Mail Stop 4561
October 17, 2006
Li Te Xiao
President
Artcraft V, Inc.
Baimang Checking Station 1st Building South
Mountain Xili Town, Shenzhen, China
Re: Artcraft V, Inc.
Amendment No. 1 to Registration Statement on Form SB-2
Filed September 20, 2006
File No. 333-131019
Dear Mr. Xiao:
We have reviewed your filing and have the following
comments.
Where indicated, we think you should revise your document in
response
to these comments. If you disagree, we will consider your
explanation as to why our comment is inapplicable or a revision is
unnecessary. Please be as detailed as necessary in your
explanation.
In some of our comments, we may ask you to provide us with
supplemental information so we may better understand your
disclosure.
After reviewing this information, we may or may not raise
additional
comments.
Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects. We welcome
any questions you may have about our comments or any other aspect
of
our review. Feel free to call us at the telephone numbers listed
at
the end of this letter.
General
1. We note your response to comment 1 and your revised disclosure.
However, the stock purchase and exchange agreement is not
consistent
with your response or your disclosure. For example, we note that
Artcraft purchased all of the outstanding shares of Top Interest
which were held by Mr. Zu Da Xu. However, Mr. Zu Da Xu is not
party
to the agreement. Please advise.
Front Cover of Prospectus
2. Please revise the number of shares being offered. Please
revise
the back cover as well.
Summary Financial Data, pages 5 to 6
3. Please update your summary of financial data to provide current
financial information.
Risk Factors, page 6
4. Please update the financial data included in your risk factors
to
correspond to the date of your financial statements.
Risks Related to Our Corporate Structure, page 14
Our corporate actions are...., page 15
5. Please revise the identity of your principal shareholder.
Management`s Discussion and Analysis or Plan of Operation
6. We note on page 27 of your filing that you refer to a cash
balance
as of January 13, 2006 and that you provide analysis of results of
operations for the nine-month periods ended September 30, 2005 and
2004. Please update your disclosures to provide current financial
information as is required by Item 303 of Regulation S-B.
Additionally, we note other sections of the filing are not using
current information. Please update the information in your
filing,
as appropriate.
7. We note your discussion which appears to indicate that you are
a
development stage enterprise. If you believe that this is the
case,
please restate your financial statements in an amended filing to
meet
all of the applicable requirements of paragraphs 11 to 13 of SFAS
7.
Additionally, please have your independent accountants revise
their
audit report, as appropriate.
Capital Resources and Liquidity, page 27
8. We note your disclosure that you expect general and
administrative
costs to average approximately $1,700 per month for the next
twelve
months. Please clarify how you made this determination in light
of
the fact that general and administrative expenses appear to have
averaged $8,300 per month during the six months ended June 30,
2006.
Please adjust your disclosures accordingly.
Unique Characteristics of Chinese Internet Search Market, page 31
9. We note your response to comment 41. However, it still may not
be
clear how your distributors "acquire customers" or identify
customers. Please include additional disclosure to further
clarify.
Selling Stockholders, page 44
10. We note your response to comment 48. Please disclose in a
footnote to the selling stockholder table that Guoqiong Yu wholly-
owns China US Bridge Capital Ltd. and is CEO.
Experts, page 49
11. We note the report of your independent registered accounting
firm, Kabani & Company, Inc., on the financial statements of
Artcraft
V, Inc. and Subsidiaries. Please disclose Kabani & Company, Inc.
as
experts. Additionally, please advise us whether or not Lichter,
Yu
and Associates issued an auditors` report in connection with any
financial statement included within your filing and adjust your
disclosure of Experts, accordingly. Additionally, please make
adjustments throughout the filing, as appropriate (e.g., adjust
your
exhibits accordingly).
Financial Statements
Unaudited Financial Statements of Artcraft V, Inc. and
Subsidiaries
Consolidated Statements of Cash Flows
12. You have disclosed that Notes Receivable generally includes
cash
loans made to others which generate interest. Please restate your
financial statements to present these transactions as investing
activities within your consolidated statements of cash flows.
Reference is made to paragraph 17 of SFAS 95.
Audited Financial Statements of Artcraft V, Inc. and Subsidiaries
Report of Independent Registered Public Accounting Firm
13. We note that the opinion of Kabani & Company, Inc. covers the
balance sheet as of December 31, 2005 and the related financial
statements for the year ended December 31, 2005 and that the
opinion
does not correspond to the financial statement information you
provided prior to the year ended December 31, 2005. Rule 310 (a)
of
Regulation S-B requires that your consolidated statements of
income,
stockholders` equity and cash flows for the year ended December
31,
2004 be audited. Please amend your filing to meet this
requirement
and to provide an appropriate auditors` opinion(s).
14. In light of the disclosure in Note 11 to the financial
statements
in which you indicate that there is substantial doubt about your
ability to continue as a going concern, please help us to
understand
what considerations were made by your auditor in determining that
a
going concern paragraph was not required in their opinion.
Additionally, please advise us what consideration you gave to
providing a similar footnote within your unaudited financial
statements to address the going concern issue as you have incurred
further losses during the six months ended June 30, 2006 and as
operations have resulted in further uses of cash.
General
15. We note your response to prior comment 55. As Top Interest`s
financial information is the historical financial information for
Artcraft V, Inc. and Subsidiaries prior to the reverse acquisition
and as Top Interest date of inception is February 24, 2004, the
date
of inception of Artcraft V, Inc. becomes February 24, 2004. In an
amended filing, please update your audited and unaudited financial
statements and adjust your disclosure throughout the filing, as
appropriate, to reflect that February 24, 2004 is the date of
inception for Artcraft V, Inc.`s financial information. Upon
updating your financial statements to precisely indicate the
period
between February 24, 2004 and December 31, 2004 represented your
2004
operations, please have your auditor adjust their report.
Unaudited Pro Forma Financial Statements of Artcraft V, Inc.
16. We note your response to prior comments 51, 52 and 53. In
light
of the fact that Artcraft V, Inc. and subsidiaries already
consolidated its wholly-owned subsidiary Top Interest within the
financial statements provided within this filing on Form SB-2
(which
includes the historical financial information of Top Interest
since
its inception on February 24, 2004) and that Top Interest
represents
substantially all of the financial position and operations of
Artcraft V, Inc., there is no need to provide unaudited pro forma
financial information related to the reverse merger transaction.
Please remove your pro forma financial information related to this
transaction in an amended filing.
Financial Statements of Top Interest International Limited and
Subsidiary
General
17. We note your response to prior comments 51 and 52. In light
of
the fact that Artcraft V, Inc. and subsidiaries already
consolidated
its wholly-owned subsidiary Top Interest within the financial
statements provided within this filing on Form SB-2 (which
includes
the historical financial information of Top Interest since its
inception on February 24, 2004) and that Top Interest represents
substantially all of the financial position and operations of
Artcraft V, Inc., there is no need to provide separate financial
statements for Top Interest. Please remove the separate financial
statements of Top Interest in an amended filing on Form SB-2.
Part II
Item 26. Recent Sales of Unregistered Securities
18. We note your response to comment 56 and your revised
disclosure.
Please advise us how you complied with the prohibition on general
solicitation in your May 2005 offering.
Item 27. Exhibits and Financial Statement Schedules
19. Please revise the legal opinion to reflect the proper amount
of
shares being registered. In addition, please revise the
references
to Nevada law.
* * * *
As appropriate, please amend your registration statement in
response to these comments. You may wish to provide us with
marked
copies of the amendment to expedite our review. Please furnish a
cover letter with your amendment that keys your responses to our
comments and provides any requested supplemental information.
Detailed cover letters greatly facilitate our review. Please
understand that we may have additional comments after reviewing
your
amendment and responses to our comments.
We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings reviewed by the staff to
be
certain that they have provided all information investors require
for
an informed decision. Since the company and its management are in
possession of all facts relating to a company`s disclosure, they
are
responsible for the accuracy and adequacy of the disclosures they
have made.
We will consider a written request for acceleration of the
effective date of the registration statement as a confirmation of
the
fact that those requesting acceleration are aware of their
respective
responsibilities under the Securities Act of 1933 and the
Securities
Exchange Act of 1934 as they relate to the proposed public
offering
of the securities specified in the above registration statement.
We
will act on the request and, pursuant to delegated authority,
grant
acceleration of the effective date.
We direct your attention to Rules 460 and 461 regarding
requesting acceleration of a registration statement. Please allow
adequate time after the filing of any amendment for further review
before submitting a request for acceleration. Please provide this
request at least two business days in advance of the requested
effective date.
You may contact Howard Efron, Accountant, at (202) 551-3439
or
Steven Jacobs, Accounting Branch Chief, at (202) 551-3403 if you
have
questions regarding comments on the financial statements and
related
matters. Please contact me at (202) 551-3852 with any other
questions.
Sincerely,
Michael McTiernan
Special Counsel
cc: Richard I. Anslow, Esq. (via facsimile)
Anslow & Jaclin, LLP
Mr. Li Te Xiao
Artcraft V, Inc.
October 17, 2006
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