8-K/A

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K/A

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): October 5, 2009

ChinaCast Education Corporation

(Exact name of registrant as specified in charter)

Delaware
(State or other Jurisdiction of
Incorporation or Organization) 000-50550
(Commission File Number) 20-0178991
(IRS Employer
Identification No.)

Suite 08, 20/F, One International Financial Centre, 1 Harbour View Street,
Central, Hong Kong

(Address of Principal Executive Offices and zip code)

Registrant’s telephone number, including area code: (852) 3960-6506

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12(b) under the Exchange Act (17 CFR 240.14a-12(b))

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

 EX-23.1

 EX-99.1(i)

 EX-99.1(ii)

 EX-99.1(iii)

 EX-99.1(iv)

 EX-99.2

Item 2.01 Completion of Acquisition or Disposition of Assets.

     This Amendment No. 1 on Form 8-K/A amends the Current Report on Form 8-K filed by ChinaCast Education Corporation (the “Company”) on October 9, 2009 (the “Initial Form 8-K”) to include financial statements and pro forma financial information permitted pursuant to Item 9.01 of Form 8-K to be excluded from the Initial Form 8-K and filed by amendment to the Initial Form 8-K no later than 71 days after the date the Initial Form 8-K was required to be filed.

     As previously announced, on October 5, 2009, ChinaCast Communication Holdings Limited (the “Purchaser”), a subsidiary of Company, completed the acquisition (the “Acquisition”) of East Achieve Limited (“East Achieve”), the holding company which owns 100% of Lijiang College, from Xie Jiqing who holds 100% of the equity interest in East Achieve for a total purchase price of RMB365,000,000 (or approximately $53.7 million). RMB295,000,000 (or approximately $43.4 million) of the purchase price has been paid and the remaining RMB70,000,000 (or approximately $10.3 million) will be paid within 30 days of August 31, 2010. The source of the cash used for the acquisition is from working capital of the Company.

     East Achieve owns 100% of the equity interest in Shanghai Xijiu Information Technology Co., Ltd. (“Xijiu”), which in turn owns 100% of the equity interest in China Lianhe Biotechnology Co., Ltd. (“Lianhe”). As a result of the consummation of the acquisition, the Purchaser now holds 100% of the equity interest in Lianhe. Lijiang College is jointly sponsored by Lianhe and Guangxi Normal University. Lijiang College was founded in 2001 as an independent, accredited college affiliated with Guangxi Normal University, which is located in the city of Guilin in Southwestern China. The university has 415 full-time and part-time instructors and offers fully accredited bachelor degree and diploma courses in tourism, hospitality, language studies, computer engineering, economics, law, music, art and physical education.

     After the Acquisition, East Achieve, Xijiu and Lianhe are holding companies with no other business. Before the Acquisition, as part of a reorganization, Xijiu purchased the entire interest in Lianhe, which was accounted for using the purchase method of accounting. As such, the audited financial statements of East Achieve for the year ended December 31, 2008 and the unaudited condensed financial statements of East Achieve for the nine months ended September 30, 2009 do not reflect the profitability of Lijiang College for the corresponding periods. To provide additional information of the asset that the Company has purchased, the audited financial statements of Lijiang College for the year ended December 31, 2008 and the unaudited condensed financial statements of Lijiang College for the nine months ended September 30, 2009 were also provided as part of this Report.

Item 9.01 Financial Statements and Exhibits.

(a) Financial Statements of Business Acquired.

     The audited financial statements of East Achieve for the fiscal years ended December 31, 2008, are filed herewith as Exhibit 99.1 and are incorporated herein by reference.

(b) Pro Forma Financial Information.

     The unaudited pro forma condensed combined financial statements of the Company and East Achieve for the year ended December 31, 2008, and for the nine months ended September 30, 2009, are filed herewith as Exhibit 99.2 and are incorporated herein by reference.

(d) Exhibits. The following exhibits are provided as part of this Report.

23.1	Consent of Independent Registered Public Accounting Firm.
99.1 (i)	Audited Financial Statements of East Achieve for the fiscal years ended December 31, 2008.
99.1 (ii)	Audited Financial Statements of Lijiang College for the fiscal years ended December 31, 2008.
99.1 (iii)	Unaudited Condensed Financial Statements of East Achieve for the nine months ended September 30, 2009.
99.1 (iv)	Unaudited Condensed Financial Statements of Lijiang College for the nine months ended September 30, 2009.
99.2	Unaudited Pro Forma Condensed Combined Financial Statements of the Company and East Achieve for the year ended December 31, 2008, and for the nine months ended September 30, 2009.

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	CHINACAST EDUCATION CORPORATION
Date: December 18, 2009	By:	/s/ Antonio Sena
		Name:	Antonio Sena
		Title:	Chief Financial Officer

Exhibit Index

Exhibit Number	Description
23.1	Consent of Independent Registered Public Accounting Firm.
99.1 (i)	Audited Financial Statements of East Achieve for the fiscal years ended December 31, 2008.
99.1 (ii)	Audited Financial Statements of Lijiang College for the fiscal years ended December 31, 2008.
99.1 (iii)	Unaudited Condensed Financial Statements of East Achieve for the nine months ended September 30, 2009.
99.1 (iv)	Unaudited Condensed Financial Statements of Lijiang College for the nine months ended September 30, 2009.
99.2	Unaudited Pro Forma Condensed Combined Financial Statements of the Company and East Achieve for the year ended December 31, 2008, and for the nine months ended September 30, 2009.

EX-23.1

Exhibit 23.1

Jimmy C.H. Cheung & Co
Certified Public Accountants
Member of Kreston International Registered with the Public Company
Accounting Oversight Board

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

TO THE BOARD OF DIRECTORS OF
CHINACAST EDUCATION CORPORATION

We hereby consent to the incorporation on Form 8-k of Chinacast Education Corporation of our report dated December 4, 2009 and November 21, 2009, relating to the consolidated financial statements of East Achieve Limited and Lijiang College of Guangxi Normal University respectively as of and for the year ended December 31, 2008.

/s/ JIMMY C.H. CHEUNG & CO
JIMMY C.H. CHEUNG & CO
Certified Public Accountants

Hong Kong

Date: December 18, 2009

1607 Dominion Centre, 43 Queen’s Road East, Wanchai, Hong Kong Tel: (852) 25295500      Fax: (852) 28651067 Email: jimmycheung@jimmycheungco.com Website: http://www.jimmycheungco.com	Kreston International A global association of independent accountants and business advisors

EX-99.1(I)

Exhibit 99.1(i)

EAST ACHIEVE LIMITED AND SUBSIDIARY

(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2008

EAST ACHIEVE LIMITED AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)

CONTENTS

	Pages
Report of Independent Registered Public Accounting Firm		1
Consolidated Balance Sheet		2
Consolidated Statements of Operations		3
Consolidated Statements of Stockholders’ Equity		4
Consolidated Statements of Cash Flows		5
Notes to the Consolidated Financial Statements		6 - 10

Jimmy C.H. Cheung & Co
Certified Public Accountants
(A member of Kreston International)  
Registered with the Public Company
Accounting Oversight Board

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors of:
East Achieve Limited and subsidiary
(a development stage company)

We have audited the accompanying consolidated balance sheet of East Achieve Limited and its subsidiary (a development stage company), as of December 31, 2008 and the related consolidated statements of operations, stockholders’ equity and cash flows for the years ended December 31, 2008 and 2007. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits of the financial statements provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of East Achieve Limited and its subsidiary (a development stage company), as of December 31, 2008, and the results of its operations and its cash flows for the years ended December 31, 2008 and 2007, in conformity with accounting principles generally accepted in the United States of America.

JIMMY C.H. CHEUNG & CO
Certified Public Accountants

Hong Kong

Date: December 4, 2009

1607 Dominion Centre, 43 Queen’s Road East, Wanchai, Hong Kong
Tel: (852) 25295500 Fax: (852) 28651067 Email: jimmycheung@jimmycheungco.com
Website: http://www.jimmycheungco.com

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EAST ACHIEVE LIMITED AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED BALANCE SHEET
AS OF DECEMBER 31, 2008

	2008
	RMB
ASSETS
CURRENT ASSETS
Cash and cash equivalents		109,881
Total Current Assets		109,881
TOTAL ASSETS		109,881

LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES
Accrued expenses and other current liabilities	115
Total Current Liabilities	115
TOTAL LIABILITIES	115
COMMITMENTS AND CONTINGENCIES	—
STOCKHOLDERS’ EQUITY
Common stock ($1 par value, 50,000 shares authorized, 2 shares issued and outstanding)	16
Additional paid-in capital	1,361,452
Accumulated deficit during development stage	(1,251,702	)
Total stockholders’ Equity	109,766
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	109,881

The accompanying notes are an integral part of these consolidated financial statements

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EAST ACHIEVE LIMITED AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF OPERATIONS

							September 15, 2004
							(Inception) through
	2008			2007			December 31, 2008
	RMB			RMB			RMB
REVENUES		—			—			—
COST OF REVENUES		—			—			—
GROSS PROFIT		—			—			—
OPERATING EXPENSES
General and administrative expenses		274,461			366,119			690,044
LOSS FROM OPERATIONS		(274,461	)		(366,119	)		(690,044	)
OTHER INCOME (EXPENSES)
Interest income		888			914			3,728
Bank loan interest		(565,386	)		—			(565,386	)
Total Other (Expenses) Income, net		(564,498	)		914			(561,658	)
LOSS BEFORE TAXES		(838,959	)		(365,205	)		(1,251,702	)
INCOME TAX EXPENSE		—			—			—
NET LOSS		(838,959	)		(365,205	)		(1,251,702	)
Net loss per share — basic and diluted		(419,479.50	)		(182,602.50	)
Weighted average number of shares outstanding during the year — basic and diluted		2			2

The accompanying notes are an integral part of these consolidated financial statements

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EAST ACHIEVE LIMITED AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

					Additional
	Common Stock				paid-in		Accumulated
	Shares		Amount		capital		deficit			Total
	RMB		RMB		RMB		RMB			RMB
Stock issued to founders for cash		2		16		—		—			16
Net loss for the period		—		—		—		(16	)		(16	)
Balance at December 31, 2004		2		16		—		(16	)		—
Contributed by a stockholder		—		—		1,361,452		—			1,361,452
Net loss for the year		—		—		—		(29,549	)		(29,549	)
Balance at December 31, 2005		2		16		1,361,452		(29,565	)		1,331,903
Net loss for the year		—		—		—		(17,973	)		(17,973	)
Balance at December 31, 2006		2		16		1,361,452		(47,538	)		1,313,930
Net loss for the year		—		—		—		(365,205	)		(365,205	)
Balance at December 31, 2007		2		16		1,361,452		(412,743	)		948,725
Net loss for the year		—		—		—		(838,959	)		(838,959	)
Balance at December 31, 2008		2		16		1,361,452		(1,251,702	)		109,766

The accompanying notes are an integral part of these consolidated financial statements

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EAST ACHIEVE LIMITED AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF CASH FLOWS

	2008			2007			September 15, 2004 (Inception) through December 31, 2008
	RMB			RMB			RMB
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss		(838,959	)		(365,205	)		(1,251,702	)
Adjusted to reconcile net income to cash provided by operating activities:
Changes in operating assets and liabilities
(Increase) decrease in:
Prepaid expenses and other current assets		19,622,817			(18,389,291	)		—
Increase (decrease) in:
Accrued expenses and other current liabilities		(199	)		314			115
Net cash provided by (used in) operating activities		18,783,659			(18,754,182	)		(1,251,587	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of shares		—			—			16
Contributed by a stockholder		—			—			1,361,452
Repayment of bank borrowings		(18,810,000	)		—			(18,810,000	)
Proceeds from bank borrowings raised		—			18,810,000			18,810,000
Net cash (used in) provided by financing activities		(18,810,000	)		18,810,000			1,361,468
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS		(26,341	)		55,818			109,881
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR		136,222			80,404			—
CASH AND CASH EQUIVALENTS AT END OF YEAR		109,881			136,222			109,881
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Interest paid		565,386			—			565,386

The accompanying notes are an integral part of these consolidated financial statements

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EAST ACHIEVE LIMITED AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION

(A)	Organization
	East Achieve Limited (“EA”) was incorporated on September 15, 2004 in the British Virgin Islands (the “BVI”) as a limited liability company. EA is an investment holding company.
	EA established Shanghai Xijiu Information and Technology Co., Ltd. (“Xijiu”) in the People’s Republic of China (“PRC”) as a wholly owned subsidiary on January 20, 2005. The business activities of Xijiu are information technology development, consulting services and investment holding.
	EA and Xijiu have no revenues since their inception and, in accordance with statement of Financial Accounting Standard (“SFAS”) No. 7, “Accounting and Reporting by Development Stage Enterprise.’’ is considered a Development Stage Company.
	EA and Xijiu are hereinafter referred to as (the “Company”).
(B)	FASB Launches New Accounting Standards Codification
	In June 2009 the Financial Accounting Standards Board (“FASB”) issued FASB Accounting Standards Codification (“Codification”) as the single source of authoritative GAAP recognized by the FASB to be applied by nongovernmental entities effective for interim and annual periods ending after September 15, 2009. Rules and interpretive releases of the SEC under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. The Codification supersedes all existing non-SEC accounting and reporting standards. All other non-grandfathered, non-SEC accounting literature not included in the Codification have become non-authoritative.
	Following the Codification, FASB will not issue new standards in the form of Statements, FASB Staff Positions (“FSP”) or Emerging Issues Task Force (“EITF”) Abstracts. Instead, it will issue Accounting Standards Updates, which will serve to update the Codification, provide background information about the guidance and provide the basis for conclusions on the changes to the Codification.
	GAAP is not intended to be changed as a result of the FASB’s Codification, but it will change the way the guidance is organized and presented. As a result, these changes will have a significant impact on how companies reference GAAP in their financial statements and in their accounting policies. The Trust has adopted the Codification in this quarterly report by using plain English to describe FASB broad topic references.
(C)	Use of estimates
	The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
(D)	Principles of consolidation
	The accompanying 2008 consolidated financial statements include the financial statements of EA and its wholly owned subsidiary, Xijiu.
	All significant inter-company transactions and balances have been eliminated in consolidation.
(E)	Cash and cash equivalents
	For purpose of the statements of cash flows, cash and cash equivalents include cash on hand and demand deposits with a bank with a maturity of less than three months.
(F)	Long-lived assets
	The Company accounts for long-lived assets under the Statements of Financial Accounting Standards Nos. 142 and 144 “Accounting for Goodwill and Other Intangible Assets” and “Accounting for Impairment or Disposal of Long-Lived Assets” (“SFAS No. 142 and 144”). In accordance with SFAS No. 142 and 144, long-lived assets held and used by the Company are reviewed for impairment annually or more frequently if events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. For purposes of evaluating the recoverability of long-lived assets, when undiscounted future cash flows will not be sufficient to recover an asset’s carrying amount, the asset is written down to its fair value. In the opinion of the management, no impairment of property and equipment, intangible assets and land use rights exist at December 31, 2008.

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(G)	Investment
	Investment in an investee over which the Company does not have significant influence, the Company carries the investment at cost and recognizes as income any dividend received from distribution of the investee’s earnings. The Company reviews the investment for impairment whenever events or changes in circumstances indicate that the carrying value may no longer be recoverable.
(H)	Fair value of financial instruments
	Statement of Financial Accounting Standards No. 107, “Disclosure About Fair Value of Financial Instruments,” requires certain disclosures regarding the fair value of financial instruments. Fair value of financial instruments is made at a specific point in time, based on relevant information about financial markets and specific financial instruments. As these estimates are subjective in nature, involving uncertainties and matters of significant judgment, they cannot be determined with precision. Changes in assumptions can significantly affect estimated fair values.
	The carrying value of cash and cash equivalents, accounts receivable (trade and others), accounts payable (trade and others) and accrued liabilities approximate their fair value because of the short-term nature of these instruments. The Company places its cash and cash equivalents with what it believes to be high credit quality financial institutions. The Company has a diversified customer base, most of which are in the PRC. The Company controls credit risk related to accounts receivable through credit approvals, credit limit and monitoring procedures. The Company routinely assesses the financial strength of its students and, based upon factors surrounding the credit risk, establishes an allowance, if required, for uncollectible accounts and, as a consequence, believes that its accounts receivable credit risk exposure beyond such allowance is limited.
(I)	Income taxes
	The Company accounts for income taxes under the Statement of Financial Accounting Standards No. 109, “Accounting for Income Taxes” (“Statement 109”). Under Statement 109, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities 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. Under Statement 109, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date.
(J)	Segments
	The Company adopted Statement of Financial Accounting Standards No. 131, Disclosures about Segments of an Enterprise and Related Information (“SFAS 131”). SFAS 131 establishes standards for operating information regarding operating segments in annual financial statements and requires selected information for those segments to be presented in interim financial reports issued to stockholders. SFAS 131 also establishes standards for related disclosures about products and services and geographic areas. Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, or decision making group, in making decision how to allocate resources and assess performance. The information disclosed herein, materially represents all of the financial information related to the Company’s principal operating segments. The Company operates in a one segment.
(K)	Recent Accounting Pronouncements
	On April 9, 2009, the FASB issued authoritative pronouncement regarding interim disclosures about fair value of financial instruments”. This pronouncement amends FASB Statement No. 107, “Disclosures about Fair Value of Financial Instruments,” to require disclosures about fair value of financial instruments for interim reporting periods as well as in annual financial statements of publicly traded companies. This pronouncement also amends APB Opinion No. 28, “Interim Financial Reporting,” to require those disclosures in summarized financial information at interim reporting periods. This pronouncement became effective on April 1, 2009. They do not require disclosures for earlier periods presented for comparative purposes at initial adoption. In periods after initial adoption, this pronouncement requires comparative disclosures only for periods ending after initial adoption. The adoption of this pronouncement did not have a material effect on the Company’s consolidated financial statements.
	On April 9, 2009, the FASB issued authoritative pronouncement regarding recognition and presentation of other-than-temporary impairments. This pronouncement amends the other-than-temporary impairment guidance in U.S. GAAP for debt securities to make the guidance more operational and to improve the presentation and disclosure of other-than-temporary impairments on debt and equity securities in the financial statements. This pronouncement does not amend existing recognition and measurement guidance related to other-than-temporary impairments of equity securities. This pronouncement became effective on April 1, 2009. They do not require disclosures for earlier periods presented for comparative purposes at initial adoption. In periods after initial adoption, this pronouncement requires comparative disclosures only for periods ending after initial adoption. The adoption of this pronoucement did not have a significant effect on the Company’s consolidated

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financial position or results of operations.

On April 9, 2009, the FASB issued authoritative pronouncement regarding determining fair value when the volume and level of activity for the asset or liability have significantly decreased and identifying transactions that are not orderly. This pronouncement provides additional guidance for estimating fair value in accordance with FASB Statement No. 157, “Fair Value Measurements,” when the volume and level of activity for the asset or liability have significantly decreased. This pronouncement also includes guidance on identifying circumstances that indicate a transaction is not orderly. This pronouncement emphasizes that even if there has been a significant decrease in the volume and level of activity for the asset or liability and regardless of the valuation technique(s) used, the objective of a fair value measurement remains the same. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction (that is, not a forced liquidation or distressed sale) between market participants at the measurement date under current market conditions. This pronouncement became effective on April 1, 2009 and is applied prospectively. It does not require disclosures for earlier periods presented for comparative purposes at initial adoption. In periods after initial adoption, this pronouncement requires comparative disclosures only for periods ending after initial adoption. The adoption of the Codification has no significant effect on the Company’s consolidated financial position or results of operations.

On May 28, 2009, the FASB issued authoritative pronouncement regarding subsequent events. The objective of this pronouncement is to establish general standards for the accounting and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. In particular, this pronouncement sets forth the period after the balance sheet date during which management of a reporting entity should evaluate events or transactions that may occur for potential recognition or disclosure in the financial statements; the circumstances under which an entity should recognize events or transactions occurring after the balance sheet date in its financial statements; and the disclosures that an entity should make about events or transactions that occurred after the balance sheet date. This pronouncement is effective for interim or annual periods ending after June 15, 2009. The adoption of the Codification has no significant effect on the Company’s consolidated financial position or results of operations.

On June 12, 2009, the FASB issued authoritative pronouncement regarding amendments to FASB Interpretation No. 46(R) (“FIN 46(R)”). This pronouncement is a revision to FIN 46(R) and changes how a company determines when an entity that is insufficiently capitalized or is not controlled through voting (or similar rights) should be consolidated. The determination of whether a company is required to consolidate an entity is based on, among other things, an entity’s purpose and design and a company’s ability to direct the activities of the entity that most significantly impact the entity’s economic performance. This pronouncement retains the scope of FIN 46(R) with the addition of entities previously considered qualifying special-purpose entities, as the concept of these entities was eliminated in FASB Statement 166. The Statement is effective as of the beginning of the first fiscal year that begins after November 15, 2009. The Company is currently evaluating whether the adoption of this pronouncement will have a significant effect on its consolidated financial position or results of operations.

On July 1, 2009, the FASB issued authoritative pronouncement, “The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles — a replacement of FASB Statement No. 162”, the FASB Accounting Standards Codification (the “Codification”) became the single source of authoritative nongovernmental US GAAP. The Codification is effective for interim and annual periods ending after September 15, 2009. The adoption of this pronouncement did not have a significant effect on the Company’s consolidated financial position or results of operations.

On August 28, 2009, the FASB issued ASU 2009-05 (previously exposed for comments as proposed FSP FAS 157-f) to provide guidance on measuring the fair value of liabilities under ASC 820. The ASU clarifies that the quoted price for the identical liability, when traded as an asset in an active market, is also a Level 1 measurement for that liability when no adjustment to the quoted price is required. In the absence of a Level 1 measurement, an entity must use one or more of the following valuation techniques to estimate fair value (in a manner consistent with the principles in ASC 820), which can be classified into two broad categories:

A valuation technique that uses a quoted price:

Of an identical liability when traded as an asset.

Of a similar liability or of a similar liability when traded as an asset.

Another valuation technique (e.g., a market approach or an income approach), including one of the following:

A technique based on the amount an entity would pay to transfer the identical liability.

A technique based on the amount an entity would receive to enter into an identical liability.

The ASU is effective for the first interim or annual reporting period beginning after the ASU’s issuance. The Company is currently evaluating whether the adoption will have a significant effect on its consolidated financial position or results of operations.

In October 2009, the FASB issued ASU 2009-13, “Multiple-Deliverable Revenue Arrangements”, now codified under FASB ASC Topic 605, “Revenue Recognition”, (“ASU 2009-13”). ASU 2009-13 requires entities to allocate revenue in an arrangement using estimated selling prices of the

8

delivered goods and services based on a selling price hierarchy. The amendments eliminate the residual method of revenue allocation and require revenue to be allocated using the relative selling price method. ASU 2009-13 should be applied on a prospective basis for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010, with early adoption permitted. Management is currently evaluating the potential impact of ASU2009-13 on our financial statements.

In October 2009, the FASB issued ASU 2009-14, “Certain Arrangements That Include Software Elements, now codified under FASB ASC Topic 985, “Software”, (“ASU 2009-14”). ASU 2009-14 removes tangible products from the scope of software revenue guidance and provides guidance on determining whether software deliverables in an arrangement that includes a tangible product are covered by the scope of the software revenue guidance. ASU 2009-14 should be applied on a prospective basis for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010, with early adoption permitted. Management is currently evaluating the potential impact of ASU 2009-14 on our financial statements.

In October, 2009, the FASB issued ASU 2009-15, “Accounting for Own-Share Lending Arrangements in Contemplation of Convertible Debt Issuance or Other Financing”, now codified under FASB ASC Topic 470 “Debt”, (“ASU 2009-15”), and provides guidance for accounting and reporting for own-share lending arrangements issued in contemplation of a convertible debt issuance. At the date of issuance, a share-lending arrangement entered into on an entity’s own shares should be measured at fair value in accordance with Topic 820 and recognized as an issuance cost, with an offset to additional paid-in capital. Loaned shares are excluded from basic and diluted earnings per share unless default of the share-lending arrangement occurs. The amendments also require several disclosures including a description and the terms of the arrangement and the reason for entering into the arrangement. The effective dates of the amendments are dependent upon the date the share-lending arrangement was entered into and include retrospective application for arrangements outstanding as of the beginning of fiscal years beginning on or after December 15, 2009. Management is currently evaluating the potential impact of ASU 2009-15 on our financial statements.

2. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities at December 31, 2008 consisted of the following:

	2008
	RMB
Employee income tax payable		115
		115

3. INCOME TAX

EA was incorporated in the BVI and under current laws of the BVI, income earned is not subject to income tax.

XIjiu was incorporated in the PRC and is subject to PRC income tax which is computed according to the relevant laws and regulations in the PRC. The applicable tax rate has been 25%.

4. STOCKHOLERS’ EQUITY

(A)	Common stock
	EA was incorporated on September 15, 2004, with an authorized share capital of $50,000 comprising 50,000 shares of $1 each. On the date of incorporation, 2 shares of $1 each were issued and fully paid.
(B)	Additional paid-in capital
	In January 2005, the shareholder of the Company provided RMB1,361,452 for the registered capital of Xijiu which was capitalized as additional pain-in capital.

5. CONCENTRATIONS AND RISKS

During 2008 and 2007, both 100% of the Company’s assets were located in China.

9

6. SUBSEQUENT EVENTS

On September 9, 2009, Xijiu acquired the entire equity interest of China Lianhe Biotechnology Co., Ltd. (“Lianhe”) which owned the entire equity interest of Lijiang College of Guangxi Normal University (“LJC”). This transaction was accounted for using the purchase accounting method and the results of Lianhe and LJC were consolidated into EA starting from the date of acquisition of September 9, 2009.

On September 28, 2009, the shareholder of EA entered into a Share Transfer Agreement with ChinaCast Communication Holdings Limited (“CCH”) to dispose the entire equity interest in EA to CCH. This transaction was consummated on October 5, 2009.

10

EX-99.1(II)

Exhibit 99.1(ii)

LIJIANG COLLEGE OF
GUANGXI NORMAL UNIVERSITY

FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2008

LIJIANG COLLEGE OF GUANGXI NORMAL UNIVERSITY

CONTENTS

	Pages
Report of Independent Registered Public Accounting Firm		1
Balance Sheet as of December 31, 2008		2
Statements of Operations for the years ended December 31, 2008 and 2007		3
Statements of Shareholders’ Equity for the years ended December 31, 2008 and 2007		4
Statements of Cash Flows for the years ended December 31, 2008 and 2007		5
Notes to the Financial Statements		6 - 12

Jimmy C.H. Cheung & Co
Certified Public Accountants
(A member of Kreston International)  
Registered with the Public Company
Accounting Oversight Board

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors of:
Lijiang College of Guangxi Normal University

We have audited the accompanying balance sheet of Lijiang College of Guangxi Normal University, as of December 31, 2008 and the related statements of operations, shareholders’ equity and cash flows for the years ended December 31, 2008 and 2007. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits of the financial statements provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Lijiang College of Guangxi Normal University, as of December 31, 2008, and the results of its operations and its cash flows for the years ended December 31, 2008 and 2007, in conformity with accounting principles generally accepted in the United States of America.

JIMMY C.H. CHEUNG & CO
Certified Public Accountants

Hong Kong

Date: November 21, 2009

1607 Dominion Centre, 43 Queen’s Road East, Wanchai, Hong Kong
Tel: (852) 25295500 Fax: (852) 28651067 Email: jimmycheung@jimmycheungco.com
Website: http://www.jimmycheungco.com

1

LIJIANG COLLEGE OF GUANGXI NORMAL UNIVERSITY
BALANCE SHEET
AS OF DECEMBER 31, 2008

	2008
	RMB
ASSETS
CURRENT ASSETS
Cash and cash equivalents		12,727,962
Accounts receivable, net		11,364,561
Prepaid expenses and other current assets		63,762,845
Total Current Assets		87,855,368
PROPERTY AND EQUIPMENT, NET		249,323,663
OTHER ASSETS
Land use rights, net		17,011,680
TOTAL ASSETS		354,190,711
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Current portion of notes payable		15,000,000
Deferred revenue		68,344,340
Accrued expenses and other current liabilities		104,474,467
Income taxes payable		3,466,043
Due to holding company		34,460,184
Total Current Liabilities		225,745,034
NON-CURRENT LIABILITIES
Notes payable		90,000,000
TOTAL LIABILITIES		315,745,034
COMMITMENTS AND CONTINGENCIES		—
SHAREHOLDERS’ EQUITY
Registered capital		18,580,000
Retained earnings
Unappropriated		19,865,677
Total Shareholders’ Equity		38,445,677
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		354,190,711

The accompanying notes are an integral part of these financial statements

2

LIJIANG COLLEGE OF GUANGXI NORMAL UNIVERSITY
STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 2008 AND 2007

	2008			2007
	RMB			RMB
REVENUES		90,720,379			61,620,668
COST OF REVENUES		(71,331,246	)		(47,151,076	)
GROSS PROFIT		19,389,133			14,469,592
OPERATING EXPENSES
General and administrative expenses		69,329			51,920
Loss on disposal of property and equipment		—			8,609,728
		69,329			8,661,648
INCOME FROM OPERATIONS		19,319,804			5,807,944
OTHER INCOME (EXPENSES)
Interest income		326,383			304,445
Bank loan interest		(8,905,568	)		(1,780,500	)
Other income		23,748			38,900
Total Other (Expenses) Income, net		(8,555,437	)		(1,437,155	)
INCOME BEFORE TAXES		10,764,367			4,370,789
INCOME TAX EXPENSE		1,614,655			655,618
NET INCOME		9,149,712			3,715,171

The accompanying notes are an integral part of these financial statements

3

LIJIANG COLLEGE OF GUANGXI NORMAL UNIVERSITY
STATEMENTS OF SHAREHOLDERS’ EQUITY
FOR THE YEAR ENDED DECEMBER 31, 2008

			Unappropriated
	Registered		Retained
	capital		earnings		Total
	RMB		RMB		RMB
Balance at December 31, 2006		18,500,000		7,000,794		25,500,794
Issuance of shares		80,000		—		80,000
Net income for the year		—		3,715,171		3,715,171
Balance at December 31, 2007		18,580,000		10,715,965		29,295,965
Net income for the year		—		9,149,712		9,149,712
Balance at December 31, 2008		18,580,000		19,865,677		38,445,677

The accompanying notes are an integral part of these financial statements

4

LIJIANG COLLEGE OF GUANGXI NORMAL UNIVERSITY
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2008 AND 2007

	2008			2007
	RMB			RMB
CASH FLOWS FROM OPERATING ACTIVITIES
Net income		9,149,711			3,715,171
Adjusted to reconcile net income to cash provided by operating activities:
Depreciation and amortization		17,844,924			5,415,813
Loss on disposal of property and equipment		—			8,609,728
Changes in operating assets and liabilities
(Increase) decrease in:
Accounts receivables		(1,512,563	)		(6,600,569	)
Prepaid expenses and other current assets		(31,244,803	)		18,510,108
Increase (decrease) in:
Deferred revenues		12,427,020			22,340,177
Accrued expenses and other current liabilities		(6,336,514	)		39,054,292
Income taxes payable		1,614,655			655,619
Net cash provided by operating activities		1,942,430			91,700,339
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of fixed assets and land use rights		(27,696,866	)		(201,872,821	)
Proceeds from the disposal of property and equipment		—			6,975
Net cash used in investing activities		(27,696,866	)		(201,865,846	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of shares		—			80,000.00
Borrowings from holding company		3,540,184			30,920,000
Bank loans borrowed		15,000,000			90,000,000
Net cash provided by financing activities		18,540,184			121,000,000
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS		(7,214,252	)		10,834,493
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR		19,942,214			9,107,721
CASH AND CASH EQUIVALENTS AT END OF YEAR		12,727,962			19,942,214
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Interest paid		8,905,568			5,153,254

SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING ACTIVITIES

During 2007, the Company capitalized interest cost of RMB3,372,754 as cost of buildings under construction.

The accompanying notes are an integral part of these financial statements

5

LIJIANG COLLEGE OF GUANGXI NORMAL UNIVERSITY
NOTES TO THE FINANCIAL STATEMENTS

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION

(A)	Organization
	Lijiang College of Guangxi Normal University (“LJC” or “the College”) was incorporated in the People’s Republic of China (“PRC”) on September 8, 2005. LJC is an education and career preparation college that offers bachelor degree and diploma courses in tourism management, advertising, language studies, computer engineering, finance economics, music, art and physical education. Revenue is generated primarily from student tuition fees and student boarding charges.
(B)	FASB Launches New Accounting Standards Codification
	In June 2009 the Financial Accounting Standards Board (“FASB”) issued FASB Accounting Standards Codification (“Codification”) as the single source of authoritative GAAP recognized by the FASB to be applied by nongovernmental entities effective for interim and annual periods ending after September 15, 2009. Rules and interpretive releases of the SEC under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. The Codification supersedes all existing non-SEC accounting and reporting standards. All other non-grandfathered, non-SEC accounting literature not included in the Codification have become non-authoritative.
	Following the Codification, FASB will not issue new standards in the form of Statements, FASB Staff Positions (“FSP”) or Emerging Issues Task Force (“EITF”) Abstracts. Instead, it will issue Accounting Standards Updates, which will serve to update the Codification, provide background information about the guidance and provide the basis for conclusions on the changes to the Codification.
	GAAP is not intended to be changed as a result of the FASB’s Codification, but it will change the way the guidance is organized and presented. As a result, these changes will have a significant impact on how companies reference GAAP in their financial statements and in their accounting policies. The Trust has adopted the Codification in this quarterly report by using plain English to describe FASB broad topic references.
(C)	Use of estimates
	The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
(D)	Cash and cash equivalents
	For purpose of the statements of cash flows, cash and cash equivalents include cash on hand and demand deposits with a bank with a maturity of less than three months.
(E)	Property and equipment
	Property and equipment are stated at cost, less accumulated depreciation. Expenditures for additions, major renewals and betterments are capitalized and expenditures for maintenance and repairs are charged to expense as incurred.
	Depreciation is provided on a straight-line basis, less estimated residual value over the assets’ estimated useful lives. The estimated useful lives are as follows:

Buildings		20 Years
Paths and Gardening facilities		10 Years
Library assets		5 Years
Sport facilities		10 Years
Instructional equipments		8 Years
Motor vehicles		5 Years
Other furniture, fixtures and equipment		5 Years
Construction in progress	Nil

Land use rights are stated at cost, less accumulated amortization and are amortized over the term of the relevant rights of 50 years from the date of acquisition. Amortization of land use rights for the year ended December 31, 2008 and 2007 was RMB352,574 and RMB264,430, respectively.

6

(F)	Long-lived assets
	The Company accounts for long-lived assets under the Statements of Financial Accounting Standards Nos. 142 and 144 “Accounting for Goodwill and Other Intangible Assets” and “Accounting for Impairment or Disposal of Long-Lived Assets” (“SFAS No. 142 and 144”). In accordance with SFAS No. 142 and 144, long-lived assets held and used by the Company are reviewed for impairment annually or more frequently if events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. For purposes of evaluating the recoverability of long-lived assets, when undiscounted future cash flows will not be sufficient to recover an asset’s carrying amount, the asset is written down to its fair value. In the opinion of the management, no impairment of property and equipment, intangible assets and land use rights exist at December 31, 2008.
(G)	Investment
	Investment in an investee over which the Company does not have significant influence, the Company carries the investment at cost and recognizes as income any dividend received from distribution of the investee’s earnings. The Company reviews the investment for impairment whenever events or changes in circumstances indicate that the carrying value may no longer be recoverable.
(H)	Fair value of financial instruments
	Statement of Financial Accounting Standards No. 107, “Disclosure About Fair Value of Financial Instruments,” requires certain disclosures regarding the fair value of financial instruments. Fair value of financial instruments is made at a specific point in time, based on relevant information about financial markets and specific financial instruments. As these estimates are subjective in nature, involving uncertainties and matters of significant judgment, they cannot be determined with precision. Changes in assumptions can significantly affect estimated fair values.
	The carrying value of cash and cash equivalents, accounts receivable (trade and others), accounts payable (trade and others) and accrued liabilities approximate their fair value because of the short-term nature of these instruments. The Company places its cash and cash equivalents with what it believes to be high credit quality financial institutions. The Company has a diversified customer base, most of which are in the PRC. The Company controls credit risk related to accounts receivable through credit approvals, credit limit and monitoring procedures. The Company routinely assesses the financial strength of its students and, based upon factors surrounding the credit risk, establishes an allowance, if required, for uncollectible accounts and, as a consequence, believes that its accounts receivable credit risk exposure beyond such allowance is limited.
(I)	Revenue recognition
	The Company’s revenue recognition policies are in compliance with Staff accounting bulletin (SAB) 104. The Company recognizes tuition fees income net of commissions paid, accommodation fee income and catering fees income as services are provided. Payments received before all of the relevant criteria for revenue recognition are satisfied are recorded as deferred revenue. Cost of revenue includes the cost of services provided associated with the revenue recognized within the corresponding time period.
	Deferred revenue represents amounts received from the students against future services since the Company recognizes revenue on the performance of services. Deferred revenue was RMB68,344,340 as of December 31, 2008.
(J)	Income taxes
	The Company accounts for income taxes under the Statement of Financial Accounting Standards No. 109, “Accounting for Income Taxes” (“Statement 109”). Under Statement 109, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities 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. Under Statement 109, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date.
(K)	Segments
	The Company adopted Statement of Financial Accounting Standards No. 131, Disclosures about Segments of an Enterprise and Related Information (“SFAS 131”). SFAS 131 establishes standards for operating information regarding operating segments in annual financial statements and requires selected information for those segments to be presented in interim financial reports issued to stockholders. SFAS 131 also establishes standards for related disclosures about products and services and geographic areas. Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, or decision making group, in making decision how to allocate resources and assess performance. The information disclosed herein, materially represents all of the financial information related to the Company’s principal operating segments. The Company operates in a one segment.

7

(L)	Recent Accounting Pronouncements
	On April 9, 2009, the FASB issued authoritative pronouncement regarding interim disclosures about fair value of financial instruments”. This pronouncement amends FASB Statement No. 107, “Disclosures about Fair Value of Financial Instruments,” to require disclosures about fair value of financial instruments for interim reporting periods as well as in annual financial statements of publicly traded companies. This pronouncement also amends APB Opinion No. 28, “Interim Financial Reporting,” to require those disclosures in summarized financial information at interim reporting periods. This pronouncement became effective on April 1, 2009. They do not require disclosures for earlier periods presented for comparative purposes at initial adoption. In periods after initial adoption, this pronouncement requires comparative disclosures only for periods ending after initial adoption. The adoption of this pronouncement did not have a material effect on the Company’s financial statements.
	On April 9, 2009, the FASB issued authoritative pronouncement regarding recognition and presentation of other-than-temporary impairments. This pronouncement amends the other-than-temporary impairment guidance in U.S. GAAP for debt securities to make the guidance more operational and to improve the presentation and disclosure of other-than-temporary impairments on debt and equity securities in the financial statements. This pronouncement does not amend existing recognition and measurement guidance related to other-than-temporary impairments of equity securities. This pronouncement became effective on April 1, 2009. They do not require disclosures for earlier periods presented for comparative purposes at initial adoption. In periods after initial adoption, this pronouncement requires comparative disclosures only for periods ending after initial adoption. The adoption of this pronouncement did not have a significant effect on the Company’s financial position or results of operations.
	On April 9, 2009, the FASB issued authoritative pronouncement regarding determining fair value when the volume and level of activity for the asset or liability have significantly decreased and identifying transactions that are not orderly. This pronouncement provides additional guidance for estimating fair value in accordance with FASB Statement No. 157, “Fair Value Measurements,” when the volume and level of activity for the asset or liability have significantly decreased. This pronouncement also includes guidance on identifying circumstances that indicate a transaction is not orderly. This pronouncement emphasizes that even if there has been a significant decrease in the volume and level of activity for the asset or liability and regardless of the valuation technique(s) used, the objective of a fair value measurement remains the same. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction (that is, not a forced liquidation or distressed sale) between market participants at the measurement date under current market conditions. This pronouncement became effective on April 1, 2009 and is applied prospectively. It does not require disclosures for earlier periods presented for comparative purposes at initial adoption. In periods after initial adoption, this pronouncement requires comparative disclosures only for periods ending after initial adoption. The adoption of the Codification has no significant effect on the Company’s financial position or results of operations.
	On May 28, 2009, the FASB issued authoritative pronouncement regarding subsequent events. The objective of this pronouncement is to establish general standards for the accounting and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. In particular, this pronouncement sets forth the period after the balance sheet date during which management of a reporting entity should evaluate events or transactions that may occur for potential recognition or disclosure in the financial statements; the circumstances under which an entity should recognize events or transactions occurring after the balance sheet date in its financial statements; and the disclosures that an entity should make about events or transactions that occurred after the balance sheet date. This pronouncement is effective for interim or annual periods ending after June 15, 2009. The adoption of the Codification has no significant effect on the Company’s financial position or results of operations.
	On June 12, 2009, the FASB issued authoritative pronouncement regarding amendments to FASB Interpretation No. 46(R) (“FIN 46(R)”). This pronouncement is a revision to FIN 46(R) and changes how a company determines when an entity that is insufficiently capitalized or is not controlled through voting (or similar rights) should be consolidated. The determination of whether a company is required to consolidate an entity is based on, among other things, an entity’s purpose and design and a company’s ability to direct the activities of the entity that most significantly impact the entity’s economic performance. This pronouncement retains the scope of FIN 46(R) with the addition of entities previously considered qualifying special-purpose entities, as the concept of these entities was eliminated in FASB Statement 166. The Statement is effective as of the beginning of the first fiscal year that begins after November 15, 2009. The Company is currently evaluating whether the adoption of this pronouncement will have a significant effect on its financial position or results of operations.

8

On July 1, 2009, the FASB issued authoritative pronouncement, “The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles — a replacement of FASB Statement No. 162”, the FASB Accounting Standards Codification (the “Codification”) became the single source of authoritative nongovernmental US GAAP. The Codification is effective for interim and annual periods ending after September 15, 2009. The adoption of this pronouncement did not have a significant effect on the Company’s financial position or results of operations.

On August 28, 2009, the FASB issued ASU 2009-05 (previously exposed for comments as proposed FSP FAS 157-f) to provide guidance on measuring the fair value of liabilities under ASC 820. The ASU clarifies that the quoted price for the identical liability, when traded as an asset in an active market, is also a Level 1 measurement for that liability when no adjustment to the quoted price is required. In the absence of a Level 1 measurement, an entity must use one or more of the following valuation techniques to estimate fair value (in a manner consistent with the principles in ASC 820), which can be classified into two broad categories:

A valuation technique that uses a quoted price:

Of an identical liability when traded as an asset.

Of a similar liability or of a similar liability when traded as an asset.

Another valuation technique (e.g., a market approach or an income approach), including one of the following:

A technique based on the amount an entity would pay to transfer the identical liability.

A technique based on the amount an entity would receive to enter into an identical liability.

The ASU is effective for the first interim or annual reporting period beginning after the ASU’s issuance. The Company is currently evaluating whether the adoption will have a significant effect on its financial position or results of operations.

In October 2009, the FASB issued ASU 2009-13, “Multiple-Deliverable Revenue Arrangements”, now codified under FASB ASC Topic 605, “Revenue Recognition”, (“ASU 2009-13”). ASU 2009-13 requires entities to allocate revenue in an arrangement using estimated selling prices of the delivered goods and services based on a selling price hierarchy. The amendments eliminate the residual method of revenue allocation and require revenue to be allocated using the relative selling price method. ASU 2009-13 should be applied on a prospective basis for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010, with early adoption permitted. Management is currently evaluating the potential impact of ASU2009-13 on our financial statements.

In October 2009, the FASB issued ASU 2009-14, “Certain Arrangements That Include Software Elements, now codified under FASB ASC Topic 985, “Software”, (“ASU 2009-14”). ASU 2009-14 removes tangible products from the scope of software revenue guidance and provides guidance on determining whether software deliverables in an arrangement that includes a tangible product are covered by the scope of the software revenue guidance. ASU 2009-14 should be applied on a prospective basis for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010, with early adoption permitted. Management is currently evaluating the potential impact of ASU 2009-14 on our financial statements.

In October, 2009, the FASB issued ASU 2009-15, “Accounting for Own-Share Lending Arrangements in Contemplation of Convertible Debt Issuance or Other Financing”, now codified under FASB ASC Topic 470 “Debt”, (“ASU 2009-15”), and provides guidance for accounting and reporting for own-share lending arrangements issued in contemplation of a convertible debt issuance. At the date of issuance, a share-lending arrangement entered into on an entity’s own shares should be measured at fair value in accordance with Topic 820 and recognized as an issuance cost, with an offset to additional paid-in capital. Loaned shares are excluded from basic and diluted earnings per share unless default of the share-lending arrangement occurs. The amendments also require several disclosures including a description and the terms of the arrangement and the reason for entering into the arrangement. The effective dates of the amendments are dependent upon the date the share-lending arrangement was entered into and include retrospective application for arrangements outstanding as of the beginning of fiscal years beginning on or after December 15, 2009. Management is currently evaluating the potential impact of ASU 2009-15 on our financial statements.

9

2. PREPAID EXPENSES AND OTHER CURRENT ASSETS

Prepaid expenses and other current assets at December 31, 2008 consisted of the following:

	2008
	RMB
Deferred mangement fee		11,306,912
Deposit for purchase of furniture, fixtures and equipment		129,748
Deposits paid for construction in progress		403,934
Note receivable		51,000,000
Other receivables		922,251
		63,762,845

3. PROPERTY AND EQUIPMENT, NET

The following is a summary of property and equipment at:

	2008
	RMB
Buildings		224,378,341
Paths and Greening facilities		11,445,903
Instructional equipments		8,987,691
Library assets		2,383,986
Motor vehicles		2,516,887
Other furniture, fixtures and equipment		24,180,741
Construction in progress		119,118
		274,012,668
Less: accumulated depreciation		(24,689,005	)
Property and equipment, net		249,323,663

Property and equipment is recorded at cost, including interest incurred during construction. During 2007, the Company capitalized interest cost of RMB3,372,754 as cost of buildings.

Depreciation is computed using the straight-line method over estimated useful lives of the assets. Depreciation expense for the years ended December 31, 2008 and 2007 were RMB17,492,350 and RMB5,151,383, respectively.

4. LAND USE RIGHTS, NET

Land use rights at December 31, 2008 consisted of the following:-

	2008
	RMB
Rights to use land		17,628,684
Less: accumulated amortization		(617,004	)
Land use rights, net		17,011,680

Land use rights are stated at cost, less accumulated amortization over the term of the relevant rights of 50 years from the date of acquisition. Amortization of land use rights for the years ended December 31, 2008 and 2007 were RMB352,574 and RMB264,430, respectively.

10

5. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities at December 31, 2008 consisted of the following:

	2008
	RMB
Construction costs payable		95,238,795
Advances received from students		3,842,804
Scholarship and allowances payable to students		1,358,911
Accrued employee payroll and welfare		3,979,788
Other tax payable		54,169
		104,474,467

6. NOTES PAYABLE — LONG-TERM

Balance at December 31, 2008:

	RMB
Note payable to a bank at bank’s floating rate per annum, guaranteed by a related party, due September 25, 2009.		15,000,000
Note payable to a bank at bank’s prime rate, plus 10% per annum, guaranteed by a related party, due progressively to March 29, 2014.		90,000,000
		105,000,000
Less: current maturities		15,000,000
		90,000,000

Maturities are as follows:

	RMB
For the year ended December 31,
2009		15,000,000
2010		10,000,000
2011		20,000,000
2012		25,000,000
2013		30,000,000
2014		5,000,000
		105,000,000

Interest paid in 2008 and 2007 were RMB8,905,568 and RMB5,153,254 respectively. During the year ended December 31, 2007, RMB3,372,754 was capitalized as cost of buildings.

7. INCOME TAX

The Company was incorporated in Guangxi of the PRC and is subject to PRC income tax. According to the western development preferential policy, the College is entitled to an income tax reduction. The income tax rate was reduced from 25% to 15% on a permanent basis.

The income tax expenses for 2008 and 2007 are summarized as follows:

PRC Income Tax	2008	2007
	RMB	RMB
Current	1,614,655	655,618
	1,614,655	655,618

No deferred tax liabilities incurred from temporary differences relating to revenue earned but not yet taxable.

11

8. SHAREHOLERS’ EQUITY

Registered capital

The Company was incorporated on September 8, 2005. Total registered capital paid up was RMB18,580,000.

9. CONCENTRATIONS AND RISKS

During 2008 and 2007, both 100% of the Company’s assets were located and 100% of the Company’s revenues were earned in China.

10. SUBSEQUENT EVENTS

The College entered into the Land Expropriation Agreement with Guilin Yanshan District Government on November 16, 2009 to compensate the District Government of approximately RMB15,541,000 for land clearance charges under the agreement.

East Achieve Limited (“EA”) was incorporated on September 15, 2004 in the British Virgin Islands as a limited liability company. EA is an investment holding company. EA established Shanghai Xijiu Information and Technology Co., Ltd. (“Xijiu”) in the PRC as a wholly owned subsidiary on January 20, 2005. The business activities of Xijiu are information technology development, consulting and investment holding. On September 9, 2009, Xijiu acquired the entire equity interest of China Lianhe Biotechnology Co., Ltd. (“Lianhe”) which owned the entire equity interest of LJC. On September 28, 2009, the shareholder of EA entered into a Share Transfer Agreement with ChinaCast Communication Holdings Limited (“CCH”) to dispose the entire equity interest in EA to CCH. This transaction was consummated on October 5, 2009.

12

EX-99.1(III)

Exhibit 99.1(iii)

EAST ACHIEVE LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
AS OF SEPTEMBER 30, 2009
(UNAUDITED)

EAST ACHIEVE LIMITED AND SUBSIDIARIES

CONTENTS

	Pages
Condensed Consolidated Balance Sheets as of September 30, 2009 (Unaudited)	F-1
Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2009 and 2008 (Unaudited)	F-2
Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2009 and 2008 (Unaudited)	F-3
Notes to condensed consolidated financial statements (Unaudited)	F4–F9

EAST ACHIEVE LIMITED AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited)
(In thousands, except share-related data)

ASSETS

	As of September 30, 2009
	RMB
CURRENT ASSETS
Cash and cash equivalents		72,726
Accounts receivable, net		23,873
Prepaid expenses and other current assets		6,577
Total Current Assets		103,176
PROPERTY AND EQUIPMENT, NET		254,854
OTHER ASSETS
Land use rights, net		16,747
Goodwill		117,318
Intangible assets, net		34,305
Total Other Assets		168,370
TOTAL ASSETS		526,400
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable		7,295
Accrued expenses and other current liabilities		80,718
Income tax payable		6,038
Deferred revenue		106,899
Total Current Liabilities		200,950
NON-CURRENT LIABILITIES
Notes payable		90,000
TOTAL LIABILITIES		290,950
COMMITMENTS AND CONTINGENCIES		—
SHAREHOLDERS’ EQUITY
Common stock ($0.001 par value, 50,000 shares authorized, 2 shares issued and outstanding		—
Additional paid-in capital		236,412
Accumulated deficit		(962	)
Total Shareholders’ Equity		235,450
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		526,400

The accompanying notes are an integral part of these condensed consolidated financial statements

F-1

EAST ACHIEVE LIMITED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except share-related data)

	For the three months			For the three months			For the nine months			For the nine months
	ended			ended			ended			ended
	September 30, 2009			September 30, 2008			September 30, 2009			September 30, 2008
	RMB			RMB			RMB			RMB
REVENUES		6,970			—			6,970			—
COST OF REVENUES		(5,972	)		—			(5,972	)		—
GROSS PROFIT		998			—			998			—
OPERATING EXPENSES
General and administrative expenses		(6	)		(100	)		(74	)		(198	)
INCOME (LOSS) FROM OPERATIONS		992			(100	)		924			(198	)
OTHER INCOME (EXPENSES)
Interest income		27			—			27			1
Interest expenses		(447	)		—			(447	)		(565	)
Total Other Expenses, net		(420	)		—			(420	)		(564	)
INCOME (LOSS) FROM OPERATIONS BEFORE TAXES		572			(100	)		504			(762	)
INCOME TAX EXPENSE		(215	)		—			(215	)		—
NET INCOME (LOSS)		357			(100	)		289			(762	)
Net income (loss) per share- basic and diluted		178.50			(50.00	)		144.50			(381.00	)
Weighted average number of shares outstanding during the period – basic and diluted		2			2			2			2

The accompanying notes are an integral part of these condensed consolidated financial statements

F-2

EAST ACHIEVE LIMITED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)

	For the nine months			For the nine months
	ended			ended
	September 30, 2009			September 30, 2008
	RMB			RMB
CASH FLOWS FROM OPERATING ACTIVITIES
Net income attributable to the Company		289			(762	)
Adjusted to reconcile net income to cash provided by operating activities:
Depreciation and amortization		1,999			—
Changes in operating assets and liabilities
(Increase) decrease in:
Accounts receivable		(16,858	)		—
Prepaid expenses and other current assets		1,165			19,528
Increase (decrease) in:
Deferred revenues		106,899			—
Accounts payable		2,638			—
Accrued expenses and other current liabilities		9,158			—
Income tax payable		215			—
Net cash provided by operating activities		105,505			18,766
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment		(19,428			—
Cash outflow from acquisition of subsidiaries (Note5)		(233,512	)		—
Net cash used in investing activities		(252,940	)		—
CASH FLOWS FROM FINANCING ACTIVITIES
Contributed by stockholders		235,051			—
Bank loans repaid		(15,000	)		(18,810	)
Net cash provided by (used in) financing activities		220,051			(18,810	)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		72,616			(44	)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD		110			136
CASH AND CASH EQUIVALENTS AT END OF PERIOD		72,726			92
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for interest expenses		447			565

The accompanying notes are an integral part of these condensed consolidated financial statements

F-3

EAST ACHIEVE LIMITED AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS (UNAUDITED)
(In thousands, except share-related data)

NOTE 1 BASIS OF PRESENTATION

The preparation of the unaudited condensed consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.

In the opinion of management, the unaudited condensed consolidated financial statements contain all adjustments consisting only of normal recurring accruals considered necessary to present fairly the Company’s financial position as of September 30, 2009, the results of operations for the three and nine months ended September 30, 2009 and 2008 and cash flows for the nine months ended September 30, 2009 and 2008. The results for the three months and nine months ended September 30, 2009 are not necessarily indicative of the results to be expected for a full year. These financial statements should be read in conjunction with the audited financial statements and footnotes for the year ended December 31, 2008.

FASB Launches New Accounting Standards Codification

In June 2009 the Financial Accounting Standards Board (“FASB”) issued FASB Accounting Standards Codification (“Codification”) as the single source of authoritative GAAP recognized by the FASB to be applied by nongovernmental entities effective for interim and annual periods ending after September 15, 2009. Rules and interpretive releases of the SEC under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. The Codification supersedes all existing non-SEC accounting and reporting standards. All other non-grandfathered, non-SEC accounting literature not included in the Codification have become non-authoritative.

Following the Codification, FASB will not issue new standards in the form of Statements, FASB Staff Positions (“FSP”) or Emerging Issues Task Force (“EITF”) Abstracts. Instead, it will issue Accounting Standards Updates, which will serve to update the Codification, provide background information about the guidance and provide the basis for conclusions on the changes to the Codification.

GAAP is not intended to be changed as a result of the FASB’s Codification, but it will change the way the guidance is organized and presented. As a result, these changes will have a significant impact on how companies reference GAAP in their financial statements and in their accounting policies. The Trust has adopted the Codification in this quarterly report by using plain English to describe FASB broad topic references.

NOTE 2 ORGANIZATION

East Achieve Limited (“EA”) was incorporated on September 15, 2004 in the British Virgin Islands as a limited liability company. EA is an investment holding company.

EA established Shanghai Xijiu Information and Technology Co., Ltd. (“Xijiu”) in the People’s Republic of China (“PRC”) as a wholly owned subsidiary on January 20, 2005. The business activities of Xijiu are information technology development, consulting services and investment holding.

On September 9, 2009, Xijiu acquired the entire equity interest of China Lianhe Biotechnology CO., Ltd. (“Lianhe”) which owned the entire equity interest of Lijiang College of Guangxi Normal University (“LJC”). This transaction was accounted for using the purchase accounting method and the results of Lianhe and LJC were consolidated into EA starting from the date of acquisition of September 9, 2009.

Before the acquisition, EA and Xijiu had no revenues since their inception and, in accordance with Statement of Financial Accounting Standard (“SFAS”) No. 7, “Accounting and Reporting by Development Stage Enterprise,” is considered a Development Stage Company.

F-4

LJC was incorporated in the PRC on September 8, 2005. LJC is an education and career preparation college that offers bachelor degree and diploma courses in tourism management, advertising, language studies, computer engineering, finance economics, music, art and physical education. Revenue is generated primarily from student tuition fees and student boarding charges.

EA, Xijiu, Lainhe and LJC are hereinafter referred to as (“the Company”).

NOTE 3 PRINCIPLES OF CONSOLIDATION

The accompanying unaudited condensed consolidated financial statements include the financial statements of EA and its wholly owned subsidiaries, Xijiuj, Lianhe and LJC.

All significant inter-company balances and transactions have been eliminated in consolidation.

NOTE 4 RECENT ACCOUNTING STANDARDS AND PRONOUNCEMENTS

In December 2008, the FASB issued Staff Position No. FAS 132(R)-1 “Employers’ Disclosures about Postretirement Benefit Plan Assets” (“FSP FAS 132(R)-1”) (ASC Topic 715-20-65). FSP FAS 132(R)-1 (ASC Topic 715-20-65) requires more detailed disclosures about employers’ plan assets in a defined benefit pension or other postretirement plan, including employers’ investment strategies, major categories of plan assets, concentrations of risk within plan assets, and inputs and valuation techniques used to measure the fair value of plan assets. FSP FAS 132(R)-1 (ASC Topic 715-20-65) also requires, for fair value measurements using significant unobservable inputs (Level 3), disclosure of the effect of the measurements on changes in plan assets for the period. The disclosures about plan assets required by FSP FAS 132(R)-1 (ASC Topic 715-20-65) must be provided for fiscal years ending after December 15, 2009. As this pronouncement is only disclosure-related, it will not have an impact on the financial position and results of operations.

In May 2009, the FASB issued a new statement that establishes general standards of accounting for, and disclosure of events that occur after the balance sheet date but before the financial statements are issued or are available to be issued. The new statement, located in ASC Topic 855 Subsequent Events (formerly SFAS 165, Subsequent Events) requires entities to disclose the date through which subsequent events were evaluated as well as the rationale for why that date was selected, that is, whether that date represents the date the financial statements were issued or were available to be issued. The new statement is effective for interim or annual periods ending after June 15, 2009, which was the quarter ending June 30, 2009 for the Company. The adoption of this new statement did not have a material impact on our consolidated financial statements.

In June 2009, the FASB issued SFAS No. 166 “Accounting for Transfers of Financial Assets—an amendment of FASB Statement No. 140” (“SFAS 166”) (ASC Topic 810). SFAS 166 (not part of the codification yet) amends various provisions of SFAS No. 140 “Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities—a replacement of FASB Statement No. 125” by removing the concept of a qualifying special-purpose entity and removes the exception from applying FIN 46(R) to variable interest entities that are qualifying special-purpose entities; limits the circumstances in which a transferor derecognizes a portion or component of a financial asset; defines a participating interest; requires a transferor to recognize and initially measure at fair value all assets obtained and liabilities incurred as a result of a transfer accounted for as a sale; and requires enhanced disclosure; among others. SFAS 166 will be effective as of the beginning of each reporting entity’s first annual reporting period that begins after November 15, 2009, for interim periods within that first annual reporting period and for interim and annual reporting periods thereafter. Early adoption is not permitted. This guidance will be codified under FASB ASC Topic 860, “Transfers and Servicing” when it becomes effective. The Company does not expect the standard to have any impact on the Company’s financial position.

In June 2009, the FASB issued SFAS No. 167 “Amendments to FASB Interpretation No. 46(R)” (“SFAS 167”) (not part of the codification yet). SFAS 167 amends FASB Interpretation No. 46 (Revised December 2003) “Consolidation of Variable Interest Entities—an interpretation of ARB No. 51” (FIN 46(R)) to require an enterprise to perform an analysis to determine whether the enterprise’s variable interest or interests give it a controlling financial interest in a variable interest entity; to require ongoing reassessments of whether an enterprise is the primary beneficiary of a variable interest entity; to eliminate the quantitative approach previously required for determining the primary beneficiary of a variable interest entity; to add an additional reconsideration event for determining whether an entity is a variable interest entity when any changes in facts and circumstances occur such that holders of the equity investment at risk, as a group, lose the power from voting rights or similar rights of those investments to direct the activities of the entity that most significantly impact the entity’s economic performance; and to require enhanced disclosures that will provide users of financial statements with more transparent information about an enterprise’s involvement in a variable interest entity. SFAS 167

F-5

will be effective as of the beginning of each reporting entity’s first annual reporting period that begins after November 15, 2009, for interim periods within that first annual reporting period, and for interim and annual reporting periods thereafter. Early adoption is not permitted. This guidance will be codified under FASB ASC Topic 810, “Consolidation” when it becomes effective. The Company does not expect the standard to have any impact on the Company’s financial position.

In July, 2009, the FASB issued authoritative pronouncement, “The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles — a replacement of FASB Statement No. 162”, the FASB Accounting Standards Codification (the “Codification”) became the single source of authoritative nongovernmental US GAAP. The Codification is effective for interim and annual periods ending after September 15, 2009. The adoption of this pronouncement did not have a significant effect on the Company’s consolidated financial position or results of operations.

In August 2009, the FASB issued ASU No. 2009-05 “Measuring Liabilities at Fair Value”, now codified under FASB ASC Topic 820, “Fair Value Measurements and Disclosures”, (“ASU 2009-05”) which amends Fair Value Measurements and Disclosures – Overall (ASC Topic 820-10) to provide guidance on the fair value measurement of liabilities. This update requires clarification for circumstances in which a quoted price in an active market for the identical liability is not available, a reporting entity is required to measure fair value using one or more of the following techniques: 1) a valuation technique that uses either the quoted price of the identical liability when traded as an asset or quoted prices for similar liabilities or similar liabilities when traded as an asset; or 2) another valuation technique that is consistent with the principles in ASC Topic 820 such as the income and market approach to valuation. The amendments in this update also clarify that when estimating the fair value of a liability, a reporting entity is not required to include a separate input or adjustment to other inputs relating to the existence of a restriction that prevents the transfer of the liability. This update further clarifies that if the fair value of a liability is determined by reference to a quoted price in an active market for an identical liability, that price would be considered a Level 1 measurement in the fair value hierarchy. Similarly, if the identical liability has a quoted price when traded as an asset in an active market, it is also a Level 1 fair value measurement if no adjustments to the quoted price of the asset are required. This update is effective for our fourth quarter 2009. Management does not expect this new guidance to have a material impact on the Company’s financial statements.

In October 2009, the FASB issued ASU 2009-13, “Multiple-Deliverable Revenue Arrangements”, now codified under FASB ASC Topic 605, “Revenue Recognition”, (“ASU 2009-13”). ASU 2009-13 requires entities to allocate revenue in an arrangement using estimated selling prices of the delivered goods and services based on a selling price hierarchy. The amendments eliminate the residual method of revenue allocation and require revenue to be allocated using the relative selling price method. ASU 2009-13 should be applied on a prospective basis for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010, with early adoption permitted. Management is currently evaluating the potential impact of ASU2009-13 on our financial statements.

In October 2009, the FASB issued ASU 2009-14, “Certain Arrangements That Include Software Elements, now codified under FASB ASC Topic 985, “Software”, (“ASU 2009-14”). ASU 2009-14 removes tangible products from the scope of software revenue guidance and provides guidance on determining whether software deliverables in an arrangement that includes a tangible product are covered by the scope of the software revenue guidance. ASU 2009-14 should be applied on a prospective basis for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010, with early adoption permitted. Management is currently evaluating the potential impact of ASU 2009-14 on our financial statements.

In October, 2009, the FASB issued ASU 2009-15, “Accounting for Own-Share Lending Arrangements in Contemplation of Convertible Debt Issuance or Other Financing”, now codified under FASB ASC Topic 470 “Debt”, (“ASU 2009-15”), and provides guidance for accounting and reporting for own-share lending arrangements issued in contemplation of a convertible debt issuance. At the date of issuance, a share-lending arrangement entered into on an entity’s own shares should be measured at fair value in accordance with Topic 820 and recognized as an issuance cost, with an offset to additional paid-in capital. Loaned shares are excluded from basic and diluted earnings per share unless default of the share-lending arrangement occurs. The amendments also require several disclosures including a description and the terms of the arrangement and the reason for entering into the arrangement. The effective dates of the amendments are dependent upon the date the share-lending arrangement was entered into and include retrospective application for arrangements outstanding as of the beginning of fiscal years beginning on or after December 15, 2009. Management is currently evaluating the potential impact of ASU 2009-15 on our financial statements.

NOTE 5 ACQUISITION OF SUBSIDIARIES

On September 9, 2009, Xijiu acquired 100% of the equity interest in Lianhe. Lianhe holds the entire equity interest in LJC. LCJ is a private college affiliated with Guangxi Normal University. The total consideration for the

F-6

acquisition of Lianhe was RMB235,000. The acquisition was recorded using the purchase method of accounting and, accordingly, the acquired assets and liabilities were recorded at their estimated fair market values at the date of acquisition. The preliminary purchase price allocation, which was based on management’s estimates and assumptions, was as follows:

	RMB
Cash		1,488
Other current assets		14,757
Property and equipment and land use rights		253,312
Intangible assets acquired:
Customer relationship		35,165
Goodwill		117,318
Total assets		422,040
Bank loan		(105,000	)
Other current liabilities		(82,040	)
Total purchase price		235,000

The purchase price allocation for the acquisition will be finalized within one year after the acquisition date and subject to revision as more detailed analyses are completed and additional information about fair value of assets and liabilities become available. Any change in the fair value of the net assets of the acquired company and its subsidiary will change the amount of the purchase price allocable to goodwill.

The Company believes that the acquisition furthers its strategy of expanding into the post-secondary bricks and mortar education market. The combination of these factors is the rationale for the excess of purchase price over the value of the assets acquired and liabilities assumed.

Analysis of the net out flow of cash and cash equivalents in respect of the acquisition is as follows:

	RMB
Consideration paid		235,000
Less: cash		(1,488	)
Net cash outflow		233,512

The following supplemental unaudited pro forma results of operations for the three and nine months ended September 30, 2009 presented the acquisition as if it had occurred on January 1, 2009. The unaudited pro forma results include estimates and assumptions regarding the amortization of acquired intangible assets which the Company believes are reasonable. However, pro forma results are not necessarily indicative of the results that would have occurred if the acquisition had occurred on the dates, indicated, or that may result in the future:

	Three months ended		Nine months ended
	September 30, 2009		September 30, 2009
	RMB		RMB
Revenues		27,472		79,691
Net income		3,385		3,953

F-7

NOTE 6 INTANGIBLE ASSETS, NET

Acquire intangible assets, net consisted of the following:

	September 30, 2009
	RMB
Customer relationship		35,165
Less: accumulated amortization		(860	)
		34,305

On September 9, 2009, the Company acquired a customer relationship through an acquisition (see Note 5). The customer relationship is being amortized using accelerated amortization method over 48 months based on the estimated progression of the students through the respective courses, giving consideration to the associated revenues and cash flows.

For the three months and nine months ended September 30, 2009, the Company recorded amortization expense in respect of the customer relationship amounting to RMB860 and RMB860, respectively. The Company is expected to record amortization expenses for customer relationship of RMB3,829, RMB12,894, RMB9,377, RMB5,861 and RMB2,344 in 2009, 2010, 2011, 2012 and 2013, respectively.

NOTE 7 NOTES PAYABLE-LONG-TERM

Notes payable consisted of the following:

	September 30, 2009
	RMB
Note payable to a bank at bank’s prime rate plus 10% per annum, guaranteed by a related party, due progressively to March 29, 2014.		90,000
		90,000
Maturities are as follows:
For the nine months ended September 30,
2011		10,000
2012		20,000
2013		25,000
2014		30,000
2015		5,000
		90,000

Interest expense paid for the three and nine months ended September 30, 2009 were RMB447.

NOTE 8 INCOME TAX

EA was incorporated in the BVI and under the current laws of the BVI; income earned is not subject to income tax.

Xijiu and Lianhe were incorporated in the PRC and are subject to PRC income tax which is computed according to the relevant laws and regulations in the PRC. The applicable tax rate has been 25%.

LJC is a wholly owned subsidiary of Lianhe, was incorporated in Guilin in the PRC and PRC income tax is accrued at 15% according to the western development preferential policy.

NOTE 9 SIGNIFICANT MATTER

On September 28, 2009, the shareholder of EA entered into a Share Transfer Agreement with ChinaCast Communication Holdings Limited (“CCH”) to dispose of the entire equity interest in EA to CCH. This transaction was consummated on October 5, 2009.

F-8

NOTE 10 SUBSEQUENT EVENT

LJC entered into a Land Expropriation Agreement with the Guilin Yanshan District Government on November 16, 2009 to compensate the District Government of approximately RMB15,541 for land clearance charges under the agreement.

F-9

EX-99.1(IV)

Exhibit 99.1(iv)

LIJIANG COLLEGE OF
GUANGXI NORMAL UNIVERSITY

CONDENSED FINANCIAL STATEMENTS
AS OF SEPTEMBER 30, 2009
(UNAUDITED)

\

LIJIANG COLLEGE OF
GUANGXI NORMAL UNIVERSITY

CONTENTS

	Pages
Condensed Balance Sheet as of September 30, 2009 (Unaudited)		F-1
Unaudited Condensed Statements of Operations for the three and nine months ended September 30, 2009 and 2008 (Unaudited)		F-2
Unaudited Statements of Cash Flows for the nine months ended September 30, 2009 and 2008 (Unaudited)		F-3
Notes to Condensed Financial Statements (Unaudited)		F4 - F7

LIJIANG COLLEGE OF GUANGXI NORMAL UNIVERSITY
CONDENSED BALANCE SHEET (Unaudited)
(In thousands, except share-related data)

	As of September 30, 2009
	RMB
ASSETS
CURRENT ASSETS
Cash and cash equivalents		72,493
Accounts receivable, net		23,873
Prepaid expenses and other current assets		6,537
Total Current Assets		102,903
PROPERTY AND EQUIPMENT, NET		254,854
OTHER ASSETS
Land use rights, net		16,747
TOTAL ASSETS		374,504
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable		7,295
Accrued expenses and other current liabilities		80,714
Income tax payable		6,038
Deferred revenue		106,899
Due to holding company		30,540
Total Current Liabilities		231,486
NON-CURRENT LIABILITIES
Notes payable		90,000
TOTAL LIABILITIES		321,486
COMMITMENTS AND CONTINGENCIES		—
SHAREHOLDERS’ EQUITY
Registered capital		18,580
Retained earnings (Unappropriated)		34,438
Total Shareholders’ Equity		53,018
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		374,504

The accompanying notes are an integral part of these condensed financial statements

F-1

LIJIANG COLLEGE OF GUANGXI NORMAL UNIVERSITY
CONDENSED STATEMENTS OF OPERATIONS (Unaudited)
(In thousands, except share-related data)

	For the three			For the three			For the nine			For the nine
	months			months			months			months
	ended			ended			ended			ended
	September 30,			September 30,			September 30,			September 30,
	2009			2008			2009			2008
	RMB			RMB			RMB			RMB
REVENUES		27,472			22,675			79,691			64,836
COST OF REVENUES		(17,541	)		(15,514	)		(56,705	)		(48,321	)
GROSS PROFIT		9,931			7,161			22,986			16,515
OPERATING EXPENSES
General and administrative expenses		(39	)		(1	)		(74	)		—
INCOME FROM OPERATIONS		9,892			7,160			22,912			16,515
OTHER INCOME (EXPENSES)
Interest income		39			35			69			164
Bank loan interest		(1,811	)		(2,353	)		(5,838	)		(6,663	)
Other income		—			—			—			71
Total Other (Expenses) Income, net		(1,772	)		(2,318	)		(5,769	)		(6,428	)
INCOME BEFORE TAXES		8,120			4,842			17,143			10,087
INCOME TAX EXPENSE		(1,218	)		(726	)		(2,571	)		(1,513	)
NET INCOME ATTRIBUTABLE TO THE COMPANY		6,902			4,116			14,572			8,574

The accompanying notes are an integral part of these condensed financial statements

F-2

LIJIANG COLLEGE OF GUANGXI NORMAL UNIVERSITY
CONDENSED STATEMENTS OF CASH FLOWS (Unaudited)
(In thousands)

	For the nine months ended September 30,
	2009			2008
	RMB			RMB
CASH FLOWS FROM OPERATING ACTIVITIES
Net income attributable to the Company		14,572			8,574
Adjusted to reconcile net income to cash provided by (used in) operating activities:
Depreciation and amortization		14,689			13,089
Changes in operating assets and liabilities
(Increase) decrease in:
Accounts receivable		(12,508	)		(13,342	)
Prepaid expenses and other current assets		57,225			6,967
Increase (decrease) in:
Deferred revenue		38,555			38,056
Accounts payable		7,295			5,822
Accrued expenses and other current liabilities		31,398			(5,548	)
Income tax payable		2,572			1,513
Net cash provided by operating activities		153,798			56,131
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment		(75,113	)		(23,319	)
Net cash used in investing activities		(75,113	)		(23,319	)
CASH FLOWS FROM FINANCING ACTIVITIES
Repayment of loans from holding company		(3,920	)		(10,000	)
Bank loans borrowed		—			15,000
Bank loans repaid		(15,000	)		—
Net cash (used in) provided by financing activities		(18,920	)		5,000
NET INCREASE IN CASH AND CASH EQUIVALENTS		59,765			37,812
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD		12,728			19,942
CASH AND CASH EQUIVALENTS AT END OF PERIOD		72,493			57,754
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for interest expenses		5,838			6,663

The accompanying notes are an integral part of these condensed financial statements

F-3

LIJIANG COLLEGE OF
GUANGXI NORMAL UNIVERSITY

NOTES TO THE CONDENSED
FINANCIAL STATEMENTS (UNAUDITED)
(In thousands, except share-related data)

NOTE 1	BASIS OF PRESENTATION
	Lijiang College of Guangxi Normal University (“LJC” or “the College”) was incorporated in the People’s Republic of China (“PRC”) on September 8, 2005. LJC is an education and career preparation college that offers bachelor degree and diploma courses in tourism management, advertising, language studies, computer engineering, finance economics, music, art and physical education. Revenue is generated primarily from student tuition fees and student boarding charges.
	The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.
	In the opinion of management, the unaudited condensed financial statements contain all adjustments consisting only of normal recurring accruals considered necessary to present fairly the Company’s financial position as of September 30, 2009, the results of operations for the three and nine months ended September 30, 2009 and 2008 and cash flows for the nine months ended September 30, 2009 and 2008. The results for the three months and nine months ended September 30, 2009 are not necessarily indicative of the results to be expected for a full year. These financial statements should be read in conjunction with the audited financial statements and footnotes for the year ended December 31, 2008.
	FASB Launches New Accounting Standards Codification
	In June 2009 the Financial Accounting Standards Board (“FASB”) issued FASB Accounting Standards Codification (“Codification”) as the single source of authoritative GAAP recognized by the FASB to be applied by nongovernmental entities effective for interim and annual periods ending after September 15, 2009. Rules and interpretive releases of the SEC under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. The Codification supersedes all existing non-SEC accounting and reporting standards. All other non-grandfathered, non-SEC accounting literature not included in the Codification have become non-authoritative.
	Following the Codification, FASB will not issue new standards in the form of Statements, FASB Staff Positions (“FSP”) or Emerging Issues Task Force (“EITF”) Abstracts. Instead, it will issue Accounting Standards Updates, which will serve to update the Codification, provide background information about the guidance and provide the basis for conclusions on the changes to the Codification.
	GAAP is not intended to be changed as a result of the FASB’s Codification, but it will change the way the guidance is organized and presented. As a result, these changes will have a significant impact on how companies reference GAAP in their financial statements and in their accounting policies. The Trust has adopted the Codification in this quarterly report by using plain English to describe FASB broad topic references.
NOTE 2	RECENT ACCOUNTING STANDARDS AND PRONOUNCEMENTS
	In December 2008, the FASB issued Staff Position No. FAS 132(R)-1 “Employers’ Disclosures about Postretirement Benefit Plan Assets” (“FSP FAS 132(R)-1”) (ASC Topic 715-20-65). FSP FAS 132(R)-1 (ASC Topic 715-20-65) requires more detailed disclosures about employers’ plan assets in a defined benefit pension or other postretirement plan, including employers’ investment strategies, major categories of plan assets, concentrations of risk within plan assets, and inputs and valuation techniques used to measure the fair value of plan assets. FSP FAS 132(R)-1 (ASC Topic 715-20-65) also requires, for fair value measurements using significant unobservable inputs (Level 3), disclosure of the effect of the measurements on changes in plan assets for the period. The disclosures about plan assets required by FSP FAS 132(R)-1 (ASC Topic 715-20-65) must be provided for fiscal years ending after December 15, 2009. As this pronouncement is only disclosure-related, it will not have an impact on the financial position and results of operations.

F-4

In May 2009, the FASB issued a new statement that establishes general standards of accounting for, and disclosure of events that occur after the balance sheet date but before the financial statements are issued or are available to be issued. The new statement, located in ASC Topic 855 Subsequent Events (formerly SFAS 165, Subsequent Events) requires entities to disclose the date through which subsequent events were evaluated as well as the rationale for why that date was selected, that is, whether that date represents the date the financial statements were issued or were available to be issued. The new statement is effective for interim or annual periods ending after June 15, 2009, which was the quarter ending June 30, 2009 for the Company. The adoption of this new statement did not have a material impact on our consolidated financial statements.

In June 2009, the FASB issued SFAS No. 166 “Accounting for Transfers of Financial Assets—an amendment of FASB Statement No. 140” (“SFAS 166”) (ASC Topic 810). SFAS 166 (not part of the codification yet) amends various provisions of SFAS No. 140 “Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities—a replacement of FASB Statement No. 125” by removing the concept of a qualifying special-purpose entity and removes the exception from applying FIN 46(R) to variable interest entities that are qualifying special-purpose entities; limits the circumstances in which a transferor derecognizes a portion or component of a financial asset; defines a participating interest; requires a transferor to recognize and initially measure at fair value all assets obtained and liabilities incurred as a result of a transfer accounted for as a sale; and requires enhanced disclosure; among others. SFAS 166 will be effective as of the beginning of each reporting entity’s first annual reporting period that begins after November 15, 2009, for interim periods within that first annual reporting period and for interim and annual reporting periods thereafter. Early adoption is not permitted. This guidance will be codified under FASB ASC Topic 860, “Transfers and Servicing” when it becomes effective. The Company does not expect the standard to have any impact on the Company’s financial position.

In June 2009, the FASB issued SFAS No. 167 “Amendments to FASB Interpretation No. 46(R)” (“SFAS 167”) (not part of the codification yet). SFAS 167 amends FASB Interpretation No. 46 (Revised December 2003) “Consolidation of Variable Interest Entities—an interpretation of ARB No. 51” (FIN 46(R)) to require an enterprise to perform an analysis to determine whether the enterprise’s variable interest or interests give it a controlling financial interest in a variable interest entity; to require ongoing reassessments of whether an enterprise is the primary beneficiary of a variable interest entity; to eliminate the quantitative approach previously required for determining the primary beneficiary of a variable interest entity; to add an additional reconsideration event for determining whether an entity is a variable interest entity when any changes in facts and circumstances occur such that holders of the equity investment at risk, as a group, lose the power from voting rights or similar rights of those investments to direct the activities of the entity that most significantly impact the entity’s economic performance; and to require enhanced disclosures that will provide users of financial statements with more transparent information about an enterprise’s involvement in a variable interest entity. SFAS 167 will be effective as of the beginning of each reporting entity’s first annual reporting period that begins after November 15, 2009, for interim periods within that first annual reporting period, and for interim and annual reporting periods thereafter. Early adoption is not permitted. This guidance will be codified under FASB ASC Topic 810, “Consolidation” when it becomes effective. The Company does not expect the standard to have any impact on the Company’s financial position.

In July, 2009, the FASB issued authoritative pronouncement, “The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles — a replacement of FASB Statement No. 162”, the FASB Accounting Standards Codification (the “Codification”) became the single source of authoritative nongovernmental US GAAP. The Codification is effective for interim and annual periods ending after September 15, 2009. The adoption of this pronouncement did not have a significant effect on the Company’s consolidated financial position or results of operations.

In August 2009, the FASB issued ASU No. 2009-05 “Measuring Liabilities at Fair Value”, now codified under FASB ASC Topic 820, “Fair Value Measurements and Disclosures”, (“ASU 2009-05”) which amends Fair Value Measurements and Disclosures — Overall (ASC Topic 820-10) to provide guidance on the fair value measurement of liabilities. This update requires clarification for circumstances in which a quoted price in an active market for the identical liability is not available, a reporting entity is required to measure fair value using one or more of the following techniques: 1) a valuation technique that uses either the quoted price of the identical liability when traded as an asset or quoted prices for similar liabilities or similar liabilities when traded as an asset; or 2) another valuation technique that is consistent with the principles in ASC Topic 820 such as the income and market approach to valuation. The amendments in this update also clarify that when estimating the fair value of a liability, a reporting entity is not required to include a separate input or adjustment to other inputs relating to the existence of a restriction that prevents the transfer of the liability. This update further clarifies that if the fair value of a liability is determined by reference to a quoted price in an active market for an identical liability, that price would be considered a Level 1 measurement in the fair value hierarchy. Similarly, if the identical liability has a quoted price when traded as an asset in an active market, it is also a Level 1 fair value measurement if no adjustments to the quoted price of the asset are required. This update is effective for our fourth quarter 2009. Management does not expect this new guidance to have a material impact on the Company’s financial statements.

F-5

	In October 2009, the FASB issued ASU 2009-13, “Multiple-Deliverable Revenue Arrangements”, now codified under FASB ASC Topic 605, “Revenue Recognition”, (“ASU 2009-13”). ASU 2009-13 requires entities to allocate revenue in an arrangement using estimated selling prices of the delivered goods and services based on a selling price hierarchy. The amendments eliminate the residual method of revenue allocation and require revenue to be allocated using the relative selling price method. ASU 2009-13 should be applied on a prospective basis for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010, with early adoption permitted. Management is currently evaluating the potential impact of ASU2009-13 on our financial statements.
	In October 2009, the FASB issued ASU 2009-14, “Certain Arrangements That Include Software Elements, now codified under FASB ASC Topic 985, “Software”, (“ASU 2009-14”). ASU 2009-14 removes tangible products from the scope of software revenue guidance and provides guidance on determining whether software deliverables in an arrangement that includes a tangible product are covered by the scope of the software revenue guidance. ASU 2009-14 should be applied on a prospective basis for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010, with early adoption permitted. Management is currently evaluating the potential impact of ASU 2009-14 on our financial statements.
	In October, 2009, the FASB issued ASU 2009-15, “Accounting for Own-Share Lending Arrangements in Contemplation of Convertible Debt Issuance or Other Financing”, now codified under FASB ASC Topic 470 “Debt”, (“ASU 2009-15”), and provides guidance for accounting and reporting for own-share lending arrangements issued in contemplation of a convertible debt issuance. At the date of issuance, a share-lending arrangement entered into on an entity’s own shares should be measured at fair value in accordance with Topic 820 and recognized as an issuance cost, with an offset to additional paid-in capital. Loaned shares are excluded from basic and diluted earnings per share unless default of the share-lending arrangement occurs. The amendments also require several disclosures including a description and the terms of the arrangement and the reason for entering into the arrangement. The effective dates of the amendments are dependent upon the date the share-lending arrangement was entered into and include retrospective application for arrangements outstanding as of the beginning of fiscal years beginning on or after December 15, 2009. Management is currently evaluating the potential impact of ASU 2009-15 on our financial statements.
NOTE 3	NOTES PAYABLE-LONG-TERM
	Notes payable consisted of the following:

	September 30,
	2009
	RMB
Note payable to a bank at bank’s prime rate plus 10% per annum, guaranteed by a related party, due progressively to March 29, 2014.		90,000
		90,000
Maturities are as follows:
For the nine months ended September 30,
2011		10,000
2012		20,000
2013		25,000
2014		30,000
2015		5,000
		90,000

	Interest expense paid for the three and nine months ended September 30, 2009 and 2008 were RMB1,811, RMB2,353, RMB5,838 and RMB6,663, respectively.
NOTE 4	RELATED PARTY TRANSACTIONS
	As of September 30, 2009, the College owed its holding company, China Lianhe Biotechnology Co., Ltd. (“Lianhe”) RMB30,540 which is unsecured, interest free and repayable on demand.

F-6

NOTE 5	SIGNIFICANT MATTER
	East Achieve Limited (“EA”) was incorporated on September 15, 2004 in the British Virgin Islands as a limited liability company. EA is an investment holding company. EA established Shanghai Xijiu Information and Technology Co., Ltd. (“Xijiu”) in the PRC as a wholly owned subsidiary on January 20, 2005. The business activities of Xijiu are information technology development, consulting services and investment holding. On September 9, 2009, Xijiu acquired the entire equity interest of Lianhe which owned the entire equity interest of LJC. On September 28, 2009, the shareholder of EA entered into a Share Transfer Agreement with ChinaCast Communication Holdings Limited (“CCH”) to dispose the entire equity interest in EA to CCH. This transaction was consummated on October 5, 2009.
NOTE 6	SUBSEQUENT EVENT
	The College entered into the Land Expropriation Agreement with Guilin Yanshan District Government on November 16, 2009 to compensate the District Government of approximately RMB15,541 for land clearance charges under the agreement.

F-7

EX-99.2

Exhibit 99.2

UNAUDITED PRO FORMA FINANCIAL INFORMATION

On October 5, 2009, ChinaCast Communication Holdings Limited (the “Purchaser”), a subsidiary of Company, completed the acquisition (the “Acquisition”) of East Achieve Limited (“East Achieve”), the holding company which owns 100% of Lijiang College, from Xie Jiqing who holds 100% of the equity interest in East Achieve for a total purchase price of RMB365,000,000 (or approximately $53.7 million). RMB295,000,000 (or approximately $43.4 million) of the purchase price has been paid and the remaining RMB70,000,000 (or approximately $10.3 million) will be paid within 30 days of August 31, 2010. The source of the cash used for the acquisition is from working capital of the Company.

East Achieve owns 100% of the equity interest in Shanghai Xijiu Information Technology Co., Ltd. (“Xijiu”), which in turn owns 100% of the equity interest in China Lianhe Biotechnology Co., Ltd. (“Lianhe”). As a result of the consummation of the acquisition, the Purchaser now holds 100% of the equity interest in Lianhe. Lijiang College is jointly sponsored by Lianhe and Guangxi Normal University. Lijiang College was founded in 2001 as an independent, accredited college affiliated with Guangxi Normal University, which is located in the city of Guilin in Southwestern China. The university has 415 full-time and part-time instructors and offers fully accredited bachelor degree and diploma courses in tourism, hospitality, language studies, computer engineering, economics, law, music, art and physical education. After the Acquisition, East Achieve, Xijiu and Lianhe are holding companies with no other business. Before the Acquisition, as part of a reorganization (the “Reorganization”), Xijiu and Lianhe has disposed of all assets and liabilities not related to the operations of Lijiang College and Xijiu purchased the entire interest in Lianhe, which was accounted for using the purchase method of accounting.

The following unaudited pro forma combined condensed financial statements reflect the acquisition using the purchase method of accounting. The pro forma adjustments are based upon available information and assumptions that the Company believes are reasonable. The pro forma adjustments are preliminary and have been prepared to illustrate the estimated effect of the acquisition. Consequently, the amounts reflected in the unaudited pro forma combined condensed financial statements are subject to change, and the final amounts may differ substantially.

The unaudited pro forma combined condensed balance sheet as of September 30, 2009 gives effect to the Acquisition as if it was completed on that date, and was derived from the historical unaudited balance sheet of East Achieve as of September 30, 2008, combined with ChinaCast’ historical unaudited balance sheet as of September 30, 2009.

The unaudited pro forma combined condensed statement of operations for the year ended December 31, 2008 illustrates the effect of the acquisition of East Achieve as if the Acquisition and the Reorganization had occurred on January 1, 2008, and was derived from the historical audited statement of operations for East Achieve for the year ended December 31, 2008, combined with ChinaCast’s historical audited statement of operations for the year ended December 31, 2008.

The unaudited pro forma combined condensed statement of operations for the nine months ended September 30, 2009 illustrates the effect of the acquisition of East Achieve as if the Acquisition and the Reorganization had occurred on January 1, 2009 and combines the historical unaudited statement of operations of ChinaCast for the nine months ended September 30, 2009 and the historical unaudited statement of operations of East achieve through the date of acquisition.

The pro forma combined condensed financial statements should be read in conjunction with the historical audited financial statements and notes thereto of ChinaCast contained in its 2008 Annual Report on Form 10-K, filed with the Securities and Exchange Commission on March 16, 2009, the historical unaudited financial statements and notes thereto of ChinaCast contained in its September 30, 2009 Quartely Report on Form 10-Q filed with the Securities and Exchange Commission on November 9, 2009 and the historical audited financial statements and notes thereto of East Achieve which are included as Exhibit 99.1 to this Current Report on Form 8-K. The unaudited pro forma combined condensed financial statements do not include any pro forma adjustments relating to costs of integration that the combined company may incur as such adjustments.

The pro forma information is presented for illustrative purposes only and is not necessarily indicative of the operating results or financial position that would have occurred if the acquisition had occurred as of the date or during the period presented nor is it necessarily indicative of future operating results or financial position.

UNAUDITED PRO FORMA COMBINED CONDENSED BALANCE SHEET
September 30, 2009

	Historical			Historical			Pro Forma						Pro Forma
	ChinaCast			East Achieve			Adjustments			Notes			Combined
	RMB			RMB			RMB						RMB
	(In thousands, except share-related data)
Assets
Cash and cash equivalents		398,312			72,726			(265,000	)		(a	)		206,038
Term deposits		280,000			—			—						280,000
Accounts receivable, net		55,670			23,873			—						79,543
Inventory		1,705			—			—						1,705
Prepaid expenses and other current assets		6,468			6,577			—						13,045
Amount due from related parties		2,088			—			—						2,088
Total current assets		744,243			103,176			(265,000	)					582,419
Non-current assets:
Non-current deposits		3,818			—			—						3,818
Property and equipment, net		261,940			254,854			—						516,794
Land use rights, net		119,810			16,747			—						136,557
Acquired intangible assets, net		19,497			34,305			—			(c	)		53,802
Deposit for investments		103,000			—			(100,000	)		(a	)		3,000
Long term investments		3,854			—			—						3,854
Non-current advances to a related party		97,606			—			—						97,606
Goodwill		311,332			117,318			129,550			(b	)		558,200
Total assets		1,665,100			526,400			(235,450	)					1,956,050
Liabilities, minority interest and shareholders’ equity
Current liabilities:
Account payable		18,054			7,295			—						25,349
Deferred revenue		90,751			106,899			—						197,650
Accrued expenses and other current liabilities		107,492			80,718			—						188,210
Amount due to a related party		528			—			—						528
Income tax payable		64,009			6,038			—						70,047
Current portion of bank borrowings		94,400			—			—						94,400
Current portion of capital lease obligation		1,289			—			—						1,289
Other borrowings		580			—			—						580
Total current liabilities		377,103			200,950			—						578,053
Long-term bank borrowings		54,000			90,000			—						144,000
Capital lease obligation, net of current portion		1,313			—			—						1,313
Deferred tax liabilities		19,214			—			—						19,214
Unrecognized tax benefits		50,403			—			—						50,403
Total non-current liabilities		124,930			90,000			—						214,930
Total liabilities		502,033			290,950			—						792,983
Shareholders’ equity:
Ordinary shares		29			—			—						29
Additional paid-in capital		989,945			236,412			(236,412	)		(d	)		989,945
Statutory reserve		28,117			—			—						28,117
Accumulated other comprehensive loss		(6,159	)		—			—						(6,159	)
Retained earnings (Accumulated deficit)		128,361			(962	)		962			(d	)		128,361
Total Company shareholders’ equity		1,140,293			235,450			(235,450	)					1,140,293
Noncontrolling interest		22,774			—			—						22,774
Total shareholders’ equity		1,163,067			—			—						1,163,067
Total liabilities, minority interest and shareholders’ equity		1,665,100			526,400			(235,450	)					1,956,050

UNAUDITED PRO FORMA COMBINED CONDENSED STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2009

	Historical			Historical			Pro Forma						Pro Forma
	ChinaCast			East Achieve			Adjustments			Notes			Combined
	RMB			RMB			RMB						RMB
	(In thousands, except share-related data)
Revenues:
Service		229,886			6,970			72,721			(e	)		309,577
Equipment		6,065			—			—						6,065
		235,951			6,970			72,721						315,642
Cost of revenues:
Service		(85,188	)		(5,972	)		(62,142	)		(e	) (f)		(153,302	)
Equipment		(6,001	)		—			—						(6,001	)
		(91,189	)		(5,972	)		(62,142	)					(159,303	)
Gross profit		144,762			998			10,579						156,339
Operating (expenses) income:
Selling and marketing expenses		(3,640	)		—			—						(3,640	)
General and administrative expenses		(44,472	)		(74	)		(70	)		(e	)		(44,616	)
Foreign exchange loss		65			—			—						65
Management service fee		3,806			—			—						3,806
Other operating income(loss)		387			—			—						387
Total operating expenses, net		(43,854	)		(74	)		(70	)					(43,998	)
Income from operations		100,908			924			10,509						112,341
Interest income		6,923			27			(3,945	)		(e	) (g)		3,005
Interest expense		(5,591	)		(447	)		(5,392	)					(11,430	)
Income before provision for income taxes and loss in equity investments		102,240			504			1,172						103,916
Provision for income taxes		(21,090	)		(215	)		(2,357	)		(e	)		(23,662	)
Income before loss in equity investments		81,150			289			(1,185	)					80,254
(Loss)gain in equity investments		(1,370	)		—			—						(1,370	)
Net income		79,780			289			(1,185	)					78,884
Less: Net income attributable to noncontrolling interest		(6,945	)		—			—						(6,945	)
Net income (loss) attributable to the Company		72,835			289			(1,185	)					71,939
Net income per share
Basic		2.03												2.01
Diluted		2.03												2.00
Weighted average shares used in computation:
Basic		35,813,325												35,813,325
Diluted		35,945,264												35,945,264

UNAUDITED PRO FORMA COMBINED CONDENSED STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2008

	Historical			Historical			Pro Forma						Pro Forma
	ChinaCast			East Achieve			Adjustments			Notes			Combined
	RMB			RMB			RMB						RMB
	(In thousands, except share-related data)
Revenues:
Service		257,126			—			90,720			(e	)		347,846
Equipment		28,912			—			—						28,912
		286,038			—			90,720						376,758
Cost of revenues:
Service		(118,860	)		—			(85,397	)		(e	)(g)		(204,257	)
Equipment		(29,122	)		—			—						(29,122	)
		(147,982	)		—			(85,397	)					(233,379	)
Gross profit		138,056			—			5,323						143,379
Operating (expenses) income:
Selling and marketing expenses		(7,096	)		—			—						(7,096	)
General and administrative expenses		(69,679	)		(269	)		(69	)		(e	)		(70,017	)
Foreign exchange loss		(1,162	)		(5	)		—						(1,167	)
Management service fee		6,463			—			—						6,463
Other operating income		37			—			24			(e	)		61
Total operating expenses, net		(71,437	)		(274	)		(45	)					(71,756	)
Income from operations		66,619			(274	)		5,278						71,623
Impairment loss on cost method investment		(8,500	)		—			—						(8,500	)
Interest income		19,462			1			(10,400	)		(e	)(f)		9,063
Interest expense		(2,575	)		(566	)		(8,906	)		(e	)		(12,047	)
Income before provision for income taxes and loss in equity investments		75,006			(839	)		(14,028	)					60,139
Provision for income taxes		(24,381	)		—			(1,615	)		(e	)		(25,996	)
Net income before loss in equity investments		50,625			(839	)		(15,643	)					34,143
Loss in equity investments		(441	)		—			—						(441	)
Net income (loss)		50,184			(839	)		(15,643	)					33,702
Less: Net income attributable to noncontrolling interest		(7,517	)		—			—						(7,517	)
Net income (loss) attributable to the Company		42,667			(839	)		(15,643	)					26,185
Net income per share
Basic		1.40												0.86
Diluted		1.39												0.85
Weighted average shares used in computation:
Basic		30,442,992												30,442,992
Diluted		30,691,742												30,691,742

NOTES TO UNAUDITED PRO FORMA COMBINED CONDENSED
STATEMENTS OF OPERATIONS

     The unaudited pro forma combined condensed statements of operations for the year ended December 31, 2008 and the nine months ended September 30, 2009 were prepared by combining the Company’s historical statements of operations for the year ended December 31, 2008 and the nine months ended September 30, 2009 with East Achieve’s historical results for the year ended December 31, 2008 and the period from January 1, 2009 to September 30, 2009, respectively, giving effect to the acquisition as though it was completed on January 1, 2008 and January 1, 2009 respectively. Certain historical information of East Achieve has been reclassified to conform to the presentation of the Company’s historical statements.

1. Acquisition

     On October 5, 2009, ChinaCast Communication Holdings Limited (the “Purchaser”), a subsidiary of Company, completed the acquisition (the “Acquisition”) of East Achieve Limited (“East Achieve”), the holding company which owns 100% of Lijiang College, from Xie Jiqing who holds 100% of the equity interest in East Achieve for a total purchase price of RMB365,000,000 (or approximately $53.7 million). RMB295,000,000 (or approximately $43.4 million) of the purchase price has been paid and the remaining RMB70,000,000 (or approximately $10.3 million) will be paid within 30 days of August 31, 2010. The source of the cash used for the acquisition is from working capital of the Company.

     East Achieve owns 100% of the equity interest in Shanghai Xijiu Information Technology Co., Ltd. (“Xijiu”), which in turn owns 100% of the equity interest in China Lianhe Biotechnology Co., Ltd. (“Lianhe”). As a result of the consummation of the acquisition, the Purchaser now holds 100% of the equity interest in Lianhe. Lijiang College is jointly sponsored by Lianhe and Guangxi Normal University. Lijiang College was founded in 2001 as an independent, accredited college affiliated with Guangxi Normal University, which is located in the city of Guilin in Southwestern China. The university has 415 full-time and part-time instructors and offers fully accredited bachelor degree and diploma courses in tourism, hospitality, language studies, computer engineering, economics, law, music, art and physical education. After the Acquisition, East Achieve, Xijiu and Lianhe are holding companies with no other business. Before the Acquisition, as part of a reorganization (the “Reorganization”), Xijiu and Lianhe had disposed of all assets and liabilities not related to the operations of Lijiang College and Xijiu purchased the entire interest in Lianhe, which was accounted for using the purchase method of accounting.

     The Company has completed a preliminary allocation of the purchase price to the fair value of assets acquired and liabilities assumed at the date of acquisition included as adjustment notes 2(b). It is possible that the purchase price allocation will be adjusted upon finalization of the accounting for the acquired assets.

     The amortizable intangible includes RMB34.3 million of acquired customer relationship. Useful lives of 47 months have been assigned to the customer relationship intangible. The identifiable intangible assets and goodwill are not deductible for tax purposes.

2. Pro forma adjustments made by ChinaCast in connection with the preparation of the unaudited pro forma combined condensed balance sheet as of September 30, 2009 and the unaudited pro forma combined condensed statement of operations for the year ended December 31, 2008 and nine months ended September 30, 2009 are as follows:

(a)	To reduce cash and cash equivalent on the RMB265 million of cash and RMB100 million of deposit for investment utilized by the Company to fund the acquisition
(b)	Purchase price allocation:
	The purchase price for the acquisition amounted to RMB365 million. The estimated purchase price has been preliminarily allocated as follows based on the assets and liabilities acquired as of September 30, 2009:
	Estimated fair value of net tangible assets acquired and liabilities assumed:

	RMB
Cash		72,726
Other current assets		30,450
Fixed asset and land use rights		271,601
Deferred revenue		(106,899	)
Other current liabilities		(94,051	)
Bank loan		(90,000	)
				83,827
Intangible assets acquired (customer relationship)				34,305
Goodwill				246,868
Total purchase price				365,000

(c)	To record intangible assets obtained in the transaction based upon the preliminary allocation of the purchase price
(d)	To eliminate East Achieve’s common stock, additional paid-in-capital and retained earnings
(e)	To record the revenue and expenses of Lijiang College assuming the completion of the Reorganization at period beginning
(f)	To reduce interest income on the RMB365 million of cash utilized by the Company to fund the acquisition
(g)	To record the amortization of expense of intangible assets obtained in the transaction based upon the preliminary allocation of the purchase price