2.    Investment in 4 PRC entities

Thank you for sending us the FASB 141 and 142. In fact we have already looked
at them before. What I requested in the meeting was something from SEC, not
FASB, to justify your initial recording of these investments at the current
book value, which you told us that they were booked at "COST". I am not a SEC
expert but I consider that we need to look at the SEC SAB 97 unless your US
accounts are not to be filed with the SEC. Please correct me if I am wrong.
For your convenience, I have attached the SAB 97 document downloaded from
SEC. Or you can find it here:

http://www.sec.gov/interps/account/sab97.txt

It is meaningless for me to repeat again both your and our arguments here. I
think we have already spent enough time on that. If you need us to audit
these 4 investments please provide what we need:

- - Which L&L entity's common stock has been given to the PRC entities to
exchange for their equities, and when?
- - If the above-mentioned L&L entity's common stock was not a new issue of
stock, when, to whom and at what value did these common stocks previously
allot?
- - Supporting documents to prove the above, including the management accounts
of the L&L entity as of the date of stock allotment to justify the fair value
of L&L stock at that moment.

Remember, we need to look at the fair value of stock of L&L, not the 4 PRC
investees, as of the date of allotment.