This report is provided strictly for internal use by the subscriber in accordance with the terms of the subscription contract. Re-distribution or re-selling of this report for use by companies other than the subscriber is prohibited.


D&B Report

DATE PRINTED: May 22, 2006

D-U-N-S: 54-528-4184

FULL REVISION

COMPANY DETAILS
COMPANY NAME : SHENZHEN XINSHENGDAI INDUSTRY DEVELOPMENT CO., LTD.
COMPANY NAME (CHINESE) : 深圳市新生代实业发展有限公司
BUSINESS ADDRESS : 31H, 32G, JINGHAI GARDEN, FUHUA RD., FUTIAN DIST., SHENZHEN
GUANGDONG, 518000
BUSINESS ADDRESS (CHINESE) : 福田区福华路京海花园31H,32G深圳市
广东省, 518000
中华人民共和国
TEL : 0755 83740588
0755 83741543
FAX : 0755 83754294
D&B RATING : CC3
D&B RISK INDEX : 5
STARTED : 2001
HISTORY : CLEAR
SALES :438,000
(RMB)
WORTH :765,000 (RMB)
EMPLOYEE : 30 HERE
CONDITION : FAIR
REGISTERED CAPITAL : RMB 1000000
SIC : 7373 0100
LINE OF BUSINESS : SUBJECT IS MAINLY ENGAGED IN SINGING SYSTEMS SOFTWARE DEVELOPMENT AND SALE.
CHIEF EXECUTIVE : XU, RUILING /GENERAL MANAGER
CURRENCY : All monetary amounts quoted in this report are shown in Renminbi(RMB) unless otherwise stated.
EXECUTIVE  SUMMARY
    		• The D&B Rating for the company is CC3 which indicates a tangible net worth between RMB650,000 and RMB999,999 and an overall credit condition which is considered fair.
    		•  The Risk Index for the company is 5, which indicates "Higher Than Average Risk" .
    		• Subject company is a limited company established in 2001.
    		• Subject company's registered capital is RMB 1000000.
    		• Nothing detrimental found against D&B China's court file.
    		• Subject company has no media record in the past 12 months.

    D&B China Risk Index

    Shenzhen Xinshengdai Industry Development Co., Ltd.'s Risk Index Level is 5

    Industry Norm Grouping

    Industry Group SIC: 7373

    Industry Group Description: Computer integrated systems design

    Industry Group Risk Index Quartile Values:

    Lower Quartile : 4
    Median Quartile : 5
    Upper Quartile : 5


    Distribution of Industry Group Risk Index in D&B China Database



    New Credit Risk Index

    % of Report in Database

    Commentary

    1

    7%

    Low Risk

    2

    16%

    Lower Than Average Risk

    3

    27%

    Average Risk

    4

    25%

    Slightly Higher Than Average Risk

    5

    18%

    Higher Than Average Risk

    6

    7%

    High Risk

    * The Risk Index is derived based on the Index development sample of more than 500,000 company records. When using the Index to make individual applicant decisions, a customized version of this table based on an analysis of the Index against your customer account portfolio is recommended.It does not necessarily mean doing business with this company will experience credit risk.

    The Risk Index was recently enhanced in August 2003 and has been computed based on up-to-date information currently available in the D&B database, using D&B's expertise and advanced statistical techniques. 
    RISK ANALYSIS

    The major factors that influence the Risk Index for this company are:

    1. Indication of higher industry risk classification.
    2. Employee size of the company suggests potential higher risk.
    3. Productivity (sales per employee) ratio suggests potential higher risk of financial stress.
    4. Profitability ratio suggests potential higher risk of financial stress.

    Note: Besides the major factors listed above,there are other key drivers that also contribute to the Risk Index calculation. For more information of the Methodology and Key drivers,please refer to Appendix at the end of the report.




    CURRENT INVESTIGATION

    On May 22, 2006, Mr.Wu of Tech. Dept., ,

    confirmed operational data in this report, and other information was obtained from a third party source.

    Subject's English name is literally translated from its Chinese name.


    FINANCE

    FISCAL BALANCE SHEET AS OF Dec 31, 2005 RMB (Thousands)
    Cash 408

    Account Receivables 109

    Accounts Payable

    35
    Other Receivables 3

    Other Payables

    5
    Inventory 262

    Advances from Customers

    1

    Other Current Assets 19

    Other Current Liabilities

    61
    TOTAL CURRENT ASSETS 801 TOTAL CURRENT LIABILITIES 102
    Fixed Assets, net 65
    TOTAL FIXED ASSETS 65
    TOTAL LIABILITIES 102
    Other Assets 1
    Capital 1,000
    Retained Earnings -235
    INVESTMENT & OTHER ASSETS 1 TOTAL EQUITY 765
    TOTAL ASSETS 867 EQUITY & LIABILITIES 867


    PROFIT & LOSS STATEMENT

    Dec 31, 2005
    (RMB) (RMB)
    (Thousands)
    (Fiscal)
    Sales 438
    Cost of Sales 247
    Gross Profit/Loss 191
    Operating Expenses -13
    Administrative Expenses -235
    Financial Expenses -1
    Operating Profit/Loss -58
    Profit/Loss Before Tax -58
    Income Tax 0
    Profit/Loss After Tax -58

    The above statements were obtained from outside sources.


    COMPARATIVES
    Dec 31, 2005 Dec 31, 2004
    (RMB) (RMB)
    (Thousands) (Thousands)
    (Fiscal) (Fiscal)
    CURRENT ASSETS 801 839
    CURRENT LIABILITIES 102 87
    WORKING CAPITAL 699 752
    OTHER TANGIBLE ASSETS 66 72
    OTHER LIABILITIES
    MINORITY INTEREST
    TANGIBLE NET WORTH 765 824
    CASH & BANK 408 723
    A/CS & NOTES RECEIVABLE 112 115
    FIXED ASSETS 65 71
    A/CS & NOTES PAYABLE 40 37
    INVENTORY 262
    ANNUAL SALES/REVENUE 438


    KEY RATIOS

    Dec 31, 2005 Dec 31, 2004
    (RMB)
    		(RMB)

    CURRENT RATIO 7.85 9.64
    QUICK RATIO 5.28 9.64
    TOTAL DEBT/EQUITY RATIO 0.13 0.10
    DEBT RATIO 0.11 0.09
    COLLECTION PERIOD(DAYS) 89
    PAYMENT PERIOD(DAYS) 51
    INVENTORY TURNOVER(DAYS) 381
    ASSET TURNOVER 0.50
    NET PROFIT MARGIN(%) -13.24
    RETURN ON EQUITY(%) -7.58
    RETURN ON ASSETS(%) -6.69
    EARNINGS PER SHARE($)


    BANKING

    The company maintains relationship(s) with the following bank(s) in China:

    BANK OF CHINA
    SAIGE PLAZA SUB BRANCH

    1F, Saige Plaza, Shenzhen
    Tel: 0755-83684586

    Account Number : 825505452708091001


    CORPORATE HISTORY

    Registration Date : April 23, 2001
    Registered At : Shenzhen Administration for Industry & Commerce
    Registration No. : 4403012064214
    License Expiry Date : April 23, 2011
    Registered Capital : RMB 1,000,000
    Tax No. : 440301728545441
    Business Start Year : 2001
    Legal Status : a limited company

    Shareholders

    Xu Ruiling
    Shares:90%
    Xu Baohui
    Shares:10%
    Total 100%

    Subject passed the annual inspection of 2005 with Shenzhen Administration for Industry & Commerce.
    Subject's registered address was changed from 17E, A Bldg., Huaqiang Garden, Fuhong Rd., Futian Dist., Shenzhen to captioned one on Mar.13,2006


    PRINCIPALS

    Details of director(s) are listed as follows:

    Name: Xu, Ruiling
    Name(CHINESE): 许瑞灵
    Gender: male
    Title: General Manager
    Education Level: university
    Started with Subject: 2001
    Area of Responsibility: overall management
    Related Experience: Since 1996
    He is also the legal representative of subject company

    Name: Xu, Baohui
    Name(CHINESE): 许保辉
    Gender: male
    Title: Vice General Manager
    Started with Subject: 2001
    Related Experience: Since 1996
    Function Departments: Finance Dept.
    Business Dept.
    Administration Dept.


    OPERATIONS

    Subject is mainly engaged in singing systems software development and sale.

    Business scope: developing web system integration and computer software; information consultation; domestic commerce, material supplying and selling (except ones specially operated, controlling or sold)


    Subject is not entitled to independent import and export rights.


    PURCHASE TERRITORY


    Local
    Local 100%
    Domestic purchasing area: Guangdong


    PURCHASING TERMS
    T/T
    Cash


    SALES TERRITORY


    Local
    Local 100%
    Domestic selling area:Guangdong


    SELLING TERMS
    T/T
    Cash

    EMPLOYEES

    30 (Here)


    LOCATION

    Subject is located in a commercial area. Subject owns premises of 200 sq.m. at the above captioned address (In China, land in urban area is owned by the government, while the land in rural area is collectively owned).


    REGISTERED ADDRESS

    Address: 31H, 32G, Jinghai Garden, Fuhua Rd.,
    Futian Dist., Shenzhen




    APPENDIX

    D&B RISK INDEX METHODOLOGY


    The D&B Risk index is based on a scale of 1 to 6, where 1 represents a lower and 6 a higher percentage of observed business failures. The index is computed using available data in D&B's information database.

    The Risk Index is related to observed business failures. Though the index does not predict the probability of business closure, it reflects from a database profiling approach, the ratio of failed to operating businesses for each Risk Index Level.


    The Key Drivers in the Risk Index include the following:

    KEY DRIVERS

    BUSINESS INFORMATION

    • Legal Company Structure
    • Industry
    • Employee Size
    • Export/Import Indicator
    • Registered Capital
    • Age of Company
    • D&B History Indicator
    • Family Support

    FINANCIAL INFORMATION

    • Current Ratio
    • Return on Assets
    • Sales to Employee Ratio

    GEO

    • Region & Province

    PAYMENT INFORMATION

    • Slow Payment

    PUBLIC FILINGS

    • Court Actions

    D&B RISK INDEX APPLICATION

    This D&B Risk Index provides you with a quick assessment of a business' risk standing and when used together with other information, allows you to derive better risk decisions. Applications of the D&B Risk Index can include using it to:

    Below is a sample decision matrix to apply the D&B Risk Index to new credit assessments.

    NEW CREDIT ASSESSMENT APPLICATION

    Low Risk Index *
    May proceed to process applicant quickly with minimal or no manual review depending on the extent of index validation analysis. All credit limits should be based on applicant's capacity.

    Medium Risk Index *
    Recommend a manual review of the applicant / or adjusting your credit terms based on applicant's capacity, your internal credit policy and risk tolerance.

    High Risk Index *
    Requires thorough manual review of potential decline, or approval based on up front cash basis depending on applicant's capacity, your internal credit policy and risk tolerance.

    The above illustration assumes that the credit grantor has no prior history or experience with the new applicant and is using the D&B Risk Index in combination with other information including internal credit application, other D&B data, and sales channel input.

    * The D&B Risk Index values within each of the 3 risk levels above should be based on, and defined by, the analysis of the D&B Risk Index against your customer account portfolio to determine the optimal index ranges within each risk level.

    Below is a sample decision matrix to apply the D&B Risk Index to monitor existing customers for credit limit adjustments and receivable management follow up.

    MONITOR EXISTING CUSTOMERS' APPLICATION

    Risk Level

    Existing Credit Limit*

    		 Low Risk Medium Risk High Risk

    High
    • Revise to very high limit
    • Proactively target for up selling opportunities
    • Maintain high limit
      (no adjustments)
    • Monitor on regular basis for upward or downward index trend
    • Adjust to lower credit limit
    • Monitor closely for upward or downward index trend

    Medium
    • Maintain medium limit or revise to high limit
    • Proactively target for up selling opportunities
    • Maintain medium limit
      (no adjustments)
    • Monitor on regular basis for upward or downward index trend
    • Adjust to lower credit limit
    • Monitor closely for upward or downward index trend

    Low
    • Maintain low limit, or revise to medium limit based on capacity
    • Maintain low limit
    • Adjust credit limit to lower credit limit
    • Monitor on regular basis for upward or downward index trend
    • Monitor closely for upward or downward index trend
    • Consider cash terms and other receivable management options


    The above illustration assumes that there are 3 levels of credit limit ranges for your existing customers from small to medium to large, and that these limits are mapped to 3 levels of D&B index values from low risk to medium to high. The D&B index values within each level should be based on, and defined by, the analysis of the D&B index against your customer account portfolio to determine the optimal index ranges

    * Assumes credit limit range has been developed from existing understanding of customer's capacity

    *FULL DISPLAY COMPLETE*

     

     

    This report is provided strictly for internal use by the subscriber in accordance with the terms of the subscription contract. Re-distribution or re-selling of this report for use by companies other than the subscriber is prohibited.

    This report, which is licensed under contract solely for use by D&B's customer as one factor in its business decisions, contains information compiled from sources D&B does not control and which, unless otherwise indicated in this report, has not been verified. D&B does not assume any of user's business risk; does not guarantee the accuracy, completeness, and timeliness of the information; and shall not be liable in tort, contract or otherwise for any loss, damage, and injury resulting from use of this information, even if caused by D&B's negligence. Copyright 2006 Dun & Bradstreet All Rights Reserved *** REPORT COMPLETE ***