**UNITED
        STATES**
 **SECURITIES
        AND EXCHANGE COMMISSION**
 **WASHINGTON,
        D.C. 20549**
 
 **AMENDMENT
        NO. 2 TO**
 **FORM
        10-Q/A**
  **x** **QUARTERLY
        REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE**
 **SECURITIES
        EXCHANGE ACT OF 1934**
  **For
        the quarterly period ended March 31, 2007**
 
 **OR**
 
 **o** **TRANSITION
        REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE**
 **SECURITIES
        EXCHANGE ACT OF 1934**
 
 **Commission
        File Number**
 **000-51981**
  
 **ASIA
        TIME CORPORATION**
 *(Exact
        name of small business issuer as specified in its charter)*
 
 **Delaware**
                *(State
                  or other jurisdiction of incorporation*
                *or
                  organization)*
              
              **20-4062619**
                *(I.R.S.
                  Employer Identification**No.)***Room
                  1601-1604, 16/F., CRE Centre**
                **889
                  Cheung Sha Wan Road,**
                **Kowloon,
                  Hong Kong******
                *(Address
                  of principal executive offices)*
              
              **N/A**
                *(Zip
                  Code)*
 
 **(852)-23100101**
 *(Registrant’s
        telephone number, including area code)*
 
 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 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.
 
 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 Exchange Act).  Yes o No x
  There
        were 23,156,629 shares outstanding of registrant’s common stock, par value
        $.0001 per share, as of May 1, 2007.
  
 
 
  **EXPLANATORY
        NOTE**
 
 This
        Amendment No. 2 (this “Amendment No. 2”) on Form 10-Q/A, which amends and
        restates items identified below with respect to the Form 10-Q, filed by Asia
        Time Corporation (“we” or the “Company”) with the Securities and Exchange
        Commission (the “SEC”) on November 19, 2007 (the “Original Filing”), as amended
        by Amendment No. 1 on Form 10-Q/A to the Original Filing filed with the SEC
        on
        September 26, 2007 (“Amendment No. 1”, and collectively with the Originally
        Filing, referred to as the “Original Filing as Amended”) is being filed to
        reflect revisions to Financial Statements, Management’s Discussion And Analysis
        Of Financial Condition And Results Of Operation, Risk Factors, and Controls
        and
        Procedures. The Company has revised its financial statements for the three
        months ended March 31, 2007 and 2006 to reflect various adjustments, primarily
        to account for all fees and costs related to the January 2007 reverse merger
        as
        a charge to operations, to adjust the accounting for inventories and cost
        of
        sales by accruing for vendor incentives, and to recognize stock-based
        compensation in 2007. As a result of these adjustments, various income tax
        calculations were also revised, which effected net income and also caused
        reclassifications to cash flows. The Company has also corrected average and
        actual shares outstanding retroactively (and related earnings per share
        calculations) to reflect the January 2007 reverse merger. These adjustments
        are
        more fully described at Note 19 of the Notes to the Financial Statements
        contained herein.
 
 This
        Form
        10-Q/A only amends information in Item 1 (Financial Statements), Item 1A
        (Risk
        Factors), Item 2 (Management’s Discussion and Analysis of Financial Condition
        and Results of Operation), and Item 4 (Controls and Procedures), and the
        other
        Items as presented in the Original Filing are not being amended but are restated
        without change in this Amendment for ease of reference. As a result of this
        Amendment, the certifications pursuant to Section 302 and Section 906 of
        the
        Sarbanes-Oxley Act of 2002, filed as exhibits to our Original Filing as Amended
        have been revised, re-executed and re-filed as of the date of this Amendment
        No.
        2. Except for the foregoing amended and restated information, this Amendment
        No.
        2 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. 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.
 
  
  **ASIA
        TIME CORPORATION.**
 **FORM
        10-Q QUARTERLY REPORT**
 
 **TABLE
        OF CONTENTS**
 
 **Page**PART
                  I - FINANCIAL INFORMATION
              1ITEM
                  1.
              FINANCIAL
                  STATEMENTS
              1Condensed
                  Consolidated Balance Sheet (Unaudited)
              2Condensed
                  Consolidated Income Statement (Unaudited)
              4Condensed
                  Consolidated Statement of Cash Flows (Unaudited)
              5Notes
                  to Condensed Consolidated Financial Statements (Unaudited)
              7ITEM
                  2.
              MANAGEMENT’S
                  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
                  OPERATION
              43ITEM
                  3.
              QUANTITATIVE
                  AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
              51ITEM
                  4.
              CONTROLS
                  AND PROCEDURES
              52PART
                  II - OTHER INFORMATION
              53ITEM
                  1.
              LEGAL
                  PROCEEDINGS
              53ITEM
                  1A.
              RISK
                  FACTORS
              53ITEM
                  2.
              UNREGISTERED
                  SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
              53ITEM
                  3.
              DEFAULTS
                  UPON SENIOR SECURITIES
              53ITEM
                  4.
              SUBMISSION
                  OF MATTERS TO A VOTE OF SECURITY HOLDERS
              53ITEM
                  5.
              OTHER
                  INFORMATION
              53ITEM
                  6.
              EXHIBITS
              53SIGNATURES
              
              54
 
 
 
 **PART
        I - FINANCIAL INFORMATION**
 
 **ITEM
        1.**  **FINANCIAL
        STATEMENTS**
 
 The
        accompanying unaudited financial statements have been prepared in accordance
        with accounting principles generally accepted in the United States of America
        for interim financial information and with the instructions to Form 10-Q.
        Accordingly, they do not include all of the information and footnotes required
        by generally accepted accounting principles for complete financial statements.
        The accompanying unaudited financial statements reflect all adjustments that,
        in
        the opinion of management, are considered necessary for a fair presentation
        of
        the financial position, results of operations, and cash flows for the periods
        presented. The results of operations for such periods are not necessarily
        indicative of the results expected for the full fiscal year or for any future
        period. The accompanying unaudited financial statements should be read in
        conjunction with the audited financial statements of Asia Time Corporation
        included in the Form 10-K/A for the fiscal year ended December 31, 2006 as
        filed
        with the Securities and Exchange Commission on February 8, 2008.
 
 1
 
 ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 CONDENSED
        CONSOLIDATED BALANCE SHEETS
 (Stated
        in US Dollars)
 
 
 ***As
                  of******March
                  31,***
              
              ***December
                  31,******2007***
              
              ***2006******(Unaudited)***
              
              ***(Audited)*****$**
              
              **$**(restated)
              
              (restated)**ASSETS**Current
                  Assets :Cash
                  and cash equivalents
              
              
              170,340
              
              
              316,621Restricted
                  cash
              
              
              4,604,317
              
              
              4,523,679Accounts
                  receivable
              
              
              13,839,068
              
              
              8,188,985Prepaid
                  expenses and other receivables - Note 8
              
              
              5,680,051
              
              
              2,101,133Tax
                  prepayment
              
              
              -
              
              
              767Inventories,
                  net - Note 9
              
              
              878,367
              
              
              6,246,185Prepaid
                  lease payments - Note 11
              
              
              17,079
              
              
              22,958Total
                  Current Assets
              
              
              25,189,222
              
              
              21,400,328Deferred
                  tax assets - Note 6
              
              
              13,969
              
              
              14,042Plant
                  and equipment, net - Note 10
              
              
              820,489
              
              
              890,258Leasehold
                  lands - Note 11
              
              
              890,740
              
              
              895,322Held-to-maturity
                  investments - Note 12
              
              
              299,654
              
              
              301,196Intangible
                  assets - Note 13
              
              
              305,158
              
              
              337,836Restricted
                  cash
              
              
              299,654
              
              
              257,301**TOTAL
                  ASSETS**
              
              
              27,818,886
              
              
              24,096,283**LIABILITIES
                  AND STOCKHOLDERS’ EQUITY****LIABILITIES**Current
                  Liabilities :Accounts
                  payable
              
              
              805,344
              
              
              770,360Other
                  payables accrued liabilities - Note 14
              
              
              139,455
              
              
              190,358Income
                  tax payable
              
              
              1,669,177
              
              
              1,387,571Bank
                  borrowings - Note 15
              
              
              12,661,617
              
              
              13,205,167Total
                  Current Liabilities
              
              
              15,275,593
              
              
              15,553,456Deferred
                  tax liabilities - Note 6
              
              
              31,548
              
              
              31,711**TOTAL
                  LIABILITIES**
              
              
              15,307,141
              
              
              15,585,167
 
 2
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 CONDENSED
        CONSOLIDATED BALANCE SHEETS (Continued)
 (Stated
        in US Dollars)
 
 
 ***As
                  of******March
                  31,***
              
              ***December
                  31,******2007***
              
              ***2006******(Unaudited)***
              
              ***(Audited)***$
              
              $(restated)
              
              (restated)**STOCKHOLDERS’
                  EQUITY**Preferred
                  stock - Note 16Par
                  value : 2007 - US$0.0001Authorized:
                  2007 - 10,000,000 sharesIssued
                  and outstanding: 2007 - 2,250,348 shares (2006 - none)
              
              
              225
              
              
              -Common
                  stock - Note 18Par
                  value : 2007 - US$0.0001Authorized:
                  2007 - 100,000,000 sharesIssued
                  and outstanding: 2007 - 23,156,629 shares (2006 - 19,454,420
                  shares)
              
              
              2,316
              
              
              1,946Additional
                  paid-in capital
              
              
              4,898,949
              
              
              654,298Accumulated
                  other comprehensive income
              
              
              (44,607
              )
              
              7,470Retained
                  earnings
              
              
              7,654,862
              
              
              7,847,402**TOTAL
                  STOCKHOLDERS’ EQUITY**
              
              
              12,511,745
              
              
              8,511,116**TOTAL
                  LIABILITIES AND STOCKHOLDERS’ EQUITY**
              
              
              27,818,886
              
              
              24,096,283
  See
        notes
        to condensed consolidated financial statements.
  3
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 CONDENSED
        CONSOLIDATED STATEMENTS OF OPERATIONS
 (Stated
        in US Dollars)
 
 ***Three
                  months ended March 31,******2007***
              
              ***2006******(Unaudited)***
              
              ***(Unaudited)*****$**
              
              **$**(restated)
              
              (restated)Net
                  sales
              
              
              21,118,142
              
              
              20,303,091Cost
                  of sales
              
              
              (17,898,978
              )
              
              (18,142,289
              )Gross
                  profit
              
              
              3,219,164
              
              
              2,160,802Other
                  income - Note 4
              
              
              48,497
              
              
              41,905Depreciation
              
              
              (65,431
              )
              
              (75,753
              )Administrative
                  and other operating
                expenses,
                  including stock-based
                compensation
              
              
              (2,046,406
              )
              
              (301,810
              )Income
                  from operations
              
              
              1,155,824
              
              
              1,825,144Fees
                  and costs related to reverse merger - Note 1
              
              
              (736,197
              )
              
              -Other
                  income - Note 4
              
              
              29,929
              
              
              42,913Interest
                  expense - Note 5
              
              
              (239,429
              )
              
              (200,556
              )Income
                  before taxes
              
              
              210,127
              
              
              1,667,501Income
                  taxes - Note 6
              
              
              (402,667
              )
              
              (294,945
              )Net
                  income (loss)
              
              
              (192,540
              )
              
              1,372,556Earnings
                  per common share-
                  Basic
              
              
              (0.01
              )
              
              0.07-
                  Diluted
              
              
              (0.01
              )
              
              0.07Weighted
                  average common shares-
                  Basic
              
              
              23,156,629
              
              
              19,454,420-
                  Diluted
              
              
              23,156,629
              
              
              19,454,420
  See
        notes
        to condensed consolidated financial statements.
 
 4
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 CONDENSED
        CONSOLIDATED STATEMENTS OF CASH FLOWS
 (Stated
        in US Dollars)
 
 ***Three
                  months ended March 31,******2007***
              
              ***2006******(Unaudited)***
              
              ***(Unaudited)*****$**
              
              **$**(restated)
              
              (restated)**Cash
                  flows from operating activities**Net
                  income (loss)
              
              
              (192,540
              )
              
              1,372,556Adjustments
                  to reconcile net income (loss) to net cashused
                  in operating activities :Stock-based
                  compensation
              
              
              1,611,563
              
              
              -Amortization
                  of intangible assets
              
              
              31,023
              
              
              38,720Amortization
                  of leasehold lands
              
              
              5,774
              
              
              2,023Depreciation
              
              
              65,431
              
              
              75,753Gain
                  on disposal of plant and equipment
              
              
              -
              
              
              (2,037
              )Income
                  taxes
              
              
              402,667
              
              
              294,945Changes
                  in operating assets and liabilities :(Increase)
                  decrease in -Accounts
                  receivable
              
              
              (5,705,639
              )
              
              (766,647
              )Prepaid
                  expenses and other receivables
              
              
              (3,573,152
              )
              
              (396,270
              )Inventories
              
              
              5,347,553
              
              
              (714,080
              )Increase
                  (decrease) in -Accounts
                  payable
              
              
              39,021
              
              
              187,074Other
                  payables and accrued liabilities
              
              
              (63,519
              )
              
              (18,395
              )Income
                  taxes payable
              
              
              (112,158
              )
              
              (33,989
              )Unearned
                  revenue
              
              
              -
              
              
              (1,238,248
              )Net
                  cash used in operating activities
              
              
              (2,143,976
              )
              
              (1,198,595
              )**Cash
                  flows from investing activities**Acquisition
                  of plant and equipment
              
              
              (64
              )
              
              (381,125
              )Proceeds
                  from disposal of plant and equipment
              
              
              -
              
              
              2,037Net
                  cash used in investing activities
              
              
              (64
              )
              
              (379,088
              )**Cash
                  flows from financing activities**Proceeds
                  from issuance of Series A convertible preferred stock
              
              
              2,641,683
              
              
              -Advances
                  from related parties
              
              
              (19,655
              )
              
              (1,069,745
              )Proceeds
                  from new short-term bank loans
              
              
              112,157
              
              
              33,988Repayment
                  of short-term bank loans
              
              
              (434,006
              )
              
              (88,348
              )Net
                  advances under other short-term bank borrowings
              
              
              (86,461
              )
              
              3,945,193Increase
                  in restricted cash
              
              
              (147,822
              )
              
              (1,808,096
              )Decrease
                  in bank overdrafts
              
              
              (68,773
              )
              
              (109,056
              )Net
                  cash provided by financing activities
              
              
              1,997,123
              
              
              903,936Net
                  decrease in cash and cash equivalents
              
              
              (146,917
              )
              
              (673,747
              )Effect
                  of foreign currency translation on cash and cash
                  equivalents
              
              
              636
              
              
              (266
              )Cash
                  and cash equivalents - beginning of period
              
              
              316,621
              
              
              780,090Cash
                  and cash equivalents - end of period
              
              
              170,340
              
              
              106,077
 
 5
 
 ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 CONDENSED
        CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
 (Stated
        in US Dollars)
 
 
 ***Three
                  months ended March 31,******2007***
              
              ***2006******(Unaudited)***
              
              ***(Unaudited)******$***
              
              ***$***(restated)
              
              (restated)Supplemental
                  disclosures of cash flow information :Cash
                  paid for :Interest
              
              
              239,429
              
              
              200,556Income
                  taxes
              
              
              112,158
              
              
              33,989
 
  See
        notes
        to condensed consolidated financial statements.
  6
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 **1.**
              **Organization
                  and Recapitalization**
 
 Asia
        Time
        Corporation (the “Company”) (formerly SRKP 9, Inc.) was incorporated in the
        State of Delaware on January 3, 2006. Effective January 23, 2007, the Company
        changed its name from SRKP 9, Inc. to Asia Time Corporation.
  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 Kwong
        Kai Shun, the sole shareholder of Times Manufacture (“Original Shareholder”).
        The closing of the Exchange Agreement occurred on January 23, 2007.
 
 The
        Company effected 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 the capital
        shares of Times Manufacture from the Original Shareholder, in exchange for
        which
        the Company issued 19,454,420 shares of its Common Stock to the Original
        Shareholder. The 19,454,420 shares of common stock issued to the Original
        Shareholder in conjunction with this transaction have been presented as
        outstanding for all periods presented.
 
 The
        Original Shareholder of Times Manufacture acquired 84% of the Company’s issued
        and outstanding common stock in conjunction with the completion of the Exchange
        Agreement. Therefore, although Times Manufacture became the Company’s
        wholly-owned subsidiary, the transaction was accounted for as a recapitalization
        in the form of a reverse merger of Times Manufacture, whereby Times Manufacture
        was deemed to be the accounting acquirer and was deemed to have retroactively
        adopted the capital structure of SRKP 9, Inc. Since the transaction was
        accounted for as a reverse merger, the accompanying consolidated financial
        statements reflect the historical consolidated financial statements of Times
        Manufacture for all periods presented, and do not include the historical
        financial statements of SRKP 9, Inc. All costs associated with the reverse
        merger transaction were expensed as incurred.
 
 7
 ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **1.**
              **Organization
                  and Recapitalization
                  (continued)**
 
 The
        Company agreed to register the 1,999,192 shares of common stock that were
        held
        by certain of the Company’s shareholders immediately prior to the closing of the
        Exchange Agreement. If the Company fails to register 1,999,192 shares due
        to
        failure on the part of the Company, additional shares of its common stock
        shall
        be issued to the respective shareholders in the amount of 0.0333% of their
        respective shares for each calendar day until the registration becomes
        effective. There is no maximum potential consideration to be transferred
        in
        connection with the registration of these shares. The Company agreed to file
        a
        registration statement no later than the tenth day after the end of the six
        month period that immediately follows the filing date of the initial
        registration statement (the "Required Filing Date"). The Company agreed to
        use
        reasonable best efforts to cause such registration statement to become effective
        within 120 days after the Required Filing Date or the actual filing date,
        whichever is earlier, or 150 days after the Required Filing Date or the actual
        filing date, whichever is earlier, if the registration statement is subject
        to a
        full review by the Securities and Exchange Commission. In addition, the Company
        agreed to use its reasonable best efforts to maintain the registration statement
        effective for a period of 24 months at the Company's expense.
 
 
 Restatement
 
 The
        Company has revised its financial statements for the three months ended March
        31, 2007 to reflect various adjustments, primarily to account for all fees
        and
        costs related to the January 2007 reverse merger as a charge to operations,
        to
        adjust the accounting for inventories and cost of sales by accruing for vendor
        incentives, and to recognize stock-based compensation in 2007. As a result
        of
        these adjustments, various income tax calculations were also revised, which
        effected net loss and also caused reclassifications to cash flows. The Company
        has also corrected average and actual shares outstanding retroactively (and
        related earnings per share calculations) to reflect the January 2007 reverse
        merger. These adjustments are more fully described at Note 19.
  8
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 **2.**
              **Description
                  of business**
 
 The
        Company and its subsidiaries are engaged in trading of completed watches
        and
        watch components.
 
 Name
                  of company
              Place
                  and date of incorporation
              Issued
                  and fully
                paid
                  capital
              Principal
                  activitiesTimes
                  Manufacture & E-Commerce Corporation Ltd.
              British
                  Virgin Islands
                March
                  21, 2002
              US$20,002
                Ordinary
              Investment
                  holdingTimes
                  Manufacturing & E-Commerce Corporation Ltd. (“TMEHK”)
              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
 
 
 **3.**
              **Summary
                  of significant accounting
                  policies**
 
 Consolidation
 
 The
        consolidated financial statements include the accounts of the Company and
        its
        majority owned subsidiaries. Intercompany accounts and transactions have
        been
        eliminated in consolidation.
  9
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 **3.**
              **Summary
                  of significant accounting
                  policies**
 
 Consolidation
 
 Basis
        of presentation
 
 The
        accompanying condensed consolidated financial statements of the Company and
        its
        subsidiaries have been prepared in accordance with generally accepted accounting
        principles in the United States of America for interim consolidated financial
        information. Accordingly, they do not include all the information and notes
        necessary for a comprehensive set of consolidated financial
        statements.
 
 In
        the
        opinion of the management of the Company, the accompanying financial statements
        include all adjustments, including those of a normal recurring nature, necessary
        for a fair presentation of the results of operations for the three months
        ended
        March 31, 2007 and 2006. Results for the interim periods presented are not
        necessarily indicative of the results that might be expected for the full
        fiscal
        year. These condensed financial statements should be read in conjunction
        with
        the consolidated financial statements of Asia Time Corporation and the notes
        thereto for the years ended December 31, 2006, 2005 and 2004 as filed with
        Securities and Exchange Commission.
 
 
 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 plant and equipment and intangible assets.
        Actual
        results could differ from those estimates.
 
 10
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 **3.**
              **Summary
                  of significant accounting policies
                  (continued)**
 
 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.
 
 For
        the
        three months ended March 31, 2007 and 2006, customers representing 10% or
        more
        of the Group’s net sales and their related accounts receivable were as
        follows:
 
 ***Three
                  months ended***
                ***March
                  31,*****2007**
              
              **2006*****$***
              
              ***$***Customer
                  A
              
              
              2,736,969
              
              
              2,989,922Customer
                  B
              
              
              2,136,233
              
              
              2,881,040Customer
                  C
              
              
              -
              
              
              2,118,331Net
                  sales
              
              
              4,873,202
              
              
              7,989,293Accounts
                  receivable
              
              
              1,239,793
              
              
              709,970
 
 Restricted
        cash
 
 Deposits
        in banks for securities of bank borrowings that are restricted in use are
        classified as restricted cash.
 
 11
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **3.**
              **Summary
                  of significant accounting policies
                  (continued)**
 
 Accounts
        receivable
 
 Accounts
        receivable are stated at their original amount less an allowance for doubtful
        accounts, based on a review of outstanding amounts at the period end. An
        allowance for doubtful accounts is also recorded when there is objective
        evidence that the Company will not be able to collect all amounts due according
        to the original terms of the receivables. Uncollectible amounts are written
        off
        when identified. The Company extends unsecured credit to customers in the
        normal
        course of business and believes all accounts receivable in excess of the
        allowances for doubtful receivables are fully collectible. The Group does
        not
        accrue interest on trade accounts receivable.
 
 During
        the three months ended March 31, 2007 and 2006, the Company had no uncollectible
        accounts receivable and, accordingly, did not record any allowance for doubtful
        accounts.
 
 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 three months ended March 31, 2007 and
        2006, the Company did not make any allowance for slow-moving or defective
        inventories.
 
 Leasehold
        land
 
 Leasehold
        lands, representing upfront payments or land use rights, are recorded at
        their
        acquisition cost and amortized using the straight-line method over the lease
        terms.
  12
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **3.**
              **Summary
                  of significant accounting policies
                  (continued)**
 
 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
              %
 
 Held-to-maturity
        investments
 
 The
        Company’s policies with respect to 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 cost to purchase including
        transaction costs. Subsequently, they are stated in the balance sheet at
        amortized cost using the effective interest method less any identified
        impairment losses.
  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 the statement of operations.
 
  13
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **3.**
              **Summary
                  of significant accounting policies
                  (continued)**
 
 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
        Company 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 any of the periods
        presented.
 
 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
        their 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.
 
 Income
        taxes
 
 The
        Group
        uses the asset and liability method of accounting for income taxes pursuant
        to
        Statement of Financial Accounting Standards (“SFAS”) No. 109 “Accounting for
        Income Taxes”. Under the asset and liability method, deferred tax assets and
        liabilities are recognized for the future tax consequences attributable to
        temporary differences between the financial statements carrying amounts of
        existing assets and liabilities and loss carry forwards and their respective
        tax
        bases. Deferred tax assets and liabilities are measured using enacted tax
        rates
        expected to apply to taxable income in the years in which those temporary
        differences are expected to be recovered or settled. Valuation allowances
        are
        established when necessary to reduce deferred tax assets to the amount expected
        to be realized.
  14
 
 ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **3.**
              **Summary
                  of significant accounting policies
                  (continued)**
 
 Earnings
        per share
 
 The
        Company computes earnings per share in accordance with SFAS No. 128, “Earnings
        per Share” (“SFAS 128”), and SEC Staff Accounting Bulletin No. 98 (“SAB 98”).
        SFAS 128 requires companies with complex capital structures to present basic
        and
        diluted earnings per share. Basic earnings per share is measured as net income
        (loss) divided by the weighted average common shares outstanding for the
        period.
        Diluted earnings per share is similar to basic earnings per share but presents
        the dilutive effect on a per share basis of potential common shares (e.g.,
        convertible securities, options, and warrants) as if they had been issued
        at the
        beginning of the periods presented, or date of issuance, if later. Potential
        common shares that have an anti-dilutive effect (i.e., that increase income
        per
        share or decrease loss per share) are excluded from the calculation of diluted
        earnings per share.
 
 The
        Company did not have any potentially dilutive common share equivalents during
        the three months ended March 31, 2006. As the Company had a net loss for
        the
        three months ended March 31, 2007, the calculation of diluted earnings per
        share
        for the period excluded the effect of the Series A Convertible Preferred
        Stock
        on an “as converted” basis, since the effect would have been anti-dilutive.
        Basic and diluted earnings per share were thus the same for the three months
        ended March 31, 2007.
 
 The
        following table is a reconciliation of the weighted average common shares
        used
        in the computation of basic and diluted earnings per share for the periods
        presented:
  15
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **3.**
              **Summary
                  of significant accounting policies
                  (continued)**
 
 Earnings
        per share (continued)
 
 
 **Three Months Ended March
                  31,****2007**
              
              **2006****Weighted**
              
              
              
              
              
              **Weighted****Net**
              
              **Average**
              
              
              
              **Net**
              
              **Average****Loss**
              
              **Shares**
              
              **Per
                  Share**
              
              **Income**
              
              **Shares**
              
              **Per
                  Share**Earnings
                  per share - basicNet
                  income (loss)
              
              $
              (192,540
              )
              
              23,156,629
              
              $
              (0.01
              )
              $
              1,372,556
              
              
              19,454,420
              
              $
              0.07Effect
                  of dilutive securitiesConvertible
                  preferred stock
              
              
              -
              
              
              -
              
              
              
              
              
              -
              
              
              -Earnings
                  per share - dilutedNet
                  income (loss)
              
              $
              (192,540
              )
              
              23,156,629
              
              $
              (0.01
              )
              $
              1,372,556
              
              
              19,454,420
              
              $
              0.07
 
  16
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **3.**
              **Summary
                  of significant accounting policies
                  (Continued)**
 
 Stock-Based
        Compensation
  Effective
        January 1, 2006, the Company 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 the Company 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
        the Company’s financial statements over the vesting period of the awards.
        Accordingly, the Company recognizes compensation cost for equity-based
        compensation for all new or modified grants issued after December 31, 2005.
        The
        Company did not have equity awards outstanding at December 31,
        2005.
 
 The
        Company accounts 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.
 
 The
        Company did not recognize any stock-based compensation during the three months
        ended March 31, 2006. During the three months ended March 31, 2007, the Company
        recorded $1,611,563, as a charge to operations to recognize the grant date
        fair
        value of stock-based compensation in conjunction with the Escrow Agreement
        described at Note 16.
 
 Recent
        accounting pronouncements
 
 In
        July
        2006, the FASB issued FIN 48, “Accounting for Uncertainty in Income Taxes.” FIN
        48 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 the Company’s 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 did not have
        any
        material unrecognized tax benefits as of January 1, 2007. The adoption of
        FIN 48
        did not have any impact on the Company’s consolidated financial
        statements.
  17
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **3.**
              **Summary
                  of significant accounting policies
                  (continued)**
 
 
 Recent
        accounting pronouncements (continued)
 
 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. SFAS 157 is
        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 157, the Company
        currently does not believe the adoption of SFAS 157 will have a material
        impact
        on the Company’s consolidated financial statements.
 
 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” (“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 has not chosen 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 consolidated financial
        statements.
  18
 
 ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **4.**
              **Other
                  income**
 
 ***Three
                  months ended March 31,******2007***
              
              ***2006******(Unaudited)***
              
              ***(Unaudited)******$***
              
              ***$****Operating
                  income*License
                  fee of intangible assets
              
              
              32,716
              
              
              41,905Rental
                  income
              
              
              15,781
              
              
              -48,497
              
              
              41,905*Non-operating
                  income*Bank
                  interest income
              
              
              29,002
              
              
              36,343Net
                  exchange gains
              
              
              927
              
              
              109Other
                  interest income
              
              
              -
              
              
              6,46129,929
              
              
              42,91378,426
              
              
              84,818
 
 
 **5.**
              **Interest
                  expense**
 
 ***Three
                  months ended March 31,******2007***
              
              ***2006******(Unaudited)***
              
              ***(Unaudited)******$***
              
              ***$***Interest
                  on bank trust receipts
              
              
              219,502
              
              
              179,554Interest
                  on short-term bank loans
              
              
              9,583
              
              
              5,175Interest
                  on bank overdrafts
              
              
              10,344
              
              
              15,827239,429
              
              
              200,556
   19
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **6.**
              **Income
                  taxes**
 
 ***Three
                  months ended***
                ***March
                  31,******2007***
              
              ***2006******(Unaudited)***
              
              ***(Unaudited)******$***
              
              ***$***Hong
                  Kong profits taxCurrent
                  period
              
              
              402,667
              
              
              294,945
 
 The
        Company’s subsidiaries operating in Hong Kong are subject to a tax of 17.5% on
        the estimated assessable profits during the periods. During the three months
        ended March 31, 2007 and 2006, the effective tax rate was (191.6)% and 17.7%,
        respectively. The effective tax rate in 2007 would have been 15.7% if
        non-deductible stock-based compensation and reverse merger costs had been
        excluded from the calculation.
 
 Deferred
        tax (assets) liabilities as of March 31, 2007 and 2006 are composed of the
        following:
 
 ***As
                  of******March
                  31,***
              
              ***December
                  31,******2007***
              
              ***2006******(Unaudited)***
              
              ***(Audited)******$***
              
              ***$***Temporary
                  difference on accelerated taxdepreciation
                  on plant and equipment
              
              
              17,579
              
              
              17,669Deferred
                  tax liabilities, net
              
              
              17,579
              
              
              17,669Recognized
                  in the balance sheet:Net
                  deferred tax assets
              
              
              (13,969
              )
              
              (14,042
              )Net
                  deferred tax liabilities
              
              
              31,548
              
              
              31,71117,579
              
              
              17,669
 
 Deferred
        tax assets of the Company relating to the tax effect of the change in valuation
        allowance of the Company have not been accounted for in the financial statements
        for the three months ended March 31, 2007 and 2006, 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 March 31, 2007 or December 31, 2006.
  20
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **7.**
              **Comprehensive
                  income**
 
 ***Three
                  months ended***
                ***March
                  31,******2007***
              
              ***2006******(Unaudited)***
              
              ***(Unaudited)******$***
              
              ***$***Net
                  income
              
              
              (192,540
              )
              
              1,372,556Foreign
                  currency translation adjustment
              
              
              (52,077
              )
              
              (4,067
              )Total
                  comprehensive income
              
              
              (244,617
              )
              
              1,368,489
 
 
 **8.**
              **Prepaid
                  expenses and other
                  receivables**
 
 ***As
                  of******March
                  31,***
              
              ***December
                  31,******2007***
              
              ***2006******(Unaudited)***
              
              ***(Audited)******$***
              
              ***$***Rebate
                  receivable
              
              
              1,695,002
              
              
              -Interest
                  receivable
              
              
              -
              
              
              20,218Rental
                  receivable
              
              
              -
              
              
              46,314Other
                  receivable
              
              
              50,015
              
              
              -Purchase
                  deposits paid
              
              
              3,306,826
              
              
              1,530,372Sales
                  proceeds of intangible assets receivable
              
              
              299,501
              
              
              301,042Other
                  deposits and prepayments
              
              
              328,707
              
              
              203,1875,680,051
              
              
              2,101,133
 
 
 **9.**
              **Inventories**
 ***As
                    of******March
                    31,***
                
                ***December
                    31,******2007***
                
                ***2006******(Unaudited)***
                
                ***(Audited)******$***
                
                ***$***Completed
                    watches, at cost
                
                
                762,191
                
                
                1,745,648Watch
                    movements, cost
                
                
                194,602
                
                
                4,500,537878,367
                
                
                6,246,185
  21
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **10.**
              **Plant
                  and equipment**
 
 ***As
                  of******March
                  31,***
              
              ***December
                  31,******2007***
              
              ***2006******(Unaudited)***
              
              ***(Audited)******$***
              
              ***$****Cost*Buildings
              
              
              241,109
              
              
              242,350Furniture
                  and fixtures
              
              
              490,406
              
              
              492,866Office
                  equipment
              
              
              145,164
              
              
              145,911Machinery
                  and equipment
              
              
              319,979
              
              
              321,626Moulds
              
              
              382,696
              
              
              384,665Motor
                  vehicles
              
              
              45,693
              
              
              45,9281,625,047
              
              
              1,633,346*Accumulated
                  depreciation*Buildings
              
              
              9,868
              
              
              8,441Furniture
                  and fixtures
              
              
              260,501
              
              
              237,508Office
                  equipment
              
              
              107,653
              
              
              100,612Machinery
                  and equipment
              
              
              108,995
              
              
              93,475Moulds
              
              
              289,716
              
              
              276,936Motor
                  vehicles
              
              
              27,825
              
              
              26,116804,558
              
              
              743,088*Net*Buildings
              
              
              231,241
              
              
              233,909Furniture
                  and fixtures
              
              
              229,905
              
              
              255,358Office
                  equipment
              
              
              37,511
              
              
              45,299Machinery
                  and equipment
              
              
              210,984
              
              
              228,151Moulds
              
              
              92,980
              
              
              107,729Motor
                  vehicles
              
              
              17,868
              
              
              19,812820,489
              
              
              890,258
 
 Depreciation
        expenses included in administrative and other operating expenses for the
        three
        months ended March 31, 2007 and March 31, 2006 are $65,431 and $75,753,
        respectively.
 
 As
        at
        March 31, 2007 and December 31, 2006, the carrying amount of buildings pledged
        as security for the Group’s banking facilities amounted to $231,241 and
        $233,909, respectively.
  22
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 **11.**
              **Leasehold
                  lands**
 ***As
                    of******March
                    31,***
                
                ***December
                    31,******2007***
                
                ***2006******(Unaudited)***
                
                ***(Audited)******$***
                
                ***$****Cost*
                
                
                944,653
                
                
                949,514*Accumulated
                    amortization*
                
                
                36,834
                
                
                31,234*Net*
                
                
                907,819
                
                
                918,280Analyzed
                    for reporting purposes as:Current
                    asset
                
                
                17,079
                
                
                22,958Non-current
                    asset
                
                
                890,740
                
                
                895,322907,819
                
                
                918,280
 
 Amortization
        expenses included in administrative and other operating expenses for the
        three
        months ended March 31, 2007 and March 31, 2006 are $5,774 and $2,023,
        respectively.
 
 As
        at
        March 31, 2007 and December 31, 2006, the carrying amount of leasehold lands
        pledged as security for the Group’s banking facilities amounted to $907,819 and
        $918,280, respectively.
 
 **12.**
              **Held-to-maturity
                  investments**
 
 ***As
                  of******March
                  31,***
              
              ***December
                  31,******2007***
              
              ***2006******(Unaudited)***
              
              ***(Audited)******$***
              
              ***$***Hang
                  Seng Capital Guarantee Investment Fund-
                  30,000 units at $10 each, interest rate at 10.5% in 3.75
                  years*Cost*
              
              
              299,654
              
              
              301,196
  The
        carrying amount of the held-to-maturity investment approximates its fair
        value
        at March 31, 2007.
 
 As
        at
        March 31, 2007 and December 31, 2006, the carrying amount of held-to-maturity
        investments pledged as security for the Group’s banking facilities amounted to
        $299,654 and $301,196, respectively.
  23
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **13.**
              **Intangible
                  assets**
 
 ***As
                  of******March
                  31,***
              
              ***December
                  31,******2007***
              
              ***2006******(Unaudited)***
              
              ***(Audited)******$***
              
              ***$****Cost*Trademarks
              
              
              199,667
              
              
              200,695Websites
              
              
              419,301
              
              
              421,459618,968
              
              
              622,154*Accumulated
                  amortization*Trademarks
              
              
              121,797
              
              
              112,389Websites
              
              
              192,013
              
              
              171,929313,810
              
              
              284,318*Net*Trademarks
              
              
              77,870
              
              
              88,306Websites
              
              
              227,288
              
              
              249,530305,158
              
              
              337,836
 
 Amortization
        expenses included in administrative and other operating expenses for the
        three
        months ended March 31, 2007 and March 31, 2006 are $ 31,023 and
        $38,720, respectively.
 
 
 **14.**
              **Other
                  payables and accrued
                  liabilities**
 
 ***As
                  of******March
                  31,***
              
              ***December
                  31,******2007***
              
              ***2006******(Unaudited)***
              
              ***(Audited)******$***
              
              ***$***Accrued
                  expenses
              
              
              130,496
              
              
              181,352Sales
                  deposits received
              
              
              8,959
              
              
              9,006139,455
              
              
              190,358
 
  24
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 **15.**
              **Bank
                  borrowings**
 ***As
                    of******March
                    31,***
                
                ***December
                    31,******2007***
                
                ***2006******(Unaudited)***
                
                ***(Audited)******$***
                
                ***$***Secured:Bank
                    overdrafts repayable on demand
                
                
                480,280
                
                
                551,714Repayable
                    within one yearNon-recurring
                    bank loans
                
                
                1,141,262
                
                
                1,469,866Other
                    bank borrowings
                
                
                11,040,075
                
                
                11,183,58712,661,617
                
                
                13,205,167
 
 As
        of
        March 31, 2007, the above banking borrowings were secured by the
        following:
 
 (a)
              first
                  fixed legal charge over leasehold land and buildings with carrying
                  amounts
                  of $1,139,060 (note 10 and 11);
 
 (b)
              charge
                  over bank deposits of $4,903,971;
 
 (c)
              charge
                  over held-to-maturity investments of $299,654 (note
                  12)
 
 (d)
              personal
                  guarantee executed by a director of the Company;
                  and
 
 (e)
              other
                  financial covenant :- The bank borrowings require one of the Company’s
                  subsidiaries to maintain a minimum net worth of $1,283,038. The
                  Company’s
                  subsidiary was in compliance with this requirement at March 31,
                  2007.
  25
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **16.**
              **Common
                  stock and convertible preferred
                  stock**
 
 A
        reconciliation of certain of the equity accounts of SRKP 9, Inc. and Times
        Manufacture as a result of the January 2007 reverse merger is as
        follows:
 
 **Series
                  A Convertible Preferred Stock**
              
              **Common
                  Stock**
              
              **Additional****($0.0001
                  Par Value)**
              
              **($0.0001
                  Par Value)**
              
              **Paid-In****Shares**
              
              **Amount**
              
              **Shares**
              
              **Amount**
              
              **Capital****Balances,
                  December 31, 2006**
              
              **0**
              
              **$**
              **0**
              
              
              **19,454,420**
              
              **$**
              **1,946**
              
              **$**
              **654,298**Jan.
                  23, 2007
              
              
              Shares
                  issued to SRKP 9 founders:Originally
                  issued on Jan. 3, 2006;
                deemed
                  issued on Jan. 23, 2007 for
                reverse
                  merger purposes
              
              
              -
              
              
              -
              
              
              2,700,000
              
              
              270
              
              
              (270
              )Issued
                  in connection with
                1.371188519-
                  for-1 retroactive stock
                split
              
              
              
              
              
              
              
              
              1,002,209
              
              
              100
              
              
              (100
              )Jan.
                  23, 2007
              
              
              Adjustment
                  to SRKP 9 accounts to
                reflect
                  reverse merger
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (7,999
              )Jan.
                  23, 2007
              
              
              Gross
                  proceeds from shares sold in offering - initial closing
              
              
              1,749,028
              
              
              175
              
              
              -
              
              
              -
              
              
              2,256,071Jan.
                  23, 2007
              
              
              Offering
                  costs - initial closing (9% of gross)
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (203,062
              )Jan.23,2007
              
              
              Stock-based
                  compensation
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              1,611,563Feb.
                  9,2007
              
              
              Gross
                  proceeds from shares sold in offering - final closing
              
              
              501,320
              
              
              50
              
              
              -
              
              
              -
              
              
              646,651Feb.
                  9,2007
              
              
              Offering
                  costs - initial closing (9% of gross)
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (58,203
              )**Balances,
                  March 31, 2007**
              
              **2,250,348**
              
              **$**
              **225**
              
              
              **23,156,629**
              
              **$**
              **2,316**
              
              **$**
              **4,898,949**
   26
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **16.**
              **Common
                  stock and convertible preferred stock
                  (continued)**
 
 The
        Company conducted a private placement (“Private Placement”) pursuant to
        subscription agreements (the “Subscription Agreement”) entered into by the
        Company and certain investors. Pursuant to the Private Placement, 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 $2,902,947.
 
 At
        the
        initial closing of the Private Placement 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 Private Placement on February 9, 2007, the Company sold
        an
        aggregate of 501,320 shares of Series A Preferred Stock.
 
 The
        shares of the Company’s Series A Preferred Stock are convertible into shares of
        common stock at a conversion price equal to the share purchase price, subject
        to
        adjustments. Accordingly, each share of Series A Preferred Stock is initially
        convertible into one share of common stock.
 
 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 $1,000,000, 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.
 
 The
        Company agreed to 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
        Company agreed to a penalty provision with respect to its obligation to register
        the Series A Convertible Preferred Stock. If the Company fails to register
        the
        Series A Convertible Preferred Stock due to failure on the part of the Company,
        the Company will pay to the holders of Series A Convertible Preferred Stock
        a
        cash payment equal to 0.0333% of the purchase price of their respective shares
        for each business day of the failure. There is no maximum potential
        consideration to be transferred. The Company is required to file the
        registration statement no later than thirty days after the consummation of
        the
        Private Placement and agreed to use reasonable best efforts to cause such
        Registration Statement to become effective within one hundred and fifty 150
        days
        after the closing of the Private Placement, or one hundred eighty 180 days
        if
        the Registration Statement is subject to a full review by the SEC. The Company
        is also required to use its reasonable best effort to maintain the Registration
        Statement effective for a period of twenty-four 24 months at the Company’s
        expense.
 
  27
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **16.**
              **Common
                  stock and convertible preferred stock
                  (continued)**
 
 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, in January and February 2007, Kwong
        Kai
        Shun, the Company's 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 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. In addition, Mr. Kwong has 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 the Company's 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 June 30, 2007,
        which
        has been subsequently extended to March 31, 2008. The number of shares that
        Mr.
        Kwong will distribute to shareholders will be determined by the number of
        shares
        of common stock that have not been sold by the investors, multiplied by the
        shortfall in a valuation agreed upon by the parties. The agreed upon shortfall
        in valuation is calculated using the $1.29 purchase price per share of the
        common stock, the actual amount of net income for either 2006 or 2007 (subject
        to specified adjustments) and a price earnings ratio set at 5 for 2006 and
        4 for
        2007. In no circumstances will Mr. Kwong be required to distribute in excess
        of
        2,326,000 shares. In the event that Mr. Kwong transfers any shares to investors,
        it is anticipated that the transfer will be effected under an exemption from
        registration pursuant to the Securities Act of 1933, as amended.
 
 The
        Company has accounted for the Escrow Shares as the equivalent of a
        performance-based compensatory stock plan between the Company and Mr. Kwong.
        Accordingly, the Company determined the fair value of the stock-based
        compensation related to the Escrow Shares by employing a binomial tree model,
        which is commonly used to value performance-based equity compensation packages.
        The valuation model used a volatility factor of 57%, a risk-free interest
        rate
        of 5.7%, and weekly steps to incorporate various possible scenarios for net
        income and common stock price. The probability at each quarter-end represents
        the probability of achieving the annual 2006 and 2007 net income targets
        specified in the Escrow Agreement. This quarterly probability is a time-weighted
        average of the implicit probabilities of achieving each net income target.
        The
        probabilities are calculated using multi-period scenario analyses through
        a
        backward induction tree, which generated an aggregate fair value for the
        Escrow
        Shares of $2,433,650. The inputs to the valuation mode were based on actual
        quarterly net income and estimates made by the Company that the required
        annual
        net income would be equaled or exceeded.
 
 As
        the
        performance conditions under this compensatory stock plan relate to the
        attainment of specific defined net income milestones for both 2006 and 2007,
        the
        Company has determined that the appropriate period over which to recognize
        the
        charge to operations for the aggregate fair value of this compensatory stock
        plan of $2,433,650 is the 11-month period from February 2007 through December
        2007, which is the period of vesting (which is equivalent to the period of
        benefit), since this is the period in which the Escrow Shares are subject
        to the
        Escrow  Agreement.
 
 The
        Company has allocated the $2,433,650 based on the quarterly weighted average
        of
        the implicit probabilities of achieving each net income target. The cumulative
        probability factor at March 31, 2007 was 66.22%. Accordingly, 66.22% of
        $2,433,650, or $1,611,563, was charged to operations for the three months
        ended
        March 31, 2007.
 
 Approximately
        66% of the aggregate fair value of $2,433,650 was charged to operations during
        the three months ended March 31, 2007 because at March 31, 2007 it appeared
        probable (but not certain) that the Company would meet or exceed the required
        net income for 2006, and net income for the three months ended March 31,
        2007
        was within expectations.
 
 28
 
 ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **16.**
              **Common
                  stock and convertible preferred stock
                  (continued)**
 
 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 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 the 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.
  29
 
 ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **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 Company 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 $4,900 and $4,718 for the three months
        ended March 31, 2007 and 2006, respectively.
 
 
 **18.**
              **Segment
                  Information**
 
  For
        management purposes, the Company is currently organized into two principal
        activities - sale of watch movements (components) and sale of completed watches.
        These principal activities are the basis on which the Company reports its
        primary segment information.
 
 Three
                  months ended
                March
                  31, 2007
              
              Watch
                  Movements
              
              Completed
                  Watches
              
              Total*$*
              
              *$*
              
              *$*Sales
              
              
              19,224,066
              
              
              1,894,076
              
              
              21,118,142Cost
                  of sales
              
              
              (16,922,125
              )
              
              (976,853
              )
              
              (17,898,978
              )Segment
                  result
              
              
              2,301,941
              
              
              917,223
              
              
              3,219,164Three
                  months ended
                March
                  31, 2006
              
              
              Watch
                  Movements
              
              
              Completed
                  Watched
              
              
              Total*$*
              
              *$*
              
              *$*Sales
              
              
              18,184,751
              
              
              2,118,340
              
              
              20,303,091Cost
                  of sales
              
              
              (17,027,271
              )
              
              (1,115,018
              )
              
              (18,142,289
              )Segment
                  result
              
              
              1,157,480
              
              
              1,003,322
              
              
              2,160,802
  
 30
 ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **18.**
              **Segment
                  Information (continued)**
 
 The
        Company’s operations are conducted primarily in Hong Kong and China and the
        Company’s sales, gross profit and total assets attributable to other
        geographical areas are less than **** 10%
        of
        the Company’s corresponding consolidated totals for the three months and three
        months ended March 31, 2007 and 2006. Consequently, no segment information
        by
        geographical areas is presented.
 
 **19.**
              **Restatement******
 
 The
        Company has restated its financial statements for the three months ended
        March
        31, 2007 and 2006 to correct various accounting errors and/or disclosure
        omissions.
 
 The
        restated financial statements include adjustments to account for all fees
        and
        costs related to the January 2007 reverse merger (see Note 1) as a charge
        to
        operations, to account for inventories by adjusting watch movement costing
        for
        the effects of vendor incentives from an as received basis to an accrual
        basis,
        as the Company was able to estimate the value of the incentives as inventory
        is
        purchased, and to recognize stock-based compensation cost related to the
        Escrow
        Agreement (see Note 16). As a result of these adjustments, various income
        tax
        calculations were also revised, which effected net income and also caused
        reclassifications to cash flows. The Company has also corrected average and
        actual shares outstanding retroactively (and related earnings per share
        calculations) to reflect the January 2007 reverse merger (see Note 1). The
        Company also made various changes to footnote disclosures relating to these
        revisions.
 
 Below
        are
        summaries of the financial statement line items that were affected by the
        restatements described above.
 
  31
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **19.**
              **Restatement****(continued)**
 
 Statement
        of Operations
 Three
        months ended March 31, 2007 (Unaudited)
 
 2007
              
              2007
              
              2007(As
                  originally reported)
              
              (As
                  restated)
              
              (Effect
                  of
                adjustment)$
              
              $
              
              $Net
                  sales
              
              
              21,118,142
              
              
              21,118,142
              
              
              -Cost
                  of sales
              
              
              (18,255,983
              )
              
              (17,898,978
              )
              
              357,005Gross
                  profit
              
              
              2,862,159
              
              
              3,219,164
              
              
              357,005Other
                  income
              
              
              
              
              
              48,497
              
              
              48,497Depreciation
              
              
              (65,431
              )
              
              (65,431
              )
              
              -Administrative
                  and other operating expenses, including stock-based compensation
              
              
              (434,843
              )
              
              (2,046,406
              )
              
              (1,611,563
              )Income
                  from operations
              
              
              2,361,885
              
              
              1,155,824
              
              
              (1,206,061
              )Fees
                  and costs related to reverse merger
              
              
              -
              
              
              (736,197
              )
              
              (736,197
              )Other
                  income
              
              
              78,426
              
              
              29,929
              
              
              (48,497
              )Interest
                  expense
              
              
              (239,429
              )
              
              (239,429
              )
              
              -Income
                  before taxes
              
              
              2,200,882
              
              
              210,127
              
              
              (1,990,755
              )Income
                  taxes
              
              
              (405,672
              )
              
              (402,667
              )
              
              3,005Net
                  income (loss)
              
              
              1,795,210
              
              
              (192,540
              )
              
              (1,987,750
              )Earnings
                  per common share-
                  Basic
              
              
              0.08
              
              
              (0.01
              )
              
              (0.09
              )-
                  Diluted
              
              
              0.07
              
              
              (0.01
              )
              
              (0.08
              )Weighted
                  average common shares-
                  Basic
              
              
              23,156,629
              
              
              23,156,629
              
              
              --
                  Diluted
              
              
              23,156,629
              
              
              23,791,074
              
              
              (634,445
              )
 
  32
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **19.**
              **Restatement****(continued)**
 
 Statement
        of Operations
 Three
        months ended March 31, 2006 (Unaudited)
 
 2006
              
              2006
              
              2006(As
                  originally reported)
              
              (As
                  restated)
              
              (Effect
                  of
                adjustment)$
              
              $
              
              $Net
                  sales
              
              
              20,303,091
              
              
              20,303,091
              
              
              -Cost
                  of sales
              
              
              (18,080,818
              )
              
              (18,142,289
              )
              
              61,471Gross
                  profit
              
              
              2,222,273
              
              
              2,160,802
              
              
              61,471Other
                  income
              
              
              
              
              
              41,905
              
              
              -Depreciation
              
              
              (75,753
              )
              
              (75,753
              )
              
              -Administrative
                  and other operating expenses, including stock-based
                  compensation
              
              
              (314,342
              )
              
              (301,810
              )
              
              -Income
                  from operations
              
              
              1,832,178
              
              
              1,825,144
              
              
              61,471Other
                  income
              
              
              84,818
              
              
              42,913
              
              
              -Interest
                  expense
              
              
              (200,556
              )
              
              (200,556
              )
              
              -Income
                  before taxes
              
              
              1,716,440
              
              
              1,667,501
              
              
              61,471Income
                  taxes
              
              
              (297,150
              )
              
              (294,945
              )
              
              (2,205
              )Net
                  income
              
              
              1,419,290
              
              
              1,372,556
              
              
              59,266Earnings
                  per common share-
                  Basic
              
              
              0.06
              
              
              0.07
              
              
              0.01-
                  Diluted
              
              
              0.06
              
              
              0.07
              
              
              0.01Weighted
                  average common shares-
                  Basic
              
              
              23,156,629
              
              
              19,454,420
              
              
              (3,702,209
              )-
                  Diluted
              
              
              25,406,977
              
              
              19,454,420
              
              
              (5,952,557
              )
 
  33
  
 ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **19.**
              **Restatement****(continued)**
 
 Consolidated
        Balance Sheet
 Three
        months ended March 31, 2007 (unaudited)
 
 2007
              
              2007
              
              2007(As
                  originally reported)
              
              (As
                  restated)
              
              (Effect
                  of
                adjustment)$
              
              $
              
              $**ASSETS**Current
                  Assets :Cash
                  and cash equivalents
              
              
              170,340
              
              
              170,340
              
              
              -Restricted
                  cash
              
              
              4,604,317
              
              
              4,604,317
              
              
              -Accounts
                  receivable
              
              
              13,839,068
              
              
              13,839,068
              
              
              -Prepaid
                  expenses and other receivables
              
              
              5,675,551
              
              
              5,680,051
              
              
              4,500Inventories,
                  net
              
              
              895,538
              
              
              878,367
              
              
              (17,171
              )Prepaid
                  lease payments
              
              
              17,079
              
              
              17,079
              
              
              -Total
                  Current Assets
              
              
              25,201,893
              
              
              25,189,222
              
              
              (12,671
              )Deferred
                  tax assets
              
              
              13,969
              
              
              13,969
              
              
              -Plant
                  and equipment, net
              
              
              820,489
              
              
              820,489
              
              
              -Leasehold
                  lands
              
              
              890,740
              
              
              890,740
              
              
              -Held-to-maturity
                  investments
              
              
              299,654
              
              
              299,654
              
              
              -Intangible
                  assets
              
              
              305,158
              
              
              305,158
              
              
              -Restricted
                  cash
              
              
              299,654
              
              
              299,654
              
              
              -**TOTAL
                  ASSETS**
              
              
              27,831,557
              
              
              27,818,886
              
              
              (12,671
              )**LIABILITIES
                  AND STOCKHOLDERS’ EQUITY****LIABILITIES**Current
                  Liabilities :Accounts
                  payable
              
              
              805,344
              
              
              805,344
              
              
              -Other
                  payables and accrued liabilities
              
              
              139,455
              
              
              139,455
              
              
              -Income
                  tax payable
              
              
              1,737,662
              
              
              1,669,177
              
              
              (68,485
              )Bank
                  borrowings
              
              
              12,661,617
              
              
              12,661,617
              
              
              -Total
                  Current Liabilities
              
              
              15,344,078
              
              
              15,275,593
              
              
              (68,485
              )Deferred
                  tax liabilities
              
              
              31,548
              
              
              31,548
              
              
              -**TOTAL
                  LIABILITIES**
              
              
              15,375,626
              
              
              15,307,141
              
              
              (68,485
              )
 
  34
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **19.**
              **Restatement****(continued)**
 
 Consolidated
        of Balance Sheet (continued)
 Three
        months ended March 31, 2007 (unaudited)
 
 2007
              
              2007
              
              2007(As
                  originally reported)
              
              (As
                  restated)
              
              (Effect
                  of
                adjustment)$
              
              $
              
              $**STOCKHOLDERS’
                  EQUITY**Preferred
                  stockPar
                  value : 2007 - US$0.0001Authorized:
                  2007 - 10,000,000 sharesIssued
                  and outstanding:
                2007
                  - 2,250,348 shares
              
              
              225
              
              
              225
              
              
              -Common
                  stockPar
                  value : 2007 - US$0.0001Authorized:
                  2007 - 100,000,000 sharesIssued
                  and outstanding:
                2007
                  - 23,156,629 shares
              
              
              2,316
              
              
              2,316
              
              
              -Additional
                  paid-in capital
              
              
              2,553,663
              
              
              4,898,949
              
              
              2,345,286Accumulated
                  other comprehensive income
              
              
              (44,607
              )
              
              (44,607
              )
              
              -Retained
                  earnings
              
              
              9,944,334
              
              
              7,654,862
              
              
              (2,289,472
              )**TOTAL
                  STOCKHOLDERS’ EQUITY**
              
              
              12,455,931
              
              
              12,511,745
              
              
              55,814**TOTAL
                  LIABILITIES AND STOCKHOLDERS’ EQUITY**
              
              
              27,831,557
              
              
              27,818,886
              
              
              (12,671
              )
 
  35
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **19.**
              **Restatement****(continued)**
 
 Statement
        of Cash Flows
 Three
        months ended March 31, 2007 (unaudited)
 
 2007
              
              2007
              
              2007(As
                  originally reported)
              
              (As
                  restated)
              
              (Effect
                  of
                adjustment)$
              
              $
              
              $**Cash
                  flows from operating activities**Net
                  income (loss)
              
              
              1,795,210
              
              
              (192,540
              )
              
              (1,987,750
              )Adjustments
                  to reconcile net income (loss) to
                net
                  cash used in operating activities :Stock-based
                  compensation
              
              
              -
              
              
              1,611,563
              
              
              1,611,563Amortization
                  of intangible assets
              
              
              31,023
              
              
              31,023
              
              
              -Amortization
                  of leasehold lands
              
              
              5,774
              
              
              5,774
              
              
              -Depreciation
              
              
              65,431
              
              
              65,431
              
              
              -Income
                  taxes
              
              
              405,672
              
              
              402,667
              
              
              (3,005
              )Changes
                  in operating assets and liabilities :(Increase)
                  decrease in -Accounts
                  receivable
              
              
              (5,705,639
              )
              
              (5,705,639
              )
              
              -Prepaid
                  expenses and other receivables
              
              
              (3,568,652
              )
              
              (3,573,152
              )
              
              (4,500
              )Inventories
              
              
              5,704,558
              
              
              5,347,553
              
              
              (357,005
              )Increase
                  (decrease) in -Accounts
                  payable
              
              
              39,021
              
              
              39,021
              
              
              -Other
                  payables and accrued liabilities
              
              
              (63,519
              )
              
              (63,519
              )
              
              -Advances
                  from related parties
              
              
              (19,655
              )
              
              -
              
              
              19,655Income
                  taxes payable
              
              
              (112,158
              )
              
              (112,158
              )
              
              -Net
                  cash used in operating activities
              
              
              (1,422,934
              )
              
              (2,143,976
              )
              
              (721,042
              )**Cash
                  flows from investing activities**Acquisition
                  of plant and equipment
              
              
              (64
              )
              
              (64
              )
              
              -Net
                  cash used in investing activities
              
              
              (64
              )
              
              (64
              )
              
              -
 
  36
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **19.**
              **Restatement****(continued)**
 
 Statement
        of Cash Flows (Continued)
 Three
        months ended March 31, 2007 (unaudited)
 
 2007
              
              2007
              
              2007(As
                  originally reported)
              
              (As
                  restated)
              
              (Effect
                  of
                adjustment)$
              
              $
              
              $**Cash
                  flows from financing activities**Proceeds
                  from issuance of common stock
              
              
              1,897,793
              
              
              -
              
              
              (1,897,793
              )Proceeds
                  from issuance of Series A convertible
                preferred
                  stock
              
              
              -
              
              
              2,641,683
              
              
              2,641,683Advances
                  from related parties
              
              
              -
              
              
              (19,655
              )
              
              (19,655
              )Proceeds
                  from new short-term bank loans
              
              
              -
              
              
              112,157
              
              
              112,157Repayment
                  of short-term bank loans
              
              
              (321,849
              )
              
              (434,006
              )
              
              (112,157
              )Net
                  advances under other short-term bank
                borrowings
              
              
              (86,461
              )
              
              (86,461
              )
              
              -Increase
                  in restricted cash
              
              
              (147,822
              )
              
              (147,822
              )
              
              -Decrease
                  in bank overdrafts
              
              
              (68,773
              )
              
              (68,773
              )
              
              -Net
                  cash provided by financing activities
              
              
              1,272,888
              
              
              1,997,123
              
              
              724,235Net
                  decrease in cash and cash equivalents
              
              
              (150,110
              )
              
              (146,917
              )
              
              3,193Effect
                  of foreign currency translation on cash and
                cash
                  equivalents
              
              
              636
              
              
              636
              
              
              -Cash
                  and cash equivalents - beginning of period
              
              
              319,814
              
              
              316,621
              
              
              (3,193
              )Cash
                  and cash equivalents - end of period
              
              
              170,340
              
              
              170,340
              
              
              -
 
  37
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **19.**
              **Restatement****(continued)**
 
 Statement
        of Cash Flows
 Three
        months ended March 31, 2006 (unaudited)
 
 2006
              
              2006
              
              2006(As
                  originally reported)
              
              (As
                  restated)
              
              (Effect
                  of
                adjustment)$
              
              $
              
              $**Cash
                  flows from operating activities**Net
                  income
              
              
              1,419,290
              
              
              1,372,556
              
              
              46,734Adjustments
                  to reconcile net income to net cash
                provided
                  by operating activities:Amortization
                  of intangible assets
              
              
              38,720
              
              
              38,720
              
              
              -Amortization
                  of leasehold lands
              
              
              2,023
              
              
              2,023
              
              
              -Depreciation
              
              
              75,753
              
              
              75,753
              
              
              -Gain
                  on disposal of plant and equipment
              
              
              (2,037
              )
              
              (2,037
              )
              
              -Income
                  taxes
              
              
              297,150
              
              
              294,945
              
              
              2,205Changes
                  in operating assets and liabilities:(Increase)
                  decrease in -Accounts
                  receivable
              
              
              (766,647
              )
              
              (766,647
              )
              
              -Prepaid
                  expenses and other receivables
              
              
              (1,404,441
              )
              
              (396,270
              )
              
              (1,008,171
              )Inventories
              
              
              232,620
              
              
              (714,080
              )
              
              946,700Increase
                  (decrease) in -Accounts
                  payable
              
              
              187,074
              
              
              187,074
              
              
              -Other
                  payables and accrued liabilities
              
              
              (395
              )
              
              (18,395
              )
              
              (18,000
              )Advances
                  from related parties
              
              
              (1,069,745
              )
              
              -
              
              
              1,069,745Income
                  taxes payable
              
              
              (33,989
              )
              
              (33,989
              )
              
              -Unearned
                  income
              
              
              (1,238,248
              )
              
              (1,238,248
              )
              
              -Net
                  cash used in operating activities
              
              
              (2,262,872
              )
              
              (1,198,595
              )
              
              1,064,277**Cash
                  flows from investing activities**Acquisition
                  of plant and equipment
              
              
              (381,125
              )
              
              (381,125
              )
              
              -Proceeds
                  from disposal of plant and equipment
              
              
              2,037
              
              
              2,037
              
              
              -Net
                  cash used in investing activities
              
              
              (379,088
              )
              
              (379,088
              )
              
              -
 
  38
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **19.**
              **Restatement****(continued)**
 
 Statement
        of Cash Flows (continued)
 Three
        months ended March 31, 2006 (unaudited)
 
 2006
              
              2006
              
              2006(As
                  originally reported)
              
              (As
                  restated)
              
              (Effect
                  of
                adjustment)$
              
              $
              
              $**Cash
                  flows from financing activities**Proceeds
                  from issuance of common stock
              
              
              2,167
              
              
              -
              
              
              (2,167
              )Advances
                  from related parties
              
              
              -
              
              
              (1,069,745
              )
              
              (1,069,745
              )Proceeds
                  from new short-term bank loans
              
              
              -
              
              
              33,988
              
              
              33,988Repayment
                  of short-term bank loans
              
              
              (54,359
              )
              
              (88,348
              )
              
              (33,989
              )Net
                  advances under short-term bank
                borrowings
              
              
              3,945,192
              
              
              3,945,193
              
              
              -Increase
                  in restricted cash
              
              
              (1,808,096
              )
              
              (1,808,096
              )
              
              -Decrease
                  in bank overdrafts
              
              
              (109,056
              )
              
              (109,056
              )
              
              -Net
                  cash provided by financing activities
              
              
              1,975,848
              
              
              903,936
              
              
              (1,071,912
              )Net
                  decrease in cash and cash equivalents
              
              
              (666,112
              )
              
              (673,747
              )
              
              (7,635
              )Effect
                  of foreign currency translation on cash and
                cash
                  equivalents
              
              
              (266
              )
              
              (266
              )
              
              -Cash
                  and cash equivalents - beginning of period
              
              
              780,090
              
              
              780,090
              
              
              -Cash
                  and cash equivalents - end of period
              
              
              113,712
              
              
              106,077
              
              
              (7,635
              )
 
  39
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 
 **20.**
              **Subsequent
                  Events**
  On
        November 13, 2007, the Company closed a financing transaction under Regulation
        S
        with ABN AMRO Bank N.V. (the “Subscriber”) issuing (i) US $8,000,000 Variable
        Rate Convertible Bonds due 2012 (the “Bonds”) and (ii) warrants to purchase
        600,000 shares of common stock of the Company expiring 2010 (the “Warrants”).
        The financing transaction was completed in accordance with a subscription
        agreement entered into by the Company and the Subscriber dated October 31,
        2007.
  US
        $8,000,000 Variable Rate Convertible Bonds
  The
        Bonds
        were issued further to a trust deed between the Company and The Bank of New
        York, London Branch, dated November 13, 2007 (the “Trust Deed”), and are
        represented by the global certificate in the form as set forth in the Trust
        Deed. The bonds are subject to a paying and conversion agency agreement between
        the Company, The Bank of New York, and The Bank of New York, London Branch,
  The
        Bonds
        are subscribed at a price equal to 97% of their principal amount, which is
        the
        issue price of 100% less a 3% commission to the Subscriber. The Terms and
        Conditions of the Bonds (the “Terms”) contained in the Trust Deed, set forth,
        among other things, the following terms:
  -
        The
        Bonds bear interest from November 13, 2007 at the rate of 6% per annum for
        the
        first year after November 13, 2007 and 3% per annum thereafter, of the principal
        amount of the Bonds.
 
 -
        Each
        Bond is convertible at the option of the holder at any time on and after
        365
        days after the date the Company’s shares of common stock commence trading on the
        American Stock Exchange or any alternative stock exchange (the “Listing Date”)
        into shares of common stock of the Company at an initial per share conversion
        price (“Conversion Price”) equal to the price per share at which shares are sold
        in the Company’s proposed initial public offering on the American Stock Exchange
        (“AMEX”) with minimum gross proceeds of US$2,000,000. If no initial public
        offering has occurred prior to conversion, the Conversion Price will be US$2.00,
        subject to adjustment according to the Terms of the Bonds. No Bonds may be
        converted after the close of business on November 13, 2012, or if such Bond
        is
        called for redemption before the maturity date, then up to the close of business
        on a date no later than seven business days prior to the date fixed for
        redemption thereof.
 
  40
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 **20.**
              **Subsequent
                  Events (continued)**
 
 -
        The
        number of shares of the Company’s common stock to be issued on conversion of the
        Bonds will be determined by dividing the principal amount of each Bond to
        be
        converted by the Conversion Price in effect at the conversion date. The
        Conversion Price is subject to adjustment in certain events, including the
        Company’s issuance of additional shares of common stock or rights to purchase
        common stock at a per share or per share exercise or conversion price,
        respectively, at less than the applicable Conversion Price of the Bonds.
        If for
        the period of 20 consecutive trading days immediately prior to November 13,
        2009
        or September 29, 2012, the Conversion Price for the Bonds is higher than
        the
        average closing price for the shares, then the Conversion Price will be reset
        to
        such average closing price; provided that, the conversion price will not
        be
        reset lower than 70% of the then existing conversion price. In addition,
        the
        Trust Deed provides that the Conversion Price of the Bonds cannot be adjusted
        to
        lower than $0.25 per share of common stock (as adjusted for stock splits,
        stock
        dividends, spin-offs, rights offerings, recapitalizations and similar
        events).
 
 -
        If on or before November 13, 2008, (i) the Company common stock is not listed
        on
        AMEX or the New York Stock Exchange or NASDAQ or (ii) the Bonds, Warrants,
        and
        shares underlying the Bonds and Warrants are not registered with the Securities
        and Exchange Commission (the “SEC”), the holder of the Bonds can require the
        Company to redeem the Bonds at 106.09% of their principal amount. Also, at
        any
        time after November 13, 2010, the holders of the Bonds can require the Company
        to redeem the Bonds at 126.51% of their principal amount. The Company is
        required to redeem any outstanding Bonds at 150.87% of its principal amount
        on
        November 13, 2012.
  Warrants
        to Purchase 600,000 Shares of Common Stock
 
 The
        Warrants, which are evidenced by a warrant instrument entered into by and
        between the Company and the Subscriber, dated November 13, 2007 (the “Warrant
        Instrument”), are subject to the terms of a warrant agency agreement by and
        among the Company, The Bank of New York and The Bank of New York, London
        Branch,
        dated November 13, 2007 (the “Warrant Agency Agreement”).
 
 Pursuant
        to the terms and conditions of the Warrant Instrument and Warrant Agency
        Agreement, the Warrants are exercisable at $0.0001 per share and terminate
        on
        November 13, 2010. The Company has agreed to list the shares underlying the
        Warrants on AMEX, or any alternative stock exchange by November 13, 2008.
        In
        addition, the Company has agreed to register the shares of common stock
        underlying the Warrants with the SEC on or prior to November 13, 2008 and
        will
        keep the registration effective until 30 days after the Warrants terminate.
   41
  ASIA
        TIME
        CORPORATION
 (Formerly
        SRKP 9, Inc.)
 
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (restated)
 (Stated
        in US Dollars)
 
 THREE
        MONTHS ENDED MARCH 31, 2007 AND 2006
 
 **21.**
              **Subsequent
                  Events (continued)**
 
 Registration
        Rights
 
 On
        November 13, 2007, the Company and the Subscriber also entered into a
        registration rights agreement pursuant to which the Company agreed to register
        the Bonds and Warrants, and the shares of common stock underlying the Bonds
        and
        Warrants (the “Registrable Securities”). The Company agreed to prepare and file
        with the SEC, no later than 90 days after the Listing Date, a Registration
        Statement on Form S-1 (the “Registration Statement”) to register the Registrable
        Securities and, as promptly as possible, and in any event no later than 365
        days
        after the Listing Date, cause that Registration Statement, as amended, to
        become
        effective. In addition, the Company agreed to list all Registrable Securities
        covered by the Registration Statement on each securities exchange on which
        similar securities issued by the Company are then listed. The registration
        rights agreement does not provide for liquidated or specified damages in
        the
        event the Company does not timely register the Registrable Securities.
 
 Accounting
        for Bonds and Warrants
 
 At
        November 13, 2007, the date of issuance, the Company determined the fair
        value
        of the Bonds to be zero, net of discounts for the fair value of the Warrants
        and
        the beneficial conversion feature aggregating $7,760,000, which were determined
        using the relative fair value method in accordance with APB 14 and EITF 98-5.
        The Warrants and the beneficial conversion feature were valued at $1,652,701
        and
        $6,107,299, respectively, with the fair value of the Warrants calculated
        using
        the Black-Scholes valuation model with a stock price fair value of $3.50
        per
        share (the mid-point of the pending initial public offering) and the fair
        value
        of the beneficial conversion feature calculated using a conversion price
        of
        $2.00 per share (which is the Bond conversion price called for if the Company
        does not complete an initial public offering) and a fair value of $3.50 per
        share. The total amount allocated to the beneficial conversion feature is
        limited to the face value of the Bond, net of the Warrant fair value. The
        Bond
        discounts related to the Warrants and the beneficial conversion feature will
        be
        included in additional paid-in capital. The discounts will be recorded as
        interest expense over the five-year term of the Bonds using the interest
        method.
        The value of the Warrants and beneficial conversion feature are subject to
        adjustment based on the actual public offering price when the Company completes
        such an offering. There will be very significant adjustments to the
        aforementioned discounts if the actual initial public offering price is $3.50
        per share, as the actual number of shares issuable upon conversion of the
        Bonds
        will decrease from 4,000,000 shares to 2,285,714 shares, and the beneficial
        conversion feature will decrease accordingly. The Company will recalculate
        these
        amounts after its initial public offering based on the public offering price
        and
        will make any appropriate adjustments.
 
 As
        indicated above, the Company will redeem each unconverted Bond at 150.87%
        of its
        principal amount on November 13, 2012 (the maturity date). Based on this
        commitment, the Company has determined the total redemption premium to be
        $4,069,600, which is in addition to the original face value of the Bonds
        of
        $8,000,000. This redemption premium will be amortized to interest expense
        over
        the term of the Bonds by the interest method.
 
 42
  **ITEM
        2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
        OPERATION**
 
 **Forward-Looking
        Statements**
 
 *The
        following discussion should be read in conjunction with our consolidated
        financial statements and related notes included elsewhere in this quarterly
        report. This quarterly 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 quarterly report are qualified by these cautionary statements and there
        can
        be no assurance of the actual results or developments.*
 
 **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 91% of our revenue for the three months
        ended
        March 31, 2007. 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.
 
 **Recent
        Events**
 
 ***January
        2007 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”). 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.
 
 43
 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 June 30, 2007, which has been subsequently extended to March 31, 2008.
        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 have accounted for the Escrow Shares as the
        equivalent of a performance-based compensatory stock plan between Mr. Kwong
        and
        us. Accordingly, during the three months ended March 31, 2007, we recorded
        a
        charge to operations of $1,611,563 to recognize the grant date fair value
        of
        stock-based compensation in conjunction with the Escrow Shares.
 
 **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.
 
 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 it 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 three months ended March 31, 2007
        was
        $19.2 million, with a gross profit $2.3 million, a 5.7% and 87.9% increase,
        respectively, as compared to $18.2 million in revenue and $1.2 million in
        gross
        profit for the three months ended March 31, 2006. The gross profit margin
        increased to 12.0% for the three months ended March 31, 2007 from 6.4% for
        the
        same period in 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 to 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.
 
 44
 **Complete
        Watch Segment**
 
 Revenue
        of our complete watch segment was $1.9 million for the three months ended
        March
        31, 2007, a 10.6% decrease compared to the same period in 2006 in which revenue
        was $2.1 million. This segment contributed approximately 9.0% of our revenue
        for
        the three months ended March 31, 2007, as compared to 10.4% of revenue for
        the
        period ended March 31, 2006. Our main market positioning in China is on the
        middle-class adult, daily, sporty and classy design.
 
 **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 nine months ended September 30, 2007 and 2006, we did
        not
        make any allowance for slow-moving or defective inventories.
 
 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.
 
 45
 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.
 
 46
 We
        did
        not recognize any stock-based compensation during the three months or six
        months
        ended March 31, 2006. During the three months ended March 31, 2007, we recorded
        $1,611,563 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:
 
 **Three
                  Months Ended March 31,****2007**
              
              **2006**Net
                  Sales
              
              
              100.0
              %
              
              100.0
              %Cost
                  of Sales
              
              
              84.8
              %
              
              89.4
              %Gross
                  Profit
              
              
              15.2
              %
              
              10.6
              %Other
                  Income
              
              
              0.2
              %
              
              0.2
              %Depreciation
              
              
              0.3
              %
              
              0.4
              %Administrative
                  and other operating expenses, including stock-based
                  compensation
              
              
              9.7
              %
              
              1.5
              %Income
                  from Operations
              
              
              5.4
              %
              
              8.9
              %Fees
                  and Costs related to Reverse Merger
              
              
              3.5
              %
              
              -Other
                  Income
              
              
              0.1
              %
              
              0.2
              %Interest
                  Expense
              
              
              1.1
              %
              
              1.0
              %Income
                  before Taxes
              
              
              0.9
              %
              
              8.1
              %Income
                  Taxes
              
              
              1.9
              %
              
              1.5
              %Net
                  Income
              
              
              -1.0
              %
              
              6.6
              %
 
 ***Comparison
        of the three months ended March 31, 2007 with the three months ended March
        31,
        2006***
 
 Net
        sales
        for the three months end March 31, 2007 was $21.1 million as compared to
        $20.3
        million for the comparable period in 2006, an increase of $0.8 million, or
        4.0%.
        This increase was primarily due to an increase in sales of watch movements.
        Net
        sales of movements was $19.2 million for the three months end March 31, 2007,
        accounting for approximately 91.0% of our total sales for the period, an
        increase of 5.7% as compared to $18.2 million for the comparable period in
        2006.
        The increase was primarily attributed to the increase in sales in middle
        to
        high-end movements, which had a higher price and profit margin, partially
        offset
        by a decrease in sales volume from 25.9 million pieces to 21.3 million pieces
        in
        the comparable three month periods in 2006 and 2007, respectively. The decrease
        in the sales volume of movements is primarily due to the decrease in low-end
        items. Sales of completed watches for the three months end March 31, 2007
        was
        $1.9 million as compared to $2.1 million for the comparable period in 2006,
        a
        decrease of 10.6%. The decrease was due to a decrease in sales volume, largely
        in low-end items, from 0.28 million pieces to 0.21 million pieces in the
        comparable periods in 2007 and 2006 respectively.
 
 Cost
        of
        sales for the three months ended March 31, 2007 was $17.9 million, or 84.8%
        of
        net sales, as compared to $18.1 million for the same period in 2006, or 89.4%
        of
        net sales. The decrease in cost of sales as a percentage of net sales was
        largely attributable to the improved economies of scale.
 
 Gross
        profit for the three months ended March 31, 2007 was $3.2 million, or 15.2%
        of
        net sales, compared to $2.2 million, or 10.6% of net sales for the same period
        in 2006. The increase in our gross profit margin was primarily attributed
        to the
        increase in sales of higher-margin products as a result of diversification
        of
        products and economies of scale. Gross profit margins are usually a factor
        of
        product mix and demand for product. The gross profit of watch movements as
        a
        percentage of net sales had increased from 6.4% for the period ended March
        31,
        2006 as compared to 12.0% of net sales for the same period in 2007. The increase
        in gross profit margin was primarily due to an increase in sales of
        higher-margin items. There was only a slight increase of gross profit for
        completed watch for the three months ended March 31, 2007, which was 48.4%
        of
        net sales as compared to 47.4% of net sales for the comparable period in
        2006 as
        the product mix had no significant change.
 
 47
 Other
        income from operations was $48,497, or 0.2% of net sales for the three months
        ended March 31, 2007, as compared to $41,905, or 0.2% of net sales for the
        three
        months ended March 31, 2006. The slight increase was primarily due to an
        increase in rental income, which was $15,781 for the three months ended March
        31, 2007, partially offset by a decrease in income received from the license
        fees of intangible assets, which was $32,716 for the three months ended March
        31, 2007, as compared to $41,905 for the same period in 2006.
 
 Administrative
        and other operating expenses were $2,046,406, or 9.7% of net sales for the
        three
        months ended March 31, 2007, as compared to $301,810, or 1.5% of net sales
        for comparable period in 2006. The increase in amount and as a percentage
        of net
        sales was primarily due to the recognition of $1,611,563 of performance based
        stock- compensation in 2007 related to the Escrow Shares provided by our
        CEO,
        Kwong Kai Shun to certain investors, which are subject to the achievement
        of
        defined annual net income for 2006 and 2007 pursuant to the Private Placement
        agreement entered into with those investors. This stock compensation is measured
        each quarter based the probabilities that income for the year 2007 will reach
        a
        certain level so charges most likely will be recorded in the remaining quarters
        of 2007. The cost increases were also attributable to the increase in
        professional fees related to reporting requirements as a public company and
        additional employees and upgraded staff benefits in the comparable period
        in
        2007. Management considers these expenses as a percentage of net sales to
        be a
        key performance indicator in managing our business.
 
 Fees
        and
        costs related to the reverse merger for the three months ended March 31,
        2007
        were $736,197, which included the cost of obtaining the shell entity $317,000
        paid to the shareholders of SRKP 9, Inc. There were no such expenses in the
        same
        period in 2006.
 
 Other
        income from non-operating activities was $29,929, or 0.1% of net sales, for
        the
        three months ended March 31, 2007, as compared to $42,913, or 0.2% of net
        sales,
        for the three months ended March 31, 2006. The decrease was primarily due
        to a
        decrease in bank interest income, which was $29,002 for the three months
        ended
        March 31, 2007 as compared to $36,343 for the same period in 2006 and a lack
        of
        other interest income in the comparable period in 2007.
 
 Interest
        expense for the three months ended March 31, 2007 was $239,429, or 1.1% of
        net
        sales, as compared to $200,556 for the same period in 2006, or 1.0% of net
        sales. This increase was primarily attributable to the increase in bank interest
        rates in the three months ended March 31, 2006 and the comparable period
        in
        2007. 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 the three months ended March 31, 2007 were $402,667, or 1.9% of
        net
        sales, as compared to $294,945, or 1.5% of net sales for the same period
        in
        2006.
 
 Net
        loss
        for the three months ended March 31, 2007 was $192,540, or 1.0% of net sales,
        as
        compared to a net income of $1.4 million, or 6.6% of the net sales for the
        comparable period in 2006. The net loss was primarily due to the recognition
        of
        $1,611,563 of performance based stock compensation in 2007 related to certain
        Escrow Shares. provided by our CEO, in order for the Company to complete
        a
        financing transaction. (See footnote 16 for further information.
 
 **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.
 
 48
 **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.
 
 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.
 
 49
 **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 March
        31,
        2007 we had general banking facilities amounted to $12.7 million for overdraft,
        letter of credit, trust receipt, invoice financing and export loans granted
        by
        nine banks. The amount decreased by $1.1 million compared to $13.8 million
        as at
        March 31, 2006. 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.
 
 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
        three months ended March 31, 2007, net cash used by operating activities
        was
        approximately $2.1million, as compared to net cash used in operating activities
        of $1.2 million for the comparable period in 2006. The increase in net cash
        used
        by operating activities was primarily attributable to a net loss of $192,540
        for
        the three months ended March 31, 2007 as compared to a net income of $1.4
        million in the comparable period, and an increase in fees and costs related
        to
        restructuring and to the Share Exchange, partially offset by an adjustment
        related to stock-based compensation to our CEO, Kwong Kai Shun of $1.6 million.
        The net cash used by operating activities in the three months ended March
        31,
        2007 was also attributable to an increase in purchase deposits paid by $3.6
        million comparable to the year ended December 31, 2006. The purpose of purchase
        deposits was to keep costs of goods sold at lower market prices to avoid
        buying
        price increases in hot seasons.
 
 50
 Net
        cash
        used in investing activities was $64 for the three months ended March 31,
        2007,
        compared to $379,088 in the comparable period in 2006. The decrease in net
        cash
        used was primarily due to the decrease in expenditures for acquiring plant
        and
        equipment and no significant investment was made during the three months
        ended
        March 31, 2007.
 
 Net
        cash
        provided by financing activities was $2.0 million for the three months ended
        March 31, 2007 and $0.9 million for the comparable period in 2006. The increase
        in net cash provided by financing activities was attributable to an issuance
        of
        equity securities of $2.6 million and a decrease of approximately $1.0 million
        in advances to related parties in the three months ended March 31, 2007 as
        compared to the same period in 2006.
 
 For
        the
        three months ended March 31, 2007 and the same period in 2006, our average
        inventory turnover were approximately 18 days and 34 days, respectively.
        The
        average days outstanding of our accounts receivable for the three months
        ended
        March 31, 2007 was 56 days, as compared to 32 days for the same period in
        2006.
        The increase in the average days outstanding of our accounts receivable was
        due
        to the change in our credit policy. Since January 2007, we have extended
        our
        credit terms from 30 days to 60 day to customers who have a good credit history
        in order to improve our profit margin and competitiveness. Inventory turnover
        and average days outstanding are key operating measures that management relies
        on to monitor our business.
 
 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.
 
 **ITEM
        3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET
        RISK**
 
 *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.
 
 51
 *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
        4.  CONTROLS AND PROCEDURES**
 
 *(a)
        Evaluation of disclosure controls and procedures*
 
 As
        of
        March 31, 2007, 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 March 31, 2007 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.
 
 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-Q.
  52
 *(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 March 31, 2007
        that have materially affected, or are reasonably likely to materially affect,
        our internal control over financial reporting.
 
 
 **PART
        II-OTHER INFORMATION**
 
 **ITEM
        1.**  **LEGAL
        PROCEEDINGS**
 
 We
        are
        not currently a party to any material legal proceedings.
 
 **ITEM
        1A. RISK FACTORS**
 
 There
        have been no material changes from the risk factors disclosed in the “Risk
        Factors” section of our annual report on Form 10-K/A, as amended, for the year
        ended December 31, 2006.
 
 **ITEM
        2.**  **UNREGISTERED
        SALES OF EQUITY SECURITIES AND USE OF PROCEEDS**
 
 None.
 
 **ITEM
        3.**  **DEFAULTS
        UPON SENIOR SECURITIES**
 
 None.
 
 **ITEM
        4.**  **SUBMISSION
        OF MATTERS TO A VOTE OF SECURITY HOLDERS**
 
 None.
 
 **ITEM
        5.**  **OTHER
        INFORMATION**
 
 None.
 
 **ITEM
        6.**  **EXHIBITS**
  (a)
        Exhibits
 
 31.1
              Certification
                  of Principal Executive Officer and Principal Financial and Accounting
                  Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act of
                  2002.32.1
              Certification
                  of Principal Executive Officer and Principal Financial and Accounting
                  Officer 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.
  53
 
 **SIGNATURES**
 
 In
        accordance with the requirements of the Exchange Act, the registrant has
        duly
        caused this report to be signed on its behalf by the undersigned, thereunto
        duly
        authorized.
 
 **ASIA
                  TIME CORPORATION**
                (Registrant)February
                  8, 2008
              By:
              /s/ Kwong
                  Kai ShunKwong
                  Kai ShunChief
                  Executive Officer, Chief Financial Officer and Chairman of the
                  Board
  54