UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                   FORM 10-Q/A

[X]  Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange
     Act of 1934

                  For the quarterly period ended March 31, 2008

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

                          Commission File Number: None

                    NEW TAOHUAYUAN CULTURE TOURISM CO., LTD.

         Nevada                                       Applied For
---------------------------                ----------------------------------
State or other jurisdiction               (I.R.S.) Employer Identification No.
  of incorporation
                                1# Dongfeng Road
                   Xi'an Weiyang Tourism Development District
                                Xian, China
                     -------------------------------------
                     Address of principal executive offices

                                0086-29-86671555
                          ---------------------------
               Registrant's telephone number, including area code

                                       N/A
                           ---------------------------
                  Former address of principal executive offices

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) had been subject to such filing
requirements for the past 90 days.  YES  [X]        No  [  ]

Indicate by check mark whether the Registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act. (Check One):

Large accelerated filer [  ]                      Accelerated filer [  ]

Non-accelerated filer [  ]                       Smaller reporting company [X]
(Do not check if a smaller reporting company)

Indicate by check mark whether the Registrant is a shell company (as defined in
Exchange Act Rule 12b-2 of the Exchange Act).   YES  [ ]        No  [X]

         Class of Stock         No. Shares Outstanding            Date

            Common                  18,727,327              January 15, 2009



<PAGE>

ITEM 1.  FINANCIAL STATEMENTS


         NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMIITED AND SUBSIDIARY
                        CONSOLIDATED FINANCIAL STATEMENTS
                                 MARCH 31, 2008
                                   (UNAUDITED)

                                TABLE OF CONTENTS



Unaudited consolidated Balance Sheet as of March 31, 2008                  3

Unaudited consolidated Statements of Income for the three
  month periods ended March 31, 2008 and 2007                              4

Unaudited consolidated Statements of Cash Flows for the
  three month periods ended March 31, 2008 and 2007                        5

Notes to unaudited consolidated financial statements                      6-23

                                EXPLANATORY NOTE

New Taohuayuan  Culture  Tourism Company Limited is filing this Amendment No. 1
on Form  10-Q for the  purpose  of  amending  the  deposit  for land use  rights
explained under Note C of the Quarterly  Report on Form 10-Q for the three month
period  ended  March 31,  2008  filed  with the U.S.  Securities  and  Exchanges
Commission on June 23, 2008 ("Original Report") reversing the impairment for the
deposit for land use rights for the period covered by the Original Report. Other
accounts restated are the result of this amendment.

Except as  described  above,  no other  changes  have been made to the  Original
Report.  In addition,  as required by Rule 12b-15 under the Securities  Exchange
Act of 1934, new certifications by our Principal Executive Officer and Principal
Financial Officer are filed as exhibits to this Amendment.

                                       2
<PAGE>


          NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED AND SUBSIDIARY
                      CONSOLIDATED BALANCE SHEET - RESTATED

                                                March 31, 2008
                                                  (Restated)      December 31,
                                                 (Unaudited)         2007
                                     ASSETS
 Current assets
   Cash and cash equivalents                   $    26,696        $    45,680
   Accounts receivable, net                         21,432             34,178
   Inventories                                      83,671            127,182
   Prepaid expenses and other current assets           860                385
   Due from related parties                        489,776            476,552
                                               -----------        -----------
           Total Current Assets                    622,435            683,977

 Property & equipment, net                       6,842,569          6,713,733
 Construction-in- progress                       9,317,700          7,944,945
 Land use right, net                             2,550,238          2,463,522
 Deposit for land use rights - restated         17,136,000         16,452,000
                                              ------------        -----------
 Total assets                                 $ 36,468,942       $ 34,258,177
                                              ============       ============

                      LIABILITIES AND STOCKHOLDERS' EQUITY

 Current liabilities
   Accounts payable and accrued expenses      $    563,098      $     495,825
   Deferred revenue                                 12,895             52,105
   Taxes payable - restated                      4,464,944          4,070,480
                                              ------------      -------------
      Total Current Liabilities                  5,040,937          4,618,410

 Stockholders' equity
   Common stock, $.001 par value, 50,000,000
     shares authorized, 18,727,327 issued and
     outstanding                                    18,727             18,727
   Preferred stock, $.001 par value,10,000,000
     shares authorized, none shares issued and
     outstanding                                         -                  -
   Additional paid in capital                   15,855,727         15,855,727
   Statutory reserve - restated                  2,074,050          2,018,901
   Other comprehensive income - restated         4,451,831          3,207,587
   Retained earning - restated                   9,027,669          8,538,825
                                               -----------       ------------
   Total stockholders' equity                   31,428,005         29,639,767
                                               -----------       ------------
 Total liabilities and stockholders'          $ 36,468,942        $34,258,177
  stockholders' equity                        ============        ===========


              The accompanying notes are an integral part of these
                  unaudited consolidated financial statements.

                                       3
<PAGE>

          NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED AND SUBSIDIARY
   CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME - RESTATED
            FOR THE THREE MONTH PERIODS ENDED MARCH 31, 2008 AND 2007
                                   (UNAUDITED)

                                                    For the three month
                                                   periods ended March 31,
                                                   2008              2007
                                               -----------------------------
                                                (Restated)
Net revenue
 Catering and hotel related services
   income                                      $  1,026,648       $  880,863
 Management fee income                              482,207          443,560
                                               ------------       ----------
         Total net revenue                        1,508,855        1,324,423

Cost of revenue                                     319,166          221,017
                                               ------------       ----------
Gross profit                                      1,189,689        1,103,406

Operating expenses
  General and administrative expenses               304,366          262,765
  Depreciation and amortization                     162,474          145,040
  Imapirement - Deposit - restated                        -                -
                                               ------------       ----------
        Total operating expenses                    466,840          407,805
                                               ------------       ----------

Income from operations                              722,849          695,601
                                               ------------       ----------
Other (Income) expense
   Interest income                                     (447)            (310)
   Other income, net                                 (4,530)               -
                                               ------------       ----------
        Total other income                           (4,977)            (310)
                                               ------------       ----------
Income before income taxes                          727,826          695,911
Provision for income taxes                          183,832          224,351
                                               ------------       ----------
Net income - restated                               543,994          471,560

Other comprehensive item:
  Foreign currency translation gain -
    restated                                      1,244,244          283,448
                                               ------------       ----------
Net comprehensive income - restated             $ 1,788,238       $  755,008
                                               ============       ==========
Earning per share:
  Basic & diluted earning per share -
     restated                                   $      0.03       $     0.03
                                               ============       ==========

Weighted average number of shares
outstanding:
  Basic & diluted weighted average
    number of shares                             18,727,327       18,443,994
                                               ============       ==========

The basic and diluted  shares are the same because  there are no diluted  shares
issued

              The accompanying notes are an integral part of these
                  unaudited consolidated financial statements.

                                       4

<PAGE>

          NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED AND SUBSIDIARY
                 CONSOLIDATED STATEMENTS OF CASH FLOWS -RESTATED
            FOR THE THREE MONTH PERIODS ENDED MARCH 31, 2008 AND 2007
                                   (UNAUDITED)

                                             For the three month periods ended
                                                         March 31,
                                                    2008             2007
                                                   ------           -----
                                                 (Restated)
 CASH FLOWS FROM OPERATING ACTIVITIES
    Net income - restated                         $543,994       $ 471,560
    Adjustments to reconcile net income to
      net cash provided by operating activities:
    Depreciation and amortization                  162,474         145,040
    (Increase) / decrease in current assets:
    Accounts receivables                            13,249           3,814
    Inventory                                       47,763          (8,499)
    Other receivables                                 (449)        (12,797)
    Increase/(Decrease) in current liabilities:
    Accounts payable and accrued expenses           45,828        (158,500)
    Taxes payable - restated                       220,454         310,969
    Deferred revenue                               (40,499)           (998)
                                                 ---------        --------
   Total Adjustments                               448,821         279,029
                                                 ---------        --------
    Net cash provided by operating activities      992,815         750,589

  CASH FLOWS FROM INVESTING ACTIVITIES
    Payment for construction-in-progress        (1,020,321)              -
    Purchase of property & equipment                     -            (776)
    Increase in long-term assets                         -      (1,083,864)
                                                ----------      ----------
    Net cash used in investing activities       (1,020,321)     (1,084,640)

 CASH FLOWS FROM FINANCING ACTIVITIES
    Advances to related parties                          -         (44,126)
    Proceed from related party                       7,065               -
    Proceed from stock issuance                          -          85,000
                                                ----------      ----------
    Net cash provided by financing activities        7,065          40,874
                                                ----------      ----------
    Effect of exchange rate changes on cash
       and cash equivalents                          1,457         348,800
                                                ----------      ----------
    Net increase (decrease) in cash and
       cash equivalents                            (18,984)         55,623

    Cash and cash equivalents, beginning
       balance                                      45,680          46,394
                                                ----------      ----------
    Cash and cash equivalents, ending
       balance                                 $    26,696      $  102,017
                                               ===========      ==========
 SUPPLEMENTAL DISCLOSURES:
    Cash paid during the year for:
       Income tax payments                     $         -      $        -
      Interest payments                        $         -      $        -
                                               ===========      ==========

              The accompanying notes are an integral part of these
                  unaudited consolidated financial statements.


                                       5
<PAGE>

                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Note A - ORGANIZATION

      New Taohuayuan Culture Tourism Company Limited (the "Company") was
      incorporated under the laws of the State of Nevada on November 3, 2004.
      The Company is an investment holding company.

      Shaanxi New Taohuayuan Culture Tourism Company Limited ("Shaanxi NTHY")
      was incorporated in the People's Republic of China ("PRC") on August 3,
      1997 as a limited liability company. Shaanxi NTHY operates a resort in
      Xi'an, in the PRC, providing catering, hotel and related services.

      Pursuant to an agreement and plan of migratory merger between the Company
      and Shaanxi NTHY on November 5, 2004, the Company acquired Shaanxi NTHY by
      issuing 17,027,328 shares of its common stock to the original shareholders
      of Shaanxi NTHY in exchange for 100% of their membership interests (the
      "Merger"). As a result, the controlling member of Shaanxi NTHY has
      effective and actual operating control of the Company. The Merger was
      approved by the Shaanxi Ministry of Commerce on November 24, 2004. Since
      then, Shaanxi NTHY has become a wholly owned subsidiary of the Company and
      its status has changed to a wholly owned foreign owned enterprise.

      Since the Company had no operations or net assets prior to the
      acquisition, the acquisition was considered to be a capital transaction in
      substance, rather than a business combination and no goodwill was
      recognized. For financial reporting purposes, the acquisition was treated
      as a reverse acquisition whereby Shaanxi NTHY is considered to be the
      accounting survivor and the operating entity while the Company is
      considered to be the legal survivor.

Note B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      Unaudited Interim Financial Information

      The accompanying unaudited consolidated financial statements have been
      prepared by New Taohuayuan Tourism Company Limited pursuant to the rules
      and regulations of the Securities and Exchange Commission (the "SEC") Form
      10-QSB and Item 310 of Regulation S-B, and generally accepted accounting
      principles for interim financial reporting. The information furnished
      herein reflects all adjustments (consisting of normal recurring accruals
      and adjustments) which are, in the opinion of management, necessary to
      fairly present the operating results for the respective periods. Certain
      information and footnote disclosures normally present in annual
      consolidated financial statements prepared in accordance with accounting
      principles generally accepted in the United States of America have been
      omitted pursuant to such rules and regulations. These consolidated
      financial statements should be read in conjunction with the audited
      consolidated financial statements and footnotes included in the Company's
      Annual Report on Form 10-KSB. The results of the three months ended March
      31, 2008 are not necessarily indicative of the results to be expected for
      the full year ending December 31, 2008.

                                       6
<PAGE>

                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

      Basis of Presentation

      The accompanying consolidated financial statements have been prepared in
      conformity with accounting principles generally accepted in the United
      States of America. The Company's functional currency is the Chinese
      Renminbi (CNY); however the accompanying consolidated financial statements
      have been translated and presented in United States Dollars (USD).

      Foreign currency transactions and comprehensive income (loss)

      As of March 31, 2008, the accounts of Shaanxi NTHY were maintained, and
      its financial statements were expressed, in Chinese Yuan Renminbi (CNY).
      Such financial statements were translated into U.S. Dollars (USD) in
      accordance with Statement of Financial Accounts Standards ("SFAS") No. 52,
      "Foreign Currency Translation," with the CNY as the functional currency.
      According to the Statement, all assets and liabilities were translated at
      the current exchange rate, stockholder's equity are translated at the
      historical rates and income statement items are translated at the average
      exchange rate for the period. The resulting translation adjustments are
      reported under other comprehensive income in accordance with SFAS No. 130,
      "Reporting Comprehensive Income" as a component of shareholders' equity.

      During the three month periods ended March 31, 2008 and 2007 the
      transactions of Shaanxi NTHY were denominated in foreign currency and were
      recorded in Chinese Yuan Renminbi (CNY) at the rates of exchange in effect
      when the transactions occur. Exchange gains and losses are recognized for
      the different foreign exchange rates applied when the foreign currency
      assets and liabilities are settled. Transaction gains and losses that
      arise from exchange rate fluctuations on transactions denominated in a
      currency other than the functional currency are included in the results of
      operations as incurred.

      Use of Estimates

      The preparation of financial statements in conformity with generally
      accepted accounting principles in the United States ("GAAP") requires
      management to make certain 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, and such differences may
      be material to the financial statements. Certain prior year amounts have
      been reclassified to conform to the current year presentation.


                                       7
<PAGE>

                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

      Principles of Consolidation

      The consolidated financial statements include the accounts of New
      Taohuayuan Culture Tourism Company Limited and its wholly owned subsidiary
      Shaanxi NTHY, collectively referred to within as the Company. All material
      inter-company accounts, transactions and profits have been eliminated in
      consolidation.

       Revenue Recognition

      The Company generates revenue from catering, hotel, and related services.
      The Company's revenue recognition policies are in compliance with Staff
      accounting bulletin (SAB) 104. Revenue is generally recognized: (a) when
      persuasive evidence of an arrangement exists; (b) when services are
      rendered; (c) when the fee is fixed or determinable; and (d) when
      collectibility is reasonably assured. Such service revenues are recognized
      net of discounts.

      The Company also generates management fee income in accordance with
      Shaanxi New Taohuayuan Economy Trade Company Limited and its subsidiaries
      (related parties) based on terms stated in the agreement. These companies
      are controlled by a common director and stockholder of the Company. Cost
      of good sold related to management fee income is immaterial comparing with
      the total expenses incurred for the Company during its fiscal year.

      Income Taxes

      The Company utilizes SFAS No. 109, "Accounting for Income Taxes," which
      requires the recognition of deferred tax assets and liabilities for the
      expected future tax consequences of events that have been included in the
      financial statements or tax returns. Under this method, deferred income
      taxes are recognized for the tax consequences in future years of
      differences between the tax bases of assets and liabilities and their
      financial reporting amounts at each period end based on enacted tax laws
      and statutory tax rates applicable to the periods in which the differences
      are expected to affect taxable income. Valuation allowances are
      established, when necessary, to reduce deferred tax assets to the amount
      expected to be realized.

      In July 2006, the Financial Accounting Standards Board ("FASB") issued
      FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes--an
      Interpretation of FASB Statement No. 109 ("FIN 48"). FIN 48 seeks to
      reduce the diversity in practice associated with certain aspects of
      measuring and recognition in accounting for income taxes. In addition, FIN
      48 requires expanded disclosure with respect to the uncertainty in income
      taxes and is effective

                                       8
<PAGE>

                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

      Beginning January 1, 2008, the new Enterprise Income Tax ("EIT") law will
      replace the existing laws for Domestic Enterprises ("DES") and Foreign
      Invested Enterprises ("FIEs"). The new standard EIT rate of 25% will
      replace the 33% rate currently applicable to both DES and FIEs. The two
      years tax exemption, three years 50% tax reduction tax holiday for
      production-oriented FIEs will be eliminated.

      Statement of Cash Flows

      In accordance with SFAS No. 95, "Statement of Cash Flows," cash flows from
      the Company's operations is based upon the local currencies. As a result,
      amounts related to assets and liabilities reported on the statement of
      cash flows will not necessarily agree with changes in the corresponding
      balances on the balance sheet.

      Segment Reporting

      Statement of Financial Accounting Standards No. 131 ("SFAS 131"),
      "Disclosure About Segments of an Enterprise and Related Information"
      requires use of the "management approach" model for segment reporting. The
      management approach model is based on the way a company's management
      organizes segments within the company for making operating decisions and
      assessing performance. Reportable segments are based on products and
      services, geography, legal structure, management structure, or any other
      manner in which management disaggregates a company.

      Risks and Uncertainties

      The Company is subject to substantial risks from, among other things,
      intense competition associated with the industry in general, other risks
      associated with financing, liquidity requirements, rapidly changing
      customer requirements, limited operating history, foreign currency
      exchange rates and the volatility of public markets.

      The Company's operations are carried out in the PRC. Accordingly, the
      Company's business, financial condition and results of operations may be
      influenced by the political, economic and legal environments in the PRC,
      by the general state of the PRC's economy. The Company's business may be
      influenced by changes in governmental policies with respect to laws and
      regulations, anti-inflationary measures, currency conversion and
      remittance abroad, and rates and methods of taxation, among other things.

      Contingencies

      Certain conditions may exist as of the date the financial statements are
      issued, which may result in a loss to the Company but which will only be
      resolved when one or more future events occur or fail to occur. The
      Company's management and legal counsel assess such contingent liabilities,
      and such assessment inherently involves an exercise of judgment. In
      assessing loss contingencies related to legal proceedings that are pending
      against the Company or unasserted claims that may result in such
      proceedings, the Company's legal counsel evaluates the perceived merits of

                                       9
<PAGE>

                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

      any legal proceedings or unasserted claims as well as the perceived merits
      of the amount of relief sought or expected to be sought.

      If the assessment of a contingency indicates that it is probable that a
      material loss has been incurred and the amount of the liability can be
      estimated, then the estimated liability would be accrued in the Company's
      financial statements. If the assessment indicates that a potential
      a potential material loss contingency is not probable but is reasonably
      possible, or is probable but cannot be estimated, then the nature of the
      contingent liability, together with an estimate of the range of possible
      loss if determinable and material would be disclosed.

      Loss contingencies considered to be remote by management are generally not
      disclosed unless they involve guarantees, in which case the guarantee
      would be disclosed.

       Allowance for Doubtful Accounts

      Management reviews the composition of accounts receivable, loans and
      prepaid expense and analyzes historical bad debts, aging analysis, current
      economic trends and changes in payment patterns to evaluate the adequacy
      of these reserves. Reserves are recorded primarily on a specific
      identification basis. Allowance for doubtful accounts amounted to $28,258
      and $10,475 at March 31, 2008 and 2007 respectively.

      Intangible Assets

      The Company applies criteria specified in SFAS No. 141, "Business
      Combinations" to determine whether an intangible asset should be
      recognized separately from goodwill. Intangible assets acquired through
      business acquisitions are recognized as assets separate from goodwill if
      they satisfy either the "contractual-legal" or "separability" criterion.
      Per SFAS 142, intangible assets with definite lives are amortized over
      their estimated useful life and reviewed for impairment in accordance with
      SFAS No. 144, "Accounting for the Impairment or Disposal of Long-lived
      Assets." Intangible assets, such as purchased technology, trademark,
      customer list, user base and non-compete agreements, arising from the
      acquisitions of subsidiaries and variable interest entities are recognized
      and measured at fair value upon acquisition. Intangible assets are
      amortized over their estimated useful lives from one to ten years. The
      Company reviews the amortization methods and estimated useful lives of
      intangible assets at least annually or when events or changes in
      circumstances indicate that assets may be impaired. The recoverability of
      an intangible asset to be held and used is evaluated by comparing the
      carrying amount of the intangible asset to its future net undiscounted
      cash flows. If the intangible asset is considered to be impaired, the
      impairment loss is measured as the amount by which the carrying amount of
      the intangible asset exceeds the fair value of the intangible asset,
      calculated using a discounted future cash flow analysis. The Company uses
      estimates and judgments in its impairment tests, and if different
      estimates or judgments had been utilized, the timing or the amount of the
      impairment charges could be different.

                                       10
<PAGE>

                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

     Effective  January 1, 2002,  the Company  adopted  Statement  of  Financial
     Accounting Standards No. 144, "Accounting for the Impairment or Disposal of
     Long-Lived Assets" ("SFAS 144"), which addresses  financial  accounting and
     reporting  for  the  impairment  or  disposal  of  long-lived   assets  and
     supersedes  SFAS No. 121,  "Accounting  for the  Impairment  of  Long-Lived
     Assets and for Long-Lived Assets to be Disposed Of," and the accounting and
     reporting  provisions  of APB  Opinion  No. 30,  "Reporting  the Results of
     Operations  for  a  Disposal  of a  Segment  of a  Business."  The  Company
     periodically  evaluates the carrying value of long-lived  assets to be held
     and used in accordance with SFAS 144. SFAS 144 requires  impairment  losses
     to be recorded on long-lived  assets used in operations  when indicators of
     impairment  are present and the  undiscounted  cash flows  estimated  to be
     generated by those assets are less than the assets'  carrying  amounts.  In
     that event, a loss is recognized  based on the amount by which the carrying
     amount  exceeds the fair market  value of the  long-lived  assets.  Loss on
     long-lived  assets to be disposed  of is  determined  in a similar  manner,
     except that fair market values are reduced for the cost of disposal.

      Recent Accounting Pronouncements

      In September 2006, FASB issued SFAS 158 `Employers' Accounting for Defined
      Benefit Pension and Other Postretirement Plans--an amendment of FASB
      Statements No. 87, 88, 106, and 132(R)' This Statement improves financial
      reporting by requiring an employer to recognize the over funded or under
      funded status of a defined benefit postretirement plan (other than a
      multiemployer plan) as an asset or liability in its statement of financial
      position and to recognize changes in that funded status in the year in
      which the changes occur through comprehensive income of a business entity
      or changes in unrestricted net assets of a not-for-profit organization.
      This Statement also improves financial reporting by requiring an employer
      to measure the funded status of a plan as of the date of its year-end
      statement of financial position, with limited exceptions. An employer with
      publicly traded equity securities is required to initially recognize the
      funded status of a defined benefit postretirement plan and to provide the
      required disclosures as of the end of the fiscal year ending after
      December 15, 2006. An employer without publicly traded equity securities
      is required to recognize the funded status of a defined benefit
      postretirement plan and to provide the required disclosures as of the end
      of the fiscal year ending after June 15, 2007. However, an employer
      without publicly traded equity securities is required to disclose the
      following information in the notes to financial statements for a fiscal
      year ending after December 15, 2006, but before June 16, 2007, unless it
      has applied the recognition provisions of this Statement in preparing
      those financial statements:


                                       11
<PAGE>

                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

     a.   A brief description of the provisions of this Statement

     b.   The date that adoption is required

     c.   The date the employer  plans to adopt the  recognition  provisions  of
          this Statement, if earlier.

      The requirement to measure plan assets and benefit obligations as of the
      date of the employer's fiscal year-end statement of financial position is
      effective for fiscal years ending after December 15, 2008. The management
      is currently evaluating the effect of this pronouncement on financial
      statements.

      In December 2007, the FASB issued SFAS No. 160, "Non-controlling Interests
      in Consolidated Financial Statements". This Statement amends ARB 51 to
      establish accounting and reporting standards for the non-controlling
      (minority) interest in a subsidiary and for the deconsolidation of a
      subsidiary. It clarifies that a non-controlling interest in a subsidiary
      is an ownership interest in the consolidated entity that should be
      reported as equity in the consolidated financial statements. SFAS No. 160
      is effective for the Company's fiscal year beginning October 1, 2009.
      Management is currently evaluating the effect of this pronouncement on
      financial statements.

      In March 2008, the FASB issued FASB Statement No. 161, Disclosures about
      Derivative Instruments and Hedging Activities. The new standard is
      intended to improve financial reporting about derivative instruments and
      hedging activities by requiring enhanced disclosures to enable investors
      to better understand their effects on an entity's financial position,
      financial performance, and cash flows The new standard also improves
      transparency about the location and amounts of derivative instruments in
      an entity's financial statements; how derivative instruments and related
      hedged items are accounted for under Statement 133; and how derivative
      instruments and related hedged items affect its financial position,
      financial performance, and cash flows. . It is effective for financial
      statements issued for fiscal years and interim periods beginning after
      November 15, 2008, with early application encouraged. Management is
      currently evaluating the effect of this pronouncement on financial
      statements.

     In December 2007, the FASB issued SFAS No. 141(R), "Business Combinations".
     This Statement replaces SFAS No. 141, Business Combinations. This Statement
     retains the fundamental  requirements in Statement 141 that the acquisition
     method of accounting  (which  Statement 141 called the purchase  method) be
     used for all business combinations and for an acquirer to be identified for
     each business combination.  This Statement also establishes  principles and
     requirements  for how the  acquirer:  a)  recognizes  and  measures  in its
     financial  statements the  identifiable  assets  acquired,  the liabilities
     assumed,  and any non-controlling  interest in the acquiree;  b) recognizes
     and measures the goodwill  acquired in the business  combination  or a gain
     from a bargain  purchase and c) determines what  information to disclose to

                                       12
<PAGE>

                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

     enable  users of the  financial  statements  to  evaluate  the  nature  and
     financial effects of the business  combination.  SFAS No. 141(R) will apply
     prospectively to business combinations for which the acquisition date is on
     or after Company's fiscal year beginning October 1, 2009. While the Company
     has not yet evaluated this statement for the impact,  if any, that SFAS No.
     141(R) will have on its consolidated financial statements, the Company will
     be required to expense costs related to any  acquisitions  after  September
     30, 2009.

      In May 0f 2008, FSAB issued SFASB No.162, The Hierarchy of Generally
      Accepted Accounting Principles. The pronouncement mandates the GAAP
      hierarchy reside in the accounting literature as opposed to the audit
      literature. This has the practical impact of elevating FASB Statements of
      Financial Accounting Concepts in the GAAP hierarchy. This pronouncement
      will become effective 60 days following SEC approval. The company does not
      believe this pronouncement will impact its financial statements.

      In May of 2008, FASB issued SFASB No. 163, Accounting for Financial
      Guarantee Insurance Contracts-an interpretation of FASB Statement No. 60.
      The scope of the statement is limited to financial guarantee insurance
      (and reinsurance) contracts. The pronouncement is effective for fiscal
      years beginning after December 31, 2008. The company does not believe this
      pronouncement will impact its financial statements.

Note C - DEPOSIT FOR LAND USE RIGHT - RESTATED

     The Company has deposited  amounts with the local  government  for land use
     rights  amounting to $17,136,000 at March 31, 2008 for the acquisition of a
     parcel of land in PRC.  The  Company  intends to  acquire  the land for the
     development  of a new  project.  To  obtain  the land use  rights  from the
     Government, the Company is required to pay the demolish fee associated with
     the  acquisition  of the land use rights  amounting to  $21,420,000.  As of
     March 31, 2008,  the demolish fee was not  deposited  with the  government,
     therefore,  the  official  title  for the  land  use  rights  has not  been
     transferred to the Company.  The deposit amount is secured by the assets of
     the major shareholder of the Company as of July 23, 2008.

Note D - PROPERTY AND EQUIPMENT, NET

      As of March 31, 2008 the property and equipment of the Company consisted
      of the following:

                                                     3-31-2008
                                                 --------------
            Buildings                              $ 7,034,092
            Infrastructure and Leasehold
                Inprovement                          1,739,339
            Furniture and fixtures                   1,598,885
            Equipments                               1,928,591
            Automobiles                                305,596
                                                   -----------
                                                    12,606,503
            Accumulated Depreciation                (5,763,934)
                                                   -----------
            Property and Equipment, net            $ 6,842,569
                                                   ===========

                                       13
<PAGE>

                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

      The Company had depreciation expenses of $147,101, and $131,317 for the
      three month periods ended March 31, 2008 and 2007 respectively.

Note E - LAND USE RIGHT, NET

      According to the laws of China, the government owns all the land in China.
      Companies or individuals are authorized to possess and use the land only
      through land use rights granted by the Chinese government. Land use rights
      are being amortized using the straight-line method over the lease term of
      40 to 68 years.

      As of March 31, 2008 the intangible assets of the Company consisted of the
      following:

                                                 3-31-2008
                                                 ---------

                  Land use rights               $ 3,257,016
                                                -----------
                  Accumulated amortization         (706,778)
                                                -----------
                  Land use rights, net          $ 2,550,238


      The Company had amortization expenses of $15,373 and $13,723 as of March
      31, 2008 and 2007. The amortization expenses for land use right for next
      five years after March 31, 2008 are as follows:

                March 31, 2009                 $    61,492
                March 31, 2010                      61,492
                March 31, 2011                      61,492
                March 31, 2012                      61,492
                March 31, 2013                      61,492
                                              ------------
                Thereafter                       2,242,778
                                              ============
                    Total                       $2,550,238
                                              ============

Note F - ACCOUNTS PAYABLE AND ACCRUED EXPENSES

     The Company's accounts payable and accrued expenses as of March 31, 2008
     are summarized as follows:

                                                 3-31-2008
                                                ---------

            Accounts payables                 $   159,400
            Other payables                        295,482
            Accrued payroll                        29,988
            Accrued expenses                       78,228
                                              -----------
            Total accounts payables and
               accrued expenses               $   563,098
                                              ===========

                                       14
<PAGE>

                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Note G - DEFERRED REVENUE

      The company has recorded deferred revenue of $12,895 as of March 31, 2008.
      Deferred revenue represents advances from customers for using the resort
      facilities within the next twelve month period.

Note H- TAX PAYABLES - RESTATED

     As of March 31, 2008, tax payables are summarized as follows:

                                               3-31-2008
                                           -------------

      Income tax payable                   $   3,623,622
      Business tax payable                       723,614
      VAT payable                                     47
      Other taxes payable                        117,661
                                           -------------
      Tax payable                          $   4,464,944
                                           =============

Note I - INCOME TAXES - RESTATED

      The Company is registered in the State of Nevada and has registered
      primarily in two tax jurisdictions - the PRC and the United States. For
      certain operations in US and China, the Company has incurred net
      accumulated operating losses for income tax purposes The Company believes
      that it is more likely than not that these net accumulated operating
      losses will not be utilized in the future. Therefore, the Company has
      provided full valuation allowance for the deferred tax assets arising from
      the losses at these locations as of March 31, 2008. Accordingly, the
      Company has no net deferred tax assets.

      The provision for income taxes from operations on income consists of the
      following for the years ended March 31, 2008 and 2007:

         US Current Income Tax Expense (Benefit)        3-31-2008     3-31-2007
         --------------------------------------         ---------     ---------
            Federal                                     $       -     $       -
            State                                       $       -     $       -

            PRC Current Income Expense                  $ 183,832     $ 224,351
                                                        ---------     ---------
         Total  Provision for Income Tax                $ 183,832     $ 224,351
                                                        =========     =========



                                       15
<PAGE>

                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

      The following is a reconciliation of the provision for income taxes at
      the U.S. federal income tax rate to the income taxes reflected in the
      Statement of Operations:

                                                        3-31-2008     3-31-2007
                                                        ---------     ---------
            Tax expense (credit) at statutory rate -
                federal                                     34%           34%
            State tax expense net of federal tax             6%            6%
            Valuation allowance                            (40%)         (40%)
            Foreign income tax - PRC                        25%           33%
            Tax expense (benefit)at actual rate             25%           32%

      United States of America
      ------------------------

      As of March 31, 2008, the Company in the United States had approximately
      $7,500 in net operating loss carry forwards available to offset future
      taxable income. Federal net operating losses can generally be carried
      forward 20 years. The deferred tax assets for the United States entities
      at March 31, 2008 consists mainly of net operating loss carry forwards and
      were fully reserved as the management believes it is more likely than not
      that these assets will not be realized in the future.

      The following table sets forth the significant components of the net
      deferred tax assets for operation in the US as of March 31, 2008 and 2007.


                                                       3-31-2008     3-31-2007
                                                       ---------     ----------

               Net operation loss carry forward        $ 933,500     $      -
                                                       ---------     --------

                  Total deferred tax assets              317,500            -
                  Less: valuation allowance             (317,500)           -
                                                       ---------     --------
               Net deferred tax assets                 $       -     $      -
                                                       ---------     --------

      People's Republic of China (PRC)

      Pursuant to the PRC Income Tax Laws, the Enterprise Income Tax ("EIT") is
      at a statutory rate of 33%, which is comprises of 30% national income tax
      and 3% local income tax. Beginning January 1, 2008, the new Enterprise
      Income Tax ("EIT") law will replace the existing laws for Domestic
      Enterprises ("DES") and Foreign Invested Enterprises ("FIEs"). The new
      standard EIT rate of 25% replaced the 33% rate currently applicable to
      both DES and FIEs. The two years tax exemption, three years 50% tax
      reduction tax holiday for production-oriented FIEs will continue until the
      tax exemption period expired. The applicable new EIT for the Company is
      25%. The Company paid $0 of income tax payable as of March 31, 2008 and
      2007.


                                       16
<PAGE>

                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

      Deferred income tax assets

      Deferred income taxes are determined using the liability method for the
      temporary differences between the financial reporting basis and income tax
      basis of the Company's assets and liabilities. Deferred income taxes are
      measured based on the tax rates expected to be in effect when the
      temporary differences are included in the Company's tax return. Deferred
      tax assets and liabilities are recognized based on anticipated future tax
      consequences attributable to differences between financial statement
      carrying amounts of assets and liabilities and their respective tax bases.
      The Company's deferred tax assets represent deductible temporary
      differences arising mainly from the other payables. As of March 31, 2008
      and December 31, 2007, the Company had no deferred tax assets.

Note J - MANAGEMENT FEE AGREEMENT

      The Company entered into five management agreements with Shaanxi New
      Taohuayuan Economy Trade Company Limited and Shaanxi Wenhao Group and its
      subsidiary on various time for a period of five years. Shaanxi New
      Taohuayuan Economy Trade Company Limited and Shaanxi Wenhao Group and its
      subsidiary are related parties. The annual management fees are fixed at
      approximately $1,400,000. For the three month periods ended March 31, 2008
      and 2007, the Company earned $482,207 and $443,560 in management fees,
      respectively. There is a bonus management fee clause contained in the
      agreement calculated at 15% on the excess of the actual revenue over
      targeted revenue, as defined therein. No bonus management fees have been
      earned to date (See notes #M for details).

Note K -RELATED PARTIES TRANSACTIONS

      The Company has identified the following related parties:

     *    Chen Jingmin - a director and  stockholder  of the Company.

     *    Dongjin  Taoyuan - a stockholder  of the Company in which Chen Jingmin
          has control and a beneficial interest.

     *    Shaanxi New Taohuayuan  Economy Trade Company  Limited - the principal
          stockholder  of the  Company in which Chen  Jingmin  has control and a
          beneficial interest.

     *    Shaanxi Wenhao Zaliang Shifu Limited - a stockholder of the Company in
          which Chen Jingmin has control and a financial interest.

      The Wenhao Group has various entities as noted below:

        Shaanxi Wenhao Dongjin Taohuyuan - part of Wenhao Group.
        Shaanxi Wenhao Naner Huan Wenhao - part of Wenhao Group.
        Shaanxi Wenhao Xijiao Wenhao - part of Wenhao Group.
        Shaanxi Wenhao Yuan Taizu - part of Wenhao Group

                                       17
<PAGE>

                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

        Shaanxi  Kangze  Economic  and Trade  Limited - a  stockholder  of the
        Company in which Chen Jingmin has control and a beneficial interest.

      The Company as of March 31, 2008 had receivable from Shaanxi New
      Taohuayuan Economy Trade Company, $371,375 to the Wenhao Group, $118,401
      to Dongjin Taoyuan. These advances are unsecured, interest-free and have
      no fixed repayment terms. The Company has classified these advances as
      receivables from related parties under current assets.

      As of March 31, 2008, amounting of $3,405,780 and $4,341,120 had been paid
      to Shaanxi Traditional Decoration Co. Ltd and Shannxi Qinghua Green
      Project Co.,Ltd respectively, which are both related parties, for Lantian
      Xingtianyou Project included in construction in progress.

Note L -- COMMITMENTS

      Following are some of the significant commitments as of March 31, 2008 and
2007.

     1.   Management  Agreements  with Shaanxi New Taohuayuan  Tourism & Trading
          Co. Ltd. - Dongjin Taoyuan Branch and Xi'an Taoyuan Nanlu Branch

      On January 15, 2004 the Company signed two five-year agreements with
      Shannxi New Taohuayuan Tourism & Trading Co. Ltd - Dongjin Taoyuan Branch
      and Xi'an Taoyuan Nanlu Branch to manage the restaurants. The company will
      perform management and operation function including advertising,
      marketing, human resources and accounting on monthly basis. The Company
      will receive RMB 3,500,000 from each of the restaurant respectively as
      basic annual management fees, paid quarterly. In addition, if the annual
      revenue exceeds the targeted amount, the company will be compensated for
      additional 15% of the revenue as bonus. The agreements will expire on Jan
      14, 2009. As of March 31, 2008, the management fee earned amounting to
      $244,598 based upon the agreements.

     2.   Management  Agreements  with  Shaanxi  Wenhao  Zaliang Co. Ltd - Xi'an
          Nanerhuan Branch, Yuantaizu Branch and Beijing Branch

      On January 10, 2006 the Company signed three five-year agreements with
      Shaanxi Wenhao Zaliang Co. Ltd - Xi'an Nanerhuan Branch and Yuantaizu
      Branch respectively to manage the restaurants. The company will perform
      management and operation function including advertising, marketing, human
      resources and accounting on monthly basis. The Company will receive RMB
      3,600,000, RMB 1,800,000 and RMB 1,400,000 from each of these restaurants
      respectively as basic annual management compensation, paid quarterly. In
      addition, if the annual revenue exceeds the targeted amount, the company
      will be compensated for additional 15% of the revenue as bonus. The
      agreements will expire on Jan 09, 2010. As of March 31, 2008, the
      management fee earned amounting $237,609 based upon the agreements.

                                       18
<PAGE>

                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

     3.   Lantian  Xintianyou Garden Decoration  Project agreements with Shaanxi
          Traditional Decoration Co., Ltd.

      On Mar. 15, 2006, the company signed a decoration agreement with Shannxi
      Traditional Decoration Co. Ltd for Shannxi Lantian Xintianyou Garden
      Decoration Project. The company hired the Shannxi Traditional Decoration
      Co. Ltd., to do decoration work on its property with the commitment to pay
      RMB 80,000,000 as total compensation. The company will pay 30% of the
      amount at the beginning of the construction, 30% will be paid on 50%
      completion and 40% after the project is completed. The company is also
      responsible for appointing the third party as supervisor to monitor the
      project and to protect the surrounding environment. The project started on
      April 1st, 2006 and will be finished in 2008. As of March 31, 2008, the
      Company has paid $3,405,780 to the said contractor included in
      construction in progress.

     4.   Lantian Xintianyou Garden Green Project Agreement with Shannxi Qinghua
          Green Project Co.,Ltd.

      On May 15, 2007, the company signed an agreement with Shannxi Qinghua
      Green Co. Ltd for the afforesting project of Lantian Xintianyou Garden
      Green. The company hired Shannxi Oinghua Green Project Co. Ltd., to
      perform afforesting work on the garden with the commitment to pay RMB
      50,000,000 as total compensation. The company will pay 30% of the amount
      at the inception of the construction, 35% will be paid on 50% completion
      and 30% after the project completes. The final 5% will be held as project
      quality insurance deposit. After the project completed, Shannxi Qinghua
      Green Co.,Ltd will be responsible for the maintenance of the garden and
      the company will pay RMB 1,250,000 as annual compensation for services.
      The project started on Oct. 6, 2007 and will be finished at the end of
      2008. As of March 31, 2008, the Company has paid $4,341,120 to the said
      contractor included in construction in progress.

     5.   Lantian Xintianyou Garden Project

      The Company entered an agreement with Lantian County, Xian City, Shaanxi
      Province to offer a new project's development - Lantian Xingtianyou
      Project in 2003. The Company acquired a land (4512 Mu) in Lantian County
      and committed to finish the project in one year. The project has been
      started since 2004. However, the Company paid amount of $17,136,000 as
      land cost in 2006 but the title is not yet transferred to the Company
      without paying the demolish fee associated with the project (See note C
      for details).

Note M - STATUTORY RESERVE AND STATUTORY COMMON WELFARE FUND

      As stipulated by the Company Law of the People's Republic of China (PRC),
      net income after taxation can only be distributed as dividends after
      appropriation has been made for the following:

     i.   Making up cumulative prior years' losses, if any;


                                       19
<PAGE>

                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

     ii.  Allocations  to the  "Statutory  surplus  reserve"  of at least 10% of
          income  after  tax,  as  determined  under  PRC  accounting  rules and
          regulations, until the fund amounts to 50% of the Company's registered
          capital;

     iii. Allocations  of 5-10% of income  after tax,  as  determined  under PRC
          accounting rules and regulations,  to the Company's  "Statutory common
          welfare  fund",  which is  established  for the  purpose of  providing
          employee  facilities  and other  collective  benefits to the Company's
          employees; and

     iv.  Allocations to the discretionary  surplus reserve,  if approved in the
          stockholders' general meeting.

      In accordance with the Chinese Company Law, the company reserved statutory
      funds of $56,345 as of March 31, 2008.

      According to the new Company Law of the People's Republic of China (PRC)
      executed in 2006, the Company is no more required to reserve the
      "Statutory common welfare fund". Accordingly, the Company did not reserve
      the common welfare fund as of March 31, 2008.

Note N - RETIREMENT PLAN

      As stipulated by the rules and regulations in the PRC, the Company is
      required to contribute to a state-sponsored social insurance plan for all
      of its employees who are residents in the PRC at rates ranging from 12% to
      17% of the basic salary of its employees. The Company has no further
      obligations for the actual pension payments or post-retirement benefits
      beyond the annual contributions. The state-sponsored retirement plan is
      responsible for the entire pension obligations payable to all employees.

Note O - STOCKHOLDERS' EQUITY

      In January 2007, the Company entered into an agreement with outside third
      party to provide consulting services. As part of agreement the Company
      agreed to issue 1,699,999 shares of common stock at discount at $0.05 per
      share or $85,000 for cash. The consulting company will provide consulting
      service to the Company during the six months period starting January 2007.
      The fair market value of the common stocks of the company was $0.55 on the
      agreement date. Accordingly the Company booked $850,000 as compensation
      expense after accounting for the shares issued at discount price of $0.05
      for the said stock issuance as of December 31, 2007.


                                       20
<PAGE>

                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

      Since the consulting company did not accomplish the services stated in the
      agreement, the board of directors of the Company dated on February 28,
      2008 approved to buy back the common stocks at $0.05 per share
      subsequently. As of March 31, 2008, the consulting company did not sell
      1,699,999 shares back to the Company.

Note P - OTHER COMPREHENSIVE INCOME

      Balances of related after-tax components comprising accumulated other
      comprehensive income (loss), included in stockholders' equity, as of March
      31, 2008 and 2007 are as follows:

                                          Foreign Currency
                                       Translation Adjustment
                                       ---------------------

      Balance at December 31,              $   3,207,587
      2007
      Change in Q1 2008                        1,244,244
                                           -------------
      Balance at March 31, 2008            $   4,451,831
                                           =============

Note Q- SEGMENT REPORTING

      The Company had two principal operating segments which were: resort income
      and management fee income. These operating segments were determined based
      on the nature of the services provided. Operating segments are defined as
      components of an enterprise about which separate financial information is
      available that is evaluated regularly by the chief operating
      decision-maker in deciding how to allocate resources and in assessing
      performance. The Company's chief executive officer and chief financial
      officer have been identified as the chief operating decision makers. The
      Company's chief operating decision makers direct the allocation of
      resources to operating segments based on the profitability, cash flows,
      and other measurement factors of each respective segment.

      The Company evaluates performance based on several factors, of which the
      primary financial measure is business segment income before taxes. The
      segments' accounting policies are the same as those described in the
      summary of significant accounting policies. The following table shows the
      operations of the Company's reportable segments:


                                                      The three month periods
                                                          ended March 31,
                                                      ------------------------
                                                       2008             2007
                                                      ------           ------
      Revenues:
            Resort income from unaffiliated
                customers                           $1,026,648      $   880,863
            Management fee income from
                affiliated customers                   482,207          443,560
                                                    ----------      -----------
                            Consolidated            $1,508,855      $ 1,324,423
                                                    ==========      ===========

                                       21
<PAGE>

                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS


      Operating income (loss)
            Resort income                           $  248,142      $   252,041
            Management fee income                      482,207          443,560
            Corporation (1)                             (7,500)               -
                                                    ----------      -----------
                            Consolidated            $  722,849      $   695,601
                                                    ==========      ===========
      Net income (loss) before taxes:
            Resort income                           $  253,119      $   252,351
            Management fee income                      482,207          443,560
            Corporation (1)                             (7,500)               -
                                                    ----------      -----------
                            Consolidated            $  727,826      $   695,911
                                                    ==========      ===========
      Net income (loss) :
            Resort income                           $  165,989      $   170,997
            Management fee income                      378,005          300,563
            Corporation (1)                                  -                -
                                                    ----------      -----------
                            Consolidated            $  543,994      $   471,560

      Identifiable assets:
            Resort income                          $10,015,242      $ 9,861,232
            Management fee income                            -                -
                  Corporation (1)                   26,453,700       24,396,945
                                                   -----------      -----------
                            Consolidated           $36,468,942      $34,258,177
                                                   ===========      ===========
      Depreciation and amortization:
            Resort income                          $   162,474      $   145,040
                                                   ===========     ============
        Capital expenditures:
            Resort income                          $         -      $       776
            Management fee income                            -                -
            Corporation (1)                          1,020,321        1,083,864
                                                   -----------      -----------

                            Consolidated           $ 1,020,321      $ 1.084,640
                                                   ===========     ============

(1)  Unallocated  loss from Operating income (loss) and Net income (loss) before
     taxes are  primarily  related to general  corporate  expenses  and  capital
     expenditure for new project.


                                       22
<PAGE>

                 NEW TAOHUAYUAN CULTURE TOURISM COMPANY LIMITED
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS


NOTE R-   RESTATEMENTS

      Subsequent to the issuance of the Company's financial statements for the
      three month period ended March 31, 2008, the Company determined that
      certain transactions and presentation in the financial statements had not
      been accounted for properly in the Company's financial statements.
      Specifically, the impairment of deposit for land use rights and
      accumulated amortization of land use rights were not recorded properly.
      The financial statements for the period ended March 31, 2008 have been
      restated to give effect to the changes to the financial statements.

      The effect of the restatements is as follows:

BALANCE SHEETS:                                MARCH 31,2008      MARCH 31,2008
                                                  REPORTED          RESTATED
ASSETS:
  Deposit for Construction-in-progress        $          -       $  17,136,000

LIABILITIES:
  Taxes payable                               $  4,277,127       $   4,464,944

STOCKHOLDERS' EQUITY/(DEFICIT)
  Statutory reserve                           $  2,018,901       $   2,128,449
  Other comprehensive income                  $  4,092,216       $   4,451,831
  Accumulated Deficit /Retained earnings      $ (7,505,749)      $   8,973,270


STATEMENTS OF INCOME/(OPERATIONS):               FOR THE THREE MONTH PERIODS
                                                     ENDED MARCH 31,2008
                                                 REPORTED           RESTATED
OPERATING EXPENSES:
  Impairment - deposit                        $ 16,772,400       $           -

INCOME (LOSS) FROM OPERATIONS                 $(16,049,551)      $     722,849

INCOME (LOSS) BEFORE INCOME TAXES             $(16,044,574)      $     727,826

PROVISION FOR INCOME TAXES                    $          -       $     183,832

NET INCOME (LOSS)                             $(16,044,574)      $     543,994

OTHER COMPREHENSIVE INCOME:
  Foreign currency translation gain           $    884,629       $   1,244,244

NET COMPREHENSIVE INCOME (LOSS)               $(15,159,945)      $   1,788,238

EARNINGS (LOSS) PER SHARE:
  Basic & diluted earning (loss) per share    $      (0.86)      $        0.03


                                       23
<PAGE>

ITEM 2.  MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL  CONDITION AND PLAN OF
         OPERATION

      You should read the following discussion and analysis of our financial
condition and results of operations in conjunction with our financial statements
and the related notes included elsewhere in this report. Our financial
statements have been prepared in accordance with U.S. GAAP. In addition, our
financial statements and the financial data included in this report reflect our
reorganization and have been prepared as if our current corporate structure had
been in place throughout the relevant periods. The following discussion and
analysis contains forward-looking statements that involve risks and
uncertainties. Actual results could differ materially from those projected in
the forward-looking statements.

                                    Overview

      We own and operate the Taohuayuan Inn hotel and resort located in the city
of Xi'an, province of Shaanxi, in the PRC. The Taohuayuan Inn has 23 courtyards
with 146 rooms and 292 beds.

      We manage the DongJin Taoyuan Villas, a hotel and resort property
approximately 10 miles from downtown Xi'an. DongJin Taoyuan Villas has 84 rooms
and 168 beds. This property closed for major remodeling in 2006 and is expected
to reopen in July 2008.

      We also manage a chain of four traditional Chinese restaurants. Two of the
restaurants are in Xi'an, and one is in Beijing.

      We receive fees for managing the DongJin Taoyuan Villas and the three
restaurants. The agreements relating to the management of these properties are
discussed in more detail in Item 1 of this report.

      Room rates in the Shaanxi province are established by the Shaanxi Price
Bureau. Room rates are established for each hotel or resort in the Shaanxi
Province and are based upon a number of factors, including the quality of the
property and amenities offered. Room rates may be changed at any time by the
Shaanxi Price Bureau based upon economic conditions in China.

      Our business is not seasonal in nature.

Results of Operations

Three Months Ended March 31, 2008

 Material changes of certain items in our Statement of Operations for the three
months ended March 31, 2008, as compared to the three months ended March 31,
2007, are discussed below:

                                       24
<PAGE>


                       Increase (I)
Item                  or Decrease (D)  Reason

Operating Revenue           I          Increase in customers due to improvements
                                       made to our facilities and services.

Operating Expenses          I          Increase was in line with increased
                                       revenue.

Liquidity and Capital Resources

Our material  sources and (uses) of cash during the three months ended March 31,
2008 were:

    Cash provided by operations                                    $ 992,815
    Payment for land use rights, building improvements,
        and purchase of equipment                                 (1,020,321)
    Loans from related parties                                         7,065
    Changes in foreign currency exchange rate                          1,457
    Cash provided by cash in bank at January 1, 2008                  18,984

Our material  sources and (uses) of cash during the three months ended March 31,
2007 were:

    Cash provided by operations                                    $ 750,589
    Payment for land use rights, building improvements,
      and purchase of equipment                                   (1,084,640)
    Repayment of loans from related parties                          (44,126)
    Sale of stock                                                     85,000
    Changes in foreign currency exchange rate                        348,800


      We intend to develop a 150 room hotel and resort in Xi'an. We have not
started actual construction work on these projects.

      We have financed our operations to date through the sale of our common
stock and cash generated by our operations. As of March 31, 2008 expenditures
for our Xi'an project have been funded with cash from our operations and
proceeds from the sale of our common stock. We expect to finance the remaining
costs for the Xi'an project through cash from our operations and loans. Loans
would be collateralized by the property and issued in conjunction with the
government. However, required financing may not be available to us, in which
case the development of the project may take additional time or we may be unable
to develop the project. At present, we do not have any lines of credit or other
bank financing arrangements.

      We do not know of any trends, events or uncertainties that have, or are
reasonably likely to have, a material impact on our short-term or long-term
liquidity other than our need to pay the taxes and surcharges which we have
accrued as liabilities on our March 31, 2008 balance sheet.

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Restrictions on currency exchange

            Substantially all of our projected revenues and operating expenses
are denominated in Renminbi. The Renminbi is currently freely convertible under
the "current account", which includes dividends, trade and service-related
foreign exchange transactions, but not under the "capital account", which
includes foreign direct investment and loans.

            We may purchase foreign exchange for settlement of "current account
transactions", including payment of dividends to our shareholders, without the
approval of the State Administration for Foreign Exchange. We may also retain
foreign exchange in our current account, subject to a ceiling approved by the
State Administration for Foreign Exchange, to satisfy foreign exchange
liabilities or to pay dividends. However, the Chinese government may change its
laws or regulations and limit or eliminate our ability to purchase and retain
foreign currencies in the future.

            Since a significant amount of our future revenues will be
denominated in Renminbi, the existing and any future restrictions on currency
exchange may limit our ability to utilize revenues generated in Renminbi to fund
any business activities outside China or fund expenditures denominated in
foreign currencies.

            Exchange rate fluctuations may adversely affect our financial
performance because of our foreign currency denominated assets and liabilities,
and may reduce the value, translated or converted, as applicable into U.S.
dollars, of our net fixed assets, our earnings and our declared dividends. We do
not engage in any hedging activities in order to minimize the effect of exchange
rate risks.

Reserves

     In  accordance  with  current  Chinese  laws,  regulations  and  accounting
standards, we are required to set aside as a general reserve at least 10% of our
respective  after-tax  profits.  Appropriations  to the reserve  account are not
required after these reserves have reached 50% of our registered capital.  These
reserves  are  created  to  fund   potential   operating   losses  and  are  not
distributable as cash dividends. We are also required to set aside between 5% to
10% of our  after-tax  profits  to the  statutory  public  welfare  reserve.  In
addition and at the discretion of our  directors,  we may set aside a portion of
our after-tax  profits for enterprise  expansion funds,  staff welfare and bonus
funds and a surplus reserve. These statutory reserves and funds can only be used
for specific purposes and may not be used for dividends.

Critical Accounting Policies and Estimates

     We  prepare  financial  statements  in  conformity  with U.S.  GAAP,  which
requires us to make estimates and assumptions  that affect the reported  amounts
of assets and  liabilities,  disclosure of contingent  assets and liabilities on
the date of the financial  statements,  and the reported  amounts of revenue and
expenses during the financial  reporting period.  We continually  evaluate these
estimates and assumptions based on the most recently available information,  our
own historical  experience and various other assumptions that are believed to be

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reasonable  under the  circumstances,  the  results  of which form the basis for
making  judgments about the carrying  values of assets and liabilities  that are
not  readily  apparent  from other  sources.  Since the use of  estimates  is an
integral  component of the financial  reporting  process,  actual  results could
differ from those  estimates.  Some of our  accounting  policies  require higher
degrees of judgment than others in their  application.  We consider the policies
discussed below to be critical to an understanding  of our financial  statements
as their application assists management in making their business decisions

Revenue recognition

        We generally recognize service revenues when persuasive evidence of an
arrangement exists, services are rendered, the fee is fixed or determinable, and
collectibility is probable. Service revenues are recognized net of discounts.

Foreign currency translation

        We consider Renminbi as our functional currency as a substantial portion
of our business activities are based in Renminbi ("RMB"). However, we have
chosen the United States dollar as our reporting currency.

        Transactions in currencies other than the functional currency during the
year are translated into the functional currency at the applicable rates of
exchange prevailing at the time of the transactions. Monetary assets and
liabilities denominated in currencies other than the functional currency are
translated into the functional currency at the applicable rates of exchange in
effect at the balance sheet date. Exchange gains and losses are recorded in the
statements of operations.

      For translation of financial statements into the reporting currency,
assets and liabilities are translated at the exchange rate at the balance sheet
date, equity accounts are translated at historical exchange rates, and revenues,
expenses, gains and losses are translated at the weighted average rates of
exchange prevailing during the period. Translation adjustments resulting from
this process are recorded in accumulated other comprehensive income (loss)
within stockholders' equity.

Property, plant and equipment and depreciation

     Property,   plant  and  equipment  are  stated  at  cost  less  accumulated
depreciation.

     The  cost of an asset  consists  of its  purchase  price  and any  directly
attributable  costs of bringing the asset to its present  working  condition and
location for its intended use.  Expenditures incurred after the assets have been
put into operation, such as repairs and maintenance,  are normally recognized as
an expense in the period in which they are incurred.  In situations where it can
be clearly  demonstrated  that  expenditure  has  resulted in an increase in the
future economic benefits expected to be obtained from the use of the assets, the
expenditure is capitalized.


                                       27
<PAGE>


     When assets are sold or retired,  their costs and accumulated  depreciation
are  eliminated  from the  accounts  and any gain or loss  resulting  from their
disposal is included in the statement of operations.

     Depreciation  is  calculated  to write off the cost of property,  plant and
equipment over their estimated  useful lives as set out below,  from the date on
which  they  become  fully  operational  and after  taking  into  account  their
estimated residual values, using the straight-line method.

ITEM 4T.   CONTROLS AND PROCEDURES

      Cai Danmei, our Chief Executive Officer and Principal Financial and
Accounting Officer, has evaluated the effectiveness of our disclosure controls
and procedures (as defined in Rule 13a-15(e) of the Securities Exchange Act of
1934) as of the end of the period covered by this report, and in her opinion our
disclosure controls and procedures are effective.

      There were no changes in our internal controls over financial reporting
that occurred during the fiscal quarter that have materially affected, or are
reasonably likely to materially affect, our internal control over financial
reporting.


                                     PART II
                                OTHER INFORMATION


Item 6. Exhibits

Exhibit
 Number    Exhibit Name
--------   ------------

  31       Rule 13a-14(a) Certifications

  32       Section 1350 Certifications











                                       28
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                                   SIGNATURES


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

                                      NEW TAOHUAYUAN CULTURE TOURISM CO., LTD.


January 20, 2009                      By: /s/ Cai Danmei
                                          ------------------------------------
                                          Cai Danmei, Chief Executive Officer
                                              and Principal Financial and
                                              Accounting Officer




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