**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**





**WASHINGTON,
      D.C. 20549**





**AMENDMENT
      NO. 2 TO**


**FORM
      10-K/A**





**x ANNUAL
      REPORT PURSUANT TO SECTION
      13 OR 15(d) OF**


**THE
      SECURITIES EXCHANGE ACT OF 1934**





**FOR
      THE FISCAL YEAR ENDED DECEMBER 31, 2006**





**OR**





**o** **TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF**


**THE
      SECURITIES EXCHANGE ACT OF 1934**





**FOR
      THE TRANSITION PERIOD FROM _______
      TO ___________**




**COMMISSION
      FILE NO. 000-51981**




**ASIA
      TIME CORPORATION**


(E *xact
      Name Of Registrant As Specified In Its Charter* )





**Delaware**
            
            **20-4062619***(State
                or other jurisdiction of*
              *incorporation
                or organization)*
            
            *(I.R.S.
                Employer*
              *Identification
                No.)***Room
                1601-1604, 16/F., CRE Centre**
              **889
                Cheung Sha Wan Road, Kowloon, Hong Kong**
            
            **N/A***(Address
                of principal executive offices)*
            
            *(Zip
                Code)*





*Registrant’s
      telephone number, including area code* : **(852)-23100101**




SECURITIES
      REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:


None.




SECURITIES
      REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:


Common
      Stock, $.0001 par value




Indicate
      by check mark if the registrant is a well-known seasoned issuer, as defined
      in
      Rule 405 of the Securities Act.


Yes o 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 o 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 o




Indicate
      by check mark if disclosure of delinquent filers pursuant to Item 405 of
      Regulation S-K (§ 229.405 of this chapter) 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. o


Indicate
      by check mark whether the registrant is a 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. (Check one):




Large
      accelerated filer o Accelerated filer o Non-accelerated filer x




Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Act).




Yes o No x




There
      were 23,156,629 shares outstanding of registrant’s common stock, par value
      $.0001 per share, as of March 31, 2007. The registrant’s common stock is not
      traded or listed on any exchange.




Documents
      Incorporated by Reference: None.







**EXPLANATORY
      NOTE**





This
      Amendment No. 2 (this “Amendment No. 2”) on Form 10-K/A, which amends items
      identified below with respect to the Form 10-K, filed by Asia Time Corporation
      (“we” or “the Company”) with the Securities and Exchange Commission (the “SEC”)
      on April 17, 2007 (the “Original Filing”), as amended by Amendment No. 1 on Form
      S-1/A filed with the SEC on September 26, 2007 (“Amendment No. 2, and
      collectively with the Original Filing, the “Original Filing as Amended”) is
      being filed to reflect amendments and changes to financial and other disclosures
      contained in the Form 10-K.





The
      Company has restated its financial statements for the years ended December
      31,
      2006, 2005, and 2004 to correct various accounting errors and/or disclosure
      omissions. The restatement included the correction of errors with respect to
      the
      accounting for inventory by adjusting watch movement costing for the effects
      of
      vendor incentives from an as received basis to an accrual basis, as the Company
      is able to estimate the value of the incentives as inventory is purchased.
      The
      Company also restated average shares outstanding and actual shares outstanding
      to correct the accounting for the reverse merger transaction in January 2007.
      As
      a result of these corrections, various income tax calculations were also
      revised, which effected net income and also caused reclassifications to cash
      flows. The Company also made various changes to footnote disclosures relating
      to
      these changes. For more information regarding the restatement, refer to Note
      23
      of the Notes to the Financial Statements contained herein.





Unless
      indicated otherwise, the disclosures in this Amendment continues to describe
      conditions as of the date of the Original Filing, and the disclosures contained
      herein have not been updated to reflect events, results or developments that
      have occurred after the Original Filing, or to modify or update those
      disclosures affected by subsequent events. As a result of this Amendment No.
      2,
      the certifications pursuant to Section 302 and Section 906 of the Sarbanes-Oxley
      Act of 2002, filed as exhibits to our 10-K have been revised, re-executed and
      re-filed as of the date of this Amendment No. 2. Among other things,
      forward-looking statements made in the Original Filing have not been revised
      to
      reflect events, results or developments that have occurred or facts that have
      become known to us after the date of the Original Filing, and such
      forward-looking statements should be read in their historical context. This
      Amendment No. 2 should be read in conjunction with the Company’s filings made
      with the SEC subsequent to the Original Filing, including any amendments to
      those filings.





Please
      note that the Company was originally organized as a “blank check” shell company
      to investigate and acquire a target company or business seeking the perceived
      advantages of being a publicly held corporation. On January 23, 2007 (the
“Effective Date”), the Company closed a share exchange transaction (the “Share
      Exchange”) pursuant to which it (i) became the 100% parent of Times Manufacture
& E-Commerce Corporation Limited, a British Virgin Islands corporation
      (“Times Manufacture”), which has eight wholly-owned subsidiaries consisting of
      Times Manufacturing & E-Commerce Corporation Ltd., TME Enterprise Ltd.,
      Citibond Design Ltd. and Megamooch Online Ltd., each of which is a British
      Virgin Islands corporation, and the Hong Kong incorporated subsidiaries Billow
      Win International Enterprise Ltd., Goldcome Industrial Ltd., Citibond Industrial
      Ltd., and Megamooch International Ltd., (ii) assumed the operations of Times
      Manufacture and its subsidiaries, and (iii) changed its name from SRKP 9, Inc.
      to Asia Time Corporation. The Company reported the closing of the Share Exchange
      in the Current Report on Form 8-K filed with the Securities and Exchange
      Commission on January 29, 2007. There are no changes with respect to the
      information regarding the shell company and such information is not restated
      in
      this Amendment No. 2. This Amendment No. 2 only contains those Items that have
      been amended and restated, as set forth in the Table of Contents,
      below.





**ASIA
      TIME CORPORATION**





**TABLE
      OF CONTENTS TO ANNUAL REPORT ON FORM 10-K**


**For
      the Fiscal Year Ended December 31, 2006**





**ITEM**
            
            
            
            **Page****PART
                I**Item
                1.
            
            Business
            
            2Item
                1A.
            
            Risk
                Factors
            
            7**PART
                II**Item
                6.
            
            Selected
                Financial Data
            
            18Item
                7.
            
            Management's
                Discussion and Analysis of Financial Condition and Results of
                Operations
            
            23Item
                7A.
            
            Quantitative
                and Qualitative Disclosures about Market Risk
            
            35Item
                8.
            
            Financial
                Statements and Supplementary Data
            
            35Item
                9A.
            
            Controls
                and Procedures
            
            35**PART
                III**Item
                11.
            
            Executive
                Compensation
            
            36Item
                13.
            
            Certain
                Relationships and Related Transactions, and Director
                Independence
            
            39**PART
                IV**Item
                15.
            
            Exhibits
                and Financial Statement Schedules
            
            42Signatures
            
            43







**CAUTIONARY
      STATEMENT REGARDING FORWARD-LOOKING STATEMENTS**




The
      information contained in this report, including in the documents incorporated
      by
      reference into this report, includes some statement that are not purely
      historical and that are “forward-looking statements.” Such forward-looking
      statements include, but are not limited to, statements regarding our and their
      management’s expectations, hopes, beliefs, intentions or strategies regarding
      the future, including our financial condition, results of operations, and the
      expected impact of our recent share exchange on the parties’ individual and
      combined financial performance. In addition, any statements that refer to
      projections, forecasts or other characterizations of future events or
      circumstances, including any underlying assumptions, are forward-looking
      statements. The words “anticipates,” “believes,” “continue,” “could,”
“estimates,” “expects,” “intends,” “may,” “might,” “plans,” “possible,”
“potential,” “predicts,” “projects,” “seeks,” “should,” “will,” “would” and
      similar expressions, or the negatives of such terms, may identify
      forward-looking statements, but the absence of these words does not mean that
      a
      statement is not forward-looking.





The
      forward-looking statements contained in this report are based on current
      expectations and beliefs concerning future developments and the potential
      effects on the parties and the transaction. There can be no assurance that
      future developments actually affecting us will be those anticipated. These
      forward-looking statements involve a number of risks, uncertainties (some of
      which are beyond the parties’ control) or other assumptions that may cause
      actual results or performance to be materially different from those expressed
      or
      implied by these forward-looking statements, including the
      following:





·
            Dependence
                on a limited number of suppliers;




·
            Cyclicality
                of our business;




·
            Decline
                in the value of our inventory;




·
            Significant
                order cancellations, reductions or
                delays;




·
            Competitive
                nature of our industry;




·
            Vulnerability
                of our business to general economic
                downturn;




·
            Our
                ability to obtain all necessary government certifications and/or
                licenses
                to conduct our business;




·
            Development
                of a public trading market for our securities;




·
            The
                cost of complying with current and future governmental regulations
                and the
                impact of any changes in the regulations on our operations;
                and




·
            The
                other factors referenced in this report, including, without limitation,
                under the sections entitled “Risk Factors,” “Management’s Discussion and
                Analysis of Financial Condition and Results of Operations,” and
                “Business.”




These
      risks and uncertainties, along with others, are also described above under
      the
      heading “Risk Factors.” Should one or more of these risks or uncertainties
      materialize, or should any of the parties’ assumptions prove incorrect, actual
      results may vary in material respects from those projected in these
      forward-looking statements. We undertake no obligation to update or revise
      any
      forward-looking statements, whether as a result of new information, future
      events or otherwise, except as may be required under applicable securities
      laws.


1





**PART
      I**




**Item
      1. Business**





**ASIA
      TIME CORPORATION**





**Overview**





We
      are a
      distributor of watch movements components used in the manufacture and assembly
      of watches to a wide variety of timepiece manufacturers. Our core customer
      base
      consists primarily of wholesalers, and medium-to-large sized watch manufacturers
      that produce watches primarily for consumer sale. To a lesser extent, we design
      watches for manufacturers and exporters of watches and manufacture and
      distribute complete watches primarily to internet marketers.





We
      have
      distribution centers and strategically located sales offices throughout Hong
      Kong and the People’s Republic of China (“China” or “PRC”). We distribute more
      than 350 products from over 30 vendors, including such market leaders as Citizen
      Group, Seiko Corporation and ETA SA Manufacture Horlogere Suisse, to a base
      of
      over 300 customers primarily through our direct sales force. As a part and
      included in our sale of watch movements, we provide a variety of value-added
      services, including automated inventory management services, integration, design
      and development, management, and support services.





**Corporate
      Information**





We
      were
      incorporated in the State of Delaware on January 3, 2006. We were originally
      organized as a “blank check” shell company to investigate and acquire a target
      company or business seeking the perceived advantages of being a publicly held
      corporation. On January 23, 2007, we closed a share exchange transaction (“Share
      Exchange”) pursuant to which we (i) issued 19,454,420 shares of our common stock
      to acquire 100% equity ownership of Times Manufacture & E-Commerce
      Corporation Limited, a British Virgin Islands corporation (“Times Manufacture”),
      which has eight wholly-owned subsidiaries, (ii) assumed the operations of Times
      Manufacture and its subsidiaries, and (iii) changed our name from SRKP 9, Inc.
      to Asia Time Corporation. Our corporate offices are located at Room 1601-1604,
      16/F., CRE Centre 889 Cheung Sha Wan Road, Kowloon, Hong Kong.





With
      respect to this discussion, the terms “we” and “our” refer to Asia Time
      Corporation, its 100%-owned subsidiary Times Manufacture Times Manufacture
      and
      its subsidiaries, Times Manufacturing & E-Commerce Corporation Ltd., TME
      Enterprise Ltd., Citibond Design Ltd. and Megamooch Online Ltd., each of which
      is a British Virgin Islands corporation, and the Hong Kong corporate
      subsidiaries Billion Win International Enterprise Ltd., Goldcome Industrial
      Ltd., Citibond Industrial Ltd., and Megamooch International Ltd. Times
      Manufacture was founded in March 2002 and is based in Hong Kong.





**Our
      Industry**





A
      typical
      watch manufacturing process begins with the watch being designed, either from
      scratch or based on a chosen watch movement according to the required features.
      For example, if a watch manufacturer wants to design a three-hand chronograph
      with split-second, three dials and date, they will source the watch movements
      that meet these requirements and design the watch according to the
      specifications of this movement. Next in the process is the sourcing, purchasing
      or manufacture of the required components, including the watch case, watch
      movement, strap and crown. The last steps in the process are the assembly of
      the
      watch components, followed by testing and quality control.





Except
      for the largest watch manufactures, such as Citizen, Seiko, and Swatch, which
      produce and use their own watch movements, most watch manufacturers source
      and
      purchase the movements in the market.





In
      the
      watch manufacturing process, we provide watch movements directly to the
      manufacturers or through movement wholesalers, assisting the manufacturers
      to
      source the movement by providing technical information, advise, and pricing.
      We
      also assist provide our customers with watch design and technical
      assistance.


2


There
      are
      two categories of watch movements, quartz and mechanical. The main parts of
      an
      analog quartz watch movement are the battery; the oscillator, a piece of quartz
      that vibrates in response to the electric current; the integrated circuit,
      which
      divides the oscillations into seconds; the stepping motor, which drives the
      gear
      train; and the gear train itself, which makes the watch’s hands move. A digital
      watch movement has the same timing components as an analog quartz movement
      but
      has no stepping motor or gear train.





The
      main
      parts of a mechanical watch movement are the winding mechanism; the mainspring,
      which is the source of the watch’s power; the gear train, which transmits power
      from the mainspring to the escapement and drives the watch’s minutes and seconds
      hands; the escapement, which distributes power to the oscillator (i.e., the
      balance) and controls how fast the mainspring unwinds; the balance itself,
      which
      measures out time by vibrating at a steady rate; and the motion works, which
      moves the watch’s hour hand.





Most
      mechanical and quartz analog watch movements are made by one of three companies:
      Japan’s Citizen and Seiko, or Switzerland’s ETA, which is owned by the Swatch
      Group watch conglomerate. There are several smaller watch movement companies:
      Ronda, ISA, and others. Digital watch movements are made by various companies,
      most of them in China. Most watch manufacturers buy the movements, case them
      and
      sell them under their own brand names.





Watch
      movement distributors relieve movement manufacturers of a portion of the costs
      and personnel needed to warehouse, sell and deliver their products. Distributors
      market movement manufacturers’ products to a broader range of customers than
      such manufacturers could economically serve with their direct sales forces.
      Today, movement distributors have become an integral part of a watch
      manufacturer’s purchasing and inventory processes. Generally, companies engaged
      in the distribution of watch movement components, including us, are required
      to
      maintain a relatively significant investment in inventories and accounts
      receivable to be responsive to the needs of customers. To meet these
      requirements, we, as well as other companies in our industry, typically depend
      on internally generated funds as well as external sources of
      financing.





**Products**





We
      currently offer over 350 items. Our products primarily consist of watch
      movements and, to a lesser extent, complete watches.





*Watch
      Movements*





We
      primarily distribute quartz watch movements that are produced primarily in
      Switzerland and Japan. All quartz watch movements distributed by our company
      are
      multi-function and have three hands. The watch movements have high adaptability
      so that a range of watches, from inexpensive to luxury, may be made from the
      same watch movement. To
      a
      lesser extent, we also offer mechanical movements manufactured by Citizen,
      ETA
      and Tsinlien Sea Gull Co. Ltd. For the year ended December 31, 2006, we acquired
      most of our watch movement products from the following two manufacturers:
      Citizen Miyota Co., Ltd., which is a member company in the Citizen Group,
      supplied 64% and Seiko Corporation supplied 32%. The next highest supplier
      was
      ETA SA Manufacture Horlogere Suisse, a member of the Swatch Group, which
      supplied us with less than 1% of our watch movements.





*Complete
      Watches*





To
      a
      lesser extent we also distribute complete analog-quartz and automatic watches
      with pricing between $20.00 to $50.00. Manufacturing for these watches is
      currently outsourced to third party factories in China. Our top three brand
      names include NxTime, SIDIO and Marcellus. The watches are primarily designed
      by
      U.S. designers and range from fashion watches to classic designs. Watches can
      either be made-to-order or design-to-order.





**Strategy**





Our
      goal
      is to be a leading watch movement and timepiece distributor in Hong Kong and
      China through the following strategies.





*Offer
      wide-ranging product spectrum to customers.* Management estimates that it can increase revenues by broadening our product
      spectrum and offering more brands of quartz movement to customers. Apart from
      quartz movement, we intend to offer mechanical movements. By broadening our
      product spectrum, we hope to increase our market share through sales to
      manufacturers of high-end watches utilizing sophisticated mechanical movements.
      We plan to source other brands of quartz and mechanical movement in order to
      broaden our product spectrum. The number of brands and products that we plan
      to
      introduce will depend on the terms and conditions offered by our
      suppliers.


3


*Manufacture
      branded proprietary watch movements.* To
      further diversify our product offering and reduce our reliance on third party
      watch movement manufacturers, we eventually hope to manufacture our own brands
      of quartz movements and high end mechanical movements in-house. We estimate
      that
      our company can replace a portion of our current third-party watch movement
      sales with our own brand movements, watch movements manufactured in-house would
      be higher margin offerings than distributed products of third-party suppliers.
      In addition, in-house manufacturing will allow product offerings at more
      competitive price points which we believe will enhance our competitive position.
      To manufacture our own brands of quartz and mechanical movements in-house,
      would
      need to acquire watch movement facilities in China and invest in new equipments
      and research and development. We expect that up to $5.5 million will be required
      to obtain the equipment and facilities to manufacture branded proprietary watch
      movements. Our plan to acquire manufacturing facilities and equipment to
      manufacture our own brand of quartz and mechanical movements in-house will
      not
      take place until after the completion of our initial public offering, the
      proceeds of which will give us a portion of the required capital.





*Developing
      closer relationships with product brands owners and
      distributors.* We
      believe it is important for our company to develop closer relationships with
      product brand owners and its distributors, which we believe would lead to more
      competitive pricing and stable supply of products. We also have plans to develop
      closer relationships with our existing brands and distributors by expanding
      our
      sales force. We intend to commence expansion of our sales force in the fourth
      quarter of 2007.





*Expand
      the distribution of complete watches* .
      Currently, the distribution of complete watches represents less than 12% of
      our
      revenues. As part of our expansion plan, we intend to expand our sales and
      marketing efforts in China. We believe that a heightened focus in this area
      can
      lead to an increase in market share and enhance our earning capacity. It is
      expected that these watches will be marketed through a lower to middle pricing
      strategy, with sales price range from US$100-$200. We plan to appoint watch
      distributors in larger China cities in the next two years to expand the
      distribution of our complete watches.





**Value-Added
      Services**





As
      a part
      of and included in our sale of watch movements, we provide a number of
      value-added services which are intended to attract new customers and to maintain
      and increase sales to existing customers. These value-added services
      include:





—
            *Automated
                inventory management services.*We
                manage our customers’ inventory reordering, stocking and administration
                functions. We believe these services reduce paperwork, inventory, cycle
                time and the overall cost of doing business for our customers. The
                automated inventory management services are provided through our
                computer
                system through which we can manage our customer’s inventory reordering,
                stocking and administration functions. We believe this helps us to
                provide
                better service to our customers by understanding their stock level,
                purchase behavior and allows us to be more responsive to their demands
                and
                queries.





—
            *Integration.*Our sales specialists work directly with our customers to develop
                and
                deliver customized solutions and technical support to meet specific
                requirements for our customers’ applications. We are able to offer
                customers a one-stop source for their integration
                needs.





**Sales
      and Marketing**





*Watch
      Movements*





We
      believe we have developed valuable long-term customer relationships and an
      understanding of our customers’ requirements. Our sales personnel are trained to
      identify our customers’ requirements and to actively market our entire product
      line to satisfy those needs. We serve a broad range of wholesalers, medium
      to
      small watch manufacturers and volume users in China and Hong Kong. We have
      established inventory management programs to address the specific distribution
      requirements of our customers.


4


As
      a
      distributor for leading watch movement manufacturers, we are able to offer
      technical support as well as a variety of supply chain management programs.
      Technical support and supply chain management services enhance our ability
      to
      attract new customers. Many of our services revolve around our use of software
      automation, computer-to-computer transactions through Internet-based solutions,
      technically competent product managers and business development
      managers.





Sales
      are
      made throughout China and Hong Kong from the sales departments maintained at
      our
      distribution facilities located in Hong Kong and from strategically located
      sales offices. Sales are made primarily through personal visits by our employees
      and telephone sales personnel who answer inquiries and receive and process
      orders from customers. Sales are also made through general advertising,
      referrals and marketing support from component manufacturers.




*Complete
      Watches*





Currently,
      the main distribution channels of our watches are US direct marketers, online
      retailers and China department stores. As part of our expansion plan, we intend
      to increase our focus on China’s complete watch market along with exportation to
      overseas markets.





With
      our
      foothold in Southern China, we intend further develop Eastern China and Northern
      China regions so as to cover the entire China market in complete
      watches.





We
      intend
      continue to outsource the production of complete watches to third parties.
      As
      part of our integrated efforts, we intend to supply these manufacturers with
      watch movements.





**Suppliers**





Manufacturers
      of watch movements are increasingly relying on the marketing, customer service,
      technical support and other resources of distributors who market and sell their
      product lines to customers not normally served by the manufacturer, and to
      supplement the manufacturer’s direct sales efforts for other accounts often by
      providing value-added services not offered by the manufacturer. Manufacturers
      seek distributors who have strong relationships with desirable customers, have
      the infrastructure to handle large volumes of products and can assist customers
      in the design and use of the manufacturers’ products. Currently, we have stable
      supplies from many manufacturers, including Miyota, Seiko, ETA and Suissebaches.
      We continuously seek to identify potential new suppliers. During the fiscal
      year
      ended December 31, 2006, products purchased from our ten largest suppliers
      accounted for 81.1% of our total net sales.





**Operations**





Inventory
      management is critical to a distributor’s business. We constantly focus on a
      high number of resales or “turns” of existing inventory to reduce our exposure
      to product obsolescence and changing customer demand.





Our
      central computer system facilitates the control of purchasing and inventory,
      accounts payable, shipping and receiving, and invoicing and collection
      information for our distribution business. Our distribution software system
      includes financial systems, customer order entry, purchase order entry to
      manufacturers, warehousing and inventory control. Each of our sales departments
      and offices is electronically linked to our central computer systems, which
      provide fully integrated on-line, real-time data with respect to our inventory
      levels. We track inventory turns by vendor and by product, and our inventory
      management system provides immediate information to assist in making purchasing
      decisions and decisions as to which inventory to exchange with suppliers under
      stock rotation programs. In some cases, customers use computers that interface
      directly with our computers to identify available inventory and to rapidly
      process orders. Our computer system also tracks inventory turns by customer.
      We
      also monitor supplier stock rotation programs, inventory price protection,
      rejected material and other factors related to inventory quality and quantity.
      This system enables us to more effectively manage our inventory and to respond
      quickly to customer requirements for timely and reliable delivery of components.





**Competition**





The
      watch
      movement distribution industry is highly competitive, primarily with respect
      to
      price, product availability, knowledge of product and quality of service. We
      believe that the breadth of our customer base, services and product lines,
      our
      level of technical expertise and the overall quality of our services are
      particularly important to our competitive position. We compete with large
      distributors such as National Electronics Holding Ltd., as well as mid-size
      distributors, such as PTS Resources Ltd., many of whom distribute the same
      or
      competitive products as we do.


5


Our
      major
      competitors in complete watches include designer brands from overseas, China
      and
      Hong Kong such as Guess, Calvin Klein and Dolce & Gabanna.





**Backlog**





As
      is
      typical of watch movement distributors, we have a backlog of customer orders.
      At
      December 31, 2006, we had a backlog of approximately $1.38 million as compared
      to a backlog of approximately $0.87 million at December 31, 2005. We
      believe that a substantial portion of our backlog represents orders due to
      be
      filled within the next 90 days. In recent years, the trend in our industry
      has
      been toward outsourcing, with more customers entering into just-in-time
      contracts with distributors, instead of placing orders with long lead times.
      As
      a result, the correlation between backlog and future sales is changing. In
      addition, we have increased our use of transactions where we purchase inventory
      based on electronically transmitted forecasts from our customers that may not
      become an order until the date of shipment and, therefore, may not be reflected
      in our backlog. Our backlog is subject to delivery rescheduling and
      cancellations by the customer, sometimes without penalty or notice. For the
      foregoing reasons our backlog is not necessarily indicative of our future sales
      for any particular period.





**Employees**





At
      December 31, 2006, we had a total of 28 employees. There are no collective
      bargaining contracts covering any of our employees. We believe our relationship
      with our employees is satisfactory.


6


**Item
      1A. Risk Factors**





Any
      investment in our common stock involves a high degree of risk. Investors should
      carefully consider the risks described below and all of the information
      contained in this report before deciding whether to purchase our common stock.
      Our business, financial condition or results of operations could be materially
      adversely affected by these risks if any of them actually occur. Our shares
      of
      common stock are not currently listed or quoted for trading on any national
      securities exchange or national quotation system. If and when our common stock
      is traded, the trading price could decline due to any of these risks, and an
      investor may lose all or part of his or her investment. Some of these factors
      have affected our financial condition and operating results in the past or
      are
      currently affecting us. This Report also contains forward-looking statements
      that involve risks and uncertainties. Our actual results could differ materially
      from those anticipated in these forward-looking statements as a result of
      certain factors, including the risks described below and elsewhere in this
      report.




**ASIA
      TIME CORPORATION**





**RISKS
      RELATED TO OUR OPERATIONS**





**We
      are dependent on a limited number of suppliers. Loss of one or more of our
      key
      suppliers could harm our ability to manufacture and deliver our products to
      our
      customers, which would have a material adverse effect on our
      business.**





We
      rely
      on a limited number of suppliers for products that generate a significant
      portion of our sales. During the year ended December 31, 2006, products
      purchased from our 10 largest suppliers accounted for 81.1% of our total net
      sales. Substantially all of our inventory has been and will be purchased from
      suppliers with which we have entered into non-exclusive distribution agreements.
      Moreover, most of our distribution agreements are cancelable upon short notice.
      As a result, in the event that one or more of those suppliers experience
      financial difficulties or are not willing to do business with us in the future
      on terms acceptable to management, our ability to manufacture and deliver our
      products to our customers would be harmed, which would result in a material
      adverse effect on our business, results of operations or financial condition.
      Additionally, our relationships with our customers could be materially adversely
      affected because our customers depend on our distribution of watch movements
      from the industry’s leading suppliers.





**Our
      industry is highly cyclical, and an industry downturn could limit our ability
      to
      generate revenues and have a material adverse effect on our
      business.**





The
      watch
      movement distribution industry and, in particular, the timepiece manufacturing
      industry has historically been affected by general economic downturns and
      fluctuations in product supply and demand, often associated with changes in
      technology and manufacturing capacity. These industry cycles and economic
      downturns have often had an adverse economic effect upon manufacturers,
      end-users of watch movements and watch movement distributors, including our
      company. We cannot predict the timing or the severity of the cycles within
      our
      industry, or how long and to what levels any industry downturn and/or general
      economic weakness will last or be exacerbated by terrorism or war or other
      factors on our industry. Our revenues closely follow the strength or weakness
      of
      the timepiece market, and future downturns in this industry, would have a
      material adverse effect on our business, results of operations and financial
      condition.





**Rapid
      technological change and new and enhanced products could cause declines in
      the
      value of our inventory or result in obsolescence of our
      inventory.**





The
      watch
      movements industry is subject to rapid technological change, new and enhanced
      products and evolving industry standards, which can contribute to a decline
      in
      value or obsolescence of inventory. During an industry and/or economic downturn,
      it is possible that prices will decline due to an oversupply of product and,
      therefore, there may be greater risk of declines in inventory value. We cannot
      assure you that unforeseen new product developments or declines in the value
      of
      our inventory will not materially adversely affect our business, results of
      operations or financial condition, or that we will successfully manage our
      existing and future inventories.


7


**We
      make commitments regarding the level of business we sill seek and accept,
      including production schedules and personnel levels, and significant order
      cancellations, reductions, or delays by our customers could materially adversely
      affect our commitments and business.**





Our
      sales
      are typically made pursuant to individual purchase orders, and we generally
      do
      not have long-term supply arrangements with our customers, but instead work
      with
      our customers to develop nonbinding forecasts of future requirements. Based
      on
      these forecasts, we make commitments regarding the level of business that we
      will seek and accept, the timing of production schedules and the levels and
      utilization of personnel and other resources. A variety of conditions, both
      specific to each customer and generally affecting each customer’s industry, may
      cause customers to cancel, reduce or delay orders that were either previously
      made or anticipated. Generally, customers may cancel, reduce or delay purchase
      orders and commitments without penalty, except for payment for services rendered
      or products competed and, in certain circumstances, payment for materials
      purchased and charges associated with such cancellation, reduction or delay.
      Significant or numerous order cancellations, reductions or delays by our
      customers could have a material adverse effect on our business, financial
      condition or results of operations.





**The
      market for our products is very competitive and, if we cannot effectively
      compete, our business will be harmed.**





The
      market for our products is very competitive and subject to rapid technological
      change. We compete with many other distributors of watch movements and complete
      watches many of which are larger and have significantly greater assets, name
      recognition and financial, personnel and other resources than we have. As a
      result, our competitors may be in a stronger position to respond quickly to
      potential acquisitions and other market opportunities, new or emerging
      technologies and changes in customer requirements. Occasionally, we compete
      for
      customers with many of our own suppliers and additional competition has emerged
      from, fulfillment companies, catalogue distributors and e-commerce companies,
      including on-line distributors and brokers, which have grown with the expanded
      use of the Internet. We cannot assure you that we will be able to maintain
      or
      increase our market share against the emergence of these or other sources of
      competition. Failure to maintain and enhance our competitive position could
      materially adversely affect our business and prospects.





Additionally,
      prices for our products tend to decrease over their life cycle. This reduces
      resale per component sold. There is also continuing pressure from customers
      to
      reduce their total cost for products. Our suppliers may also seek to reduce
      our
      margins on the sale of their products in order to increase their own
      profitability or to be competitive with other suppliers of comparable product.
      We incur substantial costs on our value-added services required to remain
      competitive, retain existing business and gain new customers, and we must
      evaluate the expense of those efforts against the impact of price and margin
      reductions.





**Substantial
      defaults by our customers on accounts receivable or the loss of significant
      customers could have a material adverse effect on our liquidity and results
      of
      operations.**





A
      substantial portion of our working capital consists of accounts receivable
      from
      customers. If customers responsible for a significant amount of accounts
      receivable were to become insolvent or otherwise unable to pay for products
      and
      services, or to make payments in a timely manner, our liquidity and results
      of
      operations could be materially adversely affected. An economic or industry
      downturn could materially adversely affect the servicing of these accounts
      receivable, which could result in longer payment cycles, increased collection
      costs and defaults in excess of management’s expectations. A significant
      deterioration in our ability to collect on accounts receivable could also impact
      the cost or availability of financing available to us.





**We
      are dependent on Japanese manufacturers for our watch movements and subject
      to
      trade regulations which expose us to political and economic
      risk.**





Approximately
      97% of watch movements that we sell are manufactured by Japanese companies.
      As a
      result, our ability to sell certain products at competitive prices could be
      adversely affected by any of the following:





·
            increases
                in tariffs or duties on imports from
                Japan;




·
            changes
                in trade treaties between Japan and Hong
                Kong;




·
            strikes
                or delays in air or sea transportation between Japan and Hong
                Kong;




8


·
            future
                legislation with respect to pricing and/or import quotas on products
                imported from Japan; and




·
            turbulence
                in the Japanese economy or financial
                markets.




Trade
      regulations between Hong Kong and Japan have remained stable for the past five
      years. However, there is long-standing political tension between China and
      Japan, which could intensify, causing trade retaliation and changes in trade
      regulations. As a special administrative region of China, Hong Kong could be
      indirectly affected by changes in trade regulation between China and Japan,
      which would limit our ability to sell our products.





**Our
      industry is subject to supply shortages that could prevent us from manufacturing
      and delivering our products to our customers in a timely manner. Any delay
      or
      inability to deliver our products may have a material adverse effect on our
      results of operations.**





During
      prior periods, there have been shortages of components in the watch movements
      industry and the availability of certain movements have been limited by some
      of
      our suppliers. We cannot assure you that any future shortages or allocations
      would not have such an effect on us. A future shortage can be caused by and
      result from many situations and circumstances that are out of our control,
      and
      such shortage could limit the amount of supply available of certain required
      movements and increase prices affecting our profitability.





**We
      face risks related to our recent accounting restatements in December
      2007.**





In
      December 2007, we determined that we had accounting inaccuracies in previously
      reported financial statements and decided to restate our financial statements
      for the years ended December 31, 2006, 2005, and 2004. The restatements for
      the
      foregoing periods related to the correction of errors with respect to the
      accounting for inventory by adjusting watch movement costing for the effects
      of
      vendor incentives from an as received basis to an accrual basis, as we were
      able
      to estimate the value of the incentives as inventory is purchased. As a result
      of these adjustments, various income tax calculations were also revised, which
      effected net income and also caused reclassifications to cash flows. We also
      made various changes to footnote disclosures relating to these revisions. It
      is
      possible that such restatement of our financial statements could lead to
      litigation claims and/or regulatory proceedings against us. The defense of
      any
      such claims or proceedings may cause the diversion of management's attention
      and
      resources, and we may be required to pay damages if any such claims or
      proceedings are not resolved in our favor.





**The
      prices of our products are subject to volatility, which could have a negative
      impact on our sales and gross profit margins.**





A
      portion
      of the watch movements products we sell have historically experienced volatile
      pricing. If market pricing for these products decreases significantly, we may
      experience periods when our investment in inventory exceeds the market price
      of
      such products. In addition, at times there are price increases from our
      suppliers that we are unable to pass on to our customers. These market
      conditions could have a negative impact on our sales and gross profit margins
      unless and until our suppliers reduce the cost of these products to us.
      Furthermore, in the future, the need for aggressive pricing programs in response
      to market conditions, an increased number of low-margin, large volume
      transactions and/or increased availability of the supply of certain products,
      could further impact our gross profit margins.





**A
      reversal of the trend for distribution to play an increasing role in the watch
      movements industry could limit demand for our services and materially adversely
      affect our results of operations.**





In
      recent
      years, there has been a growing trend for large wholesalers and watch
      manufacturers to outsource their procurement, inventory and materials management
      processes to third parties, particularly watch movement distributors, including
      our company. A reversal of this trend for could limit demand for our services,
      materially adversely affecting our ability to generate revenues. If such a
      reversal occurs, we may be forced to change the focus of our operations if
      we
      are unable to generate sufficient revenues to support our operations as
      currently conducted.


9


**Our
      manufacturing capacity restraints and limited experience may cause unexpected
      costs, delays and make it more difficult to compete, which may have an adverse
      effect on our results of operations.**





As
      part
      of our expansion plan, we intend to substantially expand the design and
      manufacture of our own brands of complete watches and commence the manufacture
      of branded watch movements in-house. In order to produce our watches and watch
      movements in quantities sufficient to meet our anticipated market demand we
      will
      need to increase our manufacturing capacity by a significant factor over the
      current level. There are technical challenges to increasing manufacturing
      capacity, including equipment design and automation, material procurement,
      problems with production yields and quality control and assurance. Developing
      commercial scale manufacturing facilities will require the investment of
      substantial funds and the hiring and retaining of additional management and
      technical personnel who have the necessary manufacturing experience. We may
      encounter some difficulties, such as significant unexpected costs and delays,
      in
      scaling up the necessary manufacturing operations to produce required quantities
      of watch movements and watches. The failure to scale-up manufacturing operations
      in a timely and cost-effective way may adversely affect our income. Moreover,
      the lack of experience in watch movement and watch manufacture design may make
      it difficult to compete against companies that have more senior management
      and
      experience. If we are unable to satisfy demand for products, our ability to
      generate revenue could be impaired, market acceptance of our products could
      be
      adversely affected and customers may instead purchase our competitors’
products.





**If
      third-party carriers were unable to transport our products on a timely basis,
      we
      may be unable to timely deliver products to our customers and our operations
      could be materially adversely affected.**





All
      of
      our products are shipped through third party carriers. If a strike or other
      event prevented or disrupted these carriers from transporting our products,
      other carriers may be unavailable or may not have the capacity to deliver our
      products to our customers. If adequate third party sources to ship our products
      were unavailable at any time, our business would be materially adversely
      affected.





**Our
      products may be found to be defective and, as a result, warranty and/or product
      liability claims may be asserted against us which could have a material adverse
      effect on our business.**





Our
      products are sold at prices that are significantly lower than the cost of the
      watches in which they are incorporated. Since a defect or failure in a product
      could give rise to failures in the end products that incorporate them (and
      claims for consequential damages against us from our customers), we may face
      claims for damages that are disproportionate to the sales and profits we receive
      from our products involved. Our business could be materially adversely affected
      as a result of a significant quality or performance issue in the products sold
      by us depending on the extent to which we are required to pay for the damages
      that result. Although we currently have product liability insurance, such
      insurance is limited in coverage and amount.





**The
      failure to manage growth effectively could have an adverse effect on our
      business, financial condition, and results of operations.**





Any
      significant growth in the market for our products or entry into new markets
      by
      Asia Time may require us to expand our employee base for managerial,
      operational, financial, and other purposes. As of December 31, 2006, we had
      28
      full time employees. Continued future growth will impose significant added
      responsibilities upon the members of management to identify, recruit, maintain,
      integrate, and motivate new employees. Aside from increased difficulties in
      the
      management of human resources, we may also encounter working capital issues,
      as
      we will need increased liquidity to finance. For effective growth management,
      we
      will be required to continue improving our operations, management, and financial
      systems and control. Our failure to manage growth effectively may lead to
      operational and financial inefficiencies that will have a negative effect on
      our
      profitability.





**We
      are dependent on certain key personnel and loss of our sole executive officer,
      which would have a material adverse effect on our business and results of
      operations.**





Our
      success is, to a certain extent, attributable to our sole executive officer,
      Kwong Kai Shun. Kwong Kai Shun oversees the operation of our business. There
      can
      be no assurance that we will be able to retain Kwong Kai Shun or that he may
      not
      receive and/or accept competing offers of employment. The loss of Kwong Kai
      Shun
      could have a material adverse effect upon our business, financial condition,
      and
      results of operations.


10


**Our
      planned expansion into new international markets poses additional risks and
      could fail, which could cost us valuable resources and affect our results of
      operations.**





We
      plan
      to expand sales of products into new international markets including developing
      and developed countries, such as South America and Europe. These markets are
      untested for our products and we face risks in expanding the business overseas,
      which include differences in regulatory product testing requirements,
      intellectual property protection (including patents and trademarks), taxation
      policy, legal systems and rules, marketing costs, fluctuations in currency
      exchange rates and changes in political and economic conditions.





**RISKS
      RELATED TO US DOING BUSINESS IN CHINA**





**All
      of our assets are located in Hong Kong and China and substantially all of our
      revenues are derived from our operations in Hong Kong and China, and changes
      in
      the political and economic policies of the PRC government could have a
      significant impact upon the business we may be able to conduct in the PRC and
      the results of operations and financial condition.**





Our
      business operations may be adversely affected by the current and future
      political environment in the PRC. The PRC has operated as a socialist state
      since the mid-1900s and is controlled by the Communist Party of China. The
      Chinese government exerts substantial influence and control over the manner
      in
      which we must conduct our business activities. The PRC has only permitted
      provincial and local economic autonomy and private economic activities since
      1988. The government of the PRC has exercised and continues to exercise
      substantial control over virtually every sector of the Chinese economy,
      particularly the pharmaceutical industry, through regulation and state
      ownership. Our ability to operate in China may be adversely affected by changes
      in Chinese laws and regulations, including those relating to taxation, import
      and export tariffs, raw materials, environmental regulations, land use rights,
      property and other matters. Under current leadership, the government of the
      PRC
      has been pursuing economic reform policies that encourage private economic
      activity and greater economic decentralization. There is no assurance, however,
      that the government of the PRC will continue to pursue these policies, or that
      it will not significantly alter these policies from time to time without notice.





**Our
      operations are subject to PRC laws and regulations that are sometimes vague
      and
      uncertain. Any changes in such PRC laws and regulations, or the interpretations
      thereof, may have a material and adverse effect on our
      business.**





The
      PRC’s
      legal system is a civil law system based on written statutes, in which system
      decided legal cases have little value as precedents unlike the common law system
      prevalent in the United States. There are substantial uncertainties regarding
      the interpretation and application of PRC laws and regulations, including but
      not limited to the laws and regulations governing our business, or the
      enforcement and performance of our arrangements with customers in the event
      of
      the imposition of statutory liens, death, bankruptcy and criminal proceedings.
      The Chinese government has been developing a comprehensive system of commercial
      laws, and considerable progress has been made in introducing laws and
      regulations dealing with economic matters such as foreign investment, corporate
      organization and governance, commerce, taxation and trade. However, because
      these laws and regulations are relatively new, and because of the limited volume
      of published cases and judicial interpretation and their lack of force as
      precedents, interpretation and enforcement of these laws and regulations involve
      significant uncertainties. New laws and regulations that affect existing and
      proposed future businesses may also be applied retroactively. We are considered
      a foreign persons or foreign funded enterprises under PRC laws, and as a result,
      we are required to comply with PRC laws and regulations. We cannot predict
      what
      effect the interpretation of existing or new PRC laws or regulations may have
      on
      our businesses. If the relevant authorities find us in violation of PRC laws
      or
      regulations, they would have broad discretion in dealing with such a violation,
      including, without limitation:





·
            levying
                fines;




·
            revoking
                our business and other licenses;




·
            requiring
                that we restructure our ownership or operations;
                and




·
            requiring
                that we discontinue any portion or all of our
                business.




11


**Inflation
      in the PRC could negatively affect our profitability and
      growth.**





While
      the
      PRC economy has experienced rapid growth, such growth has been uneven among
      various sectors of the economy and in different geographical areas of the
      country. Rapid economic growth can lead to growth in the money supply and rising
      inflation. During the past decade, the rate of inflation in China has been
      as
      high as approximately 20% and China has experienced deflation as low as
      approximately minus 2%. If prices for our products rise at a rate that is
      insufficient to compensate for the rise in the costs of supplies such as raw
      materials, it may have an adverse effect on our profitability. In order to
      control inflation in the past, the PRC government has imposed controls on bank
      credits, limits on loans for fixed assets and restrictions on state bank
      lending. The implementation of such policies may impede economic growth. In
      October 2004, the People’s Bank of China, the PRC’s central bank, raised
      interest rates for the first time in nearly a decade and indicated in a
      statement that the measure was prompted by inflationary concerns in the Chinese
      economy. In April 2006, the People’s Bank of China raised the interest rate
      again. Repeated rises in interest rates by the central bank would likely slow
      economic activity in China which could, in turn, materially increase our costs
      and also reduce demand for our products.





**Recent
      PRC regulations relating to acquisitions of PRC companies by foreign entities
      may create regulatory uncertainties that could restrict or limit our ability
      to
      operate.**





The
      PRC
      State Administration of Foreign Exchange, or SAFE, issued a public notice in
      January 2005 concerning foreign exchange regulations on mergers and acquisitions
      in China. The public notice states that if an offshore company controlled by
      PRC
      residents intends to acquire a PRC company, such acquisition will be subject
      to
      strict examination by the relevant foreign exchange authorities. The public
      notice also states that the approval of the relevant foreign exchange
      authorities is required for any sale or transfer by the PRC residents of a
      PRC
      company’s assets or equity interests to foreign entities for equity interests or
      assets of the foreign entities.





In
      April
      2005, SAFE issued another public notice further explaining the January notice.
      In accordance with the April notice, if an acquisition of a PRC company by
      an
      offshore company controlled by PRC residents has been confirmed by a Foreign
      Investment Enterprise Certificate prior to the promulgation of the January
      notice, the PRC residents must each submit a registration form to the local
      SAFE
      branch with respect to their respective ownership interests in the offshore
      company, and must also file an amendment to such registration if the offshore
      company experiences material events, such as changes in the share capital,
      share
      transfer, mergers and acquisitions, spin-off transaction or use of assets in
      China to guarantee offshore obligations. The April notice also provides that
      failure to comply with the registration procedures set forth therein may result
      in restrictions on our PRC resident shareholders and subsidiaries. Pending
      the
      promulgation of detailed implementation rules, the relevant government
      authorities are reluctant to commence processing any registration or application
      for approval required under the SAFE notices.





In
      addition, on August 8, 2006, the Ministry of Commerce (“MOFCOM”), joined by the
      State-Owned Assets Supervision and Administration Commission of the State
      Council, State Administration of Taxation, State Administration for Industry
      and
      Commerce, China Securities Regulatory Commission and SAFE, amended and released
      the Provisions for Foreign Investors to Merge and Acquire Domestic Enterprises,
      new foreign-investment rules which took effect September 8, 2006, superseding
      much, but not all, of the guidance in the prior SAFE circulars. These new rules
      significantly revise China’s regulatory framework governing onshore-offshore
      restructurings and how foreign investors can acquire domestic enterprises.
      These
      new rules signify greater PRC government attention to cross-border merger,
      acquisition and other investment activities, by confirming MOFCOM as a key
      regulator for issues related to mergers and acquisitions in China and requiring
      MOFCOM approval of a broad range of merger, acquisition and investment
      transactions. Further, the new rules establish reporting requirements for
      acquisition of control by foreigners of companies in key industries, and
      reinforce the ability of the Chinese government to monitor and prohibit foreign
      control transactions in key industries.





These
      new
      rules may significantly affect the means by which offshore-onshore
      restructurings are undertaken in China in connection with offshore private
      equity and venture capital financings, mergers and acquisitions. It is expected
      that such transactional activity in China in the near future will require
      significant case-by-case guidance from MOFCOM and other government authorities
      as appropriate. It is anticipated that application of the new rules will be
      subject to significant administrative interpretation, and we will need to
      closely monitor how MOFCOM and other ministries apply the rules to ensure its
      domestic and offshore activities continue to comply with PRC law. Given the
      uncertainties regarding interpretation and application of the new rules, we
      may
      need to expend significant time and resources to maintain compliance, which
      could divert the attention of our management and adversely affect our results
      of
      operations.


12


It
      is
      uncertain how our business operations or future strategy will be affected by
      the
      interpretations and implementation of the SAFE notices and new rules. Our
      business operations or future strategy could be adversely affected by the SAFE
      notices and the new rules. For example, we may be subject to a more stringent
      review and approval process with respect to our foreign exchange activities,
      which could limit our ability to acquire companies in the PRC, restricting
      our
      ability to expand our operations.





**Failure
      to comply with the United States Foreign Corrupt Practices Act could subject
      us
      to penalties and other adverse consequences.**





We
      are
      subject to the United States Foreign Corrupt Practices Act, which generally
      prohibits United States companies from engaging in bribery or other prohibited
      payments to foreign officials for the purpose of obtaining or retaining
      business. In addition, we are required to maintain records that accurately
      and
      fairly represent our transactions and have an adequate system of internal
      accounting controls. Foreign companies, including some that may compete with
      us,
      are not subject to these prohibitions, and therefore may have a competitive
      advantage over us. Corruption, extortion, bribery, pay-offs, theft and other
      fraudulent practices occur from time-to-time in the PRC, and our executive
      officers and employees have not been subject to the United States Foreign
      Corrupt Practices Act prior to the completion of the Share Exchange. We can
      make
      no assurance that our employees or other agents will not engage in such conduct
      for which we might be held responsible. If our employees or other agents are
      found to have engaged in such practices, we could suffer severe penalties and
      other consequences that may have a material adverse effect on our business,
      financial condition and results of operations.





**Any
      recurrence of Severe Acute Respiratory Syndrome (SARS), Avian Flu, or another
      widespread public health problem, in the PRC could adversely affect our
      employees, customers, and our ability to continue our operations, including
      manufacturing and distribution.**





A
      renewed
      outbreak of Severe Acute Respiratory Syndrome, Avian Flu or another widespread
      public health problem in China, where all of our manufacturing facilities are
      located and where all of our sales occur, could have a negative effect on our
      operations. Our business is dependent upon our ability to continue to
      manufacture our products. Such an outbreak could have an impact on our
      operations as a result of:





·
            quarantines
                or closures of some of our manufacturing facilities, which would
                severely
                disrupt our operations,




·
            the
                sickness or death of our key officers and employees,
                and




·
            a
                general slowdown in the Chinese
                economy.




Any
      of
      the foregoing events or other unforeseen consequences of public health problems
      could adversely affect our operations.





**A
      downturn in the economy of the PRC may slow our growth and
      profitability.**





The
      growth of the Chinese economy has been uneven across geographic regions and
      economic sectors. There can be no assurance that growth of the Chinese economy
      will be steady or that any downturn will not have a negative effect on our
      business, especially if it results in either a decreased use of our products
      or
      in pressure on us to lower our prices.





**Because
      our business is located in the PRC, we may have difficulty establishing adequate
      management, legal and financial controls, which we are required to do in order
      to comply with U.S. securities law.**





PRC
      companies have historically not adopted a Western style of management and
      financial reporting concepts and practices, which includes strong corporate
      governance, internal controls and, computer, financial and other control
      systems. Most of our middle and top management staff are not educated and
      trained in the Western system. In addition, we may need to rely on a new and
      developing communication infrastructure to efficiently transfer our information
      from retail nodes to the headquarters. In addition, we may have difficulty
      in
      hiring and retaining a sufficient number of qualified employees to work in
      the
      PRC. As a result of these factors, we may experience difficulty in establishing
      management, legal and financial controls, collecting financial data and
      preparing financial statements, books of account and corporate records and
      instituting business practices that meet Western standards. Therefore, we may,
      in turn, experience difficulties in implementing and maintaining adequate
      internal controls as required under Section 404 of the Sarbanes-Oxley Act of
      2002. This may result in significant deficiencies or material weaknesses in
      our
      internal controls which could impact the reliability of our financial statements
      and prevent us from complying with SEC rules and regulations and the
      requirements of the Sarbanes-Oxley Act of 2002. Any such deficiencies,
      weaknesses or lack of compliance could have a materially adverse effect on
      our
      business.


13


**You
      may experience difficulties in effecting service of legal process, enforcing
      foreign judgments or bringing original actions in China based upon U.S. laws,
      including the federal securities laws or other foreign laws against us or our
      management.**





Most
      of
      our current operations are conducted in Hong Kong and China. Moreover all of
      our
      directors and officers are nationals and residents of Hong Kong and China.
      All
      or substantially all of the assets of these persons are located outside the
      United States and in the PRC. As a result, it may not be possible to effect
      service of process within the United States or elsewhere outside China upon
      these persons. In addition, uncertainty exists as to whether the courts of
      China
      would recognize or enforce judgments of U.S. courts obtained against us or
      our
      officers and/or directors predicated upon the civil liability provisions of
      the
      securities law of the United States or any state thereof, or be competent to
      hear original actions brought in China against us or such persons predicated
      upon the securities laws of the United States or any state thereof.





**RISKS
      RELATED TO OUR CAPITAL STRUCTURE**





**There
      is no current trading market for** **our** **common stock, and there is no assurance of an established public trading market,
      which would adversely affect the ability of** **our** **investors to sell their securities in the public market.**




Our
      common stock is not currently listed or quoted for trading on any national
      securities exchange or national quotation system. We are applying for the
      listing of our common stock on the American Stock Exchange in the future. There
      is no guarantee that the American Stock Exchange, or any other exchange or
      quotation system, will permit our shares to be listed and traded. If we fail
      to
      obtain a listing on the American Stock Exchange, we may seek quotation on the
      OTC Bulletin Board. The NASD has enacted changes that limit quotations on the
      OTC Bulletin Board to securities of issuers that are current in their reports
      filed with the Securities and Exchange Commission. The effect on the OTC
      Bulletin Board of these rule changes and other proposed changes cannot be
      determined at this time. The OTC Bulletin Board is an inter-dealer,
      over-the-counter market that provides significantly less liquidity than the
      NASDAQ Global Market (the “NASDAQ Global Market”). Quotes for stocks included on
      the OTC Bulletin Board are not listed in the financial sections of newspapers
      as
      are those for the NASDAQ Global Market. Therefore, prices for securities traded
      solely on the OTC Bulletin Board may be difficult to obtain and holders of
      common stock may be unable to resell their securities at or near their original
      offering price or at any price.





**Shares
      eligible for future sale may adversely affect the market price of our common
      stock, as the future sale of a substantial amount of outstanding stock in the
      public marketplace could reduce the price of our common
      stock.**




Pursuant
      to the terms of the Share Exchange, we agreed to file a registration statement
      with the Securities and Exchange Commission to register the 2,250,348 shares
      of
      common stock underlying shares of our Series A Convertible Preferred Stock
      issued in an equity financing. The registration statement must be filed with
      30
      days of the closing of the Share Exchange. We also agreed to register all of
      the
      3,702,209 shares of common stock held by our shareholders immediately prior
      to
      the Share Exchange. Of these shares, 1,703,017 shares would be covered by the
      registration statement filed in connection with the Private Placement, and
      1,999,192 shares, which are beneficially owned by affiliates of the placement
      agent would be included in a subsequent registration statement filed by us
      within 10 days after the end of the six-month period that immediately follows
      the date on which we file the registration statement to register the shares
      issued in the Private Placement. Of the 1,999,192 shares to be registered,
      1,528,933 shares are subject to a lock up arrangement such that the shares
      may
      not be sold until nine months after our common stock begins to be traded on
      either the New York Stock Exchange, American Stock Exchange, NASDAQ Global
      Market, NASDAQ Capital Market, the OTC Bulletin Board or the Pink Sheets. All
      of
      the shares included in an effective registration statement as described above
      may be freely sold and transferred except if subject to a lock up agreement.


14


Additionally,
      following the Share Exchange, the former sole stockholder of Times Manufacture
      who received 19,454,420 shares of our comment stock in the Share Exchange may
      be
      eligible to sell all or some of our shares of common stock by means of ordinary
      brokerage transactions in the open market pursuant to Rule 144, promulgated
      under the Securities Act (“Rule 144”), subject to certain limitations. In
      general, pursuant to Rule 144, a stockholder (or stockholders whose shares
      are
      aggregated) who has satisfied a one-year holding period may, under certain
      circumstances, sell within any three-month period a number of securities which
      does not exceed the greater of 1% of the then outstanding shares of common
      stock
      or the average weekly trading volume of the class during the four calendar
      weeks
      prior to such sale. As of the closing of the Share Exchange, 1% of our issued
      and outstanding shares of common stock was approximately 231,566 shares. Rule
      144 also permits, under certain circumstances, the sale of securities, without
      any limitations, by a non-affiliate that has satisfied a two-year holding
      period. Any substantial sale of common stock pursuant to any resale prospectus
      or Rule 144 may have an adverse effect on the market price of our common stock
      by creating an excessive supply.




**Following
      the Share Exchange, the former sole stockholder of Times Manufacture has
      significant influence over us.**




Our largest
      shareholder, Kwong Kai Shun, who is also our Chairman of the Board, Chief
      Executive Officer and Chief Financial Officer, beneficially owns or controls
      approximately 84.0% of our outstanding shares as of the close of the Share Exchange. As a result of his
      holding, this shareholder has a controlling influence in determining the outcome
      of any corporate transaction or other matters submitted to our shareholders for approval, including mergers, consolidations and the sale of
      all
      or substantially all of our assets, election of directors, and other significant
      corporate actions. This shareholder also has the power to prevent or cause
      a
      change in control. In addition, without the consent of this shareholder, we
      could be prevented from entering into transactions that could be beneficial
      to
      us. The interests of this shareholder may differ from the interests of our shareholders.




**The
      ability of our operating subsidiaries to pay dividends may be restricted due
      to
      foreign exchange control regulations of China.**





The
      ability of our operating subsidiaries to pay dividends may be restricted due
      to
      the foreign exchange control policies and availability of cash balance of our
      operating subsidiaries. We expect in the future that a substantial portion
      of
      our revenue being earned and currency received may be denominated in Renminbi
      (RMB). RMB is subject to the exchange control regulation in China, and, as
      a
      result, we may unable to distribute any dividends outside of China due to PRC
      exchange control regulations that restrict our ability to convert RMB into
      US
      Dollars.





**We** **may not be able to achieve the benefits** **we** **expect
      to result from the Share Exchange.**




On
      December 15, 2006, we entered into the Exchange Agreement with the sole
      shareholder of Times Manufacture, pursuant to which we agreed to acquire 100%
      of
      the issued and outstanding securities of Times Manufacture in exchange for
      shares of our common stock. On January 23, 2007, the Share Exchange closed,
      Times Manufacture became our 100%-owned subsidiary and our sole business
      operations became that of Times Manufacture. Also, the management and directors
      of Times Manufacture became the management and directors of us and we changed
      our corporate name from SRKP 9, Inc. to Asia Time Corporation.





We
      may
      not realize the benefits that we hoped to receive as a result of the Share
      Exchange, which includes:





·
            access
                to the capital markets of the United
                States;




·
            the
                increased market liquidity expected to result from exchanging stock
                in a
                private company for securities of a public company that may eventually
                be
                traded;




·
            the
                ability to use registered securities to make acquisition of assets
                or
                businesses;




·
            increased
                visibility in the financial
                community;




·
            enhanced
                access to the capital markets;




·
            improved
                transparency of operations; and




·
            perceived
                credibility and enhanced corporate image of being a publicly traded
                company.




15


There
      can
      be no assurance that any of the anticipated benefits of the Share Exchange
      will
      be realized in respect to our new business operations. In addition, the
      attention and effort devoted to achieving the benefits of the Share Exchange
      and
      attending to the obligations of being a public company, such as reporting
      requirements and securities regulations, could significantly divert management’s
      attention from other important issues, which could materially and adversely
      affect our operating results or stock price in the future.





**In
      connection with Mr. Kwong’s agreement to release, under certain conditions, up
      to 2,326,000 shares of his common stock in our company to investors in our
      January 2007 Private Placement, we will record a compensation charge of
      approximately $2.4 million for 2007.**





In
      connection with the Private Placement, Kwong Kai Shun, our Chairman of the
      Board, Chief Executive Officer and Chief Financial Officer, entered into an
      agreement (the “Escrow Agreement”) with the investors in the Private Placement
      pursuant to which Mr. Kwong agreed to place 2,326,000 shares of his common
      stock
      in escrow for possible distribution to the investors (the "Escrow Shares").
      Pursuant to the Escrow Agreement, if our net income for 2006 or 2007, subject
      to
      specified adjustments, is less than $6.3 million or $7.7 million, respectively,
      a portion, if not all, of the Escrow Shares will be transferred to the investors
      based upon our actual net income, if any, for such fiscal years. We have
      accounted for the Escrow Shares as the equivalent of a performance-based
      compensatory stock plan between Mr. Kwong and us. Accordingly, during the year
      ended December 31, 2007, we will recorded a charge to operations of $2,433,650
      to recognize the grant date fair value of stock-based compensation in
      conjunction with the Escrow Shares. The expense will have a negative effect
      on
      our results of operations for 2007 and cause our net income to be reduced by
      $2.4 million for the year. We may not realize a benefit from services provided
      under the agreement that is comparable to such negative effect. As a result,
      our
      operations may suffer and our stock price may decline.





**If
      we fail to maintain effective internal controls over financial reporting, the
      price of our common stock may be adversely affected.**





Our
      internal control over financial reporting may have weaknesses and conditions
      that need to be addressed, the disclosure of which may have an adverse impact
      on
      the price of our common stock. We are required to establish and maintain
      appropriate internal controls over financial reporting. Failure to establish
      those controls, or any failure of those controls once established, could
      adversely impact our public disclosures regarding our business, financial
      condition or results of operations. Our failure of these controls could also
      prevent us from maintaining accurate accounting records and discovering
      accounting errors and financial frauds. In addition, management’s assessment of
      internal controls over financial reporting may identify weaknesses and
      conditions that need to be addressed in our internal controls over financial
      reporting or other matters that may raise concerns for investors. Any actual
      or
      perceived weaknesses and conditions that need to be addressed in our internal
      control over financial reporting, disclosure of management’s assessment of our
      internal controls over financial reporting or disclosure of our public
      accounting firm’s attestation to or report on management’s assessment of our
      internal controls over financial reporting may have an adverse impact on the
      price of our common stock.





**Standards
      for compliance with Section 404 of the Sarbanes-Oxley Act Of 2002 are uncertain,
      and if we fail to comply in a timely manner, our business could be harmed and
      our stock price could decline.**




Rules
      adopted by the SEC pursuant to Section 404 of the Sarbanes-Oxley Act of 2002
      require annual assessment of our internal control over financial reporting,
      and
      attestation of this assessment by our company’s independent registered public
      accountants. The SEC extended the compliance dates for non-accelerated filers,
      as defined by the SEC. Accordingly, we believe that the annual assessment of
      our
      internal controls requirement will first apply to our annual report for the
      2007
      fiscal year and the attestation requirement of management’s assessment by our
      independent registered public accountants will first apply to our annual report
      for the 2008 fiscal year. The standards that must be met for management to
      assess the internal control over financial reporting as effective are new and
      complex, and require significant documentation, testing and possible remediation
      to meet the detailed standards. We may encounter problems or delays in
      completing activities necessary to make an assessment of our internal control
      over financial reporting. In addition, the attestation process by our
      independent registered public accountants is new and we may encounter problems
      or delays in completing the implementation of any requested improvements and
      receiving an attestation of our assessment by our independent registered public
      accountants. If we cannot assess our internal control over financial reporting
      as effective, or our independent registered public accountants are unable to
      provide an unqualified attestation report on such assessment, investor
      confidence and share value may be negatively impacted.


16


**Our** **common
      stock may be considered a “penny stock,” and thereby be subject to additional
      sale and trading regulations that may make it more difficult to
      sell.**




Our
      common stock, which is not currently listed or quoted for trading, may be
      considered to be a “penny stock” if it does not qualify for one of the
      exemptions from the definition of “penny stock” under Section 3a51-1 of the
      Securities Exchange Act for 1934, as amended (the “Exchange Act”) once, and if,
      it starts trading. Our common stock may be a “penny stock” if it meets one or
      more of the following conditions (i) the stock trades at a price less than
      $5.00
      per share; (ii) it is NOT traded on a “recognized” national exchange; (iii) it
      is NOT quoted on the Nasdaq Capital Market, or even if so, has a price less
      than
      $5.00 per share; or (iv) is issued by a company that has been in business less
      than three years with net tangible assets less than $5 million.




The
      principal result or effect of being designated a “penny stock” is that
      securities broker-dealers participating in sales of our common stock will be
      subject to the “penny stock” regulations set forth in Rules 15-2 through 15g-9
      promulgated under the Exchange Act. For example, Rule 15g-2 requires
      broker-dealers dealing in penny stocks to provide potential investors with
      a
      document disclosing the risks of penny stocks and to obtain a manually signed
      and dated written receipt of the document at least two business days before
      effecting any transaction in a penny stock for the investor’s account. Moreover,
      Rule 15g-9 requires broker-dealers in penny stocks to approve the account of
      any
      investor for transactions in such stocks before selling any penny stock to
      that
      investor. This procedure requires the broker-dealer to (i) obtain from the
      investor information concerning his or her financial situation, investment
      experience and investment objectives; (ii) reasonably determine, based on that
      information, that transactions in penny stocks are suitable for the investor
      and
      that the investor has sufficient knowledge and experience as to be reasonably
      capable of evaluating the risks of penny stock transactions; (iii) provide
      the
      investor with a written statement setting forth the basis on which the
      broker-dealer made the determination in (ii) above; and (iv) receive a signed
      and dated copy of such statement from the investor, confirming that it
      accurately reflects the investor’s financial situation, investment experience
      and investment objectives. Compliance with these requirements may make it more
      difficult and time consuming for holders of our common stock to resell their
      shares to third parties or to otherwise dispose of them in the market or
      otherwise.





**We** **do not foresee paying cash dividends in the foreseeable future, and as a result,
      our investors’ sole source of gain, if any, will depend on capital appreciation,
      if any.**




We
      do not
      currently plan to declare or pay any cash dividends on our shares of common
      stock in the foreseeable future and we currently intend to retain any future
      earnings for funding growth. As a result, you should not rely on an investment
      in our securities if you require dividend income. Capital appreciation, if
      any,
      of our shares may be your sole source of gain for the foreseeable future.
      Moreover, you may not be able to resell your shares in our company at or above
      the price you paid for them. We paid cash dividends of $2.4 million, $642,848,
      and $Nil during the years ended December 31, 2006, 2005, and 2004 respectively.


17




**Item
        6. Selected Financial Data**
 
 **ASIA
        TIME CORPORATION**
 
 The
        following selected consolidated statement of operations data for each of
        the
        years in the five-year period ended December 31, 2006 and the consolidated
        balance sheet data as of year-end for each of the years in the five-year
        period
        ended December 31, 2006 were derived from the audited consolidated financial
        statements except for the data as of and for the year ending December 31,
        2002.
        Such selected financial data should be read in conjunction with the consolidated
        financial statements and the notes to the consolidated financial statements
        starting on page F-1 and with Item 7. “Management’s Discussion and Analysis of
        Financial Condition and Results of Operations.”


**Consolidated
        Statement of Operations**


**Years
                Ended December 31,****2006**
            
            **2005**
            
            **2004**
            
            **2003**
            
            **2002*****(restated)***
            
            ***(restated)***
            
            ***(restated)***
            
            ***(restated)***
            
            ***(unaudited)******(in
                thousands, except share and per share
                amounts)***Net
                sales
            
            $
            81,134
            
            $
            63,078
            
            $
            36,553
            
            $
            33,215
            
            $
            43,893Cost
                of sales
            
            
            (71,496
            )
            
            (57,026
            )
            
            (34,609
            )
            
            (31,953
            )
            
            (43,036
            )Gross
                profit
            
            $
            9,637
            
            $
            6,052
            
            $
            1,944
            
            $
            1,262
            
            $
            857Otherincome
            
            
            424
            
            
            939
            
            
            -
            
            
            -
            
            
            -Depreciation
            
            
            (326
            )
            
            (259
            )
            
            (126
            )
            
            (18
            )
            
            (17
            )Administrative
                and other operatingexpenses,
                including stock based compensation
            
            
            (1,285
            )
            
            (1,436
            )
            
            (1,345
            )
            
            (834
            )
            
            (700
            )Income
                from operations
            
            $
            8,450
            
            $
            5,296
            
            $
            473
            
            $
            410
            
            $
            140Fee
                and costs related to reverse merger
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -Interest
                expense
            
            
            (1,060
            )
            
            (515
            )
            
            (165
            )
            
            (115
            )
            
            (69
            )Other
                income
            
            
            238
            
            
            156
            
            
            28
            
            
            20
            
            
            74Income
                before taxes
            
            $
            7,628
            
            $
            4,937
            
            $
            336
            
            $
            315
            
            $
            145Income
                taxes
            
            
            (1,308
            )
            
            (912
            )
            
            (132
            )
            
            (55
            )
            
            (24
            )Net
                income
            
            $
            6,320
            
            $
            4,025
            
            $
            204
            
            $
            260
            
            $
            121Earnings
                per common share:-
                Basic
            
            $
            0.32
            
            $
            0.21
            
            $
            0.01
            
            $
            0.01
            
            $
            0.01-
                Diluted
            
            $
            0.32
            
            $
            0.21
            
            $
            0.01
            
            $
            0.01
            
            $
            0.00Dividends
                declared per common share
            
            $
            0.11
            
            $
            0.03
            
            $
            -
            
            $
            -
            
            $
            -Weighted
                average common shares:-
                Basic
            
            
            19,454,420
            
            
            19,454,420
            
            
            19,454,420
            
            
            19,454,420
            
            
            19,454,420-
                Diluted
            
            
            19,454,420
            
            
            19,454,420
            
            
            19,454,420
            
            
            19,454,420
            
            
            19,454,420




**Consolidated
        Balance Sheets**
  **As
                  of December 31,****2006**
              
              **2005**
              
              **2004**
              
              **2003**
              
              **2002*****(as restated)***
              
              ***(as restated)***
              
              ***(as restated)***
              
              ***(as restated)***
              
              ***(unaudited)******(in
                  thousands)***Current
                  Assets
              
              $
              21,400
              
              $
              16,648
              
              $
              12,432
              
              $
              4,836
              
              $
              3,838Total
                  Assets
              
              
              24,096
              
              
              18,533
              
              
              13,866
              
              
              4,876
              
              
              3,947Current
                  Liabilities
              
              
              15,553
              
              
              13,890
              
              
              12,620
              
              
              3,847
              
              
              3,171Total
                  Liabilities
              
              
              15,585
              
              
              13,890
              
              
              12,620
              
              
              3,847
              
              
              3,178Total
                  Stockholders' Equity
              
              
              8,511
              
              
              4,644
              
              
              1,246
              
              
              1,030
              
              
              769
  18





**PRO
      FORMA FINANCIAL STATEMENTS**





**Unaudited
      Condensed Pro Forma Combined Financial Information**





The
      accompanying unaudited condensed pro forma combined financial information
      consists of the combined balance sheet as of December 31, 2006 of Asia Time
      Corporation, formerly SRKP 9, Inc., a Delaware corporation (the “Company”) and
      Times Manufacture & E-Commerce Corporation Limited, a British Virgin Islands
      corporation (“Times Manufacture”) and their combined statements of operations
      for the year ended December 31, 2006, as though the transactions therein
      described had occurred on the balance sheet date and at the commencement of
      the
      period presented. The objective of this pro forma is to show what the
      significant effects on historical financial information might have been had
      the
      herein described transaction occurred at an earlier date.





On
      December 15, 2006, the Company entered into a share exchange agreement with
      the
      sole shareholder of Times Manufacture. Pursuant to the share exchange agreement
      (the "Exchange Agreement") the Company agreed to issue shares of its common
      stock in exchange for all of the issued and outstanding securities of Times
      Manufacture (the "Share Exchange"). The Share Exchange closed on January 23,
      2007. The Transaction was accounted for as a reverse merger (corporate
      recapitalization) with Times Manufacture & E-Commerce Corporation Limited
      being the accounting acquirer.





Upon
      the
      closing of the Share Exchange and pursuant to the terms of the Exchange
      Agreement, we issued an aggregate of 19,454,420 shares of our common stock
      to
      the sole shareholder of Times Manufacture in exchange for all of the issued
      and
      outstanding securities of Times Manufacture. Times Manufacture also paid an
      aggregate of $350,000 to the stockholders of SRKP 9, Inc. In addition, prior
      to
      the closing of the Share Exchange, we effected a 1.371188519-for-one stock
      dividend such that there were 3,702,209 shares of common stock outstanding
      immediately prior to the Share Exchange. We issued no fractional shares in
      connection with the Share Exchange. The condensed pro forma combined financial
      information presents historical financial statements, pro forma adjustments
      and
      the pro forma results.





The
      Company entered into two subscription agreements (the “Subscription Agreement”)
      with certain investors pursuant to which the Company sold an aggregate of
      2,250,348 shares of Series A Convertible Preferred Stock (“Series A Preferred
      Stock”) at $1.29 per share for an aggregate gross proceeds of $2,952,946





At
      the
      initial closing of the Subscription Agreement on January 23, 2007, the Company
      sold an aggregate of 1,749,028 shares of Series A Preferred Stock. At the second
      and final closing of the Subscription Agreement on February 9, 2007, the Company
      sold an aggregate of 501,320 shares of Series A Preferred Stock.





Each
      share of the Company’s Series A Preferred Stock is convertible into shares of
      common stock at a conversion price equal to the share purchase price, subject
      to
      adjustments.




19




**Asia
                Time Corporation****Pro
                Forma Combined Balance Sheets (Unaudited)****December
                31, 2006****Historical**
            
            **Historical****Asia
                Time**
            
            **Times**
            
            **Pro
                Forma**
            
            
            **Pro
                Forma****Corporation**
            
            **Manufacture**
            
            **Adjustments**
            
            
            **Combined**$
            
            $
            
            $
            
            
            $**ASSETS**Current
                Assets:Cash
                and cash equivalents
            
            $
            3,193
            
            $
            316,621
            
            
            2,641,683
            (1)
            
            $
            2,331,383(350,000)
            (2)(280,114)
            (2)Restricted
                cash
            
            
            -
            
            
            4,523,679
            
            
            
            
            
            
            4,523,679Accounts
                receivable
            
            
            -
            
            
            8,188,985
            
            
            
            
            
            
            8,188,985Prepaid
                expenses and otherreceivables
            
            
            25,000
            
            
            2,101,133
            
            
            (139,083)
            (2)
            
            
            1,987,050Tax
                prepayment
            
            
            -
            
            
            767
            
            
            
            
            
            
            767Inventories
            
            
            -
            
            
            6,646,185
            
            
            
            
            
            
            6,646,185Prepaid
                lease payments
            
            
            -
            
            
            22,958
            
            
            
            
            
            
            22,958Total
                Current Assets
            
            
            28,193
            
            
            21,400,328
            
            
            
            
            
            
            23,301,007Deferred
                tax assets
            
            
            -
            
            
            14,042
            
            
            
            
            
            
            14,042Plant
                and equipment, net
            
            
            -
            
            
            890,258
            
            
            
            
            
            
            890,258Leasehold
                lands
            
            
            -
            
            
            895,322
            
            
            
            
            
            
            895,322Held-to-maturity
                investments
            
            
            -
            
            
            301,196
            
            
            
            
            
            
            301,196Intangible
                assets
            
            
            -
            
            
            337,836
            
            
            
            
            
            
            337,836Restricted
                cash
            
            
            -
            
            
            257,301
            
            
            
            
            
            
            257,301**TOTAL
                ASSETS**
            
            $
            28,193
            
            $
            24,096,283
            
            
            
            
            
            $
            25,996,962**LIABILITIES
                AND STOCKHOLDERS' EQUITY****LIABILITIES**Current
                Liabilities:Accounts
                payable
            
            
            -
            
            
            770,360
            
            
            
            
            
            
            770,360Other
                payables and accrued liabilities
            
            
            -
            
            
            190,358
            
            
            
            
            
            
            190,358Advance
                from related parties
            
            
            33,000
            
            
            -
            
            
            (33,000)
            (2)
            
            
            -Income
                tax payable
            
            
            -
            
            
            1,387,571
            
            
            
            
            
            
            1,387,571Bank
                borrowings
            
            
            -
            
            
            13,205,167
            
            
            
            
            
            
            13,205,167Total
                Current Liabilities
            
            
            33,000
            
            
            15,553,456
            
            
            
            
            
            
            15,553,456Deferred
                tax liabilities
            
            
            -
            
            
            31,711
            
            
            
            
            
            
            31,711**TOTAL
                LIABILITIES**
            
            
            33,000
            
            
            15,585,167
            
            
            
            
            
            
            15,585,167**STOCKHOLDERS'
                EQUITY**Preferred
                stock
            
            
            -
            
            
            -
            
            
            225
            (1)
            
            
            225Common
                stock
            
            
            270
            
            
            1,946
            
            
            370
            (4)
            
            
            2,316(270)
            (3)Additional
                paid-in capital
            
            
            1,897
            
            
            654,298
            
            
            (370)
            (4)
            
            
            3,290,5792,641,458
            (1)(4,807)
            (3)(1,897)
            (3)Accumulated
                other comprehensive income
            
            
            -
            
            
            7,470
            
            
            
            
            
            
            7,4706,974
            (3)Retained
                earnings
            
            
            (6,974
            )
            
            7,847,402
            
            
            (736,197)
            (2)
            
            
            7,111,205**TOTAL
                STOCKHOLDERS' EQUITY**
            
            
            (4,807
            )
            
            8,511,116
            
            
            
            
            
            
            10,411,795**TOTAL
                LIABILITIES AND STOCKHOLDERS' EQUITY**
            
            $
            28,193
            
            $
            24,096,283
            
            
            
            
            
            $
            25,996,962




20




**Asia
                Time Corporation**
              **Pro
                Forma Combined Income statement (Unaudited)**
              **December
                31, 2006****Historical**
            
            **Historical****Asia
                Time**
            
            **Times**
            
            **Pro
                Forma**
            
            
            **Pro
                Forma****Corporation**
            
            **Manufacture**
            
            **Adjustments**
            
            
            **Combined**$
            
            $
            
            $
            
            
            $Net
                sales
            
            
            -
            
            $
            81,134,275
            
            
            
            
            
            $
            81,134,275Cost
                of sales
            
            
            -
            
            
            (71,393,755
            )
            
            
            
            
            
            (71,393,755
            )Gross
                profit
            
            
            -
            
            
            9,740,520
            
            
            
            
            
            
            9,740,520Other
                income
            
            
            -
            
            
            424,016
            
            
            
            
            
            
            424,016Depreciation
            
            
            -
            
            
            (325,995
            )
            
            
            
            
            
            (325,995
            )Administrative
                and other operating expenses
            
            
            (6,974
            )
            
            (1,284,863
            )
            
            6,974
            (3)
            
            
            (3,718,513
            )(2,433,650)
            (5)Income
                from operations
            
            
            (6,974
            )
            
            8,553,678
            
            
            
            
            
            
            6,120,028Other
                income
            
            
            -
            
            
            237,571
            
            
            
            
            
            
            237,571Interest
                expenses
            
            
            -
            
            
            (1,060,536
            )
            
            
            
            
            
            (1,060,536
            )Income
                before taxes
            
            
            (6,974
            )
            
            7,730,713
            
            
            
            
            
            
            5,297,063Income
                taxes
            
            
            -
            
            
            (1,325,761
            )
            
            
            
            
            
            (1,325,761
            )Net
                income
            
            $
            (6,974
            )
            $
            6,404,952
            
            
            
            
            
            $
            3,971,302Earnings
                per share of common stock-Basic
            
            
            
            
            
            
            
            
            
            
            
            
            0.17-Diluted
            
            
            
            
            
            
            
            
            
            
            
            
            0.16Weighted
                average number of common stock-Basic
                and Diluted
            
            
            
            
            
            
            
            
            
            
            
            
            23,156,629
            (6)-Diluted
            
            
            
            
            
            
            
            
            
            
            
            
            25,406,977
            (6)




21





**Notes
      to the Unaudited Condensed Combined Pro Forma Financial
      Information**





****(1)
            Reflect
                the private placement of 2,250,348 shares of Series A Convertible
                Preferred Stock at $1.29 per share.




(2)
            Reflect
                the legal and professional fees of share exchange and the payment
                of
                $350,000 to the shareholders of SRKP 9, Inc. as expense. Amount are
                included in the Pro Forma Combined Balance Sheet but excluded from
                the Pro
                Forma Combined Income Statement, as they are non-recurring expenses
                related only to the reverse merger.




(3)
            Eliminate
                the equity accounts, net asset accounts, and income statement accounts
                of
                SRKP 9, Inc as the Transaction was accounted for as a reverse merger
                (corporate recapitalization) with Times Manufacture & E-Commerce
                Corporation Limited being the accounting
                acquirer,




(4)
            Reflect
                a 1.371188519-for-one stock reverse split in the course of the share
                exchange.




(5)
            In
                connection with the Private Placement (See 1 above), Kwong Kai Shun,
                the
                Company's Chairman of the Board, Chief Executive Officer and Chief
                Financial Officer, entered into an agreement with the investors in
                the
                Private Placement pursuant to which Mr. Kwong agreed to place 2,326,000
                shares of his common stock in escrow for possible distribution to
                the
                investors (the "Escrow Shares").Pursuant to the Escrow Agreement,
                if the
                Company's net income for 2006 or 2007 (subject to specified adjustments)
                as set forth in its filings with the SEC is less than $6,300,000
                or
                $7,700,000, respectively, a portion, if not all, of the Escrow Shares
                will
                be transferred to the investors based upon the Company's actual net
                income, if any, for such fiscal years. This Arrangement is accounted
                for
                as or as the equivalent of a performance-based compensatory stock
                plan
                between Mr. Kwong and the Company and if Mr. Kwong retains his shares
                the
                company will have and expense of $2,433,650 based on the valuation
                model
                used by the Company. In the Proformas, the statement of proforma
                operations reflects this performance award as if the underlying
                transaction had happened at the beginning of 2006 and Mr. Kwong retained
                his shares.




(6)
            Weighted
                average number of common stock are derived from the shares outstanding
                after the merger considering the shares issued to the SRKP 9, Inc.,
                and
                split and reorganization required to accomplish recapitalization.
                Diluted
                Weighted Average Shares Outstanding include the effect of the preferred
                shares issued on an as converted basis for the entire proforma
                period.




22




**Item
      7. Management’s Discussion and Analysis of Financial Condition and Results of
      Operations.**





**Forward-Looking
      Statements**





*The
      following discussion should be read in conjunction with our consolidated
      financial statements and related notes included elsewhere in this report. This
      report contains forward-looking statements. The words “anticipated,” “believe,”
“expect, “plan,” “intend,” “seek,” “estimate,” “project,” “could,” “may,” and
      similar expressions are intended to identify forward-looking statements. These
      statements include, among others, information regarding future operations,
      future capital expenditures, and future net cash flow. Such statements reflect
      our management’s current views with respect to future events and financial
      performance and involve risks and uncertainties, including, without limitation,
      general economic and business conditions, changes in foreign, political, social,
      and economic conditions, regulatory initiatives and compliance with governmental
      regulations, the ability to achieve further market penetration and additional
      customers, and various other matters, many of which are beyond our control.
      Should one or more of these risks or uncertainties occur, or should underlying
      assumptions prove to be incorrect, actual results may vary materially and
      adversely from those anticipated, believed, estimated or otherwise indicated.
      Consequently, all of the forward-looking statements made in this report are
      qualified by these cautionary statements and there can be no assurance of the
      actual results or developments.*





**ASIA
      TIME CORPORATION**





**Overview**





We
      are a
      distributor of watch movements components used in the manufacture and assembly
      of watches to a wide variety of timepiece manufacturers. There are two
      categories of watch movements, quartz and mechanical. The main parts of an
      analog quartz watch movement are the battery; the oscillator, a piece of quartz
      that vibrates in response to the electric current; the integrated circuit,
      which
      divides the oscillations into seconds; the stepping motor, which drives the
      gear
      train; and the gear train itself, which makes the watch’s hands move. A digital
      watch movement has the same timing components as an analog quartz movement
      but
      has no stepping motor or gear train. To a lesser extent we also distribute
      complete analog-quartz and automatic watches with pricing between $20.00 to
      $50.00. Manufacturing for these watches is currently outsourced to third party
      factories in China.





Our
      core
      customer base consists primarily of large wholesalers, online retailers and
      small and medium-sized watch manufacturers that produce watches primarily for
      sale to customers in Hong Kong and China. To a lesser extent, we design watches
      for manufacturers and exporters of watches and manufacture and distribute
      complete watches primarily to online retailers and internet
      marketers.





We
      are
      mainly engaged in watch movement distribution business in Hong Kong and China
      which accounted for approximately 90% of our revenue for the year ended December
      31, 2006. We have distribution centers and strategically located sales offices
      throughout Hong Kong and the People’s Republic of China (“China” or “PRC”). We
      distribute more than 350 products from over 30 vendors, including such market
      leaders as Citizen Group, Seiko Corporation and ETA SA Manufacture Horlogere
      Suisse, to a base of over 300 customers primarily through our direct sales
      force. As a part and included in our sale of watch movements, we provide a
      variety of value-added services, including automated inventory management
      services, integration, design and development, management, and support
      services.





**Corporate
      Structure**





We
      were
      incorporated in the State of Delaware on January 3, 2006. We were originally
      organized as a “blank check” shell company to investigate and acquire a target
      company or business seeking the perceived advantages of being a publicly held
      corporation. On January 23, 2007, we closed a share exchange transaction (“Share
      Exchange”) pursuant to which we (i) issued 19,454,420 shares of our common stock
      to acquire 100% equity ownership of Times Manufacture & E-Commerce
      Corporation Limited, a British Virgin Islands corporation (“Times Manufacture”),
      which has eight wholly-owned subsidiaries, (ii) assumed the operations of Times
      Manufacture and its subsidiaries, and (iii) changed our name from SRKP 9, Inc.
      to Asia Time Corporation. Times Manufacture also paid an aggregate of $350,000
      to the stockholders of SRKP 9, Inc. Times Manufacture was founded in January
      2002 and is based in Hong Kong.





23


With
      respect to this discussion, the terms “we” and “our” refer to Asia Time
      Corporation, its 100%-owned subsidiary Times Manufacture Times Manufacture
      and
      its subsidiaries, Times Manufacturing & E-Commerce Corporation Ltd., TME
      Enterprise Ltd., Citibond Design Ltd. and Megamooch Online Ltd., each of which
      is a British Virgin Islands corporation, and the Hong Kong corporate
      subsidiaries Billion Win International Enterprise Ltd., Goldcome Industrial
      Ltd., Citibond Industrial Ltd., and Megamooch International Ltd. Times
      Manufacture was founded in March 2002 and is based in Hong Kong.





In
      2005,
      we re-aligned the structure and business functions of our subsidiaries to
      clearly define the scopes our business objectives in order to strengthen our
      ability to effectively conduct our business operations. Billion Win
      International Enterprise Limited, or Billion Win, is our central sourcing
      component. Billion Win, which is held indirectly through Times Manufacture,
      procures and imports watch movements and distributes them to suppliers, volume
      users in China, and two of our subsidiaries, Goldcome Industrial Limited, or
      Goldcome, and Citibond Industrial Limited, or Citibond. Goldcome mainly focuses
      it distributions to wholesalers and large manufacturers and Citibond focuses
      on
      distributions to small to medium size manufacturers. Megamooch International
      Limited is a complete watch distributor and exporter targeting overseas buyers.
      Another two subsidiaries, TME Enterprise Ltd. and Citibond Design Ltd., are
      responsible for complete watch design for manufacturers and exporters and
      handles large volume watch movement transactions between buyers and sellers
      solely on a commission basis. Megamooch Online Ltd. operations are focused
      on
      complete watch marketing and distribution, with manufacturing being outsourced,
      and its concentrates on overseas markets.





**Watch
      Movement Segment**





Presently,
      Hong Kong does not generally have watch movement manufacturing. Watch movements
      are largely imported from Japan and Switzerland. The revenue for the watch
      movement segment of our business for the year ended December 31, 2006 was $73
      million, with a gross profit $5.9 million, a 24% and 48% growth respectively,
      compared to 58.8 million revenue and $4.0 million gross profit for the year
      ended December 31, 2005. The gross profit margin increased from 6.7% for the
      year ended December 31, 2005 to 8.1% for the year ended December 31, 2006,
      primarily due to more diversified products being promoted to customers and
      higher selling prices as a result of extended credit terms to our customers. We
      provide a wide product spectrum of products carrying major brands as well as
      middle-low end China movements. We believe carrying a wide product spectrum
      enables us to provide a convenient one-stop provider for our customers, which
      may result in higher sales per customer. We
      began
      to target small to medium manufacturers in mid-2005 and our customer base has
      expanded to more than 300 watch manufacturers. In addition, we have extended
      our
      credit period from an average of 30 days to 60 days to major customers that
      have
      maintained a history of timely settlement of receivables. We believe that this
      extension lead to an increase of purchase orders from those customers. We review
      the credit status of each customer and periodically adjust the credit period
      to
      specific customers in an attempt to maximize business with each customer without
      suffering significant credit risk.





**Complete
      Watch Segment**





Revenue
      of our complete watch segment was $8.1 million for the year ended December
      31,
      2006, a 93% increase compared to the same period in 2005, in which revenue
      was
      $4.2 million. This segment contributed approximately 10% of our revenue in
      2006,
      as compared to 6.7% of revenue for the year ended December 31, 2005. We believe
      the increase was primarily contributed our offering of value-added design
      services to our customers at no extra charge. Our main market positioning in
      China is on the middle-class adult, daily, sporty and classy
      design.





**Recent
      Events**





***Completion
      of the Share Exchange***





On
      December 15, 2006, we entered into a share exchange agreement with the sole
      shareholder of Times Manufacture. Pursuant to the share exchange agreement
      (the
      "Exchange Agreement") we agreed to issue shares of our common stock in exchange
      for all of the issued and outstanding securities of Times Manufacture (the
      "Share Exchange"). The Share Exchange closed on January 23, 2007.





Upon
      the
      closing of the Share Exchange and pursuant to the terms of the Exchange
      Agreement, we issued an aggregate of 19,454,420 shares of our common stock
      to
      the sole shareholder of Times Manufacture in exchange for all of the issued
      and
      outstanding securities of Times Manufacture. Times Manufacture also paid an
      aggregate of $350,000 to the stockholders of SRKP 9, Inc. In addition, prior
      to
      the closing of the Share Exchange and the Private Placement, as described below,
      we effectuated a 1.371188519-for-one stock dividend such that there were
      3,702,209 shares of common stock outstanding immediately prior to the Share
      Exchange and Private Placement. We issued no fractional shares in connection
      with the Share Exchange.





24


Pursuant
      to the terms of the Share Exchange, we agreed to register a total of 3,702,209
      shares of common stock held by our shareholders immediately prior to the Share
      Exchange. Of these shares held by our shareholders, 1,703,017 shares would
      be
      covered by the registration statement filed in connection with the Private
      Placement (described below) and 1,999,192 shares will be included in a
      subsequent registration statement filed by us no later August 24, 2007, which
      is
      six months and 10 days after the date on which we filed the registration
      statement to register the shares issued in the Private Placement.





***The
      Private Placement***





On
      January 23, 2007, concurrently with the close of the Share Exchange, we
      conducted an initial closing of a private placement transaction pursuant to
      which we sold an aggregate of 1,749,028 shares of Series A Convertible Preferred
      Stock at $1.29 per share. On February 9, 2007, we conducted a second and final
      closing of the private placement pursuant to which we sold 501,320 shares of
      Series A Convertible Preferred Stock at $1.29 per share. Accordingly, a total
      of
      2,250,348 shares of Series A Convertible Preferred Stock were sold in the
      private placement for an aggregate gross proceeds of $2,902,946 (the "Private
      Placement"). Of the gross proceeds, $50,000 is represented by a subscription
      receivable from one investor. WestPark Capital, Inc. ("WestPark") acted as
      the
      placement agent for the Private Placement. For its services as placement agent,
      WestPark received an aggregate fee of approximately $261,265, which consisted
      of
      a commission equal to 9.0% of the gross proceeds from the financing. After
      commissions and expenses, we received net proceeds of approximately $2.3 million
      in the Private Placement.





Pursuant
      to Subscription Agreements entered into with the investors in the Private
      Placement, each share of the Series A Convertible Preferred Stock is convertible
      into shares of common stock at a conversion price equal to the per share
      purchase price. However, if we, at any time prior to the first trading day
      on
      which our common stock is quoted on the American Stock Exchange, Nasdaq Capital
      Market, Nasdaq Global Market or New York Stock Exchange (each a "Trading
      Market") sell or issue any shares of common stock in one or a series of
      transactions at an effective price less than such conversion price where the
      aggregate gross proceeds to us are at least $1.0 million, then the
      aforementioned conversion price shall be reduced to such effective price. Each
      share of the Series A Convertible Preferred Stock shall automatically convert
      into shares of common stock if (i) the closing price of our common stock on
      the Trading Market for any 10 consecutive trading day period exceeds $3.00
      per
      share, (ii) the shares of common stock underlying the Series A Convertible
      Preferred Stock are subject to an effective registration statement, and
      (iii) the daily trading volume of the common stock on a Trading Market
      exceeds 25,000 shares per day for 10 out of 20 prior trading days. Upon
      liquidation, the holders of the Series A Convertible Preferred Stock shall
      receive $1.29 per share of the Series A Convertible Preferred Stock then held
      prior to any other distribution or payment made to holders of the common stock.




We
      agreed
      to and did file a registration statement covering the common stock underlying
      the Series A Convertible Preferred Stock sold in the Private Placement within
      30
      days of the closing of the Share Exchange pursuant to the subscription agreement
      with each investor. The investors in the Private Placement also entered into
      a
      lock up agreement pursuant to which they agreed not to sell their shares until
      our common stock begins to be listed or quoted on the New York Stock Exchange,
      American Stock Exchange, NASDAQ Global Market, NASDAQ Capital Market or the
      OTC
      Bulletin Board, after which their shares will automatically be released from
      the
      lock up every 30 days on a pro rata over a nine month period beginning on the
      date that is 30 days after listing or quotation of the shares.





In
      connection with the Private Placement, Kwong Kai Shun, our Chairman of the
      Board, Chief Executive Officer and Chief Financial Officer, entered into an
      agreement (the “Escrow Agreement”) with the investors pursuant to which he
      agreed to purchase all of the shares of Series A Preferred Stock then held
      by
      such investors at a per share purchase price of $1.29 if our common stock fails
      to be listed or quoted for trading on the American Stock Exchange, the Nasdaq
      Capital Market, the Nasdaq Global Market or the New York Stock Exchange on
      or
      before an agreed upon date. In addition, Mr. Kwong agreed to place 2,326,000
      shares of his common stock in escrow for possible distribution to the investors
      (the "Escrow Shares"). Pursuant to the Escrow Agreement, if our net income
      for
      2006 or 2007, subject to specified adjustments, as set forth in our filings
      with
      the SEC is less than $6.3 million or $7.7 million, respectively, a portion,
      if
      not all, of the Escrow Shares will be transferred to the investors based upon
      our actual net income, if any, for such fiscal years. We will account for the
      Escrow Shares as the equivalent of a performance-based compensatory stock plan
      between Mr. Kwong and us. Accordingly, during the year ended December 31, 2007,
      we expect to record $2,433,650 as a charge to operations to recognize the grant
      date fair value of stock-based compensation in conjunction with the Escrow
      Agreement, as described above.





25


Some
      of
      the controlling shareholders, control persons of WestPark were also, prior
      to
      the completion of the Share Exchange, shareholders and/or control persons of
      our
      company, including Richard Rappaport, who is the Chief Executive Officer of
      WestPark and was the President and a significant shareholder of our company
      prior to the Share Exchange, Anthony C. Pintsopoulos, who is the Chief Financial
      Officer of WestPark and an officer, director and significant shareholder of
      our
      company prior to the Share Exchange and Kevin DePrimio and Jason Stern, each
      employees of WestPark and shareholders of our company prior to the Share
      Exchange. Each of Messrs. Rappaport and Pintsopoulos resigned from all of their
      executive and director positions with our company upon the closing of the Share
      Exchange. Affiliates of WestPark who own shares of our common stock have agreed
      to a lock-up whereby they shall not sell an aggregate of 1,528,933 shares of
      common stock held by them until that date which is nine months from the day
      that
      our common stock begins to be traded on either the New York Stock Exchange,
      American Stock Exchange, NASDAQ Global Market, NASDAQ Capital Market, the OTC
      Bulletin Board or the Pink Sheets.





***Critical
      Accounting Policies and Estimates***





Financial
      Reporting Release No. 60 recommends that all companies include a discussion
      of
      critical accounting policies used in the preparation of their financial
      statements. The Securities and Exchange Commission (“SEC”) defines critical
      accounting policies as those that are, in management's view, most important
      to
      the portrayal of our financial condition and results of operations and those
      that require significant judgments and estimates.





The
      preparation of these consolidated financial statements requires our management
      to make estimates and assumptions that affect the reported amounts of assets,
      liabilities, revenues and expenses, as well as the disclosure of contingent
      assets and liabilities at the date of our financial statements. We base our
      estimates on historical experience, actuarial valuations and various other
      factors that we believe to be reasonable under the circumstances, the results
      of
      which form the basis for making judgments about the carrying value of assets
      and
      liabilities that are not readily apparent from other sources. Some of those
      judgments can be subjective and complex and, consequently, actual results may
      differ from these estimates under different assumptions or conditions. While
      for
      any given estimate or assumption made by our management there may be other
      estimates or assumptions that are reasonable, we believe that, given the current
      facts and circumstances, it is unlikely that applying any such other reasonable
      estimate or assumption would materially impact the financial statements. The
      accounting principles we utilized in preparing our consolidated financial
      statements conform in all material respects to generally accepted accounting
      principles in the United States of America.





*Impairment
      of long-lived assets*





The
      long-lived assets held and used by us are reviewed for impairment whenever
      events or changes in circumstances indicate that the carrying amount of assets
      may not be recoverable. It is reasonably possible that these assets could become
      impaired as a result of technology or other industry changes. Determination
      of
      recoverability of assets to be held and used is by comparing the carrying amount
      of an asset to future net undiscounted cash flows to be generated by the
      assets.





If
      such
      assets are considered to be impaired, the impairment to be recognized is
      measured by the amount by which the carrying amount of the assets exceeds the
      fair value of the assets. Assets to be disposed of are reported at the lower
      of
      the carrying amount of fair value less costs to sell.





*Inventories*





Inventories
      are stated at the lower of cost or market. Cost is determined on a first-in,
      first-out basis and includes only purchase costs. There are no significant
      freight charges, inspection costs and warehousing costs incurred for any of
      the
      periods presented. In assessing the ultimate realization of inventories,
      management makes judgments as to future demand requirements compared to current
      or committed inventory levels. We have vendor arrangements on the purchase
      of
      watch movements providing for price reduction paid in the form of additional
      watch movements. The percentage of additional movements to be received by us
      from these vendors is estimated and inventory costs are reduced to reflect
      the
      effect of these additional movements on the actual cost of the items in
      inventory. During the years ended December 31, 2006, 2005 and 2004, we did
      not
      make any allowance for slow-moving or defective inventories.





26


We
      evaluate our inventories for excess, obsolescence or other factors rendering
      inventories as unsellable at normal gross profit margins. Write-downs are
      recorded so that inventories reflect the approximate market value and take
      into
      account our contractual provisions with our suppliers governing price
      protections and stock rotations. Due to the large number of transactions and
      complexity of managing the process around price protections and stock rotations,
      estimates are made regarding the valuation of inventory at market
      value.





In
      addition, assumptions about future demand, market conditions and decisions
      to
      discontinue certain product lines can impact the decision to write-down
      inventories. If assumptions about future demand change and/or actual market
      conditions are different than those projected by management, additional
      write-downs of inventories may be required. In any case, actual results may
      be
      different than those estimated.





*Trade
      receivables*





Trade
      and
      other receivables are recognized initially at fair value and subsequently
      measured at amortized cost using the effective interest method, less provision
      for impairment. A provision for impairment of trade and other receivables is
      established when there is objective evidence that we will not be able to collect
      all amounts due according to the original terms of receivables. The amount
      of
      the provision is the difference between the asset’s carrying amount and the
      present value of estimated future cash flows, discounted at the effective
      interest rate. The amount of the provision is recognized in the income
      statement.





*Foreign
      currency translation*





Our
      consolidated financial statements are presented in United States dollars. Our
      functional currency is the Hong Kong Dollar (HKD). Our consolidated financial
      statements are translated into United States dollars from HKD at period-end
      exchange rates as to assets and liabilities and average exchange rates as to
      revenues and expenses. Capital accounts are translated at their historical
      exchange rates when the capital transactions occurred.





*Revenue
      recognition*





Sales
      of
      goods represent the invoiced value of goods, net of sales returns, trade
      discounts and allowances. We recognize revenue when the goods are delivered
      and
      the customer takes ownership and assumes risk of loss, collection of the
      relevant receivable is probable, persuasive evidence of an arrangement exists,
      and the sales price is fixed or determinable. We provide pre- and post- sales
      service to our customers related to inventory management information in order
      to
      facilitate and manage sales to customers. Our integration, design and
      development and management services provide customers with watch design
      assistance, components outsourcing or other project support, and are generally
      completed prior to a sale and do not continue post-delivery. There is no
      requirement that these services be provided for a sale to take place, nor is
      there any objective or reliable evidence of a separate fair value, or if no
      longer offered or ceased to be offered would a right of return be created for
      the goods sold. We believe these services are part of the sales process and
      are
      not a customer deliverable, and are therefore charged to selling expense or
      cost
      of sales, as appropriate.





*Deferred
      income tax*





Deferred
      income tax is provided in full, using the liability method, on temporary
      differences arising between the tax bases of assets and liabilities and their
      carrying amounts in the consolidated financial statements. However, if the
      deferred income tax arises from initial recognition of an asset or liability
      in
      a transaction other than a business combination that at the time of the
      transaction affects neither accounting nor taxable profit or loss, it is not
      accounted for. Deferred income tax is determined using tax rates (and laws)
      that
      have been enacted or substantially enacted by the balance sheet date and are
      expected to apply when the related deferred income tax assets is realized or
      the
      deferred income tax liability is settled.





*Stock-based
      compensation*





Effective
      January 1, 2006, we adopted SFAS No. 123 (revised 2004), “Share-Based Payment”
(“SFAS 123R”), a revision to SFAS No. 123, “Accounting for Stock-Based
      Compensation”. SFAS 123R requires that we measure the cost of employee services
      received in exchange for equity awards based on the grant date fair value of
      the
      awards, with the cost to be recognized as compensation expense in our financial
      statements over the vesting period of the awards. Accordingly, we recognize
      compensation cost for equity-based compensation for all new or modified grants
      issued after December 31, 2005. We account for stock option and warrant grants
      issued and vesting to non-employees in accordance with EITF 96-18, “Accounting
      for Equity Instruments that are Issued to Other Than Employees for Acquiring,
      or
      in Conjunction with Selling, Goods or Services”, and EITF 00-18, “Accounting
      Recognition for Certain Transactions involving Equity Instruments Granted to
      Other Than Employees”, whereas the value of the stock compensation is based upon
      the measurement date as determined at either (a) the date at which a performance
      commitment is reached or (b) at the date at which the necessary performance
      to
      earn the equity instruments is complete.





27


We
      did
      not recognize any stock-based compensation during the years ended December 31,
      2006, 2005 and 2004. During the year ended December 31, 2007, we expect to
      record $2,433,650 as a charge to operations to recognize the grant date fair
      value of stock-based compensation in conjunction with the Escrow Agreement,
      as
      described above.





**Results
      of Operations**





The
      following table sets forth certain items in our statement of operations as
      a
      percentage of net sales for the periods shown:




**Year
                ended December 31,****2006**
            
            **2005**
            
            **2004**Net
                sales
            
            
            100.0
            %
            
            100.0
            %
            
            100.0
            %Cost
                of sales
            
            
            88.1
            %
            
            90.4
            %
            
            94.7
            %Gross
                profit
            
            
            11.9
            %
            
            9.6
            %
            
            5.3
            %Other
                income –
                Note
                4
            
            
            0.5
            %
            
            1.5
            %
            
            -Depreciation
            
            
            0.4
            %
            
            0.4
            %
            
            0.3
            %Administrative
                and other operatingexpenses,
                including stock-basedcompensation
            
            
            1.6
            %
            
            2.3
            %
            
            3.7
            %Income
                from operations
            
            
            10.4
            %
            
            8.4
            %
            
            1.3
            %Fees
                and costs related to reverse merger
            
            
            -
            
            
            -
            
            
            -Other
                income - Note 4
            
            
            0.3
            %
            
            0.2
            %
            
            0.1
            %Interest
                expenses – Note 5
            
            
            1.3
            %
            
            0.8
            %
            
            0.5
            %Income
                before taxes
            
            
            9.4
            %
            
            7.8
            %
            
            0.9
            %Income
                taxes - Note 6
            
            
            1.6
            %
            
            1.4
            %
            
            0.3
            %Net
                income
            
            
            7.8
            %
            
            6.4
            %
            
            0.6
            %





***Comparison
      of year ended December 31, 2006 (“Fiscal 2006”) with year ended
      December 31, 2005 (“Fiscal 2005”)***





Net
      sales
      for the year ended December 31, 2006 were $81.1 million compared to $63.1
      million for the comparable period in 2005, an increase of 28.6%. This increase
      was largely due to the improved sales of watch movements and completed watches.
      Sales of watch movements for the year ended December 31, 2006 were $73.0 million
      compared to $58.8 million for the comparable period in 2005 an increase of
      24.1%. The increase was primary due to the increase of volume from 72.9 million
      to 97.8 million pieces, an increase of 34.2%. Sales of completed watches for
      the
      year ended December 31, 2006 was $8.1 million compared to $4.2 million for
      the
      comparable period in 2005, an increase of 90.9%.





Cost
      of
      sales consists of cost of purchases, net of discounts and returns. Cost of
      sales
      was $71.5 million for the year ended December 31, 2006 as compared to $57.0
      million for the comparable period in 2005. As a percentage of net sales, cost
      of
      sales decreased to 88.1% for the year ended December 31, 2006 compared to 90.4%
      for the comparable period in 2005. The increase in total dollars was
      attributable to higher costs associated with our products and the decrease
      as a
      percentage of net sales was attributable to improved economy of scale and more
      trading volume of watch movements. Our increase in revenue was 28.6% and our
      increase in cost of sales was 25.4% for Fiscal 2006 compared to Fiscal
      2005.





28


Gross
      profit for the year ended December 31, 2006 were $9.6 million, or 11.9% of
      net
      sales, compared to $6.1 million, or 9.6% of net sales for the comparable period
      in 2005. Management considers gross profit to be a key performance indicator
      in
      managing our business. Gross profit margins are usually a factor of product
      mix
      and demand for product. The increase of profit margin was primarily attributable
      to i) the economies of scale, where we can get a lower cost for the sales,
      and
      ii) the improved profit margin by higher mark-up prices as a result of extended
      credit terms to our customers. Together, the profit margin of movements as
      a
      percentage of net sales had increased to 8.0% for the year ended December 31,
      2006 as compared to 6.4% of net sales for same period in 2005. There was a
      slight decrease of profit margin for completed watches for the year ended
      December 31, 2006 to 47.2% of net sales as compared to 53.8% for the same period
      of 2005. This was primarily due to the increase of sales of basic units in
      2006
      which had a lower profit margin. However, this decrease was offset by the
      increase of profit margin in movement segment, which accounted for 90% of the
      total sales in 2006.





Other
      income from operation was $424,016 or 0.5% of net sales for Fiscal 2006, as
      compared to $938,573, or 1.5% of net sales for Fiscal 2005. The decrease in
      income from operation was attributable to the lack of commission income in
      Fiscal 2006 as compared to $771,432 in Fiscal 2005. This was the commission
      received for connecting buyers and sellers in China. The decrease in income
      from
      operation was partially offset by a one time income of $210,594 derived from
      the
      selling of intangible assets and a rental income of $46,284 in Fiscal 2006,
      which was the rent received from our company-owned properties.





Administrative
      and other operating expenses were $1.3 million or 1.6% of net sales for
      Fiscal 2006, as compared to $1.4 million, or 2.3% of net sales, for Fiscal
      2005. The decrease as a percentage of net sales was primarily attributable
      to
      economies of scale. Management considers these expenses as a percentage of
      net
      sales to be a key performance indicator in managing our business.





Other
      income from non-operation was $237,571 or 0.3% of net sales for Fiscal 2006,
      as
      compared to $156,199, or 0.3% of net sales for Fiscal 2005. The increase was
      primarily due to the increase in bank interest, which was $208,854 for Fiscal
      2006 and $76,358 for Fiscal 2005 partially offset by a decrease in other
      interest income of $18,635 and $49,440 for Fiscal 2006 and Fiscal 2005
      respectively.





Interest
      expense increased to $1.1 million for Fiscal 2006, compared to $514,637 for
      Fiscal 2005. This increase is primarily attributable to higher borrowing levels
      to maintain adequate inventory, and higher borrowing rates. Further increases
      in
      borrowing rates would further increase our interest expense, which would have
      a
      negative effect on our results of operations.





Income
      taxes for Fiscal 2006 were $1.3 million, or 1.6% of net sales, as compared
      to
      $911,687 for Fiscal 2005, or 1.4% of net sales. The decrease of effective income
      tax rates from 18.5% for Fiscal 2005 to 17.1% for Fiscal 2006 is primarily
      due
      to increase in income not subject to tax by $30,000 and decrease in unused
      tax
      losses not recognized by $50,000 for Fiscal 2006. Unused tax losses not
      recognized represents valuation allowances established to reduce deferred tax
      assets to the amount expected to be realized.




Net
      income for Fiscal 2006 was $6.3 million, compared to net income of $4.0 million
      for Fiscal 2005.





***Comparison
      of year ended December 31, 2005 (“Fiscal 2005”) with year ended
      December 31, 2004 (“Fiscal 2004”)***





Net
      sales
      for the year ended December 31, 2005 were $63.1 million compared to $36.6
      million for the comparable period in 2004, an increase of 72.6%. This increase
      was largely due to the improved sales of watch movements and the introduction
      of
      completed watches segment. Sales of watch movements for the year ended December
      31, 2005 were $58.8 million, compared to $36.5 million for the comparable period
      in 2004, an increase of 61.1%. The increase was primary due to the increase
      of
      volume from 31.7 million to 72.9 million pieces, an increase of 130%. There
      was
      only small change in the selling price of most of the movements in this period;
      however, there was much stronger increase in basic units than that in high-end
      units. Sales of completed watch for the year ended December 31, 2005 was $4.2
      million, there were no sales of completed watches in for the comparable period
      in 2004.





Cost
      of
      sales consists of cost of purchases, net of discounts and returns. Cost of
      sales
      for the year ended December 31, 2005 was $57.0 million, as compared to $34.6
      million for the comparable period in 2004. As a percentage of net sales, cost
      of
      sales decreased to 90.4% for the year ended December 31, 2005, compared to
      94.7%
      for the comparable period in 2004. The increase in total dollars was
      attributable to higher costs associated with our products and the decrease
      as a
      percentage of net sales was attributable to improved economy of
      scale.





29


Gross
      profit for the year ended December 31, 2005 was $6.1 million, or 9.6% of net
      sales, compared to $1.9 million, or 5.3% of net sales for the comparable period
      in 2004. Management considers gross profit to be a key performance indicator
      in
      managing our business. Gross profit margins are usually a factor of product
      mix
      and demand for product. The increase of profit margin was primarily attributable
      to i) the economies of scale, where we can get a lower cost for the sales,
      and
      ii) the introduction of the completed watches segment, which had a 53.8% profit
      margin as a percentage of net sales compared to the 6.4% of net sales of
      movements in 2005.





Other
      income from operation was $938,573 or 1.5% of net sales for Fiscal 2005 as
      compared to zero in Fiscal 2004. The income from operation in Fiscal 2005 was
      from the commission income of $771,432, which was the commission received for
      connecting buyers and sellers in China and a license fee income of $167,141.
      There were no such activities in 2004.





Administrative
      and other operating expenses were $1.4 million, or 2.3% of net sales, for
      Fiscal 2005, as compared to $1.3 million, or 3.7% of net sales, for Fiscal
      2004. The decrease as a percentage of net sales was attributable to economy
      of
      scale.





Other
      income from non-operation was $156,199 or 0.3% of net sales for Fiscal 2005,
      as
      compared to $28,047, or 0.0% of net sales for Fiscal 2004. The increase as
      a
      percentage of net sales was attributable to a number of factors. Bank interest
      income was $76,358 in Fiscal 2005, compared to $15,720 in Fiscal 2004 a yearly
      growth of 385.7% from Fiscal 2004 to 2005. There were net exchange gains in
      the
      fluctuation of exchange rates in both Fiscal 2005 and Fiscal 2004 of $1,302
      and
      $170, respectively. Other interest income in Fiscal 2005 was $49,440. There
      is
      no such income in 2004.





Interest
      expense increased to $514,637 for Fiscal 2005, compared to $164,558 for Fiscal
      2004. This increase is primarily attributable to higher borrowing levels to
      maintain adequate inventory, and higher borrowing rates.





Income
      taxes for Fiscal 2005 were $911,687, or 1.4% of net sales, as compared to
      $131,951 for Fiscal 2004, or 0.4% of net sales. The decrease of effective income
      tax rates from 39.2% for Fiscal 2004 to 18.5% for Fiscal 2005 is primarily
      due
      to decrease in unused tax losses not recognized by $67,000. Unused tax losses
      not recognized represents valuation allowances established to reduce deferred
      tax assets to the amount expected to be realized.




During
      Fiscal 2005, we recorded a provision for income taxes of $949,000.





Net
      income for Fiscal 2005 was $4.0 million, compared to net income of $204,958
      for
      Fiscal 2004.





**Liquidity
      and Capital Resources**





To
      provide liquidity and flexibility in funding our operations, we borrow amounts
      under bank facilities and other external sources of financing. As of December
      31, 2006 we had general banking facilities amounted to $13.7 million for
      overdraft, letter of credit, trust receipt, invoice financing and export loans
      granted by ten banks. Interest on the facilities ranged from minus 2.0 to 0.75%
      over the Bank’s Best Lending Rate of Hong Kong (Prime Rate) or Hong Kong Inter
      Bank Offered Rate (HIBOR). These banking facilities were secured by the
      leasehold properties, time deposits and held-to maturity investments of the
      group and personal guarantees executed by our Chairman of the
      Board.





On
      January 23, 2007, concurrently with the close of the Share Exchange, we
      conducted an initial closing of a private placement transaction pursuant to
      which we sold an aggregate of 1,749,028 shares of Series A Convertible Preferred
      Stock at $1.29 per share. On February 9, 2007, we conducted a second and final
      closing of the private placement pursuant to which we sold 501,320 shares of
      Series A Convertible Preferred Stock at $1.29 per share. Accordingly, a total
      of
      2,250,348 shares of Series A Convertible Preferred Stock were sold in the
      private placement for an aggregate gross proceeds of $2,902,946 (the “Private
      Placement”). Of the gross proceeds, $50,000 is represented by a subscription
      receivable from one investor. WestPark Capital, Inc. (“WestPark”) acted as the
      placement agent for the Private Placement. For its services as placement agent,
      WestPark received an aggregate fee of approximately $261,265, which consisted
      of
      a commission equal to 9.0% of the gross proceeds from the financing. After
      commissions and expenses, we received net proceeds of approximately $2.3 million
      in the Private Placement.





30




Pursuant
      to Subscription Agreements entered into with the investors in the Private
      Placement, each share of the Series A Convertible Preferred Stock is convertible
      into shares of common stock at a conversion price equal to the per share
      purchase price. However, if we, at any time prior to the first trading day
      on
      which our common stock is quoted on the American Stock Exchange, Nasdaq Capital
      Market, Nasdaq Global Market or New York Stock Exchange (each a “Trading
      Market”) sell or issue any shares of common stock in one or a series of
      transactions at an effective price less than such conversion price where the
      aggregate gross proceeds to us are at least $1.0 million, then the
      aforementioned conversion price shall be reduced to such effective price. Each
      share of the Series A Convertible Preferred Stock shall automatically convert
      into shares of common stock if (i) the closing price of our common stock on
      the Trading Market for any 10 consecutive trading day period exceeds $3.00
      per
      share, (ii) the shares of common stock underlying the Series A Convertible
      Preferred Stock are subject to an effective registration statement, and
      (iii) the daily trading volume of the common stock on a Trading Market
      exceeds 25,000 shares per day for 10 out of 20 prior trading days. Upon
      liquidation, the holders of the Series A Convertible Preferred Stock shall
      receive $1.29 per share of the Series A Convertible Preferred Stock then held
      prior to any other distribution or payment made to holders of the common stock.





We
      agreed
      to file, and did file, a registration statement covering the common stock
      underlying the Series A Convertible Preferred Stock sold in the Private
      Placement within 30 days of the closing of the Share Exchange pursuant to the
      subscription agreement with each investor.





For
      the
      year ended December 31, 2006, net cash provided by operating activities was
      $190,906, as compared to net cash used in operating activities of $445,644
      and
      $422,275 for the comparable period in 2005 and 2004. The increase in net cash
      provided by operating activities in Fiscal 2006 was primarily attributable
      to an
      increase in net income of 6.3 million, partially offset by an increase in cash
      used for accounts receivable of $3.4 million, prepaid expenses and other
      receivables of $1.7 million, accounts payable of $462,658, income tax payable
      of
      $701,921 and a decrease in unearned revenue of $1.6 million. The increase in
      cash used for accounts receivable was primarily attributable to an increase
      in
      net sales of 28.6% for fiscal year 2006 as compared to fiscal year 2005. The
      increase in cash used for prepaid expenses and other receivables was primarily
      attributable to an increase in purchase deposits paid from $361,000 of fiscal
      year 2005 to $1.5 million of fiscal year 2006 and the sales proceed of
      intangible assets receivable of $301,000. The decrease in cash used for accounts
      payable was primarily attributable to an increase utilization of bank borrowings
      to settle purchase costs. The increase in cash used for income tax payable
      of
      $701,921 was attributable to the settlement of income taxes incurred in fiscal
      year 2005. The decrease in unearned revenue was due to (i) the recognition
      of
      the unearned revenue and (ii) payment for the completed watch when the warranty
      period was due. The increase in net cash used in operating activities in the
      Fiscal 2005 was primarily attributable to an increase in accounts receivable
      of
      $1.4 million, an increase in inventories of $2.4 million and a decrease in
      unearned revenue of $1.6 million, partially offset by an increase in net income
      of $4.0 million. The increase in net income and account receivable were
      attributable to the increase in sales in Fiscal 2005 as compared to Fiscal
      2004.
      Inventories were also increased for an expected increase in sales. The decrease
      in unearned revenue was due to the recognition of the unearned revenue and
      payment for the completed watch was made when the warranty period was due.
      For
      Fiscal 2004, the increase in net cash used in operating activities was primarily
      attributable to an increase in accounts receivable of $2.0 million and an
      increase in inventories of $2.6 million, partially offset by an increase in
      unearned revenue of $3.2 million and net income of $0.2 million. The increase
      in
      accounts receivable was due to the extended aging. The increase in inventories
      was due to an expected increase in sales. The increase in unearned revenue
      was
      due to the warranty period of the completed watch sold, where payment was
      recognized as income until the warranty period was due.





Net
      cash
      used in investing activities was $859,823 for the year ended December 31, 2006,
      which was relatively similar to the $875,395 in cash used for the comparable
      period in 2005. The net cash used in investing activities in Fiscal 2006
      reflected the acquisition of two properties for $618,025 which were pledged
      for
      banking facilities and the acquisition of manufacturing facilities for the
      completed watches segment, offset by the disposal of an intangible asset of
      $300,849 and disposal of equipment of $2,031. The net cash used in investing
      activities in Fiscal 2005 was due to the acquisition of a property of $330,884
      and a held-to-maturity investment fund which were pledged for banking
      facilities, and the acquisition of plant and equipment of $243,504 and
      acquisition of furniture and fixtures. The net cash used in investing activities
      in Fiscal 2004 was due to the acquisition of certain intangible assets, and
      acquisition of manufacturing facilities for the completed watches
      segment.





Net
      cash
      provided by financing activities was $0.20 million for the year ended December
      31, 2006 as compared to $1.18 million and $2.77 million for the comparable
      period in 2005 and 2004, respectively. The decrease in net cash provided by
      financing activities was attributable to dividends paid of $2.45 million in
      2006
      as compared to $642,848 in 2005. The bank borrowing for Fiscal 2005 was
      increased to $10 million as compared to $7.4 million for Fiscal 2004. The total
      borrowing amount was granted by ten different banks for overdraft, letters
      of
      credit, trusts receipts, invoices financing and export loans. Interest on the
      facilities ranged from minus 1.5 to 0.5% over the Bank’s Best Lending Rate of
      Hong Kong (Prime Rate) or Hong Kong Inter Bank Offered Rate (HIBOR). The
      decrease in net cash provided by financing activities is primarily attributable
      to dividends paid of $642,000 for Fiscal 2005.





31


For
      fiscal year 2006, 2005 and 2004, our inventory turnover was 10.8, 10.8 and
      13.2
      times, respectively. During 2004, our stock level was kept at a relatively
      low
      level to improve cash flow however, we also risked stock shortage. In 2005
      and
      2006 we increased our stock level and, thus, the turnover ratio to a more
      optimal level of 10.8. We expect the turnover ratio will further decrease in
      2007 as the order delivery cycle time of our supplies has shortened, possibly
      allowing us to keep a lower stock level with a decreased risk of stock
      shortages. The average days outstanding of our accounts receivable at December
      31, 2006 were 29 days, as compared to 24 days and 10.8 days at December 31,
      2005
      and 2004. The increase in accounts receivable was due to the change in credit
      policy since 2005 where credit terms of up to 30 days were given to customers
      who had good credit history in order to improve our profit margin and
      competitiveness.





In
      an
      attempt to reduce our reliance on third-party watch movement manufacturers,
      we
      have plans to manufacture our own brands of quartz movements and mechanical
      movements in-house. To manufacture our own brands of quartz and mechanical
      movements in-house, we would need to acquire watch movement facilities in China
      and invest in new equipment and research and development. We expect that up
      to
      $5.5 million will be required to obtain the equipment and facilities to
      manufacture branded proprietary watch movements. Our plan to acquire
      manufacturing facilities and equipment to manufacture our own brand of quartz
      and mechanical movements in-house will not take place until after the completion
      of our initial public offering, the proceeds of which will give us a portion
      of
      the required capital. We will be required to raise the appropriate amount of
      capital needed for our future operations from future equity sales or through
      debt financings. Failure to obtain funding when needed may force us to delay,
      reduce, or eliminate our plans to manufacture our own watch movement parts.
      We
      may not be able to obtain additional financial resources when necessary or
      on
      terms favorable to us, if at all, and any available additional financing may
      not
      be adequate. Moreover, new equity securities issued in financings, including
      any
      shares of Series A Convertible Preferred Stock or any new series of preferred
      stock authorized by our Board of Directors, may have greater rights, preferences
      or privileges than our existing common stock. To the extent stock is issued
      or
      options and warrants are exercised, holders of our common stock will experience
      further dilution.





Based
      on
      our current plans, we believe that cash on hand, cash flow from operations
      and
      funds available under our bank facilities will be sufficient to fund our capital
      needs for the next 12 months. However, our ability to maintain sufficient
      liquidity depends partially on our ability to achieve anticipated levels of
      revenue, while continuing to control costs. If we did not have sufficient
      available cash, we would have to seek additional debt or equity financing
      through other external sources, which may not be available on acceptable terms,
      or at all. Failure to maintain financing arrangements on acceptable terms would
      have a material adverse effect on our business, results of operations and
      financial condition.





**Off-Balance
      Sheet Arrangements**





Other
      than the Escrow Agreement and Escrow Shares, as described above, we do not
      have
      any off-balance sheet debt, nor do we have any transactions, arrangements or
      relationships with any special purpose entities.





**Contractual
      Obligations**





Other
      than those commitments and obligations being entered into in the normal course
      of business, we do not have any additional, material capital commitments and
      obligations due to other parties.





**Inflation
      and Seasonality**




Inflation
      and seasonality have not had a significant impact on our operations during
      the
      last two fiscal years.




**Change
      In Accountants**





On
      February 23, 2007, we dismissed AJ. Robbins, PC (“AJ. Robbins”) as our
      independent registered public accounting firm. We engaged AJ. Robbins to audit
      our financial statements for the period from January 3, 2006 (inception) to
      February 28, 2006 (collectively, the “Audited Financial Statements”). The
      decision to change accountants was approved and ratified by our Board of
      Directors. The report of AJ. Robbins on the Audited Financial Statements did
      not
      contain any adverse opinion or disclaimer of opinion and was not qualified
      or
      modified as to uncertainty, audit scope, or accounting principle, except for
      an
      explanatory paragraph relative to our ability to continue as a going concern.
      During the period beginning from the time we engaged AJ. Robbins as our auditors
      through February 23, 2007, there have been no disagreements with AJ. Robbins
      on
      any matter of accounting principles or practices, financial statement
      disclosure, or auditing scope or procedure with respect us, which disagreements
      if not resolved to the satisfaction of AJ. Robbins would have caused AJ. Robbins
      to make reference to the subject matter of the disagreements in connection
      with
      its reports on our financial statements for such periods.  We
      have
      engaged Dominic KF Chan & Co. as our independent registered public
      accounting firm, which was the independent registered public accounting firm
      for
      Times Manufacture prior to the Share Exchange.





32


**New
      Accounting Pronouncements**





In
      February 2006, the FASB issued SFAS No. 155, Accounting for Certain Hybrid
      Financial Instruments, which amends SFAS No. 133, Accounting for Derivative
      Instruments and Hedging Activities (“SFAS No. 155”), and SFAS No. 140,
      Accounting for Transfers and Servicing of Financial Assets and Extinguishments
      of Liabilities. SFAS No. 155 simplifies the accounting for certain derivatives
      embedded in other financial instruments by allowing them to be accounted for
      as
      a whole if the holder elects to account for the whole instrument on a fair
      value
      basis. SFAS No. 155 also clarifies and amends certain other provisions of SFAS
      No. 133 and SFAS No. 140. SFAS No. 155 is effective for all financial
      instruments acquired, issued or subject to a remeasurement event occurring
      in
      fiscal years beginning after September 15, 2006. Earlier adoption is permitted,
      provided we have not yet issued financial statements, including for interim
      periods, for that fiscal year. We do not believe the adoption of SFAS No. 155
      will have a material impact on our consolidated financial position or results
      of
      operations.




The
      FASB
      released SFAS No. 156, “Accounting for Servicing of Financial Assets,” to
      simplify accounting for separately recognized servicing assets and servicing
      liabilities. SFAS No. 156 amends SFAS No. 140, “Accounting for Transfers and
      Servicing of Financial Assets and Extinguishments of Liabilities.” SFAS No. 156
      permits an entity to choose either the amortization method or the fair value
      measurement method for measuring each class of separately recognized servicing
      assets and servicing liabilities after they have been initially measured at
      fair
      value. SFAS No. 156 applies to all separately recognized servicing assets and
      liabilities acquired or issued after the beginning of an entity’s fiscal year
      that begins after September 15, 2006. SFAS No. 156 will be effective for us
      as
      of December 31, 2006, the beginning of our 2007 fiscal year. We do not believe
      the adoption of SFAS No. 156 will have a material impact on our consolidated
      financial position or results of operations.





In
      July
      2006, the FASB issued FIN 48 “Accounting for Uncertainty in Income Taxes.” This
      interpretation requires that we recognize in our financial statements, the
      impact of a tax position, if that position is more likely than not of being
      sustained on audit, based on the technical merits of the position. The
      provisions of FIN 48 are effective as of the beginning of our 2007 fiscal year,
      with the cumulative effect of the change in accounting principle recorded as
      an
      adjustment to opening retained earnings. We are currently evaluating the effect
      of FIN 48 on our financial statements and do not believe the adoption of FIN
      No.
      48 will have a material impact on our consolidated financial position or results
      of operations.





In
      September 2006, the FASB issued SFAS No. 157 “Fair Value Measurement” (“SFAS
      157”). SFAS 157 defines fair value, establishes a framework for measuring fair
      value, and expands disclosures about fair value measurements. This Statement
      shall be effective for financial statements issued for fiscal years beginning
      after November 15, 2007, and interim periods within those fiscal years. Earlier
      application is encouraged, provided that the reporting entity has not yet issued
      financial statements for that fiscal year, including any financial statements
      for an interim period within that fiscal year. The provisions of this statement
      should be applied prospectively as of the beginning of the fiscal year in which
      this Statement is initially applied, except in some circumstances where the
      statement shall be applied retrospectively. We are currently evaluating the
      effect, if any, of SFAS 157 on our financial statements. Although we will
      continue to evaluate the provisions of SFAS No. 157, management currently does
      not believe the adoption of SFAS No. 157 will have a material impact on our
      consolidated financial statements.





The
      FASB
      released SFAS No. 158, “Employers’ Accounting for Defined Benefit Pension and
      Other Postretirement Plans: an amendment of FASB Statements No. 87, 88, 106,
      and
      132(R),” which requires an employer to recognize the over funded or under funded
      status of defined benefit and other postretirement plans 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 an adjustment
      to comprehensive income. This statement also requires 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. We are required to initially recognize the
      funded status of our defined benefit and other postretirement plans as of
      December 31, 2006, and to provide the required disclosures in our 2006 annual
      report on Form 10-KSB. The adoption of SFAS No. 158 has no material effect
      on
      our financial statements.





33


On
      February 15, 2007, the FASB issued SFAS No. 159, “The Fair Value Option for
      Financial Assets and Financial Liabilities – Including
      an
      Amendment of SFAS No. 115.” The fair value option established by SFAS No. 159
      permits all entities to choose to measure eligible items at fair value at
      specified election dates. A business entity will report unrealized gains and
      losses on items for which the fair value option has been elected in earnings
      (or
      another performance indicator if the business entity does not report earnings)
      at each subsequent reporting date. The fair value option: (a) may be applied
      instrument by instrument, with a few exceptions, such as investments otherwise
      accounted for by the equity method; (b) is irrevocable (unless a new election
      date occurs); and (c) is applied only to entire instruments and not to portions
      of instruments. SFAS No. 159 is effective as of the beginning of an entity’s
      first fiscal year that begins after November 15, 2007. Early adoption is
      permitted as of the beginning of the previous fiscal year provided that the
      entity makes that choice in the first 120 days of that fiscal year and also
      elects to apply the provisions of SFAS. No.157. We have chosen not to adopt
      this
      statement early. Although we will continue to evaluate the provisions of SFAS
      No. 159, management currently does not believe the adoption of SFAS No. 159
      will
      have a material impact on our consolidated financial
      statements.


34


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





**ASIA
      TIME CORPORATION**





*Credit
      Risk.* **** We
      are
      exposed to credit risk from our cash at bank, fixed deposits and contract
      receivables. The credit risk on cash at bank and fixed deposits is limited
      because the counterparts are recognized financial institutions. Contract
      receivables are subject to credit evaluations. As we are getting more new
      customers and offering credit terms, financial efficiency, we believe that
      cash
      flow and controlling bad debt and late payment become more and more important.
      We carry out thorough research through public filing records available on our
      new customers, coupled with the employment of business intelligence information
      provider, before extending any credit to new customers. Different levels of
      credit periods and credit limits are granted to different customers according
      to
      their size, financial position, business position and payment history, among
      other factors, in order to offer the right credit terms to our customers to
      enhance competitiveness yet manage the risk. We have not recorded bad debt
      since
      inception.





*Foreign
      Currency Risk.* **** The
      functional currency of our company is the Hong Kong Dollar (HKD). In the future,
      we expect Renminbi (RMB) also to be a functional currency. Substantially all
      of
      our operations are conducted in the PRC. Our sales and purchases are conducted
      within the PRC in HKD and in the future will include RMB. Conversion of RMB
      into
      foreign currencies is regulated by the People’s Bank of China through a unified
      floating exchange rate system. Although the PRC government has stated its
      intention to support the value of the RMB, there can be no assurance that such
      exchange rate will not again become volatile or that the RMB will not devalue
      significantly against the U.S. Dollar. Exchange rate fluctuations may adversely
      affect the value, in U.S. Dollar terms, of our net assets and income derived
      from its operations in the PRC. In addition, the RMB is not freely convertible
      into foreign currency and all foreign exchange transactions must take place
      through authorized institutions.




*Country
      Risk.* **** The
      substantial portion of our business, assets and operations are located and
      conducted in Hong Kong and China. While these economies have experienced
      significant growth in the past twenty years, growth has been uneven, both
      geographically and among various sectors of the economy. The Chinese government
      has implemented various measures to encourage economic growth and guide the
      allocation of resources. Some of these measures benefit the overall economy
      of
      Hong Kong and China, but may also have a negative effect on us. For example,
      our
      operating results and financial condition may be adversely affected by
      government control over capital investments or changes in tax regulations
      applicable to us. If there are any changes in any policies by the Chinese
      government and our business is negatively affected as a result, then our
      financial results, including our ability to generate revenues and profits,
      will
      also be negatively affected.





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





The
      information required by this Item 8 is incorporated by reference to the
      Financial Statements of Asia Time Corporation beginning at page F-1 of this
      Form
      10-K/A.





**Item
      9A. Controls and Procedures**





*(a)
      Evaluation of disclosure controls and procedures*





As
      of
      December 31, 2006, our sole executive officer, who is our Chief Executive
      Officer (CEO) and our Chief Financial Officer (CFO), performed an evaluation
      of
      the effectiveness of and the operation of our disclosure controls and procedures
      as defined in Rule
      13a-15 (e)
      or Rule
      15d-15 (e)
      under
      the Exchange Act. Based on that evaluation, our CEO/CFO concluded that our
      disclosure controls and procedure as of December 31, 2006 had significant
      deficiencies that caused our controls and procedures to be ineffective. These
      deficiencies consisted of inadequate staffing and supervision that could lead
      to
      the untimely identification and resolution of accounting and disclosure matters
      and failure to perform timely and effective reviews. In addition, there are
      deficiencies in the recording and classification of accounting transactions
      and
      a lack of personnel with expertise in US generally accepted accounting
      principles and US Securities and Exchange Commission rules and
      regulations.




35





We
      are in
      the process of improving our controls and procedures in an effort to remediate
      these deficiencies through improving supervision, education, and training of
      our
      accounting staff. We have hired two third-party financial consultants to review
      and analyze our financial statements and assist us improve our reporting of
      financial information. Our management and Board of Directors, with assistance
      from outside financial consultants, conducted a review and analysis of our
      accounting treatment for (i) our inventory by adjusting watch movement costing
      for the effects of vendor incentives from an as received basis to an accrual
      basis, (ii) the share exchange transaction that we conducted in January 2007,
      (iii) stock-based compensation related to an escrow agreement that our CEO/CFO
      entered into with investors in our January 2007 private placement. Based on
      the
      review, we concluded that we misapplied accounting principles generally accepted
      in the United States of America and we restated our financial statements for
      the
      periods over the past two years.





Management
      intends to seek additional qualified in house accounting personnel, such as
      a
      chief financial officer, or third-party accounting personnel to ensure that
      management will have adequate resources in order to attain complete reporting
      of
      financial information disclosures in a timely matter. We believe that the
      remedial steps that we take will address the conditions identified by our
      CEO/CFO as significant deficiencies in our disclosure controls and procedures.
      Additional effort is needed to fully remedy these deficiencies and we are
      continuing our efforts to improve and strengthen our control processes and
      procedures. We
      have also intend to engage outside consultants to assist us in assessing and
      improving our internal controls and procedures. We
      believe that the remedial steps that we take will address the conditions
      identified by our CEO/CFO as significant deficiencies in our disclosure controls
      and procedures. We will continue to monitor the effectiveness of these new
      internal policies. Our CEO/CFO believes that there are no material inaccuracies,
      or omissions of material facts necessary to make the statements not misleading
      in light of the circumstances in which they were made, in this Form
      10-QSB.




*(b)
      Changes in internal control over financial reporting*




There
      have been no changes in our internal control over financial reporting identified
      in connection with the evaluation required by Rule 13a-15(d) or Rule 15d-15(d)
      under the Exchange Act that occurred during the quarter ended December 31,
      2006
      that have materially affected, or are reasonably likely to materially affect,
      our internal control over financial reporting.





**Item
      11.   Executive Compensation**




**ASIA
      TIME CORPORATION**





**Compensation
      Discussion and Analysis**





Prior
      to
      the Share Exchange on January 23, 2007, we were a “blank check” shell company
      that was formed to investigate and acquire a target company or business seeking
      the perceived advantages of being a publicly held corporation.  The
      officers and directors of our company prior to the Share Exchange are no longer
      employed by or affiliated with our company.  Richard Rappaport and Anthony
      Pintsopolous, our President and Chief Financial Officer, respectively, during
      2006 prior to Share Exchange, received no compensation or other perquisites
      for
      serving in such capacity.





Our
      Chief
      Executive Officer, Chief Financial Officer and Chairman of the Board, Kwong
      Kai
      Shun, determined the compensation for our current executive officers that was
      earned and paid in fiscal 2006, during which Mr. Kwong was our only executive
      officer. On January 1, 2007, Kwong Kai Shun began receiving compensation under
      a
      plan pursuant to which he received a monthly base salary of $20,000 and actual
      housing and insurance expenses, which we expected to be approximately $3,000
      and
      $1,000 per month, respectively. Mr. Kwong will also receive an annual bonus
      equivalent to three months salary, equal to $60,000, and 200,000 stock options.
      The annual bonus is subject to a minimum company achievement of $2,000,000
      annual profit before tax. The bonus for 2007 will be paid only after the 2007
      fiscal year performance has been determined and evaluated, which we expect
      to
      occur on or around on March 31, 2008. The bonus of Kwong Kai Shun is solely
      (100%) based on the achievement of annual profit before tax as this performance
      indicator is best to reflect his overall responsibility and contribution to
      the
      company for the relevant period.





In
      addition, we will record a charge of $2,433,650 in 2007 for a performance-based
      compensatory stock arrangement with Mr. Kwong. In connection with our January
      2007 Private Placement, Mr. Kwong entered into an agreement (the “Escrow
      Agreement”) with the investors pursuant to which he agreed to place 2,326,000
      shares of his common stock in escrow for possible distribution to the investors
      (the "Escrow Shares"). Pursuant to the Escrow Agreement, if our net income
      for
      2006 or 2007, subject to specified adjustments, as set forth in our filings
      with
      the SEC is less than $6.3 million or $7.7 million, respectively, a portion,
      if
      not all, of the Escrow Shares will be transferred to the investors based upon
      our actual net income, if any, for such fiscal years. We will account for the
      Escrow Shares as the equivalent of a performance-based compensatory stock plan
      between Mr. Kwong and us. Accordingly, Accordingly, during the year ended
      December 31, 2007, we will recorded a charge to operations of $2,433,650 to
      recognize the grant date fair value of stock-based compensation in conjunction
      with the Escrow Shares. .




36




Mr.
      Kwong
      was paid a salary of $61,538 and automobile, housing and medical personal
      benefits allowance in the amount of $12,312. Mr. Kwong did not receive a cash
      bonus in 2006. The increase in compensation for 2007 as compared to 2006 is
      primarily due to the increased level of responsibilities to be assumed by the
      executive in becoming a publicly-listed company. The compensation for Mr. Kwong
      was set and approved by the Board of Directors.





Compensation
      for our executive officers is determined with the goal of attracting and
      retaining high quality executive officers and encouraging them to work as
      effectively as possible on our behalf.  Key areas of corporate performance
      taken into account in setting compensation policies and decisions are growth
      of
      sales, cost control, profitability, and innovation.  The key factors may
      vary depending on which area of business a particular executive officer’s work
      is focused on.  Compensation is designed to reward executive officers for
      successfully meeting their individual functional objectives and for their
      contributions to our overall development.  For these reasons, the elements
      of compensation of our executive officers are salary, housing and bonus. 
The salary and housing components of compensation are paid and rewarded to
      cover
      an appropriate level of living expenses for the executive officers and the
      bonus
      is paid to reward the executive officer for individual and company achievement.
      With respect to the amount of a bonus, we determine company achievement based
      on
      performance factors and results of operations such as revenues generated, cost
      of revenues, net income, and whether we obtain significant contracts. We
      determine achievement level of an executive based on performance factors such
      as
      contribution to the achievement of the company.





The
      level
      and components of the compensation packages for our executive officers are
      primarily determined based upon previous compensation, comparisons with the
      compensation packages of certain public companies in the United States and
      Hong
      Kong. We review and evaluate the compensation packages of specialty timepiece
      manufacturers, distributors and retailers, in addition to other Chinese
      specialty companies engaged in the manufacture and distribution of consumer
      products.





As
      a
      result of these criteria, we have reviewed the following companies:





•
            *Hong
                Kong / Chinese timepiece and jewelry companies*:
                National Electronics Holdings Ltd. (SEHK:213), Hang Fung Gold Technology
                Limited (SSEHK:870), and Peace Mark Holdings Ltd. (SEHK:304), LJ
                International, Inc. (NasdaqNM: JADE) and Man Sang Holdings, Inc.
                (Amex:
                MHJ).





•
            *Hong
                Kong / Chinese companies listed in the United States*:
                China Architectural Engineering, Inc. (AMEX: RCH), Wonder Auto Technology,
                Inc. (NasdaqNM:WATG — manufacturer of automotive electrical
                parts in China), SORL Auto Parts, Inc.
                (NasdaqNM:SORL — manufacturer and distributor of commercial
                vehicle air brake valves and related components in China and
                internationally), and Orsus Xelent Technologies, Inc.
                (Amex:ORS — designer for retail and wholesale distribution of
                cellular phones).





Our
      Board
      of Directors focuses its evaluation and analysis on companies of similar market
      size and stage of growth, while taking into account our relative performance
      and
      our own strategic goals. We believe that the companies that we evaluate are
      comparable to us and provided valuable guidance to us in setting the appropriate
      levels and form of compensation for our executive officers.





We
      believe that the salary paid to our executive officer during, 2006, 2005, and
      2004 are indicative of the objectives of our compensation program and reflect
      the fair value of the services provided to our company. We set an executive’s
      base salary with the objective of attracting and retaining highly qualified
      individuals for the relevant position and rewarding individual performance.
      When
      setting and adjusting individual executive salary levels, we consider the
      relevant established salary range, the named executive officer’s
      responsibilities, experience, potential, individual performance and
      contribution. We also consider other factors such as our overall corporate
      budget for annual merit increases, unique skills, demand in the labor market
      and
      succession planning.




37




Currently,
      we have no specific plans to provide raises after we have become a company
      with
      securities publicly traded in the United States, other than as stated above
      with
      respect to Mr. Chong.  Although no specific plans have yet been discussed,
      we may adopt such a plan to provide raises to our executive officers in the
      future.  Adopting higher compensation in the future may be based on the
      increased amount of responsibilities to be assumed by each of the executive
      officers after we become a publicly listed company.  We may also expand the
      scope of our compensation, such as the possibility of granting options to
      executive officers and tying compensation to predetermined performance
      goals.





Our
      board
      of directors has not yet developed or considered a compensation program for
      our
      executive officers for fiscal 2007 and beyond.  It is expected that our
      board will seek to establish a compensation program for executive officers
      that
      will be designed to attract, as needed, individuals with the skills necessary
      for us achieve our business plan, to motivate those individuals, to reward
      those
      individuals fairly over time, and to retain those individuals who continue
      to
      perform at or above the levels that we expect.  We also expect that our
      executive compensation program will be designed to afford our executive officers
      a sense of ownership in our company and overall entrepreneurial spirit, and
      to
      link rewards to measurable company and individual performance.





In
      addition, our board of directors does not currently have a compensation
      committee. We anticipate that our board of directors will establish a
      compensation committee in fiscal 2008 that will be comprised of non-employee
      members of our board of directors. Our current expectation is that the
      compensation committee of our board of directors will perform, at least
      annually, a strategic review of the compensation program for our executive
      officers to determine whether it provides adequate incentives and motivation
      to
      our executive officers and whether it adequately compensates our executive
      officers relative to comparable officers in other companies with which we
      compete for executives. Those companies may or may not be public companies
      or
      companies located in Hong Kong or China or even, in all cases, companies in
      a
      similar business. The companies that we review may include the comparable
      companies listed above, in addition other companies of a size, scope and
      magnitude similar to us at the time we conduct our annual review, which may
      include companies not currently listed or reporting. We believe that the
      companies that we evaluate are comparable to us and can provide valuable
      guidance to us in determining whether the levels and forms of compensation
      for
      our executive officers are adequate.





For
      2007,
      until such time as a formal compensation program and committee is established,
      which we expect will occur in 2008, our board of directors will determine the
      bonus levels for 2007 after the completion of the fiscal year. After the
      compensation committee is formed, it will make such determinations.





**Summary
      Compensation Tables**





The
      following table sets forth information concerning the compensation for the
      three
      fiscal years ended December 31, 2006, 2005 and 2004 of the principal executive
      officer, principal financial officer, in addition to our three most highly
      compensated officers whose annual compensation exceeded $100,000, and up to
      two
      additional individuals for whom disclosure would have been required but for
      the
      fact that the individual was not serving as an executive officer of the
      registrant at the end of the last fiscal year.


**Name
                and Position**
            
            **Year**
            
            **Salary**
            
            **All
                Other**
              **Compensation(2)**
            
            **Total**Kwong
                Kai Shun
            
            
            2006
            
            $
            61,538
            
            $
            12,312
            
            $
            73,850Chief
                Executive Officer, Chief Financial Officer and Chairman of the
                Board
            
            
            2005
            
            
            62,500
            
            
            13,500
            
            
            75,5002004
            
            
            62,000
            
            
            13,500
            
            
            75,500Richard
                Rappaport(1)
            
            
            2006
            
            
            —
            
            
            —
            
            
            —Former
                Chief Executive Officer and Former Director
            
            
            2005
            
            
            —
            
            
            —
            
            
            —2004
            
            
            —
            
            
            —
            
            
            —Anthony
                Pintsopoulos(1)
            
            
            2006
            
            
            —
            
            
            —
            
            
            —Former
                Chief Financial Officer and Former Director
            
            
            2005
            
            
            —
            
            
            —
            
            
            —2004
            
            
            —
            
            
            —
            
            
            —




38







(1)
            Messrs.
                Rappaport and Pintsopoulos resigned from all positions with the Company
                upon the close of the Share Exchange on January 23,
                2007.


(2)
            This
                relates to automobile, housing and medical personal
                benefits.





**Grants** **of** **Plan-** **Based** **Awards** **in 2006**





There
      were no option grants in 2006.





**Outstanding
      Equity Awards at 2006 Fiscal Year-End**




There
      were no option exercises or options outstanding in 2006.




**Option
      Exercises and Stock Vested in Fiscal 2006**




There
      were no option exercises or stock vested in 2006.





**Director
      Compensation**





Name
            
            Fees
              Earned or
              Paid
                in
              Cash
              ($)
            
            Stock
              Awards
              ($)
            
            Option
              Awards
              ($)
            
            Non-Equity
              Incentive
                Plan
              Compensation
              ($)
            
            Change
                in
              Pension
              Value
                and
              Nonqualified
              Deferred
              Compensation
              Earnings
            
            All
                Other
              Compensation
              ($)
            
            Total
              ($)Kwong
                Kai Shun
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            0Michael
                Mak
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            0





For
      the
      year ended December 31, 2006, none of the members of our Board of Directors
      received compensation for his or her service as a director. We do not currently
      have an established policy to provide compensation to members of our Board
      of
      Directors for their services in that capacity. We intend to develop such a
      policy in the near future.





In
      January 1, 2007, Michael Mak began receiving compensation under a plan pursuant
      to which he receives monthly compensation with respect to salary, housing and
      insurance in the amounts of $15,000, $3,000 and $1,000, respectively. Mr. Mak
      will also receive an annual bonus equivalent to two months salary. The annual
      bonus is subject to a minimum achievement of $2 million annual profit
–before-tax and is payable on the 31 st of March
      of each year The compensation for Mr. Mak was set and approved by the Board
      of
      Directors.




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




**ASIA
      TIME CORPORATION**





**Times
      Manufacture & E-Commerce Corporation Limited**





Times
      Manufacture & E-Commerce Corporation Limited (“Times Manufacture”) is our
      wholly-owned subsidiary, which has interlocking executive and director positions
      with us.





**January
      2007 Share Exchange**





On
      January 23, 2007, we completed the Share Exchange with Times Manufacture and
      Kwong Kai Shun, the former sole shareholder of Times Manufacture. At the close
      of the Share Exchange, Times Manufacture became our wholly-owned subsidiary
      and
      100% of the issued and outstanding securities of Times Manufacture were
      exchanged for our securities. An aggregate of 19,454,420 shares of our common
      stock were issued to this shareholder. Further to the Share Exchange, Times
      Manufacture paid an aggregate of $350,000 to the shareholders of SRKP 9, Inc.
      As
      of the close of the Share Exchange, these shareholders owned approximately
      84.0%
      of our issued and outstanding stock. Moreover, concurrent with the closing
      of
      the Share Exchange, our board appointed Kwong Kai Shun as Chairman of the Board,
      Chief Executive Officer and Chief Financial Officer, as well as Michael Mak
      as a
      director. Kwong Kai Shun is Chief Executive Officer and director of Times
      Manufacture.




39




**WestPark
      Capital, Inc.**





On
      January 23, 2007, concurrently with the close of the Share Exchange, we
      conducted an initial closing of a private placement transaction pursuant to
      which we sold an aggregate of 1,749,028 shares of Series A Convertible Preferred
      Stock at $1.29 per share. On February 9, 2007, we conducted a second and final
      closing of the private placement pursuant to which we sold 501,320 shares of
      Series A Convertible Preferred Stock at $1.29 per share. Accordingly, a total
      of
      2,250,348 shares of Series A Convertible Preferred Stock were sold in the
      private placement for an aggregate of $2,902,946 (the “Private Placement”).
      WestPark Capital, Inc. (“WestPark”) acted as the placement agent for the Private
      Placement. Of the gross proceeds, $50,000 is represented by a subscription
      receivable from one investor. For its services as placement agent, WestPark
      received an aggregate fee of approximately $261,265, which consisted of a
      commission equal to 9.0% of the gross proceeds from the financing. WestPark
      is
      acting as the managing underwriter for our public offering that we intend to
      conduct. Upon the closing of the offering, we agreed to sell to WestPark
      Capital, Inc. warrants to purchase up to a number of shares of our common stock
      that will be determined. The warrants will be exercisable on their date of
      issuance at a per share exercise price equal to 120% of the public offering
      price, subject to standard anti-dilution adjustments for stock splits and
      similar transactions, and will expire five years. The holders of shares of
      common stock acquired upon exercise of the warrants have the right to include
      such shares in any future registration statements filed by us and to demand
      one
      registration for the shares. In addition, we have agreed to indemnify the
      underwriters against some liabilities, including liabilities under the
      Securities Act of 1933, as amended, and to contribute to payments that the
      underwriters may be required to make in respect thereof. We will pay WestPark
      a
      non-accountable expense allowance to be determined. We also agreed to retain
      WestPark as a consultant to assist us with shareholder and investor matters.
      The
      consulting arrangement will be for a period of 12 months, which will commence
      upon the closing of the offering, at a rate of $3,000 per month.





Some
      of
      the controlling shareholders, control persons of WestPark were also, prior
      to
      the completion of the Share Exchange, shareholders and/or control persons of
      our
      company, including Richard Rappaport, who is the Chief Executive Officer of
      WestPark and was the President and a significant shareholder of our company
      prior to the Share Exchange, Anthony C. Pintsopoulos, who is the Chief Financial
      Officer of WestPark and an officer, director and significant shareholder of
      our
      company prior to the Share Exchange and Kevin DePrimio and Jason Stern, each
      employees of WestPark and shareholders of our company prior to the Share
      Exchange. Each of Messrs. Rappaport and Pintsopoulos resigned from all of their
      executive and director positions with our company upon the closing of the Share
      Exchange. Affiliates of WestPark who own shares of our common stock have agreed
      to a lock-up whereby they shall not sell an aggregate of 1,528,933 shares of
      common stock held by them until that date which is nine months from the day
      that
      our common stock begins to be traded on either the New York Stock Exchange,
      American Stock Exchange, NASDAQ Global Market, NASDAQ Capital Market, the OTC
      Bulletin Board or the Pink Sheets.





We
      believe that the WestPark Capital arrangements are at fair market value and
      are
      on terms comparable to those that would have been reached in arm's-length
      negotiations had the parties been unaffiliated at the time of the
      negotiations.





**Agreement
      of** **Kwong
      Kai Shun**





In
      connection with the Private Placement, Kwong Kai Shun, our Chairman of the
      Board, Chief Executive Officer and Chief Financial Officer, entered into an
      agreement with the investors in the Private Placement. Mr. Kwong agreed to
      place
      2,326,000 shares of his common stock in escrow for possible distribution to
      the
      investors (the “Escrow Shares”). According to the agreement, if our annual net
      income for 2006 or 2007 (subject to specified adjustments) as set forth in
      its
      filings with the Securities and Exchange Commission is less than $6.3 million
      or
      $7.7 million, respectively, a portion, if not all, of the Escrow Shares will
      be
      transferred to the investors based upon our actual net income for such fiscal
      years. According to the agreement, the number of shares Mr. Kwong will
      distribute to shareholders will be determined by a formula based on the number
      of common stock held by the investors multiplied by the shortfall in a valuation
      agreed upon by the parties. We met our net income threshold of $6.3 million
      for
      2006, and the investors are not entitled to shares from Mr. Kwong for that
      year.
      If our defined net income for the year ended December 31, 2007 is less than
      $7.7
      million (a price-earning ratio of 4 times using $1.29), then Mr. Kwong will
      make
      up the shortfall by transferring to the investors the following number of common
      stock as calculated below:




40




A
      = N x
      S





A
            means
                the number of additional shares of common stock to be transferred
                by Mr.
                Kwong to the investors.





N
            means
                the number of stock held by the
                investors.





S
            means
                the shortfall in agreed valuation per share of Common Stock calculated
                as
                follows: $1.29 – ((actual amount of net income for 2007 x 4) /
                25,482,210).





For
      illustration purposes, if our net income for fiscal 2007 was $7.0 million,
      as
      opposed to $7.7 million, then Mr. Kwong would be required to transfer
      approximately 430,254 shares of common stock to the investors under the
      agreement. In no circumstances will the shares distributed by Mr. Kwong exceed
      2,326,000 shares. Each shareholder will receive a pro rata amount of shares
      based on the number of the shares that they hold at the time of any distribution
      per the agreement. In the event that Mr. Kwong transfers shares to investors
      under the agreement, it is anticipated that the transfer will be effected under
      an exemption from registration pursuant to the Securities Act of 1933, as
      amended.





We
      will
      account for the Escrow Shares as the equivalent of a performance-based
      compensatory stock plan between Mr. Kwong and us. Accordingly, during the year
      ended December 31, 2007, we will recorded a charge to operations of $2,433,650
      to recognize the grant date fair value of stock-based compensation in
      conjunction with the Escrow Shares.





In
      addition, Mr. Kwong has agreed to purchase all shares of Series A Preferred
      Stock then held by such investors at a per-share purchase price of $1.29 if
      our
      common stock shall fail to be listed or quoted for trading on the American
      Stock
      Exchange, the Nasdaq Capital Market, the Nasdaq Global Market or the New York
      Stock Exchange on or before an agreed upon date. The date for listing was
      originally set by the parties at June 30, 2007 and was subsequently extended
      to
      March 31, 2008. Mr. Kwong and the investors also executed an amendment to the
      agreement to revise the agreement to provide that our 2007 net income will
      be
      determined in accordance with US GAAP except that following will be added back
      to our US GAAP net income for purposes of calculating our 2007 net income under
      the agreement: (i) any and all non-cash charges and expenses related to the
      Bonds and Bond Warrants that we issued in November 2007, and (ii) any and all
      charges and expenses related to our Private Placement of the Series A
      Convertible Preferred Stock in January 2007 and the reverse takeover that
      occurred in January 2007.





We
      believe that arrangement with Kwong Kai Shun is at fair market value and are
      on
      terms comparable to those that would have been reached in arm's-length
      negotiations had the parties been unaffiliated at the time of the
      negotiations.





**Director
      Independence**





We
      are
      not currently required to comply with director independence requirements under
      the rules applicable to companies that do not have securities listed or quoted
      on a national securities exchange or national quotation system. If we are able
      to list our common stock on the American Stock Exchange, or AMEX, we would
      be
      required to maintain a board of directors comprised of at least 50% independent
      directors and to have an independent audit committee formed, in compliance
      with
      the requirements for listing on AMEX and in compliance with Rule 10A-3 of the
      Securities Exchange Act of 1934. Although none of our directors is currently
      an
“independent director” as that term is defined in the AMEX Company Guide, we
      intend to comply with the applicable AMEX independence listing requirements
      in
      the near future.





**Policy
      for Approval of Related Party Transactions**





We
      do not
      currently have a formal related party approval policy for review and approval
      of
      transactions required to be disclosed pursuant to Item 404 (a) of Regulation
      S-K. We intend to adopt such a policy once we establish an audit committee,
      which we anticipate occurring in 2007.





41




**PART
      IV**




**Item
      15. Exhibits and Financial Statement Schedules**




1.
      Financial Statements: See “Index to Consolidated Financial Statements” in Part
      II, Item 8 of this annual report on Form 10-K/A.





2.
      Financial Statement Schedule: Not applicable.





3.
      Exhibits: The exhibits listed in the accompanying “Index to Exhibits” are filed
      or incorporated by reference as part of this Form 10-K/A.





42




**SIGNATURES**




Pursuant
      to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
      1934, the Registrant has duly caused this report to be signed on its behalf
      by
      the undersigned, thereunto duly authorized, in the City of Kowloon, Hong Kong,
      on February 8, 2008.




**Asia
                Time Corporation**/s/
                Kwong Kai ShunKwong
                Kai ShunChief
                Executive Officer, Chief Financial Officer andChairman
                of the Board




Pursuant
      to the requirements of the Securities Exchange Act of 1934, this report has
      been
      signed by the following persons on behalf of the Registrant and in the
      capacities and on the dates indicated.





SIGNATURE
            
            TITLE
            
            DATE/s/
                Kwong Kai Shun
            
            Chief
                Executive Officer, Chief Financial Officer and Chairman of the Board
                (Principal Executive Officer; Principal Financial and Accounting
                Officer)
            
            February
                8, 2008Kwong
                Kai Shun/s/
                Michael Mak
            
            Director
            
            February
                8, 2008Michael
                Mak/s/
                Siu Po Lee
            
            Director
            
            February
                8, 2008Siu
                Po LeeDirectorDr.
                Ching Wah LeungDirectorWu
                Hok Lun




43




**Exhibit
      Index**


Exhibit No.
              
              Exhibit
                  Description2.1
              
              Share
                  Exchange Agreement, dated as of December 15, 2006, by and among the
                  Registrant, Kwong Kai Shun and Times Manufacture & E-Commerce
                  Corporation, Limited (incorporated by reference from Exhibit 2.1
                  to
                  Current Report on Form 8-K filed with the Securities and Exchange
                  Commission on January 29, 2007).3.1
              
              Certificate
                  of Incorporation (incorporated by reference from Exhibit 3.1 to
                  the
                  Registration Statement on Form 10-SB (File No. 000-51981) filed
                  with the
                  Securities and Exchange Commission on May 5, 2006).3.2
              
              Bylaws
                  (incorporated by reference from Exhibit 3.2 to the Registration
                  Statement
                  on Form 10-SB (File No. 000-51981) filed with the Securities and
                  Exchange
                  Commission on May 5, 2006).3.3
              
              Articles
                  of Merger Effecting Name Change (incorporated by reference from
                  Exhibit
                  3.3 to Current Report on Form 8-K filed with the Securities and
                  Exchange
                  Commission on January 29, 2007).3.4
              
              Certificate
                  Of Designations, Preferences And Rights Of Series A Convertible
                  Preferred
                  Stock (incorporated by reference from Exhibit 3.4 to Current Report
                  on
                  Form 8-K filed with the Securities and Exchange Commission on January
                  29,
                  2007).4.1
              
              Specimen
                  Certificate of Common Stock (incorporated by reference to Exhibit
                  4.1 of
                  the Registrant's Registration Statement on Form SB-2 filed August
                  20,
                  2004).10.1
              
              Form
                  of Subscription Agreement dated as of January 23, 2007 and February
                  9,
                  2007 (incorporated by reference from Exhibit 10.1 to Current Report
                  on
                  Form 8-K filed with the Securities and Exchange Commission on February
                  13,
                  2007).10.2
              
              Form
                  of Agreement between Kwong Kai Shun and Investors of Series A Convertible
                  Preferred Stock (incorporated by reference to Exhibit 10.2 of the
                  Registration Statement on Form S-1 filed with the Securities and
                  Exchange
                  Commission on September 26, 2007).10.2(a)
              
              Amendment
                  No. 1 to Agreement between Kwong Kai Shun and Investors of Series
                  A
                  Convertible Preferred Stock, dated June 30, 2007 (incorporated
                  by
                  reference to Exhibit 10.2(a) of the Registration Statement on Form
                  S-1
                  filed with the Securities and Exchange Commission on September
                  26,
                  2007).21.1
              
              List
                  of Subsidiaries (incorporated by reference from Exhibit 21.1 to
                  Current
                  Report on Form 8-K filed with the Securities and Exchange Commission
                  on
                  January 29, 2007).31.1
              
              Certification
                  of Chief Executive Officer and Chief Financial Officer pursuant
                  to
                  Item 601(b)(31) of Regulation S-K, as adopted pursuant to
                  Section 302 of the Sarbanes-Oxley Act of 2002.32.1*
              
              Certifications
                  of Chief Executive Officer pursuant to 18 U.S.C. Section 1350 as
                  adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
                  2002.







*
            This
                exhibit shall not be deemed "filed" for purposes of Section 18 of
                the
                Securities Exchange Act of 1934 or otherwise subject to the liabilities
                of
                that section, nor shall it be deemed incorporated by reference in
                any
                filing under the Securities Act of 1933 or the Securities Exchange
                Act of
                1934, whether made before or after the date hereof and irrespective
                of any
                general incorporation language in any
                filings.





44


**INDEX
      TO FINANCIAL STATEMENTS**





**ASIA
      TIME CORPORATION (FORMERLY SRKP 9, INC.)**





Report
                Of Independent Registered Public Accounting Firm
            F-2Balance
                Sheet
            F-3Income
                Statement
            F-5Statement
                of Stockholders’ Equity
            F-6Statement
                of Cash Flows
            F-7Notes
                to Financial Statements
            F-9





F-1




**REPORT
      OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**





To
      the
      Board of Directors and Stockholders of


Asia
      Time
      Corporation


(Formerly
      SRKP 9, Inc.)





We
      have
      audited the accompanying consolidated balance sheets of Asia Time Corporation
      (the “Company”) and its subsidiaries (collectively referred to as the “Group”)
      as of December 31, 2006, 2005 and 2004, and the related consolidated statements
      of operations, stockholders’ equity and cash flows for the years ended December
      31, 2006, 2005 and 2004. 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. 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 consolidated financial position of the Company
      and
      its subsidiaries as of December 31, 2006, 2005 and 2004, and the consolidated
      results of their operations and their cash flows for the years ended December
      31, 2006, 2005 and 2004, in conformity with accounting principles generally
      accepted in the United States of America.




As
      discussed in Note 23 to the consolidated financial statements, the Company
      corrected an accounting error by restating previously issued financial
      statements.




Dominic
      K.F. Chan & Co


Certified
      Public Accountants


Hong
      Kong


(April
      12, 2007, except as to Note 23, as to which the date is December 13,
      2007)




F-2


ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





CONSOLIDATED
      BALANCE SHEETS


(Stated
      in US Dollars)





***At December 31,******2006***
            
            ***2005***
            
            ***2004******$***
            
            ***$***
            
            ***$******(restated)***
            
            ***(restated)***
            
            ***(restated)*****ASSETS**Current
                Assets:Cash
                and cash equivalents
            
            
            316,621
            
            
            780,090
            
            
            911,487Restricted
                cash
            
            
            4,523,679
            
            
            4,306,474
            
            
            3,551,304Accounts
                receivable
            
            
            8,188,985
            
            
            4,829,586
            
            
            3,369,326Prepaid
                expenses and other receivables - Note 8
            
            
            2,101,133
            
            
            394,236
            
            
            727,934Tax
                prepayment
            
            
            767
            
            
            16,367
            
            
            -Inventories,
                net – Note 9
            
            
            6,246,185
            
            
            6,313,662
            
            
            3,872,831Prepaid
                lease payments – Note 11
            
            
            22,958
            
            
            7,993
            
            
            -Total
                Current Assets
            
            
            21,400,328
            
            
            16,648,408
            
            
            12,432,882Deferred
                tax assets – Note 7
            
            
            14,042
            
            
            -
            
            
            -Plant
                and equipment, net – Note 10
            
            
            890,258
            
            
            682,901
            
            
            696,552Leasehold
                lands – Note 11
            
            
            895,322
            
            
            315,939
            
            
            -Held-to-maturity
                investments – Note 12
            
            
            301,196
            
            
            301,954
            
            
            -Intangible
                assets – Note 13
            
            
            337,836
            
            
            584,149
            
            
            736,934Restricted
                cash
            
            
            257,301
            
            
            -
            
            
            -**TOTAL
                ASSETS**
            
            
            24,096,283
            
            
            18,533,351
            
            
            13,866,368**LIABILITIES
                AND STOCKHOLDERS’ EQUITY****LIABILITIES**Current
                Liabilities:Accounts
                payable
            
            
            770,360
            
            
            1,236,418
            
            
            1,805,995Other
                payables and accrued liabilities - Note 14
            
            
            190,358
            
            
            145,249
            
            
            41,798Advance
                from a related party – Note 15
            
            
            -
            
            
            28,854
            
            
            89,296Income
                tax payable
            
            
            1,387,571
            
            
            816,758
            
            
            85,439Unearned
                revenue – Note 14
            
            
            -
            
            
            1,598,314
            
            
            3,197,160Bank
                borrowings – Note 16
            
            
            13,205,167
            
            
            10,064,129
            
            
            7,400,775Total
                Current Liabilities
            
            
            15,553,456
            
            
            13,889,722
            
            
            12,620,463Deferred
                tax liabilities - Note 7
            
            
            31,711
            
            
            -
            
            
            -**TOTAL
                LIABILITIES**
            
            
            15,585,167
            
            
            13,889,722
            
            
            12,620,463


**COMMITMENTS
        AND CONTINGENCIES – Note 18**
  F-3


ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





CONSOLIDATED
      BALANCE SHEETS (Cont’d)


(Stated
      in US Dollars)





***At
                December 31,******2006***
            
            ***2005***
            
            ***2004******$***
            
            ***$***
            
            ***$******(restated)***
            
            ***(restated)***
            
            ***(restated)*****STOCKHOLDERS’
                EQUITY**Preferred
                stockPar
                value: US$0.0001Authorized:
                2006 – 10,000,000 sharesIssued
                and outstanding: 2006 – none issued (2005 and 2004 – none)
            
            
            -
            
            
            -
            
            
            -Common
                stockPar
                value: US$0.0001Authorized:
                100,000,000 sharesIssued
                and outstanding: 2006 – 19,454,420 shares (2005 and 2004 – 19,454,420
                shares)
            
            
            1,946
            
            
            1,946
            
            
            1,946Additional
                paid-in capital
            
            
            654,298
            
            
            654,298
            
            
            652,488Accumulated
                other comprehensive income
            
            
            7,470
            
            
            13,549
            
            
            412Retained
                earnings
            
            
            7,847,402
            
            
            3,973,836
            
            
            591,059**TOTAL
                STOCKHOLDERS’ EQUITY**
            
            
            8,511,116
            
            
            4,643,629
            
            
            1,245,905**TOTAL
                LIABILITIES AND STOCKHOLDERS’ EQUITY**
            
            
            24,096,283
            
            
            18,533,351
            
            
            13,866,368




See
      notes
      to consolidated financial statements.




F-4


ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





CONSOLIDATED
      STATEMENTS OF OPERATIONS


(Stated
      in US Dollars)





***Year
                ended December 31,******2006***
            
            ***2005***
            
            ***2004******$***
            
            ***$***
            
            ***$******(restated)***
            
            ***(restated)***
            
            ***(restated)***Net
                sales
            
            
            81,134,275
            
            
            63,078,409
            
            
            36,553,084Cost
                of sales – Note 20
            
            
            (71,496,801
            )
            
            (57,026,036
            )
            
            (34,608,653
            )Gross
                profit
            
            
            9,637,474
            
            
            6,052,373
            
            
            1,944,431Other
                income - Note 5
            
            
            424,016
            
            
            938,573
            
            
            -Depreciation
            
            
            (325,995
            )
            
            (259,127
            )
            
            (126,225
            )Administrative
                and other operating expenses – Note 22
            
            
            (1,284,863
            )
            
            (1,436,069
            )
            
            (1,344,786
            )Income
                from operations
            
            
            8,450,632
            
            
            5,295,750
            
            
            473,420Other
                income - Note 5
            
            
            237,571
            
            
            156,199
            
            
            28,047Interest
                expenses – Note 6
            
            
            (1,060,536
            )
            
            (514,637
            )
            
            (164,558
            )Income
                before taxes
            
            
            7,627,667
            
            
            4,937,312
            
            
            336,909Income
                taxes - Note 7
            
            
            (1,307,728
            )
            
            (911,687
            )
            
            (131,951
            )Net
                income
            
            
            6,319,939
            
            
            4,025,625
            
            
            204,958Earnings
                per share of common stock – Note 3-
                Basic and diluted
            
            
            0.32
            
            
            0.21
            
            
            0.01Weighted
                average number of shares of common stock – Note 3-
                Basic and diluted
            
            
            19,454,420
            
            
            19,454,420
            
            
            19,454,420




See
      notes
      to consolidated financial statements.





F-5




ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





CONSOLIDATED
      STATEMENT OF STOCKHOLDERS’ EQUITY (restated)


(Stated
      in US Dollars)


***Preferred Stock***
              
              ***Common Stock***
              
              ***Additionalpaid-in***
              
              ***Accumulatedothercomprehensive***
              
              ***Retained******Shares***
              
              ***Amount***
              
              ***Shares***
              
              ***Amount***
              
              ***Capital***
              
              ***Income***
              
              ***earnings***
              
              ***Total******$***
              
              
              
              ***$***
              
              ***$***
              
              ***$***
              
              ***$***
              
              ***$***December
                  31, 2003 (as previously reported)
              
              
              -
              
              
              -
              
              
              23,156,629
              
              
              2,316
              
              
              642,120
              
              
              (705
              )
              
              414,550
              
              
              1,058,281Restatements
                  (note 23)
              
              
              -
              
              
              -
              
              
              (3,702,209
              )
              
              (370
              )
              
              370
              
              
              
              
              
              (28,449
              )
              
              (28,449
              )Balance,
                  January 1, 2004
              
              
              -
              
              
              -
              
              
              19,454,420
              
              
              1,946
              
              
              642,490
              
              
              (705
              )
              
              386,101
              
              
              1,029,832Issuance
                  of shares – TMEHK
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              9,998
              
              
              -
              
              
              -
              
              
              9,998Comprehensive
                  incomeNet
                  income
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              204,958
              
              
              204,958Foreign
                  currency translationAdjustments
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              1,117
              
              
              -
              
              
              1,117Total
                  comprehensive income
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              1,117
              
              
              204,958
              
              
              206,075Balance,
                  December 31, 2004
              
              
              -
              
              
              -
              
              
              19,454,420
              
              
              1,946
              
              
              652,488
              
              
              412
              
              
              591,059
              
              
              1,245,905Issuance
                  of shares – Note 2
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              30,000
              
              
              -
              
              
              -
              
              
              30,000Restructuring
                  – Note 2
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (28,190
              )
              
              -
              
              
              -
              
              
              (28,190
              )Comprehensive
                  incomeNet
                  income
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              4,025,625
              
              
              4,025,625Foreign
                  currency translationAdjustments
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              13,137
              
              
              -
              
              
              13,137Total
                  comprehensive income
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              13,137
              
              
              4,025,625
              
              
              4,038,762Dividends
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (642,848
              )
              
              (642,848
              )Balance,
                  December 31, 2005
              
              
              -
              
              
              -
              
              
              19,454,420
              
              
              1,946
              
              
              654,298
              
              
              13,549
              
              
              3,973,836
              
              
              4,643,629Comprehensive
                  incomeNet
                  income
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              6,319,939
              
              
              6,319,939Foreign
                  currency translation
              
              
              -
              
              
              -Adjustments
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (6,079
              )
              
              -
              
              
              (6,079
              )Total
                  comprehensive income
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (6,079
              )
              
              6,319,939
              
              
              6,313,860Dividends
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (2,446,373
              )
              
              (2,446,373
              )**Balance,
                  December 31, 2006**
              
              
              -
              
              
              -
              
              
              19,454,420
              
              
              1,946
              
              
              654,298
              
              
              7,470
              
              
              7,847,402
              
              
              8,511,116




See
      notes
      to consolidated financial statements.




F-6


ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





CONSOLIDATED
      STATEMENTS OF CASH FLOWS


(Stated
      in US Dollars)





***Year
                ended December 31,******2006***
            
            ***2005***
            
            ***2004******$***
            
            ***$***
            
            ***$******(restated)***
            
            ***(restated)***
            
            ***(restated)*****Cash
                flows from operating activities**Net
                income
            
            
            6,319,939
            
            
            4,025,625
            
            
            204,958Adjustments
                to reconcile net
                income to net cash flows provided by operating activities:Amortization
                of intangible assets
            
            
            154,436
            
            
            154,438
            
            
            35,382Amortization
                of leasehold lands
            
            
            23,247
            
            
            7,968
            
            
            -Depreciation
            
            
            325,995
            
            
            259,127
            
            
            126,225Loss
                on disposal of plant and equipment
            
            
            7,715
            
            
            -
            
            
            -Gain
                on disposal of intangible assets
            
            
            (210,594
            )
            
            -
            
            
            -Income
                taxes
            
            
            1,307,728
            
            
            911,687
            
            
            131,951Changes
                in operating assets and liabilities:Accounts
                receivable
            
            
            (3,369,347
            )
            
            (1,445,937
            )
            
            (1,997,310
            )Prepaid
                expenses and other receivables
            
            
            (1,706,789
            )
            
            334,759
            
            
            310Inventories
            
            
            50,990
            
            
            (2,421,140
            )
            
            (2,577,568
            )Accounts
                payable
            
            
            (462,658
            )
            
            (573,017
            )
            
            538,433Other
                payables and accrued liabilities
            
            
            45,445
            
            
            103,007
            
            
            370Income
                tax payable
            
            
            (701,921
            )
            
            (199,079
            )
            
            (76,747
            )Unearned
                revenue
            
            
            (1,593,280
            )
            
            (1,603,082
            )
            
            3,191,721Net
                cash flows provided by (used in) operating activities
            
            
            190,906
            
            
            (445,644
            )
            
            (422,275
            )**Cash
                flows from investing activities**Acquisition
                of leasehold lands
            
            
            (618,025
            )
            
            (330,884
            )
            
            -Acquisition
                of held-to-maturity investments
            
            
            -
            
            
            (301,007
            )
            
            -Acquisition
                of intangible assets
            
            
            -
            
            
            -
            
            
            (771,063
            )Acquisition
                of plant and equipment
            
            
            (544,678
            )
            
            (243,504
            )
            
            (781,095
            )Proceeds
                from disposal of plant and equipment
            
            
            2,031
            
            
            -
            
            
            -Proceeds
                from disposal of intangible assets
            
            
            300,849
            
            
            -
            
            
            -Net
                cash flows used in investing activities
            
            
            (859,823
            )
            
            (875,395
            )
            
            (1,552,158
            )**Cash
                flows from financing activities**Proceeds
                from new short-term bank loans
            
            
            1,700,622
            
            
            346,622
            
            
            140,937Repayment
                of short-term bank loans
            
            
            (525,535
            )
            
            (408,211
            )
            
            (11,527
            )Repayment
                of a capital lease
            
            
            -
            
            
            -
            
            
            (6,975
            )Net
                advancement of other bank borrowings
            
            
            1,789,269
            
            
            2,946,182
            
            
            4,176,477Increase
                in restricted cash
            
            
            (484,997
            )
            
            (755,170
            )
            
            (2,255,598
            )Increase/(decrease)
                in bank overdrafts
            
            
            199,893
            
            
            (250,997
            )
            
            599,814Advance
                from a related party
            
            
            (28,763
            )
            
            (60,511
            )
            
            122,571Dividends
                paid
            
            
            (2,446,373
            )
            
            (642,848
            )
            
            -Net
                cash flows provided by financing activities
            
            
            204,116
            
            
            1,175,067
            
            
            2,765,699Net
                (decrease) / increase in cash and cash equivalents
            
            
            (464,801
            )
            
            (145,972
            )
            
            791,266Effect
                of foreign currency translation on cash and cash
                equivalents
            
            
            1,332
            
            
            14,575
            
            
            7,242Cash
                and cash equivalents - beginning of year
            
            
            780,090
            
            
            911,487
            
            
            112,979Cash
                and cash equivalents - end of year
            
            
            316,621
            
            
            780,090
            
            
            911,487




F-7




ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





CONSOLIDATED
      STATEMENTS OF CASH FLOWS (Cont’d)





(Stated
      in US Dollars)





***Year
                ended December 31,******2006***
            
            ***2005***
            
            ***2004******$***
            
            ***$***
            
            ***$******(restated)***
            
            ***(restated)***
            
            ***(restated)***Supplemental
                disclosures for cash flow information:Cash
                paid for:Interest
            
            
            1,060,536
            
            
            514,637
            
            
            164,558Income
                taxes
            
            
            701,921
            
            
            199,079
            
            
            76,747




See
      notes
      to consolidated financial statements.




F-8




ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**1.**
            **Change
                of company name**





Effect
      from January 23, 2007, the Company changed its name from SRKP 9, Inc. to Asia
      Time Corporation (the “Company”).





**2.**
            **Corporation
                information****and
                reorganization**





Asia
      Time
      Corporation (the “Company”) (formerly SRKP 9, Inc.) was incorporated in the
      State of Delaware on January 3, 2006.





Recapitalization





The
      Company entered into an Exchange Agreement dated December 15, 2006 (the
“Exchange Agreement”) with Times Manufacture & E-Commerce Corporation
      Limited, a British Virgin Islands corporation (“Times Manufacture”) and Mr.
      Kwong Kai Shun, the sole shareholder of the 100% of the capital shares of Times
      Manufacture, (“Original Shareholder”). The closing of the Exchange Agreement
      occurred on January 23, 2007.





The
      Company effectuated a 1.371188519-for-one stock reverse split in the course
      of
      the share exchange process such that there were 3,702,209 shares of common
      stock
      outstanding immediately prior to the closing of the Exchange Agreement. These
      financial statements give retroactive effect to this share split.





At
      the
      closing of the Exchange Agreement, the Company acquired all of Times
      Manufacture’s capital shares (the “Times Manufacture Shares”) from the Original
      Shareholder, and the Original Shareholder transferred and contributed all of
      his
      Times Manufacture Shares to the Company. In exchange, the Company issued
      19,454,420 shares of its Common Stock to the Original Shareholder and paid
      an
      aggregate of $350,000 to the stockholders of SRKP 9, Inc. These financial
      statements give retroactive effect to the shares issued.





The
      former stockholders of Times Manufacture acquired 84% of the Company’s issued
      and outstanding common stock as a result of completion of the share exchange
      transaction. Therefore, although Times Manufacture became the Company’s
      wholly-owned subsidiary, the transaction was accounted for as a recapitalization
      of the Company, whereby Times Manufacture is deemed to be the accounting
      acquirer and is deemed to have adopted the Company’s capital structure. Since
      the Merger was accounted for as a reverse acquisition, the accompanying
      consolidated financial statements reflect the historical financial statements
      of
      Times Manufacture, the accounting acquirer, as adjusted for the effects of
      the
      exchange of shares on its equity accounts, the inclusion of assets and
      liabilities of the accounting subsidiary as of the date of the merger at their
      historical basis, and the inclusion of the accounting subsidiary’s results of
      operations from that date. Although the Company is the legal acquirer, Times
      Manufacture was treated as having acquired the Company for accounting purposes
      and all of the operations reported represent the historical financial statements
      of Times Manufacture.




F-9


ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**2.**
            **Corporation
                information****and
                reorganization (Cont’d)**





Restructuring





For
      the
      purpose of the reverse takeover transaction (“RTO”), the companies comprising
      the group underwent a restructuring in December 2005 (the “Restructuring”), and
      the Company acquired all of the outstanding and issued shares of common stock
      of
      its subsidiaries (including Times Manufacturing & E-Commerce Corporation
      Limited (“TMEHK”), Billion Win International Enterprise Limited (“BW”), Citibond
      Industrial Limited (“CI”), Goldcome Industrial Limited (“GI”) and Megamooch
      International Limited (“MI”)) from their then existing stockholders in
      consideration for the issuance of 20,000 shares with a designated value of
      $1.00
      of the company’s voting common stock, representing 99.99% of the voting power in
      the company.





Before
      acquisition of TME HK group, TME HK acquired all of the outstanding and issued
      shares of common stock of its subsidiaries (including BW, CI, GI and MI) from
      their then existing stockholders in consideration for the issuance of 10,000
      shares with a designated value of $1.00 of TME HK’s voting common
      stock.





Corporate
      Structure – Before Restructuring





Corporate Structure - Before Restructuring





F-10




ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**2.**
            **Corporation
                information****and
                reorganization (Cont’d)**





Corporate
      Structure – After Restructuring




Corporate Structure - After Restructuring





**3.**
            **Description
                of business**





The
      Company and its subsidiaries are engaged in trading of completed watches and
      watch components.





**Name of company**
            
            **Place and date ofincorporation**
            
            **Issued and fully paidcapital**
            
            **Principal activities**Times
                Manufacture & E-Commerce Corporation Ltd
            
            British
                Virgin IslandsMarch 21, 2002
            
            US$20,002
              Ordinary
            
            Investment
                holdingTimes
                Manufacturing & E-Commerce Corporation Ltd
              (“TME
                HK”)
            
            British
                Virgin Islands
              January
                2, 2002
            
            US$20,000
              Ordinary
            
            Investment
                holdingBillion
                Win International Enterprise Ltd (“BW”)
            
            Hong
                Kong
              March
                5, 2001
            
            HK$5,000,000
              Ordinary
            
            Trading
                of watch componentsGoldcome
                Industrial Ltd (“GI”)
            
            Hong
                Kong
              March
                2, 2001
            
            HK$10,000
              Ordinary
            
            Trading
                of watch componentsCitibond
                Industrial Ltd (“CI”)
            
            Hong
                Kong
              February
                28, 2003
            
            HK$1,000
              Ordinary
            
            Trading
                of watch componentsMegamooch
                International Ltd (“MI”)
            
            Hong
                Kong
              April
                2, 2001
            
            HK$100
              Ordinary
            
            Trading
                of watches and watch componentsTME
                Enterprise Ltd
            
            British
                Virgin Islands
              November
                28, 2003
            
            US$2
              Ordinary
            
            Investment
                holdingCitibond
                Design Ltd
            
            British
                Virgin Islands
              August
                1, 2003
            
            US$2
              Ordinary
            
            InactiveMegamooch
                Online Ltd
            
            British
                Virgin Islands
              June
                6, 2003
            
            US$2
              Ordinary
            
            Trading
                of watches and watch components





F-11




ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**4.**
            **Summary
                of significant accounting
                policies**





Basis
      of presentation and consolidation





On
      December 2005, the Restructuring was completed and accordingly, the accounting
      for the recapitalization was adopted for the preparation of the comparative
      figures of the consolidated financial statements. The consolidated financial
      statements for the years ended December 31, 2005 and 2004 were issued under
      the
      name of the legal parent, but included the consolidated financial statements
      of
      TME Enterprise Limited, Citibond Design Limited and Megamooch Online Limited
      and
      the combined financial statements of TME HK, BW, CI, GI and MI.





The
      accompanying consolidated financial statements of the Company have been prepared
      in accordance with generally accepted accounting principles in the United States
      of America.





The
      consolidated financial statements include the accounts of the Company and its
      subsidiaries. All significant inter-company accounts and transactions have
      been
      eliminated in consolidation.





The
      results of subsidiaries acquired or disposed of during the years are included
      in
      the consolidated income statement from the effective date of acquisition or
      up
      to the effective date of disposal.





The
      Company also evaluates consolidation of entities under Financial Accounting
      Standards Board (FASB) Interpretation No. 46, “Consolidation of Variable
      Interest Entities” (FIN 46). FIN 46 requires management to evaluate whether an
      entity or interest is a variable interest entity and whether the Company is
      the
      primary beneficiary. Consolidation is required if both of these criteria are
      met. The Company does not have any variable interest entities requiring
      consolidation.





Use
      of
      estimates





In
      preparing financial statements in conformity with accounting principles
      generally accepted in the United States of America, management makes estimates
      and assumptions that affect the reported amounts of assets and liabilities
      and
      disclosures of contingent assets and liabilities at the dates of the financial
      statements, as well as the reported amounts of revenues and expenses during
      the
      reporting periods. These accounts and estimates include, but are not limited
      to,
      the valuation of accounts receivable, inventories, deferred income taxes and
      the
      estimation on useful lives of property, plant and equipment and intangible
      assets. Actual results could differ from those estimates.




F-12


ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**4.**
            **Summary
                of significant accounting policies
                (Cont’d)**





Concentrations
      of credit risk





Financial
      instruments that potentially subject the Group to significant concentrations
      of
      credit risk consist principally of accounts receivable. The Group extends credit
      based on an evaluation of the customer’s financial condition, generally without
      requiring collateral or other security. In
      order
      to minimize the credit risk, the management of the Group has delegated a team
      responsibility for determination of credit limits, credit approvals and other
      monitoring procedures to ensure that follow-up action is taken to recover
      overdue debts. Further, the
      Group
      reviews the recoverable amount of each individual trade debt at each balance
      sheet date to ensure that adequate impairment losses are made for irrecoverable
      amounts. In this regard, the directors of the Group consider that the Group’s
      credit risk is significantly reduced. Other
      than set forth below, no customers represented 10% or more of the Group’s net
      sales and accounts receivable.





At
      December 31, 2006, 2005 and 2004, customers represented 10% or more of the
      Group’s net sales and their related accounts receivable were as
      follows:





***Year
                ended December 31*****2006**
            
            **2005**
            
            **2004*****$***
            
            ***$***
            
            ***$***1stlargest customer
            
            
            9,587,395
            
            
            15,112,655
            
            
            4,482,1102ndlargest customer
            
            
            8,935,246
            
            
            7,047,980
            
            
            -Net
                sales
            
            
            18,522,641
            
            
            22,160,635
            
            
            4,482,110Accounts
                receivable
            
            
            1,463,565
            
            
            -
            
            
            417,954





Cash
      and cash equivalents





Cash
      and
      cash equivalents include all cash, deposits in banks and other highly liquid
      investments with initial maturities of three months or less.





Restricted
      cash





Deposits
      in banks for securities of bank overdrafts and borrowings that are restricted
      in
      use are classified as restricted cash.




F-13




ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**4.**
            **Summary
                of significant accounting policies
                (Cont’d)**





Accounts
      receivable





Accounts
      receivable are stated at original amount less an allowance made for doubtful
      receivables, if any, based on a review of all outstanding amounts at the year
      end. An allowance is also made when there is objective evidence that the Group
      will not be able to collect all amounts due according to the original terms
      of
      the receivables. Bad debts are written off when identified. The Group extends
      unsecured credit to customers in the normal course of business and believes
      all
      accounts receivable in excess of the allowances for doubtful receivables to
      be
      fully collectible. The Group does not accrue interest on trade accounts
      receivable.





During
      the years ended December 31, 2006, 2005 and 2004, the Group did not experience
      any bad debts and, accordingly, did not make any allowance for doubtful
      debts.





Inventories





Inventories
      are stated at the lower of cost or market. Cost is determined on a first-in,
      first-out basis and includes only purchase costs. There are no significant
      freight charges, inspection costs and warehousing costs incurred for any of
      the
      periods presented. In assessing the ultimate realization of inventories,
      management makes judgments as to future demand requirements compared to current
      or committed inventory levels. The Company has vendor arrangements on the
      purchase of watch movements providing for price reduction paid in the form
      of
      additional watch movements. The percentage of additional movements to be
      received by the Company from these vendors is estimated and inventory costs
      are
      reduced to reflect the effect of these additional movements on the actual cost
      of the items in inventory. During the years ended December 31, 2006, 2005 and
      2004, the Company did not make any allowance for slow-moving or defective
      inventories.





Leasehold
      lands





Leasehold
      lands, representing upfront payment for land use rights, are capitalized at
      their acquisition cost and amortized using the straight-line method over the
      lease terms.





Intangible
      assets





Intangible
      assets with limited useful lives are stated at cost less accumulated
      amortization and accumulated impairment losses.





Amortization
      of intangible assets is provided using the straight-line method over their
      estimated useful lives at the following annual rates:-





Trademarks
            
            
            20
            %Websites
            
            
            20
            %




F-14


ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**4.**
            **Summary
                of significant accounting policies
                (Cont’d)**





Held-to-maturity
      investments





The
      company’s policies for investments in debt and equity securities are as
      follows:





Non-derivative
      financial assets with fixed or determinable payments and fixed maturities that
      the company has the positive ability and intention to hold to maturity are
      classified as held-to-maturity securities. Held-to-maturity securities are
      initially recognized in the balance sheet at fair value plus transaction costs.
      Subsequently, they are stated in the balance sheet at amortized cost using
      the
      effective interest method less any identified impairment losses.





Investments
      are recognized / derecognized on the date the company commits to  purchase
      / sell the investments or they expire.





Plant
      and equipment





Plant
      and
      equipment are stated at cost less accumulated depreciation. Cost represents
      the
      purchase price of the asset and other costs incurred to bring the asset into
      its
      existing use. Maintenance, repairs and betterments, including replacement of
      minor items, are charged to expense; major additions to physical properties
      are
      capitalized.





Depreciation
      of plant and equipment is provided using the straight-line method over their
      estimated useful lives at the following annual rates:-





Buildings
            
            
            over the unexpired lease termFurniture
                and fixtures
            
            
            20
                - 25
            %Office
                equipment
            
            
            25
                - 33
            %Machinery
                and equipment
            
            
            25
                - 33
            %Moulds
            
            
            33
            %Motor
                vehicles
            
            
            25
                - 33
            %





Upon
      sale
      or disposition, the applicable amounts of asset cost and accumulated
      depreciation are removed from the accounts and the net amount less proceeds
      from
      disposal is charged or credited to income.


Impairment
      of long-lived assets





Long-lived
      assets are reviewed for impairment whenever events or changes in circumstances
      indicate that the carrying amount of the assets may not be recoverable. The
      Group recognizes impairment of long-lived assets in the event that the net
      book
      values of such assets exceed the future undiscounted cash flows attributable
      to
      such assets.





No
      impairment of long-lived assets was recognized for the years ended December
      31,
      2006, 2005 or 2004.




F-15




ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**4.**
            **Summary
                of significant accounting policies
                (Cont’d)**





Revenue
      recognition




Sales
      of
      goods represent the invoiced value of goods, net of sales returns, trade
      discounts and allowances.




The
      Company recognizes revenue when the goods are delivered and the customer takes
      ownership and assumes risk of loss, collection of the relevant receivable is
      probable, persuasive evidence of an arrangement exists, and the sales price
      is
      fixed or determinable. The Company provides pre and post sales service to its
      customers related to inventory management information in order to facilitate
      and
      manage sales to customers. By providing such services to keep track of
      customers’ inventory levels, the Company can manage and replenish inventory
      levels on a timely basis. The Company’s integration, design and development and
      management services provide customers with watch design assistance, components
      outsourcing or other project support, and are generally completed prior to
      a
      sale and do not continue post-delivery. There is no requirement that these
      services be provided for a sale to take place, nor is there any objective or
      reliable evidence of a separate fair value, or if no longer offered or ceased
      to
      be offered would a right of return be created for the goods sold. The Company
      believes these services are part of the sales process and are not a customer
      deliverable, and are therefore charged to selling expense or cost of sales,
      as
      appropriate.





Unearned
      revenue





Unearned
      revenue represents payments received from customers from the sale of goods
      for
      which the earning process has not been completed, as the customer maintains
      a
      full right of exchange. Accordingly, the significant risks and rewards of
      ownership of the goods have not been transferred from the Group to the
      customers, taking into account the conditions as stipulated in SFAS No. 48
      and
      Staff Accounting Bulletin (“SAB”) 101, as amended by SAB 104.





Advertising
      and promotion expenses





Advertising
      and promotion expenses are charged to expense as incurred.





Advertising
      and promotion expenses amounted to $2,502, $19,718 and $66,914 during 2006,
      2005
      and 2004, respectively, and are included in administrative and other operating
      expenses.




F-16




ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**4.**
            **Summary
                of significant accounting policies
                (Cont’d)**





Comprehensive
      income





The
      Group
      has adopted SFAS No. 130, “Reporting Comprehensive Income”, which establishes
      standards for reporting and display of comprehensive income, its components
      and
      accumulated balances. Accumulated other comprehensive income represents the
      accumulated balance of foreign currency translation adjustments of the Group.





Foreign
      currency translation





The
      functional currency of the Group is Hong Kong dollars (“HK$”). The Group
      maintains its financial statements in the functional currency. Monetary assets
      and liabilities denominated in currencies other than the functional currency
      are
      translated into the functional currency at rates of exchange prevailing at
      the
      balance sheet dates. Transactions denominated in currencies other than the
      functional currency are translated into the functional currency at the exchanges
      rates prevailing at the dates of the transaction. Exchange gains or losses
      arising from foreign currency transactions are included in the determination
      of
      net income for the respective periods.





For
      financial reporting purposes, the financial statements of the Group which are
      prepared using the functional currency have been translated into United States
      dollars. Assets and liabilities are translated at the exchange rates at the
      balance sheet dates and revenue and expenses are translated at the average
      exchange rates and stockholders’ equity is translated at historical exchange
      rates. Any translation adjustments resulting are not included in determining
      net
      income but are included in foreign exchange adjustment to other comprehensive
      income, a component of stockholders’ equity.





2006
            
            2005
            
            2004Year
                end HK$:US$ exchange rate
            
            
            7.7730
            
            
            7.7535
            
            
            7.7760Average
                yearly HK$:US$ exchange rate
            
            
            7.7783
            
            
            7.7778
            
            
            7.7893





Fair
      value of financial instruments





The
      carrying values of the Group’s financial instruments, including cash and cash
      equivalents, restricted cash, trade and other receivables, deposits, trade
      and
      other payables approximate their fair values due to the short-term maturity
      of
      such instruments. The
      carrying amounts of borrowings approximate their fair values because the
      applicable interest rates approximate current market rates.





F-17


ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**4.**
            **Summary
                of significant accounting policies
                (Cont’d)**





Basic
      and diluted earnings per share





The
      Company reports earnings per share in accordance with SFAS No. 128, “Earnings
      Per Share”. Basic and diluted earnings per share are computed using the weighted
      average number of shares outstanding during the periods presented. The weighted
      average number of shares represents the shares of common stock outstanding
      during the respective years. As the Company did not have any common stock
      equivalents during such years, basic and diluted income per share were the
      same
      for all periods presented.





Comparative
      amounts





Certain
      amounts included in the prior years consolidated financial statements have
      been
      reclassified to conform to the current year’s presentation. These
      reclassifications had no effect on reported total assets, liabilities,
      shareholders’ equity, or net income.





Recent
      accounting pronouncements





In
      November 2004, the Financial Accounting Standards Board (“FASB”) issued SFAS No.
      151, “Inventory costs - an amendment of ARB No. 43, Chapter 4” (“SFAS 151”).
      SFAS 151 amends ARB 43, Chapter 4 to clarify that “abnormal” amount of idle
      freight, handling costs and spoilage should be recognized as current period
      charges. SFAS 151 is effective for inventory costs incurred during fiscal years
      beginning after June 15, 2005. The adoption of SFAS 151 had no material effect
      on the Company’s financial statements.





In
      December 2004, the FASB issued SFAS No. 123R, “Share-Based Payment” (“SFAS
      123R”), which revises SFAS No. 123, “Accounting for Stock Based Compensation”,
      and supersedes APB 25. Among other items, SFAS 123R eliminates the use of APB
      25
      and the intrinsic value method of accounting, and requires companies to
      recognize in the financial statements the cost of employee services received
      in
      exchange for awards of equity instruments, based on the grant-date fair value
      of
      those awards. This cost is to be recognized over the period during which an
      employee is required to provide service in exchange for the award (typically
      the
      vesting period). SFAS 123R also requires that benefits associated with tax
      deductions in excess of recognized compensation cost be reported as a financing
      cash inflow, rather than as an operating cash flow as required under current
      literature.





SFAS
      123R
      permits companies to adopt its requirements using either a “modified
      prospective” method, or a “modified retrospective” method.





Under
      the
“modified prospective” method, compensation cost is recognized in the financial
      statements beginning with the effective date, based on the requirements of
      SFAS
      123R for all share-based awards granted or modified after that date, and based
      on the requirements of SFAS 123 for all unvested awards granted prior to the
      effective date of SFAS 123R. Under the “modified retrospective” method, the
      requirements are the same as under the “modified prospective” method, but this
      method also permits entities to restate financial statements of previous periods
      based on pro forma disclosures made in accordance with SFAS 123. The Company
      adopted SFAS 123R effective January 1, 2006 using the modified prospective
      method.




F-18




ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**4.**
            **Summary
                of significant accounting policies
                (Cont’d)**





Recent
      accounting pronouncements (Cont’d)





In
      May
      2005, the FASB issued SFAS No. 154, “Accounting Changes and Error Corrections”
(“SFAS 154”), which changes the requirements for the accounting for and
      reporting of a change in accounting principle. The statement requires
      retrospective application to prior period financial statements of changes in
      accounting principle, unless impracticable to do so. It also requires that
      a
      change in the depreciation, amortization, or depletion method for long-lived
      non-financial assets be accounted as a change in accounting estimate, effected
      by a change in accounting principle. Accounting for error corrections and
      accounting estimate changes will continue under the guidance in APB Opinion
      20,
“Accounting Changes”, as carried forward in this pronouncement. The statement is
      effective for fiscal years beginning after December 15, 2005. The adoption
      of
      SFAS No. 154 had no material effect on the Company’s financial
      statements.





In
      November 2005, the FASB issued FSP Nos. FAS 115-1 and 124-1, “The Meaning of
      Other-Than-Temporary Impairment and Its Application to Certain Investments.”
This FSP addresses the determination as to when an investment is considered
      impaired, whether the impairment is ‘other-than-temporary’, and the measurement
      of an impairment loss. The investment is impaired if the fair value is less
      than
      cost. The impairment is ‘other-than-temporary’ for equity securities and debt
      securities that can contractually be prepaid or otherwise settled in such a
      way
      that the investor would not recover substantially all of its cost. If
‘other-than-temporary’, an impairment loss shall be recognized in earnings equal
      to the difference between the investment’s cost and its fair value. The guidance
      in this FSP is effective in reporting periods beginning after December 15,
      2005.
      The adoption of FSP No. 115-1 and 124-1 had no material effect on the Company’s
      financial statements.





In
      February 2006, the FASB issued SFAS No. 155, Accounting for Certain Hybrid
      Financial Instruments, which amends SFAS No. 133, Accounting for Derivative
      Instruments and Hedging Activities (“SFAS 155”), and SFAS No. 140, Accounting
      for Transfers and Servicing of Financial Assets and Extinguishments of
      Liabilities. SFAS 155 simplifies the accounting for certain derivatives embedded
      in other financial instruments by allowing them to be accounted for as a whole
      if the holder elects to account for the whole instrument on a fair value basis.
      SFAS 155 also clarifies and amends certain other provisions of SFAS 133 and
      SFAS
      140. SFAS 155 is effective for all financial instruments acquired, issued or
      subject to a remeasurement event occurring in fiscal years beginning after
      September 15, 2006. Earlier adoption is permitted, provided the Company has
      not
      yet issued financial statements, including for interim periods, for that fiscal
      year. The Company does not believe the adoption of SFAS 155 will have a material
      effect on the Company’s financial statements.




F-19


ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**4.**
            **Summary
                of significant accounting policies
                (Cont’d)**





Recent
      accounting pronouncements (Cont’d)





In
      March
      2006, the FASB released SFAS No. 156, “Accounting for Servicing of Financial
      Assets” (“SFAS 156”), to simplify accounting for separately recognized servicing
      assets and servicing liabilities. SFAS 156 amends SFAS 140, “Accounting for
      Transfers and Servicing of Financial Assets and Extinguishments of Liabilities.”
SFAS 156 permits an entity to choose either the amortization method or the
      fair
      value measurement method for measuring each class of separately recognized
      servicing assets and servicing liabilities after they have been initially
      measured at fair value. SFAS 156 applies to all separately recognized servicing
      assets and liabilities acquired or issued after the beginning of an entity’s
      fiscal year that begins after September 15, 2006. SFAS 156 will be effective
      for
      the Company as of December 31, 2006, the beginning of the Company’s 2007 fiscal
      year. The Company does not believe the adoption of SFAS 156 will have a material
      effect on the Company’s financial statements.





In
      July
      2006, the FASB issued FIN 48 “Accounting for Uncertainty in Income Taxes.” This
      interpretation requires that the Company recognize in its financial statements,
      the impact of a tax position, if that position is more likely than not of being
      sustained on audit, based on the technical merits of the position. The
      provisions of FIN 48 are effective as of the beginning of our 2007 fiscal year,
      with the cumulative effect of the change in accounting principle recorded as
      an
      adjustment to opening retained earnings if any. The Company is currently
      evaluating the effect of FIN 48 on its financial statements and does not believe
      the adoption of FIN No. 48 will have a material effect on the Company’s
      financial statements.





In
      September 2006, the FASB issued SFAS No. 157 “Fair Value Measurement” (“SFAS
      157”). SFAS 157 defines fair value, establishes a framework for measuring fair
      value, and expands disclosures about fair value measurements. This statement
      will be effective for financial statements issued for fiscal years beginning
      after November 15, 2007, and interim periods within those fiscal years. Earlier
      application is encouraged, provided that the reporting entity has not yet issued
      financial statements for that fiscal year, including any financial statements
      for an interim period within that fiscal year. The provisions of this statement
      should be applied prospectively as of the beginning of the fiscal year in which
      this statement is initially applied, except in some circumstances where the
      statement shall be applied retrospectively. The Company is currently evaluating
      the effect, if any, of SFAS 157 on its financial statements. Although the
      Company will continue to evaluate the provisions of SFAS No. 157,
      management currently does not believe the adoption of SFAS
      No. 157 will have a material impact on the Company’s financial
      statements.




F-20




ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**4.**
            **Summary
                of significant accounting policies
                (Cont’d)**





Recent
      accounting pronouncements (Cont’d)





In
      September 2006, the FASB released SFAS No. 158, “Employers’ Accounting for
      Defined Benefit Pension and Other Postretirement Plans: an amendment of FASB
      Statements No. 87, 88, 106, and 132(R)” (“SFAS 158”), which requires an employer
      to recognize the over funded or under funded status of defined benefit and
      other
      postretirement plans 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 an adjustment to comprehensive income. This statement
      also
      requires 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. The
      Company is required to initially recognize the funded status of its defined
      benefit and other postretirement plans as of December 31, 2006. The adoption
      of
      SFAS 158 had no material effect on the Company’s 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 SFAS
      No. 115” (“SFAS 159”). The fair value option established by SFAS 159 permits all
      entities to choose to measure eligible items at fair value at specified election
      dates. A business entity will report unrealized gains and losses on items for
      which the fair value option has been elected in earnings (or another performance
      indicator if the business entity does not report earnings) at each subsequent
      reporting date. The fair value option: (a) may be applied instrument by
      instrument, with a few exceptions, such as investments otherwise accounted
      for
      by the equity method; (b) is irrevocable (unless a new election date occurs);
      and (c) is applied only to entire instruments and not to portions of
      instruments. SFAS 159 is effective as of the beginning of an entity’s first
      fiscal year that begins after November 15, 2007. Early adoption is permitted
      as
      of the beginning of the previous fiscal year provided that the entity makes
      that
      choice in the first 120 days of that fiscal year and also elects to apply the
      provisions of SFAS 157. The Company did not elect to early adopt this statement.
      Although the Company will continue to evaluate the provisions of SFAS 159,
      management currently does not believe the adoption of SFAS 159 will
      have a material impact on the Company’s financial statements.




F-21


ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**5.**
            **Other
                income**




**Year
                  ended December 31,*****2006***
              
              ***2005***
              
              ***2004******$***
              
              ***$***
              
              ***$****Operating
                  income*Commission
                  income
              
              
              -
              
              
              771,432
              
              
              -Gain
                  on disposal of intangible assets
              
              
              210,594
              
              
              -
              
              
              -License
                  fee of intangible assets
              
              
              167,138
              
              
              167,141
              
              
              -Rental
                  income
              
              
              46,284
              
              
              -
              
              
              -424,016
              
              
              938,573
              
              
              -*Non-operating
                  income*Bank
                  interest income
              
              
              208,854
              
              
              76,358
              
              
              15,720Dividend
                  income
              
              
              8,977
              
              
              4,481
              
              
              -Insurance
                  compensation
              
              
              -
              
              
              8,325
              
              
              -Net
                  exchange gains
              
              
              1,078
              
              
              1,302
              
              
              170Other
                  interest income
              
              
              18,635
              
              
              49,440
              
              
              -Sundry
                  income
              
              
              27
              
              
              16,293
              
              
              12,157237,571
              
              
              156,199
              
              
              28,047661,587
              
              
              1,094,772
              
              
              28,047


**6.**
            **Interest
                expenses**




***Year
                  ended December 31,******2006***
              
              ***2005***
              
              ***2004******$***
              
              ***$***
              
              ***$***Interest
                  on bank trust receipts
              
              
              981,184
              
              
              457,983
              
              
              139,209Interest
                  on short-term bank loans
              
              
              25,322
              
              
              6,254
              
              
              14,505Interest
                  on bank overdrafts
              
              
              54,030
              
              
              45,302
              
              
              6,648Interest
                  on a capital lease
              
              
              -
              
              
              -
              
              
              1,947Interest
                  on other loans
              
              
              -
              
              
              5,098
              
              
              2,2491,060,536
              
              
              514,637
              
              
              164,558




**7.**
            **Income
                taxes**





***Year
                ended December 31,******2006***
            
            ***2005***
            
            ***2004******$***
            
            ***$***
            
            ***$***Hong
                Kong profits taxCurrent
                year
            
            
            1,311,479
            
            
            948,933
            
            
            136,117Over
                provision in prior year
            
            
            (21,408
            )
            
            (37,246
            )
            
            (4,166
            )1,290,071
            
            
            911,687
            
            
            131,951Deferred
                taxes
            
            
            17,657
            
            
            -
            
            
            -1,307,728
            
            
            911,687
            
            
            131,951




F-22




ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**7.**
            **Income
                taxes (Cont’d)**





The
      Company’s subsidiaries operating in Hong Kong are subject to profits tax of
      17.5% on the estimated assessable profits during the years.





A
      reconciliation of income tax expense to the amount computed by applying the
      Hong
      Kong statutory tax rate to the income before taxes in the consolidated income
      statement is as follows:


***Year
                  ended December 31,******2006***
              
              ***2005***
              
              ***2004******$***
              
              ***$***
              
              ***$***Income
                  before taxes
              
              
              7,627,667
              
              
              4,937,312
              
              
              336,909Provision
                  for income taxes at Hong Kong income tax rate
              
              
              1,334,842
              
              
              864,030
              
              
              58,959Change
                  in valuation allowance
              
              
              486
              
              
              50,918
              
              
              118,129Non-taxable
                  items
              
              
              (43,870
              )
              
              (14,147
              )
              
              -Non-deductible
                  items
              
              
              7,363
              
              
              27
              
              
              418Others
              
              
              8,907
              
              
              45,927
              
              
              (44,228
              )1,307,728
              
              
              911,687
              
              
              131,951





The
      major
      components of deferred tax recognized in the consolidated balance sheets as
      of
      December 31, 2006, 2005 and 2004 are as follows:


***At
                  December 31******2006***
              
              ***2005***
              
              ***2004******$***
              
              ***$***
              
              ***$***Temporary
                  difference on accelerated tax depreciation on plant and
                  equipment
              
              
              17,669
              
              
              -
              
              
              -Deferred
                  tax liabilities, net
              
              
              17,669
              
              
              -
              
              
              -Recognized
                  in the balance sheet:Net
                  deferred tax assets
              
              
              (14,042
              )
              
              -
              
              
              -Net
                  deferred tax liabilities
              
              
              31,711
              
              
              -
              
              
              -17,669
              
              
              -
              
              
              -




Deferred
      tax assets of the Company relating to the tax effect of the change in valuation
      allowance of the Company has not been accounted for in the financial statements
      for the years ended December 31, 2006, 2005 and 2004 as management determined
      that it was more likely than not that these tax losses would not be utilized
      in
      the foreseeable future. There was no other significant unprovided deferred
      taxation of the Company at the balance sheet dates.




F-23




ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)




**8.**
            **Prepaid
                expenses and other
                receivables**




***At
                December 31,******2006***
            
            ***2005***
            
            ***2004******$***
            
            ***$***
            
            ***$***Rental
                receivable
            
            
            46,314
            
            
            -
            
            
            -Interest
                receivable
            
            
            20,218
            
            
            -
            
            
            -Purchase
                deposits paid
            
            
            1,530,372
            
            
            361,221
            
            
            727,725Sales
                proceeds of intangible assets receivable
            
            
            301,042
            
            
            -
            
            
            -Other
                deposits and prepayments
            
            
            203,187
            
            
            33,015
            
            
            2092,101,133
            
            
            394,236
            
            
            727,934




**9.**
            **Inventories**




***At
                December 31******2006***
            
            ***2005***
            
            ***2004******$***
            
            ***$***
            
            ***$***Merchandises,
                at cost – completed watches
            
            
            1,745,648
            
            
            3,630,754
            
            
            2,446,048Merchandises,
                at cost – watch movements
            
            
            4,500,537
            
            
            2,682,868
            
            
            1,426,7836,246,185
            
            
            6,313,622
            
            
            3,872,831




F-24




ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**10.**
            **Plant
                and equipment**




***At
                  December 31,******2006***
              
              ***2005***
              
              ***2004******$***
              
              ***$***
              
              ***$****Cost*Buildings
              
              
              242,350
              
              
              104,008
              
              
              -Furniture
                  and fixtures
              
              
              492,866
              
              
              478,811
              
              
              350,425Office
                  equipment
              
              
              145,911
              
              
              137,410
              
              
              124,157Machinery
                  and equipment
              
              
              321,626
              
              
              128,974
              
              
              128,601Moulds
              
              
              384,665
              
              
              230,863
              
              
              230,195Motor
                  vehicles
              
              
              45,928
              
              
              26,375
              
              
              26,2991,633,346
              
              
              1,106,441
              
              
              859,677*Accumulated
                  depreciation*Buildings
              
              
              8,441
              
              
              2,542
              
              
              -Furniture
                  and fixtures
              
              
              237,508
              
              
              140,271
              
              
              21,049Office
                  equipment
              
              
              100,612
              
              
              68,766
              
              
              35,020Machinery
                  and equipment
              
              
              93,475
              
              
              32,447
              
              
              6,633Moulds
              
              
              276,936
              
              
              153,139
              
              
              76,732Motor
                  vehicles
              
              
              26,116
              
              
              26,375
              
              
              23,691743,088
              
              
              423,540
              
              
              163,125*Net*Buildings
              
              
              233,909
              
              
              101,466
              
              
              -Furniture
                  and fixtures
              
              
              255,358
              
              
              338,540
              
              
              329,376Office
                  equipment
              
              
              45,299
              
              
              68,644
              
              
              89,137Machinery
                  and equipment
              
              
              228,151
              
              
              96,527
              
              
              121,968Moulds
              
              
              107,729
              
              
              77,724
              
              
              153,463Motor
                  vehicles
              
              
              19,812
              
              
              -
              
              
              2,608890,258
              
              
              682,901
              
              
              696,552





Depreciation
      expenses included in administrative and other operating expenses for the years
      ended 2006, 2005 and 2004 are $325,995, $259,127 and $126,225
      respectively.





As
      at
      December, 2006, 2005 and 2004, the carrying amount of buildings pledged as
      security for the Group’s banking facilities amounted to $233,909, $101,466 and
      $Nil respectively.




F-25




ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**11.**
            **Leasehold
                lands**




***At
                  December 31******2006***
              
              ***2005***
              
              ***2004******$***
              
              ***$***
              
              ***$****Cost*
              
              
              949,514
              
              
              331,924
              
              
              -*Accumulated
                  amortization*
              
              
              31,234
              
              
              7,992
              
              
              -*Net*
              
              
              918,280
              
              
              323,932
              
              
              -Analyzed
                  for reporting purposes as:Current
                  asset
              
              
              22,958
              
              
              7,993
              
              
              -Non-current
                  asset
              
              
              895,322
              
              
              315,939
              
              
              -918,280
              
              
              323,932
              
              
              -


Amortization
      expenses included in administrative and other operating expenses for the years
      ended 2006, 2005 and 2004 are $23,247, $7,968 and $Nil
      respectively.





As
      at
      December, 2006, 2005 and 2004 the carrying amount of leasehold lands pledged
      as
      security for the Group’s banking facilities amounted to $918,280, $323,932 and
      $Nil respectively.




**12.**
            **Held-to-maturity
                investments**


***At
                  December 31,******2006***
              
              ***2005***
              
              ***2004******$***
              
              ***$***
              
              ***$***Hang
                  Seng Capital Guarantee Investment Fund - 30,000 units at $10 each,
                  interest rate at 10.5% in 3.75 years*Cost*
              
              
              301,196
              
              
              301,954
              
              
              -*Fair
                  value*
              
              
              294,410
              
              
              275,100
              
              
              -


As
      at
      December, 2006, 2005 and 2004 the carrying amount of held-to-maturity
      investments pledged as security for the Group’s banking facilities amounted to
      $301,196, $301,954 and $Nil respectively.




F-26




ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**13.**
            **Intangible
                assets**




***At
                  December 31,******2006***
              
              ***2005***
              
              ***2004******$***
              
              ***$***
              
              ***$****Cost*Trademarks
              
              
              200,695
              
              
              201,199
              
              
              200,617Websites
              
              
              421,459
              
              
              573,418
              
              
              571,759622,154
              
              
              774,617
              
              
              772,376*Accumulated
                  amortization*Trademarks
              
              
              112,389
              
              
              72,431
              
              
              32,099Websites
              
              
              171,929
              
              
              118,037
              
              
              3,343284,318
              
              
              190,468
              
              
              35,442*Net*Trademarks
              
              
              88,306
              
              
              128,768
              
              
              168,518Websites
              
              
              249,530
              
              
              455,381
              
              
              568,416337,836
              
              
              584,149
              
              
              736,934


Amortization
      expenses included in administrative and other operating expenses for the years
      ended 2006, 2005 and 2004 are $ 154,436 ,
      $154,438 and $35,382 respectively.




Estimated
      aggregate future amortization expenses for the succeeding three years as of
      December 31, 2006 were as follows:


***$***2007
              
              
              124,4302008
              
              
              124,4302009
              
              
              88,976337,836




F-27




ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**14.**
            **Other
                payables and accrued
                liabilities**




***At
                  December 31,******2006***
              
              ***2005***
              
              ***2004******$***
              
              ***$***
              
              ***$***Accrued
                  expenses
              
              
              181,352
              
              
              145,249
              
              
              41,798Sales
                  deposits received
              
              
              9,006
              
              
              -
              
              
              -190,358
              
              
              145,249
              
              
              41,798




**15.**
            **Advance
                from a related party**





Advance
      from a related party for working capital is as follows:




***At
                  December 31,******2006***
              
              ***2005***
              
              ***2004******$***
              
              ***$***
              
              ***$***Advance
                  from a director
              
              
              -
              
              
              28,854
              
              
              89,296





The
      above
      advance is interest-free, unsecured and has no fixed repayment
      terms.




F-28




ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**16.**
            **Bank
                borrowings**




***At
                  December 31******2006***
              
              ***2005***
              
              ***2004******$***
              ******
              ***$***
              
              ***$***Secured:Bank
                  overdrafts repayable on demand
              
              
              551,714
              
              
              352,577
              
              
              602,614Repayable
                  within one yearNon-recurring
                  bank loans
              
              
              1,469,866
              
              
              294,764
              
              
              129,631Other
                  bank borrowings
              
              
              11,183,587
              
              
              9,416,788
              
              
              6,668,53013,205,167
              
              
              10,064,129
              
              
              7,400,775





As
      of
      December 31, 2006, the Company’s banking facilities are composed of the
      following:




**Amount****Facilities
                  granted**
              
              **Granted**
              
              **Utilized**
              
              **Unused*****$***
              
              ***$***
              
              ***$***Bank
                  overdrafts
              
              
              643,252
              
              
              551,714
              
              
              91,538Non-recurring
                  bank loans
              
              
              1,469,866
              
              
              1,469,866
              
              
              -Other
                  facilities including:-
                  Outstanding letter of credit-
                  Letter of credit under trust receipt-
                  Invoice/account payable financing
              
              
              11,578,541
              
              
              11,183,587
              
              
              394,95413,691,659
              
              
              13,205,167
              
              
              486,492


As
      of
      December 31, 2006, the above banking borrowings were secured by the
      following:





(a)
            first
                fixed legal charge over leasehold land and buildings with carrying
                amounts
                of $1,152,189 (note 11 and 12);





(b)
            charge
                over bank deposits of $4,780,980;





(c)
            charge
                over held-to-maturity investments of $301,196 (note 12);
                and





(d)
            personal
                guarantee executed by a director of the
                Company;





(e)
            other
                financial covenant.





The
      bank
      borrowings require one of the Company’s subsidiaries to maintain a minimum net
      worth of $1,286,504.





The
      interest rates of short-terms notes payable were at 7.5% to 8.375% per annum
      with various maturity rates.





The
      interest rates of non-recurring bank loans were at Hong Kong Prime Rate minus
      0.75% to 2% per annum.




F-29




ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**17.**
            **Pension
                plans**





The
      Group
      participates in a defined contribution pension scheme under the Mandatory
      Provident Fund Schemes Ordinance “MPF Scheme” for all its eligible employees in
      Hong Kong.





The
      MPF
      Scheme is available to all employees aged 18 to 64 with at least 60 days of
      service in the employment in Hong Kong. Contributions are made by the Group’s
      subsidiary operating in Hong Kong at 5% of the participants’ relevant income
      with a ceiling of HK$20,000. The participants are entitled to 100% of the
      Group’s contributions together with accrued returns irrespective of their length
      of service with the Group, but the benefits are required by law to be preserved
      until the retirement age of 65. The only obligation of the Group with respect
      to
      MPF Scheme is to make the required contributions under the plan.





The
      assets of the schemes are controlled by trustees and held separately from those
      of the Group. Total pension cost was $18,749, $18,802 and $15,346 during 2006,
      2005 and 2004 respectively.





**18.**
            **Commitments
                and contingencies**





Operating
      leases commitments





The
      Group
      leases office premises under various non-cancelable operating lease agreements
      that expire at various dates through years 2007 to 2008,  with
      an
      option to renew the lease. All leases are on a fixed repayment basis. None
      of
      the leases includes contingent rentals. Minimum future commitments under these
      agreements payable as of December 31, 2006 are as follows:-





Year
                ending December 31
            
            ***$***2007
            
            
            89,0112008
            
            
            70,272159,283





Rental
      expenses for the years ended 2006, 2005 and 2004 were $103,624, $138,262 and
      $47,466 respectively.




F-30




ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**19.**
            **Common
                stock**




***At
                  December 31******Number
                  of shares***
              
              ***Amount******2006***
              
              ***2005***
              
              ***2004***
              
              ***2006***
              
              ***2005***
              
              ***2004***Authorized:The
                  Company of $0.0001 each
              
              
              100,000,000
              
              
              100,000,000
              
              
              100,000,000
              
              
              10,000
              
              
              10,000
              
              
              10,000Issued
                  and outstanding:The
                  Company of $0.0001 each
              
              
              19,454,420
              
              
              19,454,420
              
              
              19,454,420
              
              
              1,946
              
              
              1,946
              
              
              1,946





**20.**
            **Segment
                Information**





For
      management purposes, the Group is currently organized into two major principal
      activities – trading of watch movements (components) and trading of
      completed watches. These principal activities are the basis on which the Group
      reports its primary segment information.





**2006**
            
            **Watchmovements**
            
            **Completedwatches**
            
            **Total*****$***
            
            ***$***
            
            ***$***Sales
            
            
            73,047,632
            
            
            8,086,643
            
            
            81,134,275Cost
                of sales
            
            
            (67,228,452
            )
            
            (4,268,349
            )
            
            (71,496,801
            )Segment
                result
            
            
            5,819,180
            
            
            3,818,294
            
            
            9,637,474Acquisition
                of leasehold lands
            
            
            618,025
            
            
            -
            
            
            618,025Acquisition
                of plant and equipment
            
            
            158,227
            
            
            386,451
            
            
            544,678Depreciation
            
            
            159,003
            
            
            166,992
            
            
            325,995Amortization
                of intangible assets
            
            
            -
            
            
            154,436
            
            
            154,436Amortization
                of leasehold lands
            
            
            23,247
            
            
            -
            
            
            23,247




F-31




ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS (restated)
 (Stated
        in US Dollars)
 
 **20.**
              **Segment
                  Information (continued)**
 
 **2005**
              
              **Watch**
                **movements**
              
              **Completed**
                **watches**
              
              **Total*****$***
              
              ***$***
              
              ***$***Sales
              
              
              58,843,209
              
              
              4,235,200
              
              
              63,078,409Cost
                  of sales
              
              
              (55,069,673
              )
              
              (1,956,363
              )
              
              (57,026,036
              )Segment
                  result
              
              
              3,773,536
              
              
              2,278,837
              
              
              6,052,373Acquisition
                  of leasehold lands
              
              
              330,884
              
              
              -
              
              
              330,884Acquisition
                  of plant and equipment
              
              
              243,504
              
              
              -
              
              
              243,504Depreciation
              
              
              183,180
              
              
              75,947
              
              
              259,127Amortization
                  of intangible assets
              
              
              -
              
              
              154,438
              
              
              154,438Amortization
                  of leasehold lands
              
              
              7,968
              
              
              -
              
              
              7,968
 
 **2004**
              
              **Watch**
                **movements**
              
              **Completed**
                **watches**
              
              **Total*****$***
              
              ***$***
              
              **$**Sales
              
              
              36,533,084
              
              
              -
              
              
              36,553,084Cost
                  of sales
              
              
              (34,608,653
              )
              
              -
              
              
              (34,608,653
              )Segment
                  result
              
              
              1,944,431
              
              
              -
              
              
              1,944,431Acquisition
                  of plant and equipment
              
              
              551,293
              
              
              229,802
              
              
              781,095Acquisition
                  of intangible assets
              
              
              -
              
              
              771,063
              
              
              771,063Depreciation
              
              
              49,654
              
              
              76,571
              
              
              126,225Amortization
                  of intangible assets
              
              
              -
              
              
              35,382
              
              
              35,382
 
 The
        Group’s operations are primarily in Hong Kong and China and the Group’s sales,
        gross profit and total assets attributable to other geographical areas are
        less
        than **** 10%
        of
        the Group’s corresponding consolidated totals for the years ended December,
        2006, 2005 and 2004. Consequently, no segment information by geographical
        areas
        is presented.
  F-32
 
 ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS (restated)
 (Stated
        in US Dollars)
 
 **21.**
              **Cost
                  of sales**
 
 ***Year
                  ended December 31,******2006***
              
              ***2005***
              
              ***2004******$***
              
              ***$***
              
              ***$***Opening
                  inventories
              
              
              6,313,662
              
              
              3,872,831
              
              
              1,293,049Purchases
              
              
              71,429,324
              
              
              59,466,867
              
              
              37,188,435Less:closing inventories
              
              
              (6,246,185
              )
              
              (6,313,662
              )
              
              (3,872,831
              )71,496,801
              
              
              57,026,036
              
              
              34,608,653
 
 **22.**
              **Administrative
                  and other operating
                  expenses**
 
 ***Year
                  ended December 31,******2006***
              
              ***2005***
              
              ***2004******$***
              
              ***$***
              
              ***$*****Administrative
                  expenses**Accounting
                  fee
              
              
              -
              
              
              20,121
              
              
              16,459Advertising
                  and promotion
              
              
              2,502
              
              
              19,718
              
              
              66,914Auditor’s
                  remuneration
              
              
              62,695
              
              
              131,141
              
              
              22,030Director’s
                  remuneration
              
              
              61,713
              
              
              61,713
              
              
              61,623Legal
                  and professional fees
              
              
              29,263
              
              
              255,758
              
              
              479,095Mandatory
                  provident fund contributions
              
              
              18,749
              
              
              18,802
              
              
              15,346Staff
                  salaries
              
              
              444,903
              
              
              410,542
              
              
              321,771Other
                  administrative expenses
              
              
              11,187
              
              
              9,150
              
              
              8,320631,012
              
              
              926,945
              
              
              991,558
  F-33
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS (restated)
 (Stated
        in US Dollars)
 
 **22.**
              **Administrative
                  and other operating expenses
                  (continued)**
 
 ***Year
                  ended December 31,******2006***
              
              ***2005***
              
              ***2004******$***
              
              ***$***
              
              ***$*****Other
                  operating expenses**Amortization
                  of intangible assets
              
              
              154,436
              
              
              154,438
              
              
              35,382Amortization
                  of leasehold lands
              
              
              23,247
              
              
              7,968
              
              
              -Bank
                  charges
              
              
              132,670
              
              
              60,735
              
              
              22,565Building
                  management fee
              
              
              10,830
              
              
              14,512
              
              
              6,846Consultancy
                  fee
              
              
              109,701
              
              
              50,770
              
              
              1,284Electricity
                  and water
              
              
              12,936
              
              
              12,255
              
              
              8,402Loss
                  on disposal of plant and equipment
              
              
              7,715
              
              
              -
              
              
              -Motor
                  vehicle expenses
              
              
              11,361
              
              
              13,937
              
              
              23,910Rent
                  and rates
              
              
              108,312
              
              
              138,992
              
              
              49,865Telephone
              
              
              10,465
              
              
              10,849
              
              
              9,868Other
                  operating expenses
              
              
              72,178
              
              
              44,668
              
              
              195,106653,851
              
              
              509,124
              
              
              353,2281,284,863
              
              
              1,436,069
              
              
              1,344,786
  **23.**
              **Restatement**
 
 The
        Company has restated its financial statements for the years ended December
        31,
        2006, 2005, and 2004 to correct various accounting errors and/or disclosure
        omissions.
 
 The
        restatement included the correction of errors with respect to the accounting
        for
        inventory by adjusting watch movement costing for the effects of vendor
        incentives from an as received basis to an accrual basis, as the Company
        is able
        to estimate the value of the incentives as inventory is purchased. The Company
        also restated average shares outstanding and actual shares outstanding to
        correct the accounting for the reverse merger transaction in January 2007.
        As a
        result of these corrections, various income tax calculations were also revised,
        which effected net income and also caused reclassifications to cash flows.
        The
        Company also made various changes to footnote disclosures relating to these
        changes.
 
 Below
        are
        summaries of the financial statement line items that were affected by the
        restatements described above.
  F-34
 
 ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS (restated)
 (Stated
        in US Dollars)
 
 **23.**
              **Restatement
                  (continued)**
 
 **Statement
        of Operations**
 **Year
        ended December 31, 2006**
 
 ***2006***
              
              ***2006***
              
              ***2006******(As
                  originally***
              
              ***(restated)***
              
              ***(Effect of******reported)***
              
              
              
              ***adjustments)******$***
              
              ***$***
              
              ***$***Net
                  sales
              
              
              81,134,275
              
              
              81,134,275
              
              
              -Cost
                  of sales
              
              
              (71,393,755
              )
              
              (71,496,801
              )
              
              (103,046
              )Gross
                  profit
              
              
              9,740,520
              
              
              9,637,474
              
              
              (103,046
              )Other
                  income
              **A**
              
              -
              
              
              424,016
              
              
              424,016Depreciation
              
              
              (325,995
              )
              
              (325,995
              )
              
              -Administrative
                  and other operating expenses
              **B**
              
              (1,291,837
              )
              
              (1,284,863
              )
              
              6,974Income
                  from operations
              
              
              8,122,688
              
              
              8,450,632
              
              
              327,944Other
                  income
              **A**
              
              661,587
              
              
              237,571
              
              
              (424,016
              )Interest
                  expenses
              
              
              (1,060,536
              )
              
              (1,060,536
              )
              
              -Income
                  before taxes
              
              
              7,723,739
              
              
              7,627,667
              
              
              (96,072
              )Income
                  taxes
              
              
              (1,325,761
              )
              
              (1,307,728
              )
              
              18,033Net
                  income
              
              
              6,397,978
              
              
              6,319,939
              
              
              (78,039
              )Earnings
                  per share of common stock-
                  Basic
              
              
              0.27
              
              
              0.32
              
              
              0.05-
                  Diluted
              
              
              0.25
              
              
              0.32
              
              
              0.07Weighted
                  average number of shares of common stock-
                  Basic
              
              
              23,156,629
              
              
              19,454,420
              
              
              (3,702,209
              )-
                  Diluted
              
              
              25,406,977
              
              
              19,454,420
              
              
              (5,952,557
              )
 
 
 A-
        to
        reclassify other income between operating and non-operating (refer to note
        5).
 B-
        to
        deduct the expenses of shell company from administration and other operating
        expense.
  F-35
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS (restated)
 (Stated
        in US Dollars)
 
 **23.**
              **Restatement
                  (continued)**
 
 **Statement
        of Operations**
 **Year
        ended December 31, 2005**
 
 ***2005***
              
              ***2005***
              
              ***2005******(As originally***
              
              ***(restated)***
              
              ***(Effect of******reported)***
              
              
              
              ***adjustments)******$***
              
              ***$***
              
              ***$***Net
                  sales
              
              
              63,078,409
              
              
              63,078,409
              
              
              -Cost
                  of sales
              
              
              (56,813,199
              )
              
              (57,026,036
              )
              
              (212,837
              )Gross
                  profit
              
              
              6,265,210
              
              
              6,052,373
              
              
              (212,837
              )Other
                  income
              **A**
              
              -
              
              
              938,573
              
              
              938,573Depreciation
              
              
              (259,127
              )
              
              (259,127
              )
              
              -Administrative
                  and other operating expenses
              
              
              (1,436,069
              )
              
              (1,436,069
              )
              
              -Income
                  from operations
              **A**
              
              4,570,014
              
              
              5,295,750
              
              
              725,736Other
                  income
              
              
              1,094,772
              
              
              156,199
              
              
              (938,573
              )Interest
                  expenses
              
              
              (514,637
              )
              
              (514,637
              )
              
              -Income
                  before taxes
              
              
              5,150,149
              
              
              4,937,312
              
              
              (212,837
              )Income
                  taxes
              
              
              (948,933
              )
              
              (911,687
              )
              
              37,246Net
                  income
              
              
              4,201,216
              
              
              4,025,625
              
              
              (175,591
              )Earnings
                  per share of common stock-
                  Basic
              
              
              0.18
              
              
              0.21
              
              
              0.03-
                  Diluted
              
              
              0.16
              
              
              0.21
              
              
              0.05Weighted
                  average number of shares of common stock-
                  Basic
              
              
              23,156,629
              
              
              19,454,420
              
              
              (3,702,209
              )-
                  Diluted
              
              
              25,406,977
              
              
              19,454,420
              
              
              (5,952,557
              )
 
 **A-
        to reclassify other income between operating and
        non-operating.**
  F-36
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS (restated)
 (Stated
        in US Dollars)
  **23.**
              **Restatement
                  (continued)**
 
 **Statement
        of Operations**
 **Year
        ended December 31, 2004**
 
 ***2004***
              
              ***2004***
              
              ***2004******(As originally***
              
              ***(restated)***
              
              ***(Effect of******reported)***
              
              
              
              ***adjustments)******$***
              
              ***$***
              
              ***$***Net
                  sales
              
              
              36,553,084
              
              
              36,553,084
              
              
              -Cost
                  of sales
              
              
              (34,584,844
              )
              
              (34,608,653
              )
              
              (23,809
              )Gross
                  profit
              
              
              1,968,240
              
              
              1,944,431
              
              
              (23,809
              )Other
                  income
              
              
              -
              
              
              -
              
              
              -Depreciation
              
              
              (126,225
              )
              
              (126,225
              )
              
              -Administrative
                  and other operating expenses
              
              
              (1,344,786
              )
              
              (1,344,786
              )
              
              -Income
                  from operations
              
              
              497,229
              
              
              473,420
              
              
              (23,809
              )Other
                  income
              
              
              28,047
              
              
              28,047
              
              
              -Interest
                  expenses
              
              
              (164,558
              )
              
              (164,558
              )
              
              -Income
                  before taxes
              
              
              360,718
              
              
              336,909
              
              
              (23,809
              )Income
                  taxes
              
              
              (136,117
              )
              
              (131,951
              )
              
              4,166Net
                  income
              
              
              224,601
              
              
              204,958
              
              
              (19,643
              )Earnings
                  per share of common stock-
                  Basic
              
              
              0.01
              
              
              0.01
              
              
              --
                  Diluted
              
              
              0.01
              
              
              0.01
              
              
              -Weighted
                  average number of shares of common stock-
                  Basic
              
              
              23,156,629
              
              
              19,454,420
              
              
              (3,702,209
              )-
                  Diluted
              
              
              25,406,977
              
              
              19,454,420
              
              
              (5,952,557
              )
  F-37
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS (restated)
 (Stated
        in US Dollars)
  **23.**
              **Restatement
                  (continued)**
 
 **Consolidated
        Balance Sheet**
 **December
        31, 2006**
 ***2006***
                
                ***2006***
                
                ***2006******(As originally***
                
                ***(restated)***
                
                ***(Effect of******reported)***
                
                
                
                ***adjustments)******$***
                
                ***$***
                
                ***$*****ASSETS**Current
                    Assets:Cash
                    and cash equivalents
                
                
                319,814
                
                
                316,621
                
                
                (3,193
                )Restricted
                    cash
                
                
                4,523,679
                
                
                4,523,679
                
                
                -Accounts
                    receivable
                
                
                8,188,985
                
                
                8,188,985
                
                
                -Prepaid
                    expenses and other receivables
                
                
                2,126,133
                
                
                2,101,133
                **A**
                
                (25,000
                )Tax
                    prepayment
                
                
                767
                
                
                767
                
                
                -Inventories,
                    net
                
                
                6,620,361
                
                
                6,246,185
                
                
                (374,176
                )Prepaid
                    lease payments
                
                
                22,958
                
                
                22,958
                
                
                -Total
                    Current Assets
                
                
                21,802,697
                
                
                21,400,328
                
                
                (402,369
                )Deferred
                    tax assets
                
                
                14,042
                
                
                14,042
                
                
                -Plant
                    and equipment, net
                
                
                890,258
                
                
                890,258
                
                
                -Leasehold
                    lands
                
                
                895,322
                
                
                895,322
                
                
                -Held-to-maturity
                    investments
                
                
                301,196
                
                
                301,196
                
                
                -Intangible
                    assets
                
                
                337,836
                
                
                337,836
                
                
                -Restricted
                    cash
                
                
                257,301
                
                
                257,301
                
                
                -**TOTAL
                    ASSETS**
                
                
                24,498,652
                
                
                24,096,283
                
                
                (402,369
                )**LIABILITIES
                    AND STOCKHOLDERS’ EQUITY****LIABILITIES**Current
                    Liabilities:Accounts
                    payable
                
                
                770,360
                
                
                770,360
                
                
                -Other
                    payables and accrued liabilities
                
                
                190,358
                
                
                190,358
                
                
                -Advance
                    from a related party
                
                
                33,000
                
                
                -
                **A**
                
                (33,000
                )Income
                    taxes payable
                
                
                1,453,051
                
                
                1,387,571
                
                
                (65,480
                )Unearned
                    revenue
                
                
                -
                
                
                -
                
                
                -Bank
                    borrowings
                
                
                13,205,167
                
                
                13,205,167
                
                
                -Total
                    Current Liabilities
                
                
                15,651,936
                
                
                15,553,456
                
                
                (98,480
                )Deferred
                    tax liabilities
                
                
                31,711
                
                
                31,711
                
                
                -**TOTAL
                    LIABILITIES**
                
                
                15,683,647
                
                
                15,585,167
                
                
                (98,480
                )**COMMITMENTS
                    AND CONTINGENCIES**
 
 **A –
        to eliminate the “prepaid expense and other receivables” and “advance from a
        related party” of the shell company from the accounting acquirer’s
        accounts.**
  F-38
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS (restated)
 (Stated
        in US Dollars)
 
 **23.**
              **Restatement
                  (continued)**
 
 **Consolidated
        Balance Sheet (Cont’d)**
 **December
        31, 2006**
 
 ***2006***
              
              ***2006***
              
              ***2006******(As originally***
              
              ***(restated)***
              
              ***(Effect of******reported)***
              
              
              
              ***adjustments)******$***
              
              ***$***
              
              ***$*****STOCKHOLDERS’
                  EQUITY**Preferred
                  stockPar
                  value:2006 - US$0.0001Authorized:
                  2006 – 10,000,000 sharesIssued
                  and outstanding: 2006 – none issued
              
              
              -
              
              
              -
              
              
              -Common
                  stockPar
                  value:2006 - US$0.0001Authorized:
                  2006 – 100,000,000 sharesIssued
                  and outstanding: 2006 - 19,454,420 shares
              
              
              2,316
              
              
              1,946
              
              
              (370
              )Additional
                  paid-in capital
              
              
              656,095
              
              
              654,298
              
              
              (1,797
              )Accumulated
                  other comprehensive income
              
              
              7,470
              
              
              7,470
              
              
              -Retained
                  earnings
              
              
              8,149,124
              
              
              7,847,402
              
              
              (301,722
              )**TOTAL
                  STOCKHOLDERS’ EQUITY**
              
              
              8,815,005
              
              
              8,511,116
              
              
              (303,889
              )**TOTAL
                  LIABILITIES AND STOCKHOLDERS’ EQUITY**
              
              
              24,498,652
              
              
              24,096,283
              
              
              (402,369
              )
  F-39
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS (restated)
 (Stated
        in US Dollars)
 
 **23.**
              **Restatement
                  (continued)**
 
 **Consolidated
        Balance Sheet**
 **December
        31, 2005**
 
 ***2005***
              
              ***2005***
              
              ***2005******(As originally***
              
              ***(restated)***
              
              ***(Effect of******reported)***
              
              
              
              ***adjustments)******$***
              
              ***$***
              
              ***$*****ASSETS**Current
                  Assets:Cash
                  and cash equivalents
              
              
              780,090
              
              
              780,090
              
              
              -Restricted
                  cash
              
              
              4,306,474
              
              
              4,306,474
              
              
              -Accounts
                  receivable
              
              
              4,829,586
              
              
              4,829,586
              
              
              -Prepaid
                  expenses and other receivables
              
              
              394,236
              
              
              394,236
              
              
              -Tax
                  prepayment
              
              
              16,367
              
              
              16,367
              
              
              -Inventories,
                  net
              
              
              6,584,792
              
              
              6,313,662
              
              
              (271,130
              )Prepaid
                  lease payments
              
              
              7,993
              
              
              7,993
              
              
              -Total
                  Current Assets
              
              
              16,919,538
              
              
              16,648,408
              
              
              (271,130
              )Deferred
                  tax assets
              
              
              -
              
              
              -
              
              
              -Plant
                  and equipment, net
              
              
              682,901
              
              
              682,901
              
              
              -Leasehold
                  lands
              
              
              315,939
              
              
              315,939
              
              
              -Held-to-maturity
                  investments
              
              
              301,954
              
              
              301,954
              
              
              -Intangible
                  assets
              
              
              584,149
              
              
              584,149
              
              
              -Restricted
                  cash
              
              
              -
              
              
              -
              
              
              -**TOTAL
                  ASSETS**
              
              
              18,804,481
              
              
              18,533,351
              
              
              (271,130
              )**LIABILITIES
                  AND STOCKHOLDERS’ EQUITY****LIABILITIES**Current
                  Liabilities:Accounts
                  payable
              
              
              1,236,418
              
              
              1,236,418
              
              
              -Other
                  payables and accrued liabilities
              
              
              145,249
              
              
              145,249
              
              
              -Advance
                  from a related party
              
              
              28,854
              
              
              28,854
              
              
              -Income
                  taxes payable
              
              
              864,205
              
              
              816,758
              
              
              (47,447
              )Unearned
                  revenue
              
              
              1,598,314
              
              
              1,598,314
              
              
              -Bank
                  borrowings
              
              
              10,064,129
              
              
              10,064,129
              
              
              -Total
                  Current Liabilities
              
              
              13,937,169
              
              
              13,889,722
              
              
              (47,447
              )Deferred
                  tax liabilities
              
              
              -
              
              
              -
              
              
              -**TOTAL
                  LIABILITIES**
              
              
              13,937,169
              
              
              13,889,722
              
              
              (47,447
              )**COMMITMENTS
                  AND CONTINGENCIES**
  F-40
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS (restated)
 (Stated
        in US Dollars)
  **23.**
              **Restatement
                  (continued)**
 
 **Consolidated
        Balance Sheet (Cont’d)**
 **December
        31, 2005**
 
 ***2005***
              
              ***2005***
              
              ***2005******(As
                  originally***
              
              ***(restated)***
              
              ***(Effect
                  of******reported)***
              
              
              
              ***adjustments)******$***
              
              ***$***
              
              ***$*****STOCKHOLDERS’
                  EQUITY**Preferred
                  stockPar
                  value:2005 - noneAuthorized:
                  2005 – noneIssued
                  and outstanding: 2005 – none issued
              
              
              -
              
              
              -
              
              
              -Common
                  stockPar
                  value:2005 - US$0.0001Authorized:
                  2005 – 100,000,000 sharesIssued
                  and outstanding: 2005 - 19,454,420 shares
              
              
              2,316
              
              
              1,946
              
              
              (370
              )Additional
                  paid-in capital
              
              
              653,928
              
              
              654,298
              
              
              370Accumulated
                  other comprehensive income
              
              
              13,549
              
              
              13,549
              
              
              -Retained
                  earnings
              
              
              4,197,519
              
              
              3,973,836
              
              
              (223,683
              )**TOTAL
                  STOCKHOLDERS’ EQUITY**
              
              
              4,867,312
              
              
              4,643,629
              
              
              (223,683
              )**TOTAL
                  LIABILITIES AND STOCKHOLDERS’ EQUITY**
              
              
              18,804,481
              
              
              18,533,351
              
              
              (271,130
              )
  F-41
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS (restated)
 (Stated
        in US Dollars)
  **23.**
              **Restatement
                  (continued)**
 
 **Consolidated
        Balance Sheet**
 **December
        31, 2004**
 
 ***2004***
              
              ***2004***
              
              ***2004******(As originally***
              
              ***(restated)***
              
              ***(Effect of******reported)***
              
              
              
              ***adjustments)******$***
              
              ***$***
              
              ***$*****ASSETS**Current
                  Assets:Cash
                  and cash equivalents
              
              
              911,487
              
              
              911,487
              
              
              -Restricted
                  cash
              
              
              3,551,304
              
              
              3,551,304
              
              
              -Accounts
                  receivable
              
              
              3,369,326
              
              
              3,369,326
              
              
              -Prepaid
                  expenses and other receivables
              
              
              727,934
              
              
              727,934
              
              
              -Advance
                  to a related party
              
              
              50,900
              
              
              -
              **A**
              
              (50,900
              )Tax
                  prepayment
              
              
              -
              
              
              -
              
              
              -Inventories,
                  net
              
              
              3,931,124
              
              
              3,872,831
              
              
              (58,293
              )Prepaid
                  lease payments
              
              
              -
              
              
              -
              
              
              -Total
                  Current Assets
              
              
              12,542,075
              
              
              12,432,882
              
              
              (109,193
              )Deferred
                  tax assets
              
              
              -
              
              
              -
              
              
              -Plant
                  and equipment, net
              
              
              696,552
              
              
              696,552
              
              
              -Leasehold
                  lands
              
              
              -
              
              
              -
              
              
              -Held-to-maturity
                  investments
              
              
              -
              
              
              -
              
              
              -Intangible
                  assets
              
              
              736,934
              
              
              736,934
              
              
              -Restricted
                  cash
              
              
              -
              
              
              -
              
              
              -**TOTAL
                  ASSETS**
              
              
              13,975,561
              
              
              13,866,368
              
              
              (109,193
              )**LIABILITIES
                  AND STOCKHOLDERS’ EQUITY****LIABILITIES**Current
                  Liabilities:Accounts
                  payable
              
              
              1,805,995
              
              
              1,805,995
              
              
              -Other
                  payables and accrued liabilities
              
              
              41,798
              
              
              41,798
              
              
              -Advance
                  from a related party
              
              
              140,196
              
              
              89,296
              **A**
              
              (50,900
              )Income
                  taxes payable
              
              
              95,640
              
              
              85,439
              
              
              (10,201
              )Unearned
                  revenue
              
              
              3,197,160
              
              
              3,197,160
              
              
              -Bank
                  borrowings
              
              
              7,400,775
              
              
              7,400,775
              
              
              -Total
                  Current Liabilities
              
              
              12,681,564
              
              
              12,620,463
              
              
              (61,101
              )Deferred
                  tax liabilities
              
              
              -
              
              
              -
              
              
              -**TOTAL
                  LIABILITIES**
              
              
              12,681,564
              
              
              12,620,463
              
              
              (61,101
              )**COMMITMENTS
                  AND CONTINGENCIES**
 
 A-
        to
        eliminate non-cash impacts of “advance to a related party” by “advance from a
        related party.”
  F-42





ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)




**23.**
            **Restatement
                (continued)**




**Consolidated
      Balance Sheet (Cont’d)**


**December
      31, 2004**




***2004***
              
              ***2004***
              
              ***2004******(As
                  originally***
              
              ***(restated)***
              
              ***(Effect
                  of******reported)***
              
              
              
              ***adjustments)******$***
              
              ***$***
              
              $**STOCKHOLDERS’
                  EQUITY**Preferred
                  stockPar
                  value: 2004 - noneAuthorized:
                  2004 - noneIssued
                  and outstanding: 2004 - none issued
              
              
              -
              
              
              -
              
              
              -Common
                  stockPar
                  value:2004 - US$0.0001Authorized:
                  2004 - 100,000,000 sharesIssued
                  and outstanding: 2004 - 19,454,420 shares
              
              
              2,316
              
              
              1,946
              
              
              (370
              )Additional
                  paid-in capital
              
              
              652,118
              
              
              652,488
              
              
              370Accumulated
                  other comprehensive income
              
              
              412
              
              
              412
              
              
              -Retained
                  earnings
              
              
              639,151
              
              
              591,059
              
              
              (48,092
              )**TOTAL
                  STOCKHOLDERS’ EQUITY**
              
              
              1,293,997
              
              
              1,245,905
              
              
              (48,092
              )**TOTAL
                  LIABILITIES AND STOCKHOLDERS’ EQUITY**
              
              
              13,975,561
              
              
              13,866,368
              
              
              (109,193
              )




F-43


ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)




**23.**
            **Restatement
                (continued)**





**Statement
      of Cash Flows**


**Year
      ended December 31, 2006**




***2006***
            
            ***2006***
            
            ***2006******(As
                originally***
            
            ***(restated)***
            
            ***(Effect
                of******reported)***
            
            
            
            ***adjustments)******$***
            
            ***$***
            
            ***$*****Cash
                flows from operating activities**Net
                income
            
            
            6,397,978
            
            
            6,319,939
            
            
            (78,039
            )Adjustments
                to reconcile net income to net cash provided by operating
                activities:Amortization
                of intangible assets
            
            
            154,436
            
            
            154,436
            
            
            -Amortization
                of leasehold lands
            
            
            23,247
            
            
            23,247
            
            
            -Depreciation
            
            
            325,995
            
            
            325,995
            
            
            -Loss
                on disposal of plant and equipment
            
            
            7,715
            
            
            7,715
            
            
            -Gain
                on disposal of intangible assets
            
            
            (210,594
            )
            
            (210,594
            )
            
            -Income
                taxes
            
            
            1,325,761
            
            
            1,307,728
            
            
            (18,033
            )Changes
                in operating assets and liabilities:Accounts
                receivable
            
            
            (3,369,347
            )
            
            (3,369,347
            )
            
            -Prepaid
                expenses and other receivables
            
            
            (1,731,789
            )
            
            (1,706,789
            )   **A**
            
            25,000Inventories
            
            
            (52,056
            )
            
            50,990
            
            
            103,046Accounts
                payable
            
            
            (462,658
            )
            
            (462,658
            )
            
            -Other
                payables and accrued liabilities
            
            
            45,445
            
            
            45,445
            
            
            -Advance
                from related parties
            
            
            4,237
            
            
            -
            **A**
            
            (4,237
            )Income
                taxes payable
            
            
            (701,921
            )
            
            (701,921
            )
            
            -Unearned
                revenue
            
            
            (1,593,280
            )
            
            (1,593,280
            )
            
            -Net
                cash flows provided by operating activities
            
            
            163,169
            
            
            190,906
            
            
            27,737**Cash
                flows from investing activities**Acquisition
                of leasehold lands
            
            
            (618,025
            )
            
            (618,025
            )
            
            -Acquisition
                of plant and equipment
            
            
            (544,678
            )
            
            (544,678
            )
            
            -Proceeds
                from disposal of plant and equipment
            
            
            2,031
            
            
            2,031
            
            
            -Proceeds
                from disposal of intangible assets
            
            
            300,849
            
            
            300,849
            
            
            -Net
                cash flows used in investing activities
            
            
            (859,823
            )
            
            (859,823
            )
            
            -**Cash
                flows from financing activities**Proceeds
                from issuance of common stocks
            
            
            2,167
            
            
            -
            **B**
            
            (2,167
            )Proceeds
                from new short-term bank loans
            
            
            1,700,622
            
            
            1,700,622
            
            
            -Repayment
                of short-term bank loans
            
            
            (525,535
            )
            
            (525,535
            )
            
            -Repayment
                of a capital lease
            
            
            -
            
            
            -
            
            
            -Net
                advancement of other bank borrowings
            
            
            1,789,269
            
            
            1,789,269
            
            
            -Increase
                in restricted cash
            
            
            (484,997
            )
            
            (484,997
            )
            
            -Increase
                in bank overdrafts
            
            
            199,893
            
            
            199,893
            
            
            -Advance
                from a related party
            
            
            -
            
            
            (28,763
            )**A**
            
            (28,763
            )Dividends
                paid
            
            
            (2,446,373
            )
            
            (2,446,373
            )
            
            -Net
                cash flows provided by financing activities
            
            
            235,046
            
            
            204,116
            
            
            (30,930
            )Net
                decrease in cash and cash equivalents
            
            
            (461,608
            )
            
            (464,801
            )
            
            (3,193
            )Effect
                of foreign currency translation on cash and cash
                equivalents
            
            
            1,332
            
            
            1,332
            
            
            -Cash
                and cash equivalents - beginning of year
            
            
            780,090
            
            
            780,090
            
            
            -Cash
                and cash equivalents - end of year
            
            
            319,814
            
            
            316,621
            
            
            (3,193
            )







A
      - to
      eliminate the “prepaid expense and other receivables” and “advance from a
      related party” of the shell company from the accounting acquirer’s
      accounts.


B
      - to
      eliminate the common stock of the shell company.




F-44


ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**23.**
            **Restatement
                (continued)**





**Statement
      of Cash Flows**


**Year
      ended December 31, 2005**





***2005***
            
            ***2005***
            
            ***2005******(As
                originally***
            
            ***(restated)***
            
            ***(Effect
                of******reported)***
            
            
            
            ***adjustments)******$***
            
            ***$***
            
            ***$*****Cash
                flows from operating activities**Net
                income
            
            
            4,201,216
            
            
            4,025,625
            
            
            (175,591
            )Adjustments
                to reconcile net income to net cash used in operating
                activities:Amortization
                of intangible assets
            
            
            154,438
            
            
            154,438
            
            
            -Amortization
                of leasehold lands
            
            
            7,968
            
            
            7,968
            
            
            -Depreciation
            
            
            259,127
            
            
            259,127
            
            
            -Loss
                on disposal of plant and equipment
            
            
            -
            
            
            -
            
            
            -Gain
                on disposal of intangible assets
            
            
            -
            
            
            -
            
            
            -Income
                taxes
            
            
            948,933
            
            
            911,687
            
            
            (37,246
            )Changes
                in operating assets and liabilities:Accounts
                receivable
            
            
            (1,445,937
            )
            
            (1,445,937
            )
            
            -Prepaid
                expenses and other receivables
            
            
            334,759
            
            
            334,759
            
            
            -Inventories
            
            
            (2,633,977
            )
            
            (2,421,140
            )
            
            212,837Accounts
                payable
            
            
            (573,017
            )
            
            (573,017
            )
            
            -Other
                payables and accrued liabilities
            
            
            103,007
            
            
            103,007
            
            
            -Advance
                from related parties
            
            
            (60,511
            )
            
            -
            **A**
            
            60,511Income
                taxes payable
            
            
            (199,079
            )
            
            (199,079
            )
            
            -Unearned
                revenue
            
            
            (1,603,082
            )
            
            (1,603,082
            )
            
            -Net
                cash flows used in operating activities
            
            
            (506,155
            )
            
            (445,644
            )
            
            60,511**Cash
                flows from investing activities**Acquisition
                of leasehold lands
            
            
            (330,884
            )
            
            (330,884
            )
            
            -Acquisition
                of held-to-maturity investments
            
            
            (301,007
            )
            
            (301,007
            )
            
            -Acquisition
                of intangible assets
            
            
            -
            
            
            -
            
            
            -Acquisition
                of plant and equipment
            
            
            (243,504
            )
            
            (243,504
            )
            
            -Proceeds
                from disposal of plant and equipment
            
            
            -
            
            
            -
            
            
            -Proceeds
                from disposal of intangible assets
            
            
            -
            
            
            -
            
            
            -Net
                cash flows used in investing activities
            
            
            (875,395
            )
            
            (875,395
            )
            
            -




F-45


ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**23.**
            **Restatement
                (continued)**





**Statement
      of Cash Flows**


**Year
      ended December 31, 2005**




***2005***
            
            ***2005***
            
            ***2005******(As
                originally***
            
            ***(restated)***
            
            ***(Effect
                of******reported)***
            
            
            
            ***adjustments)******$***
            
            ***$***
            
            ***$*****Cash
                flows from financing activities**Proceeds
                from new short-term bank loans
            
            
            346,622
            
            
            346,622
            
            
            -Repayment
                of short-term bank loans
            
            
            (408,211
            )
            
            (408,211
            )
            
            -Repayment
                of a capital lease
            
            
            -
            
            
            -
            
            
            -Net
                advancement of other bank borrowings
            
            
            2,946,182
            
            
            2,946,182
            
            
            -Increase
                in restricted cash
            
            
            (755,170
            )
            
            (755,170
            )
            
            -Increase
                in bank overdrafts
            
            
            (250,997
            )
            
            (250,997
            )
            
            -Advance
                from related parties
            
            
            -
            
            
            (60,511
            )**A**
            
            (60,511
            )Dividends
                paid
            
            
            (642,848
            )
            
            (642,848
            )
            
            -Net
                cash flows provided by financing activities
            
            
            1,235,578
            
            
            1,175,067
            
            
            (60,511
            )Net
                decrease in cash and cash equivalents
            
            
            (145,972
            )
            
            (145,972
            )
            
            -Effect
                of foreign currency translation on cash and cash
                equivalents
            
            
            14,575
            
            
            14,575
            
            
            -Cash
                and cash equivalents - beginning of year
            
            
            911,487
            
            
            911,487
            
            
            -Cash
                and cash equivalents - end of year
            
            
            780,090
            
            
            780,090
            
            
            -







A
      - to
      reclassify “advance from related party” from operating activities to financing
      activities.




F-46


ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**23.**
            **Restatement
                (continued)**





**Statement
      of Cash Flows**


**Year
      ended December 31, 2004**





***2004***
            
            ***2004***
            
            ***2004******(As
                originally***
            
            ***(restated)***
            
            ***(Effect
                of******reported)***
            
            
            
            ***adjustments)******$***
            
            ***$***
            
            ***$*****Cash
                flows from operating activities**Net
                income
            
            $
            224,601
            
            
            204,958
            
            
            (19,643
            )Adjustments
                to reconcile net income to net cash used in operating
                activities:Amortization
                of intangible assets
            
            
            35,382
            
            
            35,382
            
            
            -Amortization
                of leasehold lands
            
            
            -
            
            
            -
            
            
            -Depreciation
            
            
            126,225
            
            
            126,225
            
            
            -Loss
                on disposal of plant and equipment
            
            
            -
            
            
            -
            
            
            -Gain
                on disposal of intangible assets
            
            
            -
            
            
            -
            
            
            -Income
                taxes
            
            
            136,117
            
            
            131,951
            
            
            (4,166
            )Changes
                in operating assets and liabilities:Accounts
                receivable
            
            
            (1,997,310
            )
            
            (1,997,310
            )
            
            -Prepaid
                expenses and other receivables
            
            
            310
            
            
            310
            
            
            -Inventories
            
            
            (2,601,377
            )
            
            (2,577,568
            )
            
            23,809Accounts
                payable
            
            
            538,433
            
            
            538,433
            
            
            -Other
                payables and accrued liabilities
            
            
            370
            
            
            370
            
            
            -Advance
                from related parties
            
            
            122,571
            
            
            -
            **A**
            
            (122,571
            )Income
                taxes payable
            
            
            (76,747
            )
            
            (76,747
            )
            
            -Unearned
                revenue
            
            
            3,191,721
            
            
            3,191,721
            
            
            -Net
                cash flows used in operating activities
            
            
            (299,704
            )
            
            (422,275
            )
            
            (122,571
            )**Cash
                flows from investing activities**Acquisition
                of leasehold lands
            
            
            -
            
            
            -
            
            
            -Acquisition
                of held-to-maturity investments
            
            
            -
            
            
            -
            
            
            -Acquisition
                of intangible assets
            
            
            (771,063
            )
            
            (771,063
            )
            
            -Acquisition
                of plant and equipment
            
            
            (781,095
            )
            
            (781,095
            )
            
            -Proceeds
                from disposal of plant and equipment
            
            
            -
            
            
            -
            
            
            -Proceeds
                from disposal of intangible assets
            
            
            -
            
            
            -
            
            
            -Net
                cash flows used in investing activities
            
            
            (1,552,158
            )
            
            (1,552,158
            )
            
            -**Cash
                flows from financing activities**Proceeds
                from new short-term bank loans
            
            
            140,937
            
            
            140,937
            
            
            -Repayment
                of short-term bank loans
            
            
            (11,527
            )
            
            (11,527
            )
            
            -Repayment
                of a capital lease
            
            
            (6,975
            )
            
            (6,975
            )
            
            -Net
                advancement of other bank borrowings
            
            
            4,176,477
            
            
            4,176,477
            
            
            -Increase
                in restricted cash
            
            
            (2,255,598
            )
            
            (2,255,598
            )
            
            -Advance
                from related parties
            
            
            -
            
            
            122,571
            **A**
            
            122,571Decrease
                in bank overdrafts
            
            
            599,814
            
            
            599,814
            
            
            -Dividends
                paid
            
            
            -
            
            
            -
            
            
            -Net
                cash flows provided by financing activities
            
            
            2,643,128
            
            
            2,765,699
            
            
            122,571







A-
      to
      reclassify “advance from related party” from operating activities to financing
      activities.


F-47


ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**23.**
            **Restatement
                (continued)**





**Statement
      of Cash Flows**


**Year
      ended December 31, 2004 (Con’t)**




***2004***
              
              ***2004***
              
              ***2004******(As
                  originally***
              
              ***(restated)***
              
              ***(Effect
                  of******reported)***
              
              
              
              ***adjustments)******$***
              
              ***$***
              
              ***$***Net
                  increase in cash and cash equivalents
              
              
              791,266
              
              
              791,266
              
              
              -Effect
                  of foreign currency translation on cash and cash
                  equivalents
              
              
              7,242
              
              
              7,242
              
              
              -Cash
                  and cash equivalents - beginning of year
              
              
              112,979
              
              
              112,979
              
              
              -Cash
                  and cash equivalents - end of year
              
              
              911,487
              
              
              911,487
              
              
              -








**24.**
            **Events
                after balance sheet date**





Private
      placement





The
      Company entered into two subscription agreements (the “Subscription Agreement”)
      with certain investors pursuant to which the Company sold an aggregate of
      2,250,348 shares of Series A Convertible Preferred Stock (“Series A Preferred
      Stock”) at $1.29 per share for an aggregate gross proceeds of $2,952,946.





At
      the
      initial closing of the Subscription Agreement on January 23, 2007, the Company
      sold an aggregate of 1,749,028 shares of Series A Preferred Stock. At the second
      and final closing of the Subscription Agreement on February 9, 2007, the Company
      sold an aggregate of 501,320 shares of Series A Preferred Stock.





Each
      share of the Company’s Series A Preferred Stock is convertible into shares of
      common stock at a conversion price equal to the share purchase price, subject
      to
      adjustments.









ASIA
      TIME
      CORPORATION


(Formerly
      SRKP 9, Inc.)





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS (restated)


(Stated
      in US Dollars)





**24.**
            **Events
                after balance sheet date
                (continued)**





However,
      if the Company at any time prior to the first trading day on which the common
      stock is quoted on the American Stock Exchange, the Nasdaq Capital Market,
      the
      Nasdaq Global Market or the New York Stock Exchange (each a “Trading Market”)
      sells or issues any shares of common stock in one or a series of transactions
      at
      an effective price less than such conversion price where the aggregate gross
      proceeds to the Company are at least $1.0 million, then the aforementioned
      conversion price shall be reduced to such effective price. Each share of
      Series A Convertible Preferred Stock shall automatically convert into
      shares of common stock if (i) the closing price of the common stock on the
      Trading Market for any 10 consecutive trading day period exceeds $3.00 per
      share, (ii) the shares of common stock underlying the Series A
      Convertible Preferred Stock are subject to an effective registration statement,
      and (iii) the daily trading volume of the common stock on a Trading Market
      exceeds 25,000 shares per day for 10 out of 20 prior trading days.





If
      the
      Company pays a stock dividend on the shares of common stock, subdivide
      outstanding shares of common stock into a larger number of shares, combine,
      through a reverse stock split, outstanding shares of the common stock into
      a
      smaller number of shares or issues, in the event of a reclassification of shares
      of the common stock, any shares of the capital stock, then the conversion price
      of the Series A Preferred Stock will be adjusted as follows: the conversion
      price will be multiplied by a fraction, of which (i) the numerator will be
      the
      number of shares of common stock outstanding immediately before one of the
      events described above and (ii) the denominator will be the number of shares
      of
      common stock outstanding immediately after such event.





Holder
      of
      the Series A Convertible Preferred Stock have the right to one vote per share
      of
      common stock issuable upon conversion of the shares underlying any shares of
      Preferred Stock outstanding as of the record date for purposes of determining
      which holders have the right to vote with respect to any matters brought to
      a
      vote before the Company’s holders of common stock.





In
      the
      event of any liquidation, dissolution or winding up of our company, the holders
      of the Series A Convertible Preferred Stock are entitled to receive in
      preference to the holders of common stock an amount per share of $1.29 plus
      any
      accrued but unpaid dividends. If the Company’s assets are insufficient to pay
      the above amounts in full, then all of the Company’s assets will be ratably
      distributed among the holders of the Series A Convertible Preferred Stock in
      accordance with the respective amounts that would be payable on such shares
      if
      all amounts payable were paid in full.





There
      are
      no additional specific dividend rights or redemption rights of holders of the
      Series A Convertible Preferred Stock.





If
      the
      Company redeems or acquired any shares of the Series A Convertible Preferred
      Stock are converted, those shares will resume the status of authorized but
      unissued shares of preferred stock and will no longer be designated as Series
      A
      Convertible Preferred Stock.





As
      long
      as any shares of Series A Convertible Preferred Stock are outstanding, the
      Company cannot alter or adversely change the powers, preference or rights given
      to the Series A Convertible Preferred Stock holders, without the affirmative
      vote of those holders.