

10.2     Employment Agreement dated February 8, 2007 by and between IA Global,
         Inc. and Derek Schneideman (11)*

10.3     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.
         (English translation ) (12) +

10.4     Bank Credit Facility Contract dated May 16, 2007 by and between Global
         Hotline, Inc. and Mitsui Sumitomo Bank Co. Ltd. (English translation)
         (2)

10.5     Loan Application Form dated June 1, 2007 by and between IA Partners Co
         Ltd and Mizuho Bank Co Ltd. (English translation) (2)

10.6     Promissory Note Application Form dated June 19, 2007 by and between IA
         Partners Co Ltd and Mitsui Sumitomo Bank Co Ltd (English translation)
         (2)

10.7     Loan Application Form dated June 19, 2007 by and between Global
         Hotline, Inc. and Mitsui Sumitomo Bank Co Ltd (English translation) (2)

10.8     Business Assignment Agreement, dated July 3, 2007, by and between
         Global Hotline, Inc. and KDDI Corporation. (English translation) (3)

10.9     Borrowing Conditions, dated July 6, 2007, by and between Global
         Hotline, Inc. and Mizuho Bank Co Ltd. (English translation) (3)

10.10    Administrative Service Agreement, dated July 9, 2007, by and between
         Global Hotline, Inc. and Mizuho Bank Co Ltd. (English translation) (3)

10.11    Monetary Loan Certification, by Hideki Anan. (3)

10.12    Issue Conditions, dated July 17, 2007, by and between Global Hotline,
         Inc. and Mizuho Bank Co Ltd.(English translation) (3)

10.13    Indications of Main Items, dated July 17, 2007, by and between Global
         Hotline, Inc. Mizuho Bank Co Ltd. (English translation) (3)

10.14    Corporate Bonds Conditions, by Mizuho Bank Co Ltd (English translation)
         (3)

10.15    Important Conditions of Corporate Bonds, by Global Hotline, Inc.
         (English translation) (3)

10.16    Full Amount Guarantor Agreement, by Mizuho Bank Co Ltd (English
         translation) (3)

10.17    Request For Overdraft Facility, dated July 27, 2007, by Global Hotline,
         Inc. (English translation) (3)

10.18    Special Overdraft Change Facility Agreement, dated July 27, 2007, by
         and between Global Hotline, Inc. and Mitsui Sumitomo Bank Co Ltd
         (English translation) (3)

10.19    Monetary Loan Certification, dated July 31, 2007, by and between IA
         Partners Co Ltd and Mitsubishi Tokyo UFJ Bank Co Ltd (English
         translation) (3)

10.20    Monetary Loan Certification, dated July 31, 2007, by and between IA
         Partners Co Ltd and Mitsubishi Tokyo UFJ Bank Co Ltd (English
         translation) (3)

10.21    Articles of Agreement, dated August 8, 2007, by Inforidge Co Ltd
         (English translation) (13)

                                       3110.22    Agency Agreement for Offering Life Insurance, dated July 7, 2007, by
         and between Inforidge Co Ltd and American Life Insurance. (English
         translation) (13)

10.23    Share Exchange Agreement, dated August 24, 2007, by and between IA
         Global, Inc. and GPlus Media Co Ltd (14)

10.24    Right of First Refusal, dated August 24, 2007, by and between IA
         Global, Inc. and GPlus Media Co Ltd (14)

10.25    Share Exchange Agreement, dated August 24, 2007, by and between IA
         Global, Inc. and Slate Consulting Co Ltd (15)

10.26    Right of First Refusal, dated August 24, 2007, by and between IA
         Global, Inc. and Slate Consulting Co Ltd (15)

10.27    Binding Term Sheet, dated September 4, 2007, by and between IA Global,
         Inc. and LINC Media, Inc. (16)

10.28    Employment Agreement, dated September 5, 2007, by and between IA
         Global, Inc. and Mr. Schneideman. (17)*

10.29    Employment Agreement, dated September 5, 2007, by and between IA
         Global, Inc. and Mr. Scott. (18)*

10.30    Agreement on Special Overdrawn Account dated September 14, 2007, by and
         between Global Hotline, Inc., IA Partners Co Ltd, SG Telecom Co ltd,
         Inforidge Co Ltd and Sumitomo Mitsui Banking Corporation (English
         translation) (3)

10.31    Amendment to Binding Term Sheet, dated September 28, 2007, by and
         between IA Global, Inc. and LINC Media, Inc. (19)

10.32    Amendment to Binding Term Sheet, dated October 9, 2007, by and between
         IA Global, Inc. and LINC Media, Inc. (20)

10.33    Business Assignment Agreement, dated September 27, 2007, by and between
         Global Hotline, Inc. and KDDI Corporation. (English translation) (3)

10.34    Asset Purchase Agreement, dated October 22, 2007, by and between IA
         Global, Inc. and LINC Media, Inc. (21)

10.35    Promissory Note for $720,000, dated October 22, 2007, by and between IA
         Global, Inc. and LINC Media, Inc. (21)

10.36    Promissory Note for $1,200,000, dated October 22, 2007, by and between
         IA Global, Inc. and LINC Media, Inc. (21)

10.37    Promissory Note for $200,000, dated October 22, 2007, by and between IA
         Global, Inc. and LINC Media, Inc. (21)

10.38    Performance Agreement, dated October 22, 2007, by and between IA
         Global, Inc. and LINC Media, Inc. (21)

10.39    Assignment and Assumption Agreement and Bill of Sale, dated October 22,
         2007, by and between IA Global, Inc. and LINC Media, Inc.(21)

10.40    Call Center Service Agency Agreement, dated May 21, 2007, by and
         between IA Partners Co Ltd and NTT Co Ltd. (English translation) (3)

10.41    Attachment Agreement, dated May 21, 2007, by and between IA Partners Co
         Ltd and NTT Co Ltd. (English translation) (3)

10.42    Confidentiality Agreement, dated May 21, 2007, by and between IA
         Partners Co Ltd and NTT Co Ltd. Co Ltd (English translation) (3)

10.43    Covenant for Data Management, dated May 21, 2007, by IA Partners Co
         Ltd. (English translation) (3)

                                       3210.44    Request For Use of Special Overdraft Service dated November 27, 2007 by
         and between Sumitomo Mitsui Banking Corporation (English Translation)
         (34)

10.45    Binding Term Sheet, dated December 20, 2007, by and between IA Global,
         Inc. and Esprit Co Ltd.(22)

10.46    Share Mortgage Agreement, dated December 21, 2007, by and between IA
         Global, Inc. and Frontier Mortgages Pty Ltd (34)

10.47    Loan Agreement, dated December 21, 2007, by and between IA Global, Inc.
         and Frontier Mortgages Pty Ltd (34)

10.48    Certificate and Acknowledgment, dated December 21, 2007, by and between
         IA Global, Inc. and Frontier Mortgages Pty Ltd (34)

10.49    Outbound Telemarketing Program, dated November 30, 2007, by and between
         Inforidge Co Ltd and American Life Insurance Company. (34)

10.50    Working Capital Loan Amendment, dated January 22, 2008, by and between
         Global Hotline, Inc. and Mitsui Sumitomo Co Ltd. (English translation)
         (34)

10.51    Request For Loan With Draft Loan (Change), dated January 22, 2008, by
         and between IA Partners, Inc. and Mitsui Sumitomo Co Ltd. (English
         translation) (34)

10.52    Binding Term Sheet, dated January 30, 2008, between IA Global, Inc. and
         Asia Premier Executive Business Suites, Inc. (23)

10.53    Working Capital Loan Amendment, dated January 31, 2008, by and between
         Global Hotline, Inc. and Mitsui Sumitomo Co Ltd. (English translation)
         (34)

10.54    Binding Term Sheet, dated February 11, 2008, between IA Global, Inc.
         and Paper.com LLC (24)

10.55    Unsecured Corporate Bond, dated February 15, 2008, by and between
         Global Hotline, Inc. and Mitsubishi UFJ Bank Co Ltd. (English
         translation) (34)

10.56    Amendment Agreement, dated February 22, 2008, by and between IA Global,
         Inc. and LINC Media, Inc. (25)

10.57    Partner Contract dated December 22, 2005 between IA Partners Co Ltd and
         Internet Service Partners. (English translation) (27)

10.58    Business Outsourcing Basic Contract, dated October 6, 2004, by and
         between KDDI and Global Hotline. (English Translation) (28)

10.59    Agency Contract, dated April 14, 2006, by and between Japan Telecom
         Invoicing, Inc. and Global Hotline, Inc. (English translation) (29)

10.60    Agency Ordering Agreement, dated May 10, 2006, by and between IA
         Partners Co Ltd and AFLAC Co Ltd. (English translation) (30)

10.61    Business Agency Contract, dated May 10, 2006, by and between IA
         Partners Co Ltd and AFLAC Co Ltd. (English translation) (30)

10.62    Financial Support for Direct Marketing Agreement, by and between IA
         Partners Co Ltd and AFLAC Co Ltd. (English translation) (31) +

10.63    Amendment Agreement, dated March 12, 2008, by and between IA Global,
         Inc. and LINC Media, Inc. (32)

10.64    Working Capital Loan Amendment, dated February 29, 2008, by and between
         Global Hotline, Inc. and Mitsui Sumitomo Co Ltd. (English translation)
         (34)

                                       3310.65    Loan Agreement, dated December 27, 2007, by and between Global Hotline,
         Inc and Mizuho Bank Co Ltd. (English translation) (34)

10.66    Loan Plan, dated December 27, 2007, by and between Global Hotline, Inc
         and Mizuho Bank Co Ltd. (English translation) (34)

10.67    Call Center Usage Facility Agreement, dated January 10, 2008, by and
         between IA Partners Co Ltd and OMC Card, Inc. (English translation)
         (34)

10.68    Basic Agreement, dated January 10, 2008, by and between Inforidge Co
         Ltd and OMC Card, Inc. (English translation) (34)

10.69    Share Exchange Agreement, dated April 10, 2008, by and between IA
         Global, Inc. and P. Scott Valley and John Engel. (35)

10.70    Services Agreement, dated April 10, 2008, by and between IA Global,
         Inc. and IA Global, Inc. and Paper.com LLC. (35)

10.71    Working Capital Loan Amendment, dated January 22, 2008, by and between
         Global Hotline, Inc. and Mitsui Sumitomo Co Ltd. (English translation)
         (37)

10.72    Request For Loan With Draft Loan (Change), dated January 22, 2008, by
         and between IA Partners, Inc. and Mitsui Sumitomo Co Ltd. (English
         translation) (37)

10.73    Binding Term Sheet, dated January 30, 2008, between IA Global, Inc. and
         Asia Premier Executive Business Suites, Inc. (38)

10.74    Working Capital Loan Amendment, dated January 31, 2008, by and between
         Global Hotline, Inc. and Mitsui Sumitomo Co Ltd. (English translation)
         (37)

10.75    Binding Term Sheet, dated February 11, 2008, between IA Global, Inc.
         and Paper.com LLC (39)

10.76    Unsecured Corporate Bond, dated February 15, 2008, by and between
         Global Hotline, Inc. and Mitsubishi UFJ Bank Co Ltd. (English
         translation) (37)

10.77    Amendment Agreement, dated February 22, 2008, by and between IA Global,
         Inc. and LINC Media, Inc. (40)

10.78    Amendment Agreement, dated March 12, 2008, by and between IA Global,
         Inc. and LINC Media, Inc. (41)

10.79    Working Capital Loan Amendment, dated February 29, 2008, by and between
         Global Hotline, Inc. and Mitsui Sumitomo Co Ltd. (English translation)
         (37)

10.80    Amendment to Binding Term Sheet dated April 16, 2008, by and between IA
         Global, Inc. and the sellers of Asia Premier Business Suites, Inc. (43)

10.81    Amendment Agreement, dated April 25, 2008, by and between IA Global,
         Inc. and Esprit Co Ltd. (44)

10.82    Request For Use of Overdraft Facility dated April 30, 2008, by and
         between Global Hotline, Inc. and Mitsui Sumitomo Banking Corporation
         (English translation) (44)

10.83    Deed of Variation, dated April 24, 2008, by and between IA Global, Inc.
         and Frontier Mortgages Pty Ltd. (44)

10.84    Request For Loan With Draft Loan (Change), dated April 24, 2008, by and
         between IA Partners, Inc. and Mitsui Sumitomo Co Ltd. (English
         translation) (36)

10.84    Subscription Agreement, dated April 24, 2008, by and between IA Global,
         Inc. and Michael Ning. (36)

                                       3410.85    Subscription Agreement, dated May 8, 2008, by and between IA Global,
         Inc. and Michael Ning. (36)

10.86    Form of Warrant, dated May 8, 2008, by and between IA Global, Inc. and
         Michael Ning. (36)

10.87    Form of Warrant, dated May 8, 2008, by and between IA Global, Inc. and
         Michael Ning. (36)

10.88    Restricted Stock Agreement, dated April 27, 2008, by and between IA
         Global, Inc. and Mark Scott. (36) *

10.89    Restricted Stock Agreement, dated May 16, 2008, by and between IA
         Global, Inc. and Derek Schneideman. (1) *

10.90    CEO Compensation/Bonus Package, dated May 16, 2008, by and between IA
         Global, Inc. and Derek Schneideman. (45) *

10.91    Share Exchange Agreement, dated May 27, 2008, by and between IA Global,
         Inc. and Asia Premier Executive Suites, Inc., Jonathan Miller and Renee
         Rilloraza. (46)

10.92    Notes Payable for $100,000, dated May 27, 2008, by and between IA
         Global, Inc. and Jonathan Miller and Renee Rilloraza. (46)

10.93    Notes Payable for $131,000, dated May 27, 2008, by and between IA
         Global, Inc. and Jonathan Miller and Renee Rilloraza. (46)

10.94    Notes Payable for $37,000, dated May 27, 2008, by and between IA
         Global, Inc. and Jonathan Miller and Renee Rilloraza. (46)

10.95    Share Exchange Agreement, dated June 3, 2008, by and between IA Global,
         Inc. and Taicom Securities Co Ltd. (47)

10.96    CFO Compensation/Bonus Package, dated May 16, 2008, by and between IA
         Global, Inc. and Mark Scott. (45) *

10.97    Loan Agreement, dated June 4, 2008, by and between Global Hotline, Inc
         and Mizuho Bank Co Ltd. (English translation) (1)

10.98    Request For Loan With Draft Loan (Change), dated June 19, 2008, by and
         between IA Partners, Inc. and Mitsui Sumitomo Co Ltd. (English
         translation) (1)

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 June 8, 2008. (33)

99.2     Compensation Committee Charter dated June 8, 2008. (33)

99.3     Nominations and Governance Committee Charter dated June 8, 2008. (33)

99.4     Merger and Acquisition Committee Charter dated June 8, 2008. (33)
__________________

*  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.

                                       35__________________

(1)   Filed herewith.

(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 for the
      period ending September 30, 2007, and filed on November 19, 2007, 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 an Annex 2 to Registrant's Proxy Statement on May 3, 2007, and
      incorporated herein by reference.

(10)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      January 24, 2007 and filed on January 29, 2007, and incorporated herein by
      reference.

(11)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      February 8, 2007 and filed on February 13, 2007, 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 Current Report on Form 8-K, dated
      August 24, 2007 and filed on August 27, 2007, and incorporated herein by
      reference.

(15)  Filed as an exhibit to Registrant's Current Report on Form 8-K/A, dated
      August 24, 2007 and filed on August 29, 2007, and incorporated herein by
      reference.

(16)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      September 4, 2007 and filed on September 6, 2007, and incorporated herein
      by reference.

(17)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      September 5, 2007 and filed on September 10, 2007, and incorporated herein
      by reference.

(18)  Filed as an exhibit to Registrant's Current Report on Form 8-K/A, dated
      September 5, 2007 and filed on October 4, 2007, and incorporated herein by
      reference.

(19)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      September 28, 2007 and filed on October 1, 2007, and incorporated herein
      by reference.

                                       36(20)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      October 9, 2007 and filed on October 10, 2007, and incorporated herein by
      reference.

(21)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      October 22, 2007 and filed on October 23, 2007, and incorporated herein by
      reference.

(22)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      December 20, 2007 and filed on December 27, 2007, and incorporated herein
      by reference.

(23)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      January 30, 2008, and filed on February 6, 2008, and incorporated herein
      by reference.

(24)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      February 11, 2008, and filed on February 14, 2008, and incorporated herein
      by reference.

(25)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      February 22, 2008, and filed on March 4, 2008, and incorporated herein by
      reference.

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

(27)  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.

(28)  Filed as an exhibit to Registrant's Quarterly Report on Form 10-Q for the
      quarter ended June 30, 2005 and filed on August 15, 2005, and incorporated
      herein by reference.

(29)  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.

(30)  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.

(31)  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.

(32)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      March 12, 2008, and filed on March 14, 2008, and incorporated herein by
      reference.

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

(34)  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.

(35)  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.

(36)  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.

(37)  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.

                                       37(38)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      January 30, 2008, and filed on February 6, 2008, and incorporated herein
      by reference.

(39)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      February 11, 2008, and filed on February 14, 2008, and incorporated herein
      by reference.

(40)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      February 22, 2008, and filed on March 4, 2008, and incorporated herein by
      reference.

(41)  Filed as an exhibit to Registrant's Current Report on Form 8-K, dated
      March 12, 2008, and filed on March 14, 2008, and incorporated herein by
      reference.

(42)  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.

(43)  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.

(44)  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.

(45)  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.

(46)  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.

(47)  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.

                                       38REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Shareholders and Directors
IA Global, Inc.

We have audited the accompanying consolidated balance sheets of IA Global, Inc.
as of March 31, 2008 and December 31, 2007 and 2006, and the related
consolidated statements of operations, stockholders' equity and cash flows for
each of the years ended March 31, 2008 and December 31, 2007, 2006 and 2005.
These consolidated financial statements are the responsibility of the company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.

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 IA Global, Inc. as
of March 31, 2008 and December 31, 2007 and 2006, and the results of its
operations and its cash flows for the years ended March 31, 2008 and December
31, 2007, 2006 and 2005, in conformity with U.S. generally accepted accounting
principles.


                                        /s/ Sherb & Co., LLP
                                        Certified Public Accountants
New York, New York
July 14, 2008

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

                                                                                                                    December 31,
                                                                                              March 31,     ----------------------------
                                                                                                2008            2007            2006
                                                                                            ------------    ------------    ------------
ASSETS

CURRENT ASSETS:
   Cash and cash equivalents ............................................................   $  1,626,862    $  2,034,130    $  4,172,889
   Marketable securities ................................................................              -               -         250,638
   Accounts receivable, net of allowance of $674,886, $634,245 and $310,741, respectively     12,746,290       8,106,073       5,016,328
   Prepaid expenses .....................................................................      1,967,164         979,436         523,733
   Notes receivable .....................................................................      1,484,519       1,070,058         409,565
   Other current assets .................................................................        462,709         274,217         202,716
   Deferred taxes - foreign .............................................................      1,477,580       2,738,624               -
                                                                                            ------------    ------------    ------------
      Total current assets ..............................................................     19,765,124      15,202,538      10,575,869

EQUIPMENT, NET ..........................................................................      2,431,954       1,677,287         408,544

OTHER ASSETS
   Intangible assets, net ...............................................................        331,129         728,481       2,317,889
   Equity investment in Australia Secured Financial Limited .............................      6,930,355       7,024,616       7,146,386
   Equity investment in GPlus Media Co Ltd ..............................................      1,380,386       1,372,804               -
   Equity investment in Slate Consulting Co Ltd .........................................      1,396,481       1,413,659               -
   Other assets .........................................................................      2,704,752       2,502,240       1,190,820
                                                                                            ------------    ------------    ------------

                                                                                            $ 34,940,181    $ 29,921,625    $ 21,639,508
                                                                                            ============    ============    ============

LIABILITIES AND STOCKHOLDER'S EQUITY

CURRENT LIABILITIES:
   Accounts payable - trade .............................................................   $    197,943    $    253,054    $    104,573
   Accrued liabilities ..................................................................      7,851,636       4,911,241       2,477,509
   Consumption taxes received ...........................................................        460,067          15,085         264,514
   Income taxes payable- foreign ........................................................              -               -         416,724
   Note payable - current portion of long term debt .....................................     10,510,655      10,298,089       3,058,229
   Deferred revenue .....................................................................              -               -       1,297,046
                                                                                            ------------    ------------    ------------
      Total current liabilities .........................................................     19,020,301      15,477,469       7,618,595
                                                                                            ------------    ------------    ------------

LONG TERM  LIABILITIES:
   Long term debt .......................................................................      8,593,594       7,368,193       1,637,076
   Convertible debentures ...............................................................      2,195,833       2,191,667       3,125,000
                                                                                            ------------    ------------    ------------
                                                                                              10,789,427       9,559,860       4,762,076
                                                                                            ------------    ------------    ------------
STOCKHOLDER'S EQUITY:
   Series A-1 Convertible Preferred Stock, $10,000 par value, -0-, -0- and 4,375
      authorized, issued and outstanding, (liquidation value $7,000) ....................              -               -       7,000,000
   Preferred stock, $.01 par value, 5,000 authorized, none outstanding ..................              -               -               -
   Common stock, $.01 par value, 300,000,000 shares authorized,
      165,303,543, 164,883,751 and 109,165,157 issued and outstanding, respectively .....      1,653,035       1,648,837       1,091,651
   Additional paid in capital ...........................................................     43,882,701      43,713,399      32,835,714
   Accumulated deficit ..................................................................    (39,330,512)    (39,690,877)    (31,431,914)
   Accumulated other comprehensive loss .................................................       (821,864)       (534,156)       (186,614)
                                                                                            ------------    ------------    ------------
                                                                                               5,383,360       5,137,203       9,308,837
   Less common stock in treasury, at cost ...............................................       (252,907)       (252,907)        (50,000)
                                                                                            ------------    ------------    ------------
      Total stockholder's equity ........................................................      5,130,453       4,884,296       9,258,837
                                                                                            ------------    ------------    ------------

                                                                                            $ 34,940,181    $ 29,921,625    $ 21,639,508
                                                                                            ============    ============    ============

                                             See notes to consolidated financial statements.

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

                                                                                 Three Months Ended March 31,                 Years Ended December 31,
                                                                                ------------------------------    -----------------------------------------------
                                                                                     2008             2007            2007              2006            2005
                                                                                -------------    -------------    -------------    -------------    -------------
                                                                                                  (unaudited)

REVENUE .....................................................................   $  16,048,904    $   6,492,723    $  29,136,435    $  19,139,004    $  15,744,666

COST OF SALES ...............................................................       2,949,833          996,120        8,024,085        2,894,727        5,571,090
                                                                                -------------    -------------    -------------    -------------    -------------

GROSS PROFIT ................................................................      13,099,071        5,496,603       21,112,350       16,244,277       10,173,576

Selling, general and administrative expenses ................................      11,063,815        5,909,818       30,690,192       19,066,699        9,683,106
                                                                                -------------    -------------    -------------    -------------    -------------

OPERATING INCOME (LOSS) .....................................................       2,035,256         (413,215)      (9,577,842)      (2,822,422)         490,470
                                                                                -------------    -------------    -------------    -------------    -------------

OTHER INCOME (EXPENSE):
   Interest income ..........................................................          39,418           20,583           37,259           92,307           52,460
   Interest expense and amortization of beneficial  conversion feature ......        (337,368)        (195,738)        (975,336)        (850,873)        (389,850)
   Other income .............................................................          86,375           (1,326)         603,119          178,640          120,750
   (Loss) gain on equity investment in Australia Secured Financial Limited ..         (94,261)          13,589         (119,562)          69,540                -
   Gain on equity investment in GPlus Media Co Ltd ..........................           7,582                -           12,804                -                -
   Loss on equity investment in Slate Consulting Co Ltd .....................         (17,178)               -          (26,341)               -                -
   Conversion of debenture expense ..........................................               -                -         (120,046)               -                -
   Foreign currency transaction adjustment ..................................          (1,861)               -           11,381         (129,448)        (134,554)
                                                                                -------------    -------------    -------------    -------------    -------------
      Total other expense ...................................................        (317,293)        (162,892)        (576,722)        (639,834)        (351,194)
                                                                                -------------    -------------    -------------    -------------    -------------

PROFIT (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES ................       1,717,963         (576,107)     (10,154,564)      (3,462,256)         139,276

Income taxes - provision (benefit) ..........................................       1,357,598          268,043       (2,005,601)         515,000          825,000
                                                                                -------------    -------------    -------------    -------------    -------------

NET PROFIT (LOSS) FROM CONTINUING OPERATIONS ................................         360,365         (844,150)      (8,148,963)      (3,977,256)        (685,724)

DISCONTINUED OPERATIONS
   Loss (gain) from disposal of discontinued operations .....................               -                -         (110,000)         463,375          307,885
   Gain (loss) from discontinued operations .................................               -                -                -           76,054       (1,393,531)
   Loss on impairment of note receivable from sale of discontinued operations               -                -                -         (331,917)        (300,000)
                                                                                -------------    -------------    -------------    -------------    -------------
      Total (loss) / gain from discontinued operations ......................               -                -         (110,000)         207,512       (1,385,646)
                                                                                -------------    -------------    -------------    -------------    -------------

NET PROFIT (LOSS) ...........................................................   $     360,365    $    (844,150)   $  (8,258,963)   $  (3,769,744)   $  (2,071,370)
                                                                                =============    =============    =============    =============    =============

Basic and diluted profit (loss) per share of common-
   Basic profit (loss) per share from continuing operations .................   $           -    $       (0.01)   $       (0.05)   $       (0.04)   $       (0.01)
   Basic profit (loss) per share from discontinued operations ...............               -                -                -                -            (0.02)
                                                                                -------------    -------------    -------------    -------------    -------------
   Total basic profit (loss) per share ......................................   $           -    $       (0.01)   $       (0.05)   $       (0.04)   $       (0.02)
                                                                                =============    =============    =============    =============    =============

   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 ...............     164,980,626      133,470,713      151,229,245      107,718,970       90,496,230
   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

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

Balance as of December 31, 2004 .......       1,158   $        12     82,400,181   $   824,001   $ 28,785,839   $(25,590,820)  $    165,121   $ (50,000)  $  4,134,153

   Common stock issued for Global
     Hotline, Inc. acquisition ........           -             -     15,000,000       150,000      2,947,500              -              -           -      3,097,500
   Proceeds from sale of common stock .           -             -        350,000         3,500         56,000              -              -           -         59,500
   Repurchase of Fan Club Entertainment
     Co Ltd stock .....................           -             -       (350,000)       (3,500)       (52,500)             -              -           -        (56,000)
   Beneficial conversion feature ......           -             -              -             -      1,250,000              -              -           -      1,250,000
   Stock issued for services ..........           -             -         25,000           250          5,750              -              -           -          6,000
   Other comprehensive loss ...........           -             -              -             -              -              -       (403,668)          -       (403,668)
   Net loss ...........................           -             -              -             -              -     (2,071,350)             -           -     (2,071,350)
                                         ----------   -----------   ------------   -----------   ------------   ------------   ------------   ---------   ------------
      Comprehensive loss ..............                                                                                                                     (2,475,018)
                                                                                                                                                          ------------

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 .........           -             -              -             -              -              -         51,933           -         51,933
   Net loss ...........................           -             -              -             -              -     (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 .........           -             -              -             -              -              -       (347,542)          -       (347,542)
   Net loss ...........................           -             -              -             -              -     (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 .........           -             -              -             -              -        360,365       (287,708)          -         72,657
   Net loss ...........................           -             -              -             -              -              -              -           -              -
                                         ----------   -----------   ------------   -----------   ------------   ------------   ------------   ---------   ------------
                                                                                                                                                                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
                                         ==========   ===========   ============   ===========   ============   ============   ============   =========   ============

                                                            See notes to consolidated financial statements.

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


                                                                                            Three Months Ended
                                                                                                 March 31,                   Years Ended December 31,
                                                                                        -------------------------   -----------------------------------------
                                                                                            2008          2007          2007           2006          2005
                                                                                        -----------   -----------   ------------   ------------   -----------
                                                                                                      (unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net income (loss) .................................................................  $   360,365   $  (844,150)  $ (8,258,963)  $ (3,769,744)  $(2,071,350)
   Adjustments to reconcile net income (loss) to net cash used in operating activities
      Depreciation and amortization ..................................................      588,571       450,733      1,758,524      1,979,875     1,191,225
      Amortization of beneficial conversion feature ..................................      104,166       104,167        416,667        416,667       208,332
      Amortization of financing cost .................................................            -             -              -              -        44,444
      Stock based compensation .......................................................       60,000        44,029        174,514        122,007             -
      Common stock issued for services ...............................................            -             -              -              -         6,000
      Loss (gain) on equity investments ..............................................      103,857       (13,589)       135,307        (69,540)            -
      Settlement of convertible debt into equity .....................................            -             -        120,047              -             -
      Unrealized gain on marketable securities .......................................            -        (3,129)             -              -             -
      Impairment of notes receivable for sale of discontinued operations .............            -             -              -        331,917             -
   Changes in operating assets and liabilities:
      Accounts receivable ............................................................   (4,640,217)     (530,479)    (3,089,745)    (4,406,108)    1,215,499
      Notes receivable ...............................................................     (414,461)      409,565       (660,493)      (247,568)       76,699
      Prepaid expenses ...............................................................     (987,728)     (134,582)      (455,703)       (93,399)       20,665
      Other current assets ...........................................................     (188,492)     (174,772)       (71,501)       (12,933)       33,584
      Deferred taxes - foreign .......................................................    1,261,044             -     (2,738,624)             -             -
      Other assets ...................................................................     (202,512)      (16,472)    (1,311,420)      (454,961)     (243,093)
      Accounts payable - trade .......................................................      (55,111)      328,977        148,481       (391,875)      360,269
      Accrued liabilities ............................................................    2,940,395       690,194      2,747,780        (49,649)       71,055
      Net consumption tax payable ....................................................      444,982        22,757       (249,429)      (115,443)      257,923
      Income taxes payable - foreign .................................................            -       345,260       (416,724)       163,604       825,000
      Deferred revenue ...............................................................            -      (777,010)    (1,297,046)    (2,292,486)     (606,961)
                                                                                        -----------   -----------   ------------   ------------   -----------
      Net cash used in (provided by) continuing operations ...........................     (625,141)      (98,501)   (13,048,328)    (8,889,636)    1,389,291
      (Gain) loss from discontinued operations .......................................            -             -              -       (539,429)    1,246,583
      Net cash used in discontinued operations .......................................            -             -              -       (854,895)   (1,620,497)
      Net cash used in discontinued operations from debt .............................            -             -              -              -    (6,169,717)
      Net decrease in assets of discontinued operations ..............................            -             -              -     12,606,044     1,164,035
      Net (decrease) increase in liabilities of discontinued operations ..............            -             -              -    (11,939,787)    1,017,092
                                                                                        -----------   -----------   ------------   ------------   -----------
NET CASH USED IN OPERATING ACTIVITIES ................................................     (625,141)      (98,501)   (13,048,328)    (9,617,703)   (2,973,213)
                                                                                        -----------   -----------   ------------   ------------   -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
   Capital expenditures ..............................................................     (945,886)      (37,333)    (1,437,859)      (221,656)     (367,476)
   Sale of marketable securities .....................................................            -             -        250,638              -             -
   Acquisition of investment in Australian Secured Financial Limited .................            -      (125,000)      (250,000)             -             -
   Repayment of loan receivable from affiliate of controlling shareholder group ......            -             -              -      3,394,000     2,242,475
   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)            -
   Capital expenditures from discontinued operations .................................            -             -              -              -       (51,912)
   Repayment of loan receivable from QUIKCAT Australia Pty Ltd .......................            -             -              -              -       150,000
   Proceeds from sale of QUIKCAT business unit and note receivable ...................            -             -              -              -       200,000
   Proceeds from sale of Fan Club Entertainment Co Ltd ...............................            -             -              -              -       185,000
   Repayment of loan receivable from sale of Fan Club Entertainment Co Ltd ...........            -             -              -              -       445,680
   Loan to affiliate of controlling shareholder group ................................            -             -              -              -    (5,672,994)
   Cash from Global Hotline, Inc. on date of acquisition .............................            -             -              -              -     1,240,037
                                                                                        -----------   -----------   ------------   ------------   -----------
NET CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES: .................................     (945,886)     (162,333)    (1,437,221)     3,971,706    (1,629,190)
                                                                                        -----------   -----------   ------------   ------------   -----------

                                                                          (continued)
                                                                             F-5AIA GLOBAL, INC. AND SUBSIDIARIES
                                                             CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                                           (continued)

                                                                                            Three Months Ended
                                                                                                 March 31,                   Years Ended December 31,
                                                                                        -------------------------   -----------------------------------------
                                                                                            2008          2007          2007           2006          2005
                                                                                        -----------   -----------   ------------   ------------   -----------
                                                                                                      (unaudited)
CASH FROM FINANCING ACTIVITIES:
   Proceeds from debt ................................................................    1,507,099             -     17,153,095      9,276,671             -
   Repayments of debt ................................................................      (69,132)      (44,489)    (4,182,116)    (4,581,366)     (593,662)
   Proceeds from exercise of options .................................................       13,500             -         87,917              -             -
   Proceeds from sale of common stock ................................................            -             -        379,877         80,000        59,500
   Purchase of common shares for Treasury ............................................            -             -       (744,439)             -             -
   Proceeds from cash dividend from investment in Australia Secured
     Financial Limited ...............................................................            -             -              -        425,666             -
   Proceeds from issuance of convertible debentures ..................................            -             -              -              -     3,483,000
   Proceeds from long term debt- discontinued operations .............................            -             -              -              -     7,572,100
   Repayment of long term debt- discontinued operations ..............................            -             -              -              -      (674,954)
   Repayment of long term debt- discontinued operations- related party ...............            -             -              -              -      (727,429)
                                                                                        -----------   -----------   ------------   ------------   -----------
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES ..................................    1,451,467       (44,489)    12,694,334      5,200,971     9,118,555
                                                                                        -----------   -----------   ------------   ------------   -----------

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS .................................     (119,560)     (305,323)    (1,791,215)      (445,026)    4,516,152

EFFECT OF EXCHANGE RATE CHANGES ON CASH ..............................................     (287,708)       40,620       (347,542)       156,929      (414,340)

CASH AND CASH EQUIVALENTS, beginning of period .......................................    2,034,130     4,172,889      4,172,889      4,460,986       359,174
                                                                                        -----------   -----------   ------------   ------------   -----------

CASH AND CASH EQUIVALENTS, end of period .............................................  $ 1,626,862   $ 3,908,186   $  2,034,132   $  4,172,889   $ 4,460,986
                                                                                        ===========   ===========   ============   ============   ===========

Supplemental disclosures of cash flow information:
   Interest paid .....................................................................  $   228,269   $    18,340   $    222,358   $     67,563   $    17,447
   Taxes paid ........................................................................            -             -      1,004,406        233,528         2,504

Non-cash investing and financing activities:
   Conversion of debentures into common stock ........................................  $   100,000  $          -   $          -   $              $         -
   Conversion of Series A-1 Preferred Stock into common stock ........................            -     7,000,000      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             -
   Common stock issued for Global Hotline, Inc. ......................................            -             -              -              -     3,097,500
   Beneficial conversion feature recognized with issuance of convertible debentures ..            -             -              -              -     1,250,000
   Issuance of loan receivable for sale of Fan Club Entertainment Co Ltd .............            -             -              -              -       755,000
   Issuance of loan receivable for sale of QUIKCAT business unit .....................            -             -              -              -       200,000

                                                        See notes to consolidated financial statements.

                                                                             F-5BIA GLOBAL, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1.  BUSINESS

THE COMPANY AND OUR BUSINESS

         IA Global, Inc. ("IA Global") is a broadly based services company with
a dedicated focus on growth of existing business, together with expansion
through mergers and acquisitions in the Pacific Rim region. The company's
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 actively expanding investments in
the business process outsourcing (which includes human resources elements
necessary to recruit and train the very large numbers of people), B2B 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, Hong Kong/China, Singapore, and India 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, Inc. ("Global
Hotline") a Business Process Outsourcing organization, operating several 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 significant multi-year
contracts with major corporations.

         This growth trajectory 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, 2008, Global Hotline
employed 839 full and part-time personnel to support these multi-million dollar
contracts. In the Philippines, we acquired 100% of Shift Resources, LLC on April
10, 2008 and Asia Premier Executive Suites, Inc. on May 27, 2008, multi-service
call center operations that have now been merged into a single company named
Global Hotline Philippines Inc.

HUMAN CAPITAL AND RESOURCES

         During August 2007, the company closed two equity investments. These
investments provide "human capital" services in the human resources sector, a
sector which offers excellent growth opportunities throughout the Asia Pacific
region. IA Global continues to seek additional companies and partnerships in the
staffing, training, employee/ organization evaluation and assessments business
throughout the region, but with a focus on Japan. Linking these investments in a
network under the IA Global umbrella will generate synergies of expertise and
resources, creating a regional value-chain of services to further drive
aggressive growth. Our investments in Human Capital and Resources are as
follows:

                                      F-6IA Global has a 25% stake in GPlus Media Co Ltd ("GPlus"). GPlus is a
Japan based corporation with offices in Tokyo, Japan, Hong Kong and Shanghai,
China. GPlus owns and operates several of Japan's best known English-Japanese
websites, including GaijinPot.com, and Ecentral.jp, the official jobsite of the
American Chamber of Commerce in Japan. GPlus also operates CareerEngine.org,
which is a powerful network of jobsites with partners who include
ShanghaiExpat.com, the American Chambers of Commerce in Shanghai and Hong Kong,
as well as the Canada China Business Council.

         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, Hong Kong, Surrey, Canada; a call center in
Manila, Philippines; and an early stage call center in Bucharest, Romania.

FINANCIAL SERVICES

         In Australia, the company has a 36% stake in Australian Secured
Financial Limited and its affiliates, Ausec Finance Limited, ADJ Services Pty
Ltd. and Auslink Ltd (collectively, "ASFL"), which raises funds through the
issuance of private loans and bank debt within Australia and provide short term,
secured, real property loans to businesses and investors in Australia. Through
this group of companies, ASFL has created a strong financial services network
leveraging its knowledge and presence in local communities to cater to a sector
of the market neglected by larger financial institutions.

         In Japan, the company has a 20% stake 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 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, the Tokyo Commodity
Exchange, the Tokyo Grain Exchange and the Chubu (Central Japan) Commodity
Exchange. Taicom is headquartered in Tokyo and in Osaka and has three branch
offices in Japan.

DIVESTITURES

         IA Global divested several unprofitable operations in 2005 and 2006,
including Fan Club Entertainment Co Ltd ("Fan Club") on May 12, 2005, IA Global
Acquisition Co ("IA Acquisition") on July 1, 2005, the QuikCAT.Com Inc.
("QuikCAT") North America Internet accelerator business on May 28, 2005, and Rex
Tokyo Co, Ltd's ("Rex Tokyo") 60% interest in Timothy World on August 16, 2005.
IA Global divested its interest in Rex Tokyo on April 4, 2006.

         IA Global signed definitive agreements to acquire 100% of the
outsourcing business division ("Outsourcing Business Division") of LINC Media,
Inc. ("LINC Media") on October 22, 2007. On March 12, 2008, the company and LINC
Media terminated the Asset Purchase Agreement and all related Notes Payable, and
the Performance Agreement to acquire 100% of the outsourcing business division
of LINC Media.

         IA Global, Rex Tokyo, Global Hotline, IA Acquisition, Fan Club and the
Outsourcing Business Division are referred to herein collectively as the
"company", unless reference is made to the respective operations of an
individual entity comprising part of the group.

                                      F-7CORPORATE 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, China, the Philippines, Hong Kong 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.

Unaudited Financial Statements

         The accompanying unaudited consolidated financial statements of IA
Global and subsidiaries have been prepared in accordance with generally accepted
accounting principles ("GAAP") for interim financial information and with the
instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do
not include all of the information and footnotes required by U.S. GAAP for
complete financial statements. The financial statements for the period ended
March 31, 2007 are unaudited and include all adjustments necessary to a fair
statement of the results of operations for the periods then ended. All such
adjustments are of a normal recurring nature. The results of the company's
operations for any interim period are not necessarily indicative of the results
of the company's operations for a full fiscal year. For further information,
refer to the financial statements and footnotes thereto included in the
company's annual report on Form 10-K for the year ended December 31, 2007 as
filed with the Securities and Exchange Commission ("SEC") on April 15, 2008.

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.

         The company maintains cash balances at various financial institutions.
Balances at US banks are insured by the Federal Deposit Insurance Corporation up
to $100,000. 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
December 31, 2007 and 2006, 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. 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. 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 depreciated using the straight-line
method over the estimated useful life of the software, generally 2-3 years.

                                      F-8INTANGIBLE 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.

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.

FAIR VALUE OF FINANCIAL INSTRUMENTS - The carrying amounts reported in the
balance sheet for cash and cash equivalents, accounts receivable, accounts
payable, notes payable and accrued liabilities and current portion of long term
debt approximate fair value based on the short-term maturity of these
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. 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 has not recorded any deferred
revenue as of March 31, 2008 and December 31, 2007, respectively.

ADVERTISING COSTS - Advertising costs are expensed as incurred. There were
minimal advertising costs incurred for the three months ended March 31, 2008 the
years ended December 31, 2007, 2006 and 2005.

                                      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 three month period.
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. A total of 10,383,334 shares
of common stock are available for future grants under the 2007 Plan as of March
31, 2008. 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.

                               For the Three Months      For the Years ended December 31,
                                  Ended March 31,        --------------------------------
                                2008         2007         2007         2006         2005
                               ------       ------       ------       ------       ------
                                         (Unaudited)
Risk free interest rate .       3.73%        4.65%        5.39%        4.96%        4.05%
Expected life ...........      8 yrs.       8 yrs.       8 yrs.       8 yrs.       8 yrs.
Dividend rate ...........       0.00%        0.00%        0.00%        0.00%        0.00%
Expected volatility .....        122%         112%         111%         107%         155%

         The company recorded $60,000 and $44,029 of compensation expense, net
of related tax effects, relative to stock options for the three months ended
March 31, 2008 and 2007, 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).

         As of March 31, 2008, there is approximately $729,000 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 55,000 shares
of common stock at an average exercise price of $.267 per share in 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.

                                      F-10Prior 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 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.

         Previously, 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.

         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-11The table below sets out the pro forma amounts of net income and net
income per share (in thousands, except per share data) that would have resulted
for the year ended December 31, 2005, if the company accounted for its employee
stock plans under the fair value recognition provisions of SFAS 123.

                                                                      For The Year Ended,
                                                                          December 31,
                                                                              2005
                                                                          -----------
Net loss available to common stockholders, as reported ............       $(2,071,350)
Deduct: total stock-based employee compensation determined under
 fair value based method for all awards, net of related tax effects          (353,040)
                                                                          -----------
Pro-forma net loss available to common shareholders ...............       $(2,424,390)
                                                                          ===========
Loss per share:
  Basic and diluted- as reported ..................................       $     (0.02)
  Basic and diluted- pro-forma ....................................       $     (0.03)

         The company accounts for non-employee stock transactions in accordance
with SFAS No. 123R and EITF 96-18. 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.

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 deferred assets to the extent that management has determined
their realization. As of March 31, 2008, December 31, 2007 and December 31, 2006
the company has a deferred tax asset of $1,477,580, $2,738,624, and $-0-,
respectively, based on prior Japanese net operating losses that company
management has determined is available to offset future taxable income.

                                     For the Three Months             For the Years ended December 31,
                                        Ended March 31,         --------------------------------------------
                                    2008            2007            2007            2006            2005
                                ------------    ------------    ------------    ------------    ------------
                                                 (Unaudited)
Income (loss) from operations
   before income taxes:
      US operations .........   $   (803,243)   $   (633,334)   $ (3,025,217)   $ (1,904,804)   $ (2,015,233)
      Japan operations ......      2,521,206        (210,816)     (7,156,347)     (1,557,452)      2,154,529
                                ------------    ------------    ------------    ------------    ------------
Total loss from operations
   before income taxes ......      1,727,963        (844,150)    (10,181,564)     (3,462,256)        139,296
Gain (loss) from discontinued
   operations ...............              -               -        (110,000         207,512       1,385,646
                                ------------    ------------    ------------    ------------    ------------
                                $  1,727,963    $   (844,150)   $ (8,258,963)   $ (3,254,744)   $  1,246,650
                                ============    ============    ============    ============    ============

                                      F-12The following provision (benefits) for income taxes by geographic
operations is as follows:

                                     For the Three Months             For the Years ended December 31,
                                        Ended March 31,         --------------------------------------------
                                    2008            2007            2007            2006            2005
                                ------------    ------------    ------------    ------------    ------------
                                                 (Unaudited)
US operations ...............   $          -    $          -    $          -    $          -    $          -
Japan operations ............      1,357,598         268,043      (2,005,601)        515,000         825,000
                                ------------    ------------    ------------    ------------    ------------
Total provision (benefit)
   for income taxes .........   $  1,357,598    $    268,043    $ (2,005,601)   $    515,000    $    825,000
                                ============    ============    ============    ============    ============

         The components of the (benefit)provision for income taxes by taxing
jurisdiction as follows:

                                     For the Three Months             For the Years ended December 31,
                                        Ended March 31,         --------------------------------------------
                                    2008            2007            2007            2006            2005
                                ------------    ------------    ------------    ------------    ------------
                                                 (Unaudited)
US Federal, State and Local:
      Current ...............   $          -    $          -    $          -    $          -    $          -
      Deferred ..............   $          -    $          -    $          -    $          -    $          -
Japan
      Current ...............   $  1,357,598    $    268,043    $          -    $    515,000    $    825,000
      Deferred ..............   $          -    $          -    $ (2,005,601)   $          -    $          -

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

                                     For the Three Months             For the Years ended December 31,
                                        Ended March 31,         --------------------------------------------
                                    2008            2007            2007            2006            2005
                                ------------    ------------    ------------    ------------    ------------
                                                 (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 deferred tax
assets that are recorded in the consolidated balance sheets were as follows:

                                                             December 31,
                                        March 31,     --------------------------
                                           2008           2007           2006
                                       -----------    -----------    -----------
Deferred Income Taxes ..............   $ 1,480,000    $ 2,700,000    $         -
Operating loss carry forwards ......     6,920,000      7,000,000      6,700,000
                                       -----------    -----------    -----------
Gross Deferred Tax Asset ...........     8,400,000      9,700,000      6,700,000
Less: Valuation Allowance ..........    (6,920,000)    (7,000,000)    (6,700,000)
                                       -----------    -----------    -----------
Deferred Tax Asset, net of Allowance   $ 1,480,000    $ 2,700,000    $         -
                                       ===========    ===========    ===========

         The valuation allowance at March 31, 2008, 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 included approximately $1,477,000 in refundable taxes.

                                      F-13For tax return purposes, the company has available NOL carry forwards
of approximately $23.4 million which expire in various years through 2028,
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 purchasing
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 we have experienced a
change of control at any time since 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.

LITIGATION COSTS - The company is subject to possible legal actions arising in
the ordinary course of business. The company regularly reviews the status of
pending legal actions to evaluate the amount and likelihood of any potential
loss. The company accrues for these potential losses when it is probable that a
liability has been incurred and the amount of loss, or possible range of loss,
can be reasonably estimated. If actual results differ significantly from the
company's estimates, the company may be required to adjust its accruals in the
future.

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. The equity investments were not considered impaired as of March 31,
2008.

MARKETABLE SECURITIES - Marketable securities that are bought and held
principally for the purpose of selling them in the near term are classified as
trading securities. Trading securities are recorded at fair value, with the
change in fair value during the period included in earnings.

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, 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. As of March 31, 2007, there
were options outstanding for the purchase of 6,660,000 common shares and
convertible debentures convertible into 12,500,018 common shares, which could
potentially dilute future earnings per share.

                                      F-14As of December 31, 2007, there were options outstanding for the
purchase of 8,032,500 common shares, convertible debentures convertible into
8,000,013 common shares and warrants for 62,243 shares of common stock which
could potentially dilute future earnings per share. As of December 31, 2006,
there were options outstanding for the purchase of 4,200,000 common shares,
preferred stock convertible into 43,750,000 common shares, and debentures
convertible into 12,500,018 common shares which could potentially dilute future
earnings per share. As of December 31, 2005 there were options outstanding for
the purchase of 11,580,000 common shares, and convertible debentures into
12,500,018 common shares which could potentially dilute 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.

RECLASSIFICATIONS - For comparability, certain 2007 amounts have been
reclassified, where appropriate, to conform to the financial statement
presentation used in 2008.

RECENT ACCOUNTING PRONOUNCEMENTS

         In September 2006, the Financial Accounting Standards Board ("FASB")
issued SFAS No. 157; "Fair Value Measurements" ("SFAS 157"). This statement
defines fair value, establishes a framework for measuring fair value in GAAP,
and expands disclosures about fair value measurements. This statement applies
under other accounting pronouncements that require or permit fair value
measurements, the FASB having previously concluded in those accounting
pronouncements that fair value is a relevant measurement attribute. Accordingly,
this statement does not require any new fair value measurements. However, for
some entities, the application of this Statement will change current practices.
This Statement is effective for financial statements for fiscal years beginning
after November 15, 2007. Earlier application is permitted provided that the
reporting entity has not yet issued financial statements for that fiscal year.
The company is currently evaluating the provisions of SFAS 157 to determine the
impact on the company's consolidated financial statements.

         In February 2007, the FASB issued SFAS No. 159, "The Fair Value Option
for Financial Assets and Financial Liabilities-including an amendment of FASB
115" ("SFAS 159"). SFAS 159 allows entities to choose, at specified election
dates, to measure eligible financial assets and liabilities at fair value that
are not otherwise required to be measured at fair value. If a company elects the
fair value option for an eligible item, changes in that item's fair value in
subsequent reporting periods must be recognized in current earnings. SFAS 159 is
effective for fiscal years beginning after November 15, 2007. The adoption of
SFAS No 159 is not expected to have a significant impact on the company's
consolidated financial statements.

         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.

                                      F-15In 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 FASB 160 to determine the impact on the company's consolidated
financial statements.

         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"). FAS 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 company is currently evaluating the provisions
of SFAS 161 to determine the impact on the company's consolidated financial
statements.

NOTE 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 September 30, 2007. 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
significant multi-year contracts with major corporations.

         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.

                                      F-16On 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. On October 12,
2007, January 17, 2008 and April 7, 2008, the company automatically renewed this
contract through June 30, 2008. On June 23, 2008, the company renewed its
Agreements with KDDI for an additional three month period from July 1, 2008 to
September 30, 2008.

         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 Internet Service Partners, a Japanese company. Pursuant to this
agreement, IA Partners sells various internet and broadband products on behalf
of NTT and Internet Service Partners, 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, 2007, the parties
automatically renewed this agreement and it will expire on December 22, 2008.
The company experienced a shutdown of operations for sixty days under this
Partner Contract that resulted in a temporary reduction of revenues of
approximately $1,600,000. This issue was resolved and sales returned to normal
levels effective November 1, 2007.

         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 on April 14, 2007 and on April 8,
2008 through April 14, 2009. The Agency Contract 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
and May 1, 2008 through May 2, 2009. The Agency Agreement may be cancelled under
certain conditions.

         On December 29, 2006, IA Partners entered into an Agreement with AFLAC.
Pursuant to this Agreement, Global Hotline recorded $727,524 as revenue and
deferred $727,524 into 2007. During 2007, the remaining $725,756 was recognized
as revenue under this agreement.

         On 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. The Agency Agreement may be cancelled under certain conditions. To
service this Agency Agreement, IA Partners opened a call center in Osaka, Japan.
Sales activities started in October 2007. The Agency Agreement was automatically
renewed on May 19, 2008 through May 21, 2009.

                                      F-17On 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.

         In support of this Agency Agreement, Global Hotline entered an Outbound
Promotion Sales Agreement ("Sales Agreement") with Alico. Pursuant to this Sales
Agreement, Alico agreed to pay to Global Hotline a fee of approximately
75,000,000 Yen or $632,000 during the three months ending September 30, 2007 and
to pay a percentage of annualized premiums on a quarterly basis during the term
of the Sales Agreement.

         On January 7, 2008, Inforidge entered into a second 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. On April 9, 2008, the Agreement was renewed for the period April
1, 2008 to June 30, 2008. On July 9, 2008, the Agreement was renewed for the
period July 1, 2008 to September 30, 2008.

         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. The agreement 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 may be cancelled under certain conditions.

         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
currently employs 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 center currently employs over employ 300 full and
part-time employees. The company incurred startup and training costs into three
months ending December 31, 2007 on these call centers.

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.

                                      F-18The cost to acquire these assets has been 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 BPO organization named Global
Hotline Philippines Inc.

         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 so clients can be assured of a 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, 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 parties agreed to value the transaction at $618,000.

         On 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 parties agreed to value the transaction at $225,000.

                                      F-19Human 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. In addition, the company has the option to
increase its equity holding in GPlus to 75% based on mutually agreeable terms.

         GPlus is a Japan based corporation with offices in Tokyo, Japan, Hong
Kong and Shanghai, China. The company owns and operates several of Japan's best
known English-Japanese websites, including GaijinPot.jp, and Ecentral.com the
official jobsite of the American Chamber of Commerce in Japan. GPlus also
operates CareerEngine.org, which is a powerful network of jobsites with partners
who include ShanghaiExpat.com, the American Chambers of Commerce in Shanghai and
Hong Kong, as well as the Canada China Business Council.

         For the three months ended March 31, 2008, the company recorded a gain
on our investment in GPlus of $7,582 increasing our investment in GPlus. The
investment in GPlus was valued at $1,380,386 as of March 31, 2008.

         For the period August 24, 2007 to December 31, 2007, the company
recorded a gain on our investment in GPlus of $12,804 increasing our investment
in GPlus. The investment in GPlus was $1,372,804 as of December 31, 2007.

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, Hong Kong, Surrey, Canada; a call center in
Manila, Philippines; an early stage call center in Bucharest, Romania.

         For the three months ended March 31, 2008, the company recorded a loss
on our investment in Slate of $17,178 decreasing our investment in Slate. The
investment in Slate was valued at $1,396,481 as of March 31, 2008.

         For the period August 24, 2007 to December 31, 2007, the company
recorded a loss on our investment in Slate of $26,341 decreasing our investment
in Slate. The investment in Slate was $1,413,659 as of December 31, 2007.

Financial Services Equity Investments

EQUITY INVESTMENT IN AUSTRALIAN SECURED FINANCIAL LIMITED

         On October 19, 2006, the company closed its 36% equity investment in
ASFL, 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-20ASFL raises funds through the issuance of private loans and bank debt
within Australia and provide short term, secured, real property loans to
businesses and investors in Australia. Through this group of companies, ASFL has
created a strong financial services network leveraging its knowledge and
presence in local communities to cater to a sector of the market neglected by
larger financial institutions.

         For the three months ended March 31, 2008, the company recorded a loss
on our investment in ASFL of $94,261 that decreased our investment in ASFL. The
investment in ASFL was valued at $6,930,355 as of March 31, 2008.

         For the year ended December 31, 2007, the company recorded a loss on
our investment in ASFL of $119,562 decreasing our investment in ASFL. The
investment in ASFL was $7,024,616 as of December 31, 2007.

         ASFL negotiated a bank line of credit to replace its debenture
financing in the December 2007 quarter. This bank financing is expected to
provide the necessary financing to support the growth and profitability of the
business.

EQUITY INVESTMENT IN TAICOM SECURITIES CO LTD (Unaudited)

         On June 3, 2008, the company announced that it had closed a 20% equity
investment in Taicom Securities Co Ltd ("Taicom"), a Japanese securities firm.
This equity investment is 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, the Tokyo Commodity
Exchange, the Tokyo Grain Exchange and the Chubu (Central Japan) Commodity
Exchange. Taicom is headquartered in Tokyo and in Osaka and has 3 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 parties agreed to value the
transaction at $5,200,000.

                                      F-21PRO-FORMA FINANCIAL DATA

         The pro-forma financial data for the equity investments for the three
months ended March 31, 2007 and for the years ended December 31, 2007 and 2006
were as follows:


Three Months Ended March 31, 2007 (Unaudited)

                                                                 Pre-
                                                Pre-         Acquisition
                                            Acquisition     Operations of
                                           Operations of        Slate          For Forma
                           As Reported      GPlus Media      Consulting      Three Months
                           Three Months     January 1 -       January 1-         Ended
                             March 31,       March 31,         March 31,       March 31,
                               2007            2007 *           2007 *           2007
                           ------------    -------------    -------------    ------------

Revenue ...............    $ 6,492,723     $           -    $           -    $ 6,492,723
Loss (income) before
 extraordinary items ..       (844,150)    $           -            4,324       (839,826)
Net loss (income) .....       (844,150)    $         307                -       (843,843)
Loss per common share .          (0.01)                                            (0.01)

* - GPlus and Slate equity investments closed on August 24, 2007.


Year 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 ..      (8,256,963)   $           -           11,224      (8,245,739)
Net loss (income) .....      (8,256,963)   $         932                -      (8,256,031)
Loss per common share .           (0.05)               -                -           (0.05)

* - GPlus and Slate equity investments closed on August 24, 2007.


                                      F-22The 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 Occtober 19, 2008.


Twelve Months Ended December 31, 2005 (Unaudited)

                                                       Pre-
                                                    Acquisition
                                                    Operations
                                                     of Global
                                  As Reported         Hotline       For Forma
                                   Year Ended       January 1 -     Year Ended
                                  December 31,       June 15,      December 31,
                                      2005            2005 *           2005
                                  ------------     ------------    ------------

Revenues .....................    $ 15,744,686     $  5,109,288    $ 20,853,974
Loss before extraordinary items     (2,071,350)      (3,693,459)     (5,764,809)
Net loss .....................      (2,071,350)      (3,693,459)     (5,764,809)
Loss per common share ........           (0.02)               -           (0.06)

* - Global Hotline acquired on June 15, 2005

         There were no material, nonrecurring items included in the reported the
pro-forma results.

SUMMARY OF DISCONTINUED OPERATIONS

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-23On 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.

Year ended December 31, 2005 discontinued operations are as follows:

         In the year ended December 31, 2005 the company divested its remaining
holdings related to QuikCAT to Ominira that is affiliated with Innovative
Computing, the founder of QuikCAT. The closing occurred on July 15, 2005, with
an effective date of July 1, 2005. The company recorded a gain on the sale of
$61,587 during the year ended December 31, 2005. As part of this transaction,
the company sold the subsidiary, which owned the remaining rights and assets of
QuikCAT which were acquired out of bankruptcy. In addition, The company assigned
its intellectual property rights related to the Miliki Supercompressor product
and any additions, developments and modifications related to certain projects
and products and Ominira assumed certain liabilities of IA Global Acquisition
Co. The total purchase price was $620,000, which was paid with a note secured by
the assets sold and were due in installments from September 2005 to June 2006.
The company assumed certain rights and obligations under the previously
announced divestitures of our Internet accelerator business to our joint venture
partner QuikCAT Australia and its affiliate NanoCAT. During the years ended
December 31, 2005 and 2004, the company experienced losses of $154,666 and
501,230, respectively on this discontinued operation.

                                      F-24With regards to the $620,000 note receivable, on November 4, 2005,
December 5, 2005 and January 6, 2006, the company entered into amendments to the
Senior Secured Promissory Note which modified the payment schedule to
installments from January 2006 to June 2006. On February 1, 2006, the company
declared all principal, interest and other amounts due immediately. On March 15,
2006, the board of directors approved a $300,000 impairment of the Promissory
Note as of December 31, 2005. The company considered this impairment appropriate
based on the lack of payments by Ominira to date. On March 27, 2006, the company
entered into Amendment No. 4 to the Promissory Note. The Promissory Note was due
in installments from March 2006 to June 2007 and the company received as
additional collateral, twenty one shares of Innovative Computing Group, Inc.
("ICG"), a privately-owned company affiliated with Ominira. The ICG shares are
to be released to ICG as Ominira makes the required payments under the amended
Promissory Note and were valued at $30,000 per share for such collateral
purposes. In the year ended December 31, 2006, the company deemed impaired the
remaining $320,000 portion of the note receivable, plus accrued interest of
$11,917. The twenty one shares of Innovative Computing Group, Inc. do not have
any value.

         On May 12, 2005, the company announced the sale of Fan Club to TK
Partners, Inc. ("TK Partners"), formerly Cyber Holdings Co Ltd. As part of this
transaction, the company sold the 67% owned business for approximately $755,000
plus 350,000 shares of the company's common stock valued at $.16 per share. The
total cash purchase price was paid with $185,000 at signing and a note that was
due in monthly installments of approximately $65,000 from June 2005 through
January 2006. The note was unsecured and the company has received all payments
under the note. The company decided to divest the Fan Club business because it
was no longer core to its operations and the closing of new license sales were
more difficult than the company expected. The company recorded a gain on sale of
$99,349 during the year ended December 31, 2005. From the operations of Fan
Club, the company realized a loss of $257,344 and a gain of $630, respectively,
for the years ended December 31, 2005 and 2004.

         On August 16, 2005, Rex Tokyo our than 60.5% subsidiary, sold their 60%
interest in Timothy World to Inter Asset Japan Co Ltd ("IAJ"), a party
affiliated with our majority shareholder. The sale was for 6,000,000 Yen or
approximately $55,000 in cash at closing, plus the guarantee of a repayment of
an inter-company loan owed by Timothy World to Rex Tokyo, now assumed by IAJ, in
the amount of 97,867,000 Yen or approximately $866,000. This loan was to be
repaid in installments starting in September 2005 through December 2007, but
there were no repayments. This loan receivable was sold back to Rex Tokyo when
the company divested of their 60.5% interest in Rex Tokyo on April 4, 2006. The
company has no obligation to Rex Tokyo relating to Timothy World. Rex Tokyo, and
accordingly the company, recorded a gain from disposal of a discontinued
operation of $146,949 from the disposal of Timothy World.

         The following table sets forth the discontinued operations for the
company:

                                                       Year Ended December 31,
                                                     --------------------------
                                                         2006          2005
                                                     -----------   ------------
Revenue ...........................................  $ 7,651,125   $ 29,561,808
Cost of sales .....................................    6,083,120     25,382,442
                                                     -----------   ------------
Gross profit ......................................    1,568,005      4,179,366
Operating and non-operating expenses ..............    1,427,106      6,159,717
Minority interest .................................       49,655       (793,402
Income taxes ......................................       15,190        206,582
                                                     -----------   ------------
Loss from discontinued operations .................       76,054     (1,393,531)
Gain from disposal of discontinued operations            463,375        307,885
Loss on impairment of note receivable from
 sale of discontinued operations ..................     (331,917)      (300,000)
                                                     -----------   ------------
Total gain (loss) from discontinued operations ....  $   207,512   $ (1,385,646)
                                                     ===========   ============

                                      F-25NOTE 4.  ACCOUNTS RECEIVABLE/CUSTOMER CONCENTRATION

         Accounts receivable were $12,746,290, $8,106,073 and $5,016,328 as of
March 31, 2008 and December 31, 2007 and 2006, 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:

                                           Three Months         Year Ended
                                          Ended March 31,      December 31,
                                              2008            2007     2006
                                          ---------------     ----     ----
         KDDI Network Solutions .......         17%            32%      29%
         Internet Service Partners/ NTT         18%            34%      44%
         AFLAC ........................          *             11%      12%
         AIG ..........................         30%            12%       *
         Softbank                               27%             *        *

* Less than 10%.

         KDDI is a Global Hotline customer. Internet Service Partners/NTT is a
IA Partners customer. AFLAC is an IA Partner customer. AIG is an IA Partner and
an Inforidge customer. Softbank is a SG Telecom customer. There were no other
customers, other than the above, in excess of 10% in the respective periods.

         KDDI accounted for 11% and 15% of accounts receivable as of March 31,
2008 and December 31, 2007, respectively. Internet Service Partners/ NTT
accounted for 23% and 44% of total accounts receivable as of March 31, 2008 and
December 31, 2007, respectively. AFLAC accounted for 1% and 2% of total accounts
receivable as of March 31, 2008 and December 31, 2007, respectively. AIG
accounted for 20% and 18% of total accounts receivable as of March 31, 2008 and
December 31, 2007, respectively. Softbank accounted for 31% of total accounts
receivable as of March 31, 2008. The company anticipates that significant
customer concentration will continue for the foreseeable future.

NOTE 5.  PREPAID EXPENSES

         Prepaid expenses were $1,967,164, $979,436 and $523,733 as of March 31,
2008 and December 31, 2007 and 2006, respectively. These assets as of March 31,
2008 and December 31, 2007 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 $2,431,954, $1,677,287
and $408,544 as of March 31, 2008 and December 31, 2007 and 2006, respectively.
Accumulated depreciation was $1,131,248, $866,412 and $655,024 as of March 31,
2008 and December 31, 2007 and 2006, respectively. Total depreciation expense
was $191,219, and $53,381 for the three months ended March 31, 2008 and 2007,
respectively. Total depreciation expense was $211,388, $335,076 and $207,884 for
the years ended December 31, 2007, 2006 and 2005, 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:

                                    Estimated         March 31,           December 31,
                                   Useful Lives         2008           2007          2006
                                  --------------    -----------    -----------    ----------
Equipment and vehicles .......    24 - 60 months    $ 2,559,954    $ 1,729,458    $  892,512
Leasehold Improvements .......    27 - 60 months      1,000,000        814,241       171,056
                                                    -----------    -----------    ----------
                                                      3,559,954      2,543,699     1,063,568
Less: accumulated depreciation                        (1,128,00)      (866,412)     (655,024)
                                                    -----------    -----------    ----------
                                                    $ 2,431,954    $ 1,677,287    $  408,544
                                                    ===========    ===========    ==========

                                      F-26NOTE 7.  INTANGIBLE ASSETS

         Intangible assets as of March 31, 2008 and December 31, 2007 and 2006
consisted of the following:

                                    March 31,           December 31,
                                      2008           2007           2006       Estimated Life
                                  -----------    -----------    -----------    --------------
Customer contracts ...........    $ 4,946,030    $ 4,946,030    $ 4,946,030       3 years
Less: accumulated amortization     (4,604,901)    (4,217,549)    (2,628,141)
                                  -----------    -----------    -----------
    Intangible assets, net ...    $   331,129    $   728,481    $ 2,317,889
                                  ===========    ===========    ===========

         Total amortization expense was $397,352 for the three months ended
March 31, 2008 and 2007. Total amortization expense was $1,589,408, $1,644,800
and $1,644,800 for the years ended December 31, 2007, 2006 and 2005,
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.

         During the year ended December 31, 2006, the company adjusted the
intangible assets by $486,869 based on the recovery and utilization of net
operating loss carry forwards that were assumed with the acquisition of Global
Hotline.

         The amortization of intangibles for fiscal year 2008 is expected to be
$728,481.

NOTE 8.  OTHER ASSETS

         Other assets were $2,704,752, $2,502,240 and $1,190,820 as of March 31,
2008 and December 31, 2007 and 2006, respectively. These assets as of March 31,
2008 and December 31, 2007 and 2006 included loans receivable from Tesco Co Ltd
("Tesco"), employee loans receivable and bonds related to Global Hotline's
leased facilities.

NOTE 9.  ACCRUED LIABILITIES

         Accrued liabilities were $7,851,636, $4,911,241 and $2,477,509 as of
March 31, 2008 and December 31, 2007 and 2006, respectively. Such liabilities
consisted the following:

                                                               December 31,
                                             March 31,   -----------------------
                                               2008         2007         2006
                                            ----------   ----------   ----------
Accrued salaries and payroll taxes ......   $2,239,185   $1,617,059   $1,050,101
Trade debt not in accounts payable ......    4,308,945    2,304,441      493,081
Accrued interest ........................      504,043      521,332      398,373
Other accrued expenses ..................      799,462      468,408      535,954
                                            ----------   ----------   ----------
                                            $7,851,636   $4,911,241   $2,477,509
                                            ==========   ==========   ==========

                                      F-27NOTE 10. NOTES PAYABLE/ LONG TERM DEBT

         Notes payable and long term debt as of March 31, 2008 and December 31,
2007 were as follows:

         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 August 31,
2013. The loan provides for interest at 2.3755% payable monthly starting on
September 30, 2006.

         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 November 30, 2009.
The loan provides for interest at 2.4255% with interest payments starting on
April 30, 2007 and is guaranteed by Tokyo Guarantee Association.

         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 was paid quarterly starting on June 20, 2007.

         On 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 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 3.25% 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 June 1, 2007, IA Partners received a 50,000,000 Yen, or
approximately $406,400 at current exchange rates, working capital loan from
Mizuho Bank Co. Ltd. The loan requires a balloon payment of 50,000,000 Yen, or
approximately $406,000 at current exchange rates, on October 1, 2007. Interest
of 2.0% is paid monthly starting on July 1, 2007. The loan was repaid on October
30, 2007.

         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. On April 24, 2008,
IA Partners signed an amendment extending the due date to June 19, 2008. On June
19, 2008, IA Partners signed an amendment extending the term to July 31, 2008.

         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 1,707,000 Yen or approximately $14,000 on June 19,
2012. Interest of 3.0% is paid monthly starting on June 19, 2007.

         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.

                                      F-28On 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 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 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 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.

         On 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 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.

         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.

                                      F-29On 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 2.53% is paid monthly starting on March
31, 2008. The loan is guaranteed by Tokyo Credit Guarantee Association.

         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 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.

         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.

         All of the above loans, unless otherwise indicated, are guaranteed by
Hideki Anan, the CEO of Global Hotline. There are no covenants or security
requirements related to these loans.

         On December 21, 2007, the company 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. The loan was used for
working capital, including the merger and acquisition program.

         The loan required a balloon payment of $500,000 within four months of
the loan date, with a thirty day default period, and requires interest of 30%
per annum. The loan can be prepaid with the payment of thirty days interest and
is secured by the company's 36% equity investment in ASFL. The company agreed to
repurchase $150,000 or 500,000 shares from the selling shareholders of ASFL at
$0.30 per share, the closing price on December 21, 2007. There are no other
covenants or security requirements related to this loan.

         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. Pursuant to the Variation Agreement, the company repaid
$20,000, $200,000 and $300,000 on April 28, 2008, April 29, 2008 and May 12,
2008. The balance, including interest and a $25,000 extension fee, is being
repaid at $20,000 per week starting July 15, 2008.

         On June 19, 2008, the company entered into a three year loan agreement,
pursuant to which the company received a loan in the principal amount of
$695,750 at an interest rate of 11.75% per annum. The interest is payable
quarterly starting October 2008. The company issued 5,500,000 shares of common
stock which serves as collateral for the loan. In addition, the company paid a
5% funding fee for this loan and 13% in other fees.

         Future principal repayments for all long term debt as of March 31, 2008
is as follows:

                                      F-30Years Ended March 31,
                 2009               $ 10,510,655
                 2010                  2,429,334
                 2011                  2,347,152
                 2012                  2,221,260
                 2013                  1,038,338
              Thereafter                 557,511
                                    ------------
                                    $ 19,104,249
                                    ============

NOTE 11. 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 three months ended March 31,
2008 and the years ended December 31, 2007, 2006 and 2005, the company expensed
$104,000, $417,000, $417,000 and $208,000, 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,          December 31,
                                             2008          2007         2006
                                         -----------   -----------   ----------
Convertible debentures ................  $ 3,750,000   $ 3,750,000   $3,750,000
Beneficial conversion .................   (1,250,000)   (1,250,000)  (1,250,000)
                                         -----------   -----------   ----------
                                           2,500,000     2,500,000    2,500,000
Amortization of beneficial conversion .    1,145,833     1,041,667      625,000
Conversion of debentures ..............   (1,450,000)   (1,350,000)           0
                                         -----------   -----------   ----------
                                         $ 2,195,833   $ 2,191,667   $3,125,000
                                         ===========   ===========   ==========

         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.

         Since August 2007, a total of $1,050,000 of debentures were converted
into 3,500,005 shares of common stock at the original conversion price of $.30
per share. On June 28, 2008, the company converted $2,300,000 of debentures by
issuing 7,666,679 shares of common stock. In addition, the company expects to
issue an additional 5,862,734 shares 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.

                                      F-31NOTE 12. RELATED PARTY RELATIONSHIPS WITH INTER ASSET JAPAN AND AFFILIATES

         As of March 31, 2008, Inter Asset Japan LBO Fund No. 1 ("IAJ LBO
Fund"), PBAA Fund Ltd ("PBAA"), Terra Firma Fund Ltd, Inter Asset Japan Co Ltd
("IAJ"), IA Turkey Equity Portfolio Ltd ("IA Turkey"), Hiroki Isobe, Kyo Nagae
and Derek Schneideman collectively hold approximately 47.1% of our common stock
(collectively, the "Controlling Shareholders"). The share ownership percentages
excludes 811,285 shares held by GMB Holdings Ltd, and other shareholders for
which Mr. Isobe has personal signing authority and 7,666,679 shares of our
common stock issuable upon conversion of the convertible debentures. These
entities 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
Kyo Nagae, CFO of Global Hotline, control each of our Controlling Shareholders.
On February 21, 2008, Mr. Schneideman was granted a proxy by IAJ LBO Fund; PBAA;
Terra Firma; IAJ; Mr. Isobe and Mr. Nagae, or 47.3% of the aggregate votes, to
vote these shareholders' shares of common stock at all of the company's 2008
shareholder meetings.

         The 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, 2008, 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%
      IA Global Japan Co Ltd........................................ 100.0%  (2)
      GPlus Media Co Ltd............................................  25.0%  (1)
      Slate Consulting Co Ltd.......................................  20.25% (1)
      Australian Secured Financial Limited..........................  36.0%

Inter Asset Japan LBO No. 1 Fund owns:
      IA Global, Inc................................................  18.1%

PBAA Fund Ltd. owns:
      IA Global, Inc................................................  14.6%

Terra Firma Fund Ltd. owns:
      IA Global, Inc................................................   8.0%

Inter Asset Japan Co., Ltd. owns:
      IA Global, Inc................................................   1.3%

IA Turkey Equity Portfolio Ltd owns:
      IA Global, Inc................................................   1.5%

Mr. Hiroki Isobe owns:
      IA Global, Inc................................................   2.7%
      Tesco Co Ltd..................................................  23.0%

Kyo Nagae owns:
      IA Global, Inc................................................   0.9%

Global Hotline, Inc. owns:
      Inforidge Co Ltd.............................................. 100.0%
      IA Partners Co Ltd............................................ 100.0%
      SG Telecom, Inc. ............................................. 100.0%

(1) Acquired on August 24, 2007.

(2) Established on August 14, 2007.

KYO NAGAE RELATIONSHIP WITH IAJ

         In January 2006, Mr. Kyo Nagae, CFO of Global Hotline, became President
of IAJ and IAJ LBO Fund.

                                      F-32INTER 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 $2,046,513 as of March 31, 2008.

NOTE RECEIVABLE FROM CREDIE BEAUX CO LTD

         On September 21, 2007, Global Hotline loaned 25,000,000 Yen or
approximately $217,000 at current exchange rates to Credie Beaux Co Ltd, a party
affiliated with our majority shareholder, IAJ. This loan was repaid on March 26,
2008.

NOTE 13. EQUITY TRANSACTIONS

         During the period subsequent to March 31, 2008, the following
stockholder equity events occurred:

         On April 1, 2008, the company issued 200,000 shares of common stock to
two consultants for fundraising and other services. The shares were valued at
$.28 per share, the closing price on March 31, 2008.

         On April 10, 2008, the company signed definitive agreements and closed
the 100% acquisition of Shift Resources Inc. ("Shift Resources"), a Philippine
Business Process Outsourcing company. 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 parties agreed to value the transaction 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 AMEX. 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 parties agreed to value the transaction at $618,000.

         On June 3, 2008, the company announced that it had closed a 20% equity
investment in Taicom Securities Co Ltd ("Taicom"), a Japanese securities firm.
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 parties agreed to value the
transaction at $5,200,000.

         On June 28, 2008, the company converted $2,300,000 of debentures by
issuing 7,666,679 shares of common stock. In addition, the company expects to
issue an additional 5,862,734 shares 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 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.

                                      F-33During 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.

         On 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.

                                      F-34On 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.

         During 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.

                                      F-35On 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.

         During the year ended December 31, 2005, the following stockholder
equity events occurred:

         On May 12, 2005, the company acquired 350,000 shares of IA Global
common stock valued at $.16 per share when it closed the divestiture of Fan Club
to TK Partners, formerly Cyber Holdings Co Ltd.

         At the 2005 Annual Meeting of Stockholder held on June 3, 2005, the
proposal to amend our certificate of incorporation to increase the number of
authorized shares from 150,000,000 to 200,000,000, was approved.

         On June 15, 2005, the company closed the acquisition of Global Hotline,
a privately held Japanese company. 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
issued had a value of $.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.

         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 our merger and acquisition strategy,
and for general corporate purposes. The company closed the sale of $3,750,000 of
convertible debentures on July 29, 2005 and realized net proceeds of $3,483,000.
This financing included a beneficial conversion feature, which increased our
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 year ended December 31, 2006 and 2005, the company expensed $417,000
and $208,000, respectively, of this beneficial conversion recorded 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.

         On June 28, 2005, the company signed a subscription agreement with Mr.
Honda, a Japanese investor. The company sold 350,000 shares of restricted common
stock at $.17 per share. The $59,500 was received on July 25, 2005.

         On August 11, 2005, the company filed a registration statement covering
12,500,018 shares issuable upon conversion of the $3,750,000 convertible
debentures as required in the subscription agreement.

         On August 18, 2005, the company filed an amended registration statement
covering 16,638,772 shares of our common stock related to the Rex Tokyo and
Global Hotline acquisitions and certain private placements.

         On September 23, 2005, the company issued 25,000 shares of our common
stock to AIM Capital Corporation for investor relations services.

NOTE 14. STOCK INCENTIVE PLAN

         Under the 2007 Plan, the company may grant options, restricted stock or
other awards for the purchase of up to 20 million shares. A total of 10,383,334
shares of common stock are available for future grants under the 2007 Plan as of
March 31, 2008. 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.

         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-36On 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-37On 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.

         The following option activity occurred during the year ended December
31, 2005:

         On February 7, 2005, the company granted 30,000 stock options in total
at an exercise price of $.29 per share to employees of Rex Tokyo. These options
vest quarterly over three years and expire on February 7, 2015. These 30,000
options were cancelled subsequent to the sale and discontinuance of Rex Tokyo in
the year ended December 31, 2006.

         On June 23, 2005, the company granted 1,500,000 of stock options at an
exercise price of $.20 per share for the management and employees of Global
Hotline. The stock options vest quarterly over three years and expire on June
23, 2015.

                                      F-38On August 3, 2005, the company granted 400,000 of stock options at an
exercise price of $.26 per share on August 1, 2005 to Mark Scott, Raymond
Christinson, Jun Kumamoto and Eric La Cara, directors of the company. Each of
the above directors received options for 100,000 shares. The stock options vest
quarterly over three years and expire on August 1, 2015.

         On August 3, 2005, Mr. Margerison terminated his employment agreement
dated February 3, 2004 and forfeited 1,000,000 stock options of the 2,000,000
stock options granted on June 15, 2004 at $.20 per share.

         During the year ended December 31, 2005, the company divested
themselves of FCE and IA Global Acquisition, accordingly unexercised options
granted to employees of these discontinued operations were cancelled in the year
ended December 31, 2005 as well. Such expired options included i.) From a year
ended December 31, 2004 grant of 1,000,000 stock options, at $0.30 per share to
employees of FCE, a total of 600,000 were cancelled in the year ended December
31, 2005. ii.) From a year ended December 31, 2004 grant of 400,000 stock
options, at $0.34 per share to employees of IA Acquisition, all 400,000 were
cancelled in the year ended December 31, 2005.

         During the year ended December 31, 2005 a total of 30,000 stock options
were cancelled, from a year ended December 31, 2004 grant of 2,300,000 options,
at an exercise price $0.30 per share. These were granted to employees of Rex
Tokyo, which was discontinued on April 4, 2006.

         Stock option activity, for options granted under the 2007 Stock
Incentive Plans, for the three months ended March 31, 2008 and the years ended
December 31, 2007, 2006 and 2005 are summarized as follows:

Employee Stock Option Plan:
                                                         Weighted Average
                                           Options        Exercise Price
                                         ----------      ----------------
Outstanding as of December 31, 2004       7,700,000          $ 0.24
   Granted ........................       1,930,000            0.21
   Exercised ......................               -             -
   Forfeitures ....................      (2,030,000)          (0.26)
                                         ----------          ------
Outstanding as of December 31, 2005       7,600,000            0.22
   Granted ........................         900,000            0.16
   Exercised ......................      (1,000,000)          (0.08)
   Forfeitures ....................      (3,300,000)          (0.26)
                                         ----------          ------
Outstanding as of December 31, 2006       4,200,000            0.21
   Granted ........................       5,347,500            0.28
   Exercised ......................        (434,166)          (0.20)
   Forfeitures ....................      (1,055,834)          (0.21)
                                         ----------          ------
Outstanding as of December 31, 2007       8,057,500          $ 0.26
   Granted ........................       1,505,000            0.29
   Exercised ......................         (86,458)          (0.16)
   Forfeitures ....................        (350,000)          (0.34)
                                         ----------          ------
Outstanding as of March 31, 2008 ..       9,126,042          $ 0.26
                                         ==========          ======

                                      F-39Non - Employee Stock Option Plan:
                                                         Weighted Average
                                           Shares         Exercise Price
                                         ----------      ----------------
Outstanding at December 31, 2004          1,821,500            5.33
   Granted ........................               -               -
   Exercised ......................               -               -
   Expired or cancelled ...........      (1,821,500)          (5.33)
                                         ----------          ------
Outstanding at December 31, 2005                  -               -
   Granted ........................               -               -
   Exercised ......................               -               -
   Expired or cancelled ...........               -               -
                                         ----------          ------
Outstanding at December 31, 2006                  -               -
   Granted ........................               -               -
   Exercised ......................               -               -
   Expired or cancelled ...........               -               -
                                         ----------          ------
Outstanding at December 31, 2007 ..               -               -
                                         ==========          ======

         Prior to December 31, 2003, the company granted options to various
employees and consultants. The compensation expense attributed to these
issuances of these stock options had been amortized over twenty four months, the
term of service arrangement and were exercisable over five years. The
non-employee stock options outstanding were fully vested as of December 31, 2002
and have expired as of December 31, 2005.

         The following table summarizes information about stock options
outstanding and exercisable at March 31, 2008:

                                   Weighted                              Weighted
                                    Average    Weighted                   Average
                                   Remaining    Average                  Exercise
                        Number       Life in   Exercise     Number         Price
                     Outstanding     Years       Price    Exercisable   Exercisable
                     -----------   ---------   --------   -----------   -----------
Range of
exercise prices:
$0.14 to $0.16 ...     2,463,542      8.77       $0.15        863,542      $0.15
$0.20 to $0.26 ...     2,060,000      7.13       $0.21      1,892,500      $0.21
$0.29 to $0.31 ...     1,885,000      9.04       $0.29        431,250      $0.30
$0.37 to $0.53 ...     2,717,500      9.33       $0.39        332,083      $0.40
                     -----------     -----       -----    -----------      -----
                       9,126,542      8.58       $0.26      3,519,375      $0.22
                     ===========     =====       =====    ===========      =====

   The aggregate intrinsic value of the exercisable warrants as of March 31,
   2008 is approximately $789,000.

NOTE 15. 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.

Employment Agreements

         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.

                                      F-40Derek 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. 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 under the 2007 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 Plan.

         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. 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.

                                      F-41On April 27, 2008, Mr. Scott was awarded 131,400 shares of common stock
under the 2007 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 Plan.

         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.

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              $ 2,064,846
                  2010                  564,559
                  2011                  520,350
                  2012                  261,990
                  2013                   26,192
                                    -----------
                 Total              $ 3,437,937
                                    ===========

         Rent expense, for the three months ended March 31, 2008 and 2007 was
$595,643 and $387,165, respectively. Rent expense, for the years ended December
31, 2007, 2006 and 2005 was $1,818,570, $1,233,789 and $503,109, respectively.

NOTE 16. 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.

                                      F-42The 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) GPLus and Slate, our equity
investments in the human capital and resource sector , and (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.

         The following table presents revenues, operating income (loss) and
total assets by company for the three months ended March 31, 2008 and 2007 and
the years ended December 31, 2007, 2006 and 2005:

(dollars in thousands)
                                    IA           Global
                                  Global,       Hotline,       Equity
Company                            Inc.           Inc.       Investments      Total
                                 --------       --------     -----------    --------
Three Months Ended-
   March 31, 2008
   Revenue ................      $      -       $ 16,049      $      -      $ 16,049
   Operating (loss) income           (502)         2,537             -         2,035
   Total assets ...........           269         24,964         9,707        34,940

   March 31, 2007
   Revenue ................      $      -       $  6,493      $      -      $  6,493
   Operating (loss) inccome          (470)            57             -          (413)
   Total assets ...........           962         12,860         7,603        21,425


Geographic Region                  U.S.           Japan       Australia       Total
                                 --------       --------      ---------     --------
Three Months Ended-
   March 31, 2008
   Revenue ................      $      -       $ 16,049      $      -      $ 16,049
   Operating (loss) income           (502)         2,537             -         2,035
   Total assets ...........           132         27,877         6,930        34,940

   March 31, 2007
   Revenue ................      $      -       $  6,493      $      -      $  6,493
   Operating (loss) income           (470)            57             -          (413)
   Total assets ...........           962         12,860         7,603        21,425


The following reconciles operating loss to net loss:

(dollars in thousands)               Three Months Ended,
                                           March 31,
                                    --------------------
                                      2008         2007
                                    -------      -------
                                               (Unaudited)
Operating income (loss) .........   $ 2,035      $  (413)
Other expense ...................      (317)        (163)
                                    -------      -------
Income (loss) before income taxes     1,718         (576)
Income tax provision ............     1,358          268
                                    -------      -------
Net income (loss) ...............   $   360      $  (844)
                                    =======      =======

                                      F-43(dollars in thousands)
                             IA           Global
                           Global,       Hotline,        Equity                    Discontinued
Company                     Inc.           Inc.        Investments     Total        Operations       Total
                          --------       --------      -----------    --------     ------------    --------
Year Ended-
   December 31, 2007
   Revenue .........      $      -       $ 29,136       $      -      $ 29,136       $      -      $ 29,136
   Operating loss ..        (2,040)        (7,538)             -        (9,578)             -        (9,578)
   Total assets ....           457         19,654          9,811        29,922              -        29,922

   December 31, 2006
   Revenue .........      $      -       $ 19,139       $      -      $ 19,139       $      -      $ 19,139
   Operating loss ..        (1,779)        (1,043)             -        (2,822)             -        (2,822)
   Total assets ....         1,859         12,635          7,146        21,640              -        21,640

   December 31, 2005
   Revenue .........      $      -       $ 15,745       $      -      $ 15,745       $      -      $ 15,745
   Operating loss ..        (1,642)         2,122              -           480              -           480
   Total assets ....         4,291         11,237              -        15,528         12,606        28,134

Geographic Region           U.S.           Japan        Australia       Total
                          --------       --------       ---------     --------
Year Ended-
   December 31, 2007
   Revenue .........      $      -       $ 29,136       $      -      $ 29,136       $      -      $ 29,136
   Operating loss ..        (2,040)        (7,538)             -        (9,578)             -        (9,578)
   Total assets ....           457         22,440          7,025        29,922              -        29,922

   December 31, 2006
   Revenue .........      $      -       $ 19,139       $      -      $ 19,139       $      -      $ 19,139
   Operating loss ..        (1,779)        (1,043)             -        (2,822)             -        (2,822)
   Total assets ....         1,859         12,635          7,146        21,640              -        21,640

   December 31, 2005
   Revenue .........      $      -       $ 15,745       $      -      $ 15,745       $      -      $ 15,745
   Operating loss ..        (1,642)         2,122              -           480              -           480
   Total assets ....         4,291         11,237              -        15,528         12,606        28,134


The following reconciles operating loss to net loss:

(dollars in thousands)
                                                      Year Ended December 31,
                                                 --------------------------------
                                                   2007        2006        2005
                                                 --------    --------    --------
Operating loss ...............................   $ (9,578)   $ (2,822)   $    480
Other expense ................................       (577)       (640)       (341)
                                                 --------    --------    --------
Loss from continuing operations
  before income taxes ........................    (10,155)     (3,462)        139
Income tax (benefit) provision ...............     (2,006)        515         825
                                                 --------    --------    --------
Net loss from continuing operations ..........     (8,149)     (3,977)       (686)
Total (loss) gain from discontinued operations       (110)        207      (1,385)
                                                 --------    --------    --------
Net loss .....................................   $ (8,259)   $ (3,770)   $ (2,071)
                                                 ========    ========    ========

                                      F-44NOTE 17. 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     December 31   September 30     June 30      March 31
                                                                   --------    -----------   ------------    --------      --------
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 ...........................   $      -      $      -      $      -      $      -      $      -
                                                                   ========      ========      ========      ========      ========

Year Ended December 31, 2007
----------------------------
Revenue ........................................................   $ 29,136      $ 10,667      $  6,461      $  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)
                                                                   ========      ========      ========      ========      ========

Year Ended December 31, 2005
----------------------------
Revenue ........................................................   $ 15,745      $  7,746      $  7,106      $    893      $      -
Gross profit ...................................................     10,174         4,728         4,980           466             -
Net (loss) profit from continuing operations ...................       (686)         (510)          571          (463)         (284)
(Loss) profit  from discontinued operations ....................     (1,385)         (860)          162          (427)         (260)
Net profit (loss) ..............................................     (2,071)       (1,370)          734          (891)         (544)
                                                                   --------      --------      --------      --------      --------

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

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

                                      F-45REPORT 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, 2008, 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, 2008, 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
July 15, 2008SIGNATURES

         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: July 15, 2008                 By: /s/ Derek Schneideman
                                        ---------------------
                                        Derek Schneideman
                                        Chief Executive Officer and
                                        Director

                                    By: /s/  Mark Scott
                                        ---------------
                                        Mark Scott
                                        Chief Operating and Financial Officer,
                                        Director 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      July 15, 2008
---------------------    (Principal Executive Officer)
Derek Schneideman

/s/ Mark Scott           Chief Operating and Financial Officer,    July 15, 2008
--------------           Director, Director and Secretary
Mark Scott               (Principal Financial and Accounting
                         Officer)

/s/ Hideki Anan          Management Director                       July 15, 2008
---------------
Hideki Anan

/s/ Masazumi Ishii       Independent Director                      July 15, 2008
------------------
Masazumi Ishii

/s/ Eric La Cara         Independent Director                      July 15, 2008
----------------
Eric La Cara

/s/ Brian Nelson         Independent Director                      July 15, 2008
----------------
Brian Nelson

/s/ Mae Towada           Independent Director                      July 15, 2008
--------------
Mae Towada