RELATED PARTY TRANSACTIONS

6 Months Ended

Sep. 30, 2012

Related Party Transactions [Abstract]

Related Party Transactions Disclosure [Text Block]

NOTE 12 – RELATED PARTY TRANSACTIONS

During the six months ended September 30, 2012 and September 30, 2011 the Company sold approximately $1,166,000 and $1,541,000 respectively to Starlight Electronics Company, Ltd at a discounted price, similar to prices granted to major direct import customers shipped internationally with freight prepaid. The average gross profit margin on sales to Starlight Electronics for the six months ended September 30, 2012 and September 30, 2011 was 12.42% and 7.6%, respectively. The product was drop shipped to Cosmo Communications of Canada (“Cosmo”), the Company’s primary distributor of its products to Canada. During the six months ended September 30, 2012 and September 30, 2011 we sold an additional $325,674 and $0, respectively of product to Cosmo from our California warehouse facility. These amounts were included as a component of cost of goods sold in the accompanying condensed consolidated statements of operations.

The Company purchased products from Starlight Marketing Development, Ltd, (“SMD”) a subsidiary of Starlight International Holding Ltd. The purchases from SMD for the six months ended September 30, 2012 and 2011 were $0 and $3,013,875 respectively. The Company purchased products from Starlight Consumer Electronics, Ltd, (“SCE”) a subsidiary of Starlight International Holding Ltd. The purchases from SCE for the six months ended September 30, 2012 and 2011 were $4,960,073 and $0 respectively.

During the six month period ended September 30, 2012 and September 30, 2011 the Company purchased products from Cosmo Communications USA, Inc. (“Cosmo USA”) in the amount of $0 and $48,900, respectively.

During the six month period ended September 30, 2012 and September 30, 2011 the Company purchased products from Starlight Consumer Electronics USA, Inc. in the amount of $138,051 and $0, respectively.

On July 1, 2012, SMC-L entered into a service and logistics agreement with Starlight Consumer Electronics (USA), Inc. (“Starlight USA”), an indirect wholly-owned subsidiary of Starlight International, Cosmo USA, Inc. (“Cosmo USA”) and Starlight Electronics USA, Inc. (“Starlight Electronics USA”) to provide logistics, fulfillment, and warehousing services for Starlight USA, Cosmo USA and Starlight Electronic USA’s domestic sales. For these services, Starlight USA, Cosmo USA and Starlight Electronics USA have agreed to pay the Company annual service fees totaling approximately $435,000 payable monthly beginning July 1, 2012. The Company received $133,119 and $0 in service fees from these affiliates during the six months ended September 30, 2012 and September 30, 2011, respectively. This agreement terminates on April 30, 2013 at which time another annual agreement is expected to be signed for approximately the same amount.

On August 1, 2011, SMC-L entered into a service and logistics agreement with affiliates Starlight Consumer Electronics (USA), Inc., Starlight USA, Inc. and Cosmo USA to provide logistics, fulfillment, and warehousing services for these affiliates’ domestic sales. The Company received $249,999 and $499,998 in service fees from these affiliates during the six months ended September 30, 2012 and September 30, 2011, respectively. For the six months ended September 30, 2012 and 2011, the Company additionally received reimbursements from these affiliates in the amount of $0 and $15,370, respectively for expenses and salaries incurred by SMC-L on their behalf. This agreement terminated on June 30, 2012.