Median Group Inc - FORM 8-K/A - EX-99 - PROFORMA FINANCIAL STATEMENTS - CHINA MEDIA GROUP CORP

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8-K/A - FORM 8K/A NO.1 - Median Group Inc	r8ka-061412cmg.htm
EX-99 - FINANCIAL STATEMENTS OF ATEAM - 31 DEC 2011 AND 2010 - Median Group Inc	ext991a-061412cmg.htm

Exhibit 99.2

CHINA MEDIA GROUP CORPORATION
PRO-FORMA COMBINED FINANCIAL STATEMENTS
December 31, 2011
(Unaudited)

Exhibit 99.2

China Media Group Corporation

CONTENTS

		PAGE NO.

Pro-forma Combined Balance Sheet at December 31, 2011 (Unaudited)		P - 1

Pro-forma Combined Statement of Operations for the year ended December 31, 2011 (Unaudited)		P - 2

Significant Notes and Assumptions to Pro-forma Combined Financial Statements (Unaudited)		P - 3

Exhibit 99.2

CHINA MEDIA GROUP CORPORATION
INTRODUCTION TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS

On the June 8, 2012, Good World Investments Limited, a wholly owned subsidiary of China Media Group Corporation (the "Company" or "CMG") acquired all of the outstanding capital stock of A-Team Resources Sdn. Bhd. ("ATeam") in a sale and purchase transaction (the "SP Transaction"). ATeam is a manufacturer of consumer electronics and light appliances. ATeam"s operations are conducted in Malaysia.

In connection with the SP Transaction, the Company issued 558,779,837 shares of its Common Stock in acquiring all the shares of the capital stock of ATeam. Upon completion of the SP Transaction, the prior shareholder of ATeam owned approximately 50% of the Common Stock of the CMG.

Anticipated Accounting Treatment of the Acquisition Transaction

For accounting purposes, the transaction is being accounted for as a reverse merger, since the stockholder of ATeam will own a majority of the issued and outstanding shares of Common Stock of the Company. ATeam is treated as the acquirer for accounting purposes. This acquisition is being accounted for at historical cost in a manner similar to that in pooling of interests method. The historical financial statements will be combined of CMG and ATeam.

The accompanying unaudited pro forma condensed consolidated balance sheet has been presented with consolidated subsidiaries at December 31, 2011 and the unaudited pro forma condensed consolidated statement of income for the year ended December 31, 2011 has been presented as if the acquisition had occurred.

You are being provided this information to aid in your analysis of the financial aspects of the SP Transaction. This information has been derived from the audited financial statements of ATeam as of and for the year ended December 31, 2011 and the audited financial statements of CMG for the respective periods. The pro forma adjustments are based on available information and assumptions that are believed to be reasonable. The unaudited pro forma condensed financial information does not represent the results of operations that would have occurred had such transactions been consummated on the dates indicated or the financial position for any future date or period. CMG and Ateam do not assume any responsibility for the accuracy or completeness of the information provided by the other party. This information should be read in conjunction with the companies" respective historical financial statements and notes included thereto.

The following unaudited pro forma adjustments are included in the accompanying unaudited pro forma condensed consolidated balance sheet as of December 31, 2011 and the unaudited pro forma condensed consolidated statement of income for the year ended December 31, 2011 to reflect the acquisition of ATeam by the Company.

Exhibit 99.2

China Media Group Corporation
Pro Forma Combined Balance Sheet
December 31, 2011
(Unaudited)

	Historical							Year Ended
	China Media		A-Team					December 31,
	Group		Resources			Pro Forma Adjustments		2011
	Corporation		Sdn. Bhd.			Dr	Cr	Pro Forma
ASSETS
Current assets
Cash and cash equivalents	$	15,600	$	23,992				$	39,592
Trade receivables		-		3,017,369					3,017,369
Restricted cash		-		57,395					57,395
Due to related parties		372,541		-					372,541
Prepayments, deposits and receivables		169,152		139,055					308,207
Total current assets		557,293		3,237,811					3,795,104

Non current assets
Fixed assets, net		2,232		83,905					86,137
Advance payment for distribution rights		69,000		-					69,000
Investment in shares		81,556		-					81,556
Goodwill		-		-	(1)	6,093,535			6,093,535
Total non current assets		152,788		83,905					6,330,228
Total Assets	$	710,081	$	3,321,716				$	10,125,332

LIABILITIES AND STOCKHOLDERS' (DEFICIENCY)/EQUITY
Liabilities
Current liabilities
Other payables and accruals	$	424,396	$	298,534				$	722,930
Trade payables		-		44,197					44,197
Trade financing payables		-		335,671					335,671
Short term debt		100,000		205,463					305,463
Due to officers and directors		448,145		133,027					581,172
Taxation		-		90,739					90,739
Due to related parties		1,656,981		-					1,656,981
Other liabilities		236,504		-					236,504
Total current liabilities		2,866,026		1,107,631					3,973,657

Non current liabilities
Lease obligations		-		54,921					54,921
Long term debts		2,000,000		274,589					2,274,589
Total non current liabilities		2,000,000		329,510					2,329,510
Total liabilities		4,866,026		1,437,141					6,303,167

Stockholders' (deficiency)/equity
Common Stock		7,773,902		583,107	(1)	7,773,902			2,580,543
					(1)		1,997,436
Additional paid up capital		1,799,358		-	(1)	1,799,358			-
Shares to be issued		52,510		-					52,510
Comprehensive income		66,176		106,458	(1)	67,176			105,458
Accumulated deficits		(13,867,043)		839,332	(1)		13,867,043		839,332
Profit and loss		(99,304)		355,678					256,374
Uncontrolled interests		118,456		-	(1)	130,508			(12,052)
Total stockholders' (deficiency)/equity		(4,155,945)		1,884,575					3,822,165

Total liabilities and stockholders' equity	$	710,081	$	3,321,716				$	10,125,332

See Summary of Significant Notes and Assumptions to Pro Forma Financial Statements

P -1

Exhibit 99.2

China Media Group Corporation
Proforma Combined Statement of Operations
For the Year Ended December 31, 2011
(Unaudited)

	Historical							Year Ended
	China Media		A-Team					December 31,
	Group		Resources			Pro Forma Adjustments		2011
	Corporation		Sdn. Bhd.			Dr	Cr	Pro Forma

Revenues	$	142,132	$	6,932,545				$	7,074,677

Cost of sales		40,185		5,437,816					5,478,001

Gross profit		101,947		1,494,729					1,596,676

Operating expenses:
Impairment of distribution rights		68,800		-					68,800
Selling, general and administrative		213,754		953,784					1,167,538

		282,554		953,784					1,236,338

(Loss) / Income from operations before other expenses		(180,607)		540,945					360,338

Other income (expenses):
Gain on disposal of investment in unlisted shares		251,538		-					251,538
Gain on disposal of fixed assets		1,498		-					1,498
Other income		-		16,599					16,599
Income tax expenses		-		(127,947)					(127,947)
Interest expenses		(183,785)		(73,919	)				(257,704)

Net (loss) / income before uncontrolled interest		(111,356)		355,678					244,322
Uncontrolled interests		12,052		-					12,052

Net (loss) / Income		(99,304)		355,678					256,374

Other comprehensive income		(1,000)		(51,442)					(52,442)

Comprehensive (loss) / income	$	(100,304)	$	304,236				$	203,932

See Summary of Significant Notes and Assumptions to Pro Forma Financial Statements

P - 2

Exhibit 99.2

China Media Group Corporation
SIGNIFICANT NOTES AND ASSUMPTIONS TO PRO-FORMA FINANCIAL
STATEMENTS
(Unaudited)

(1)

The accompanying unaudited pro-forma financial information reflects the financial statements of China Media Group Corporation ("CMG") and A-Team Resources Sdn. Bhd. ("ATeam") regarding a planned acquisition of ATeam by CMG. The pro-forma adjustments to the balance sheet give effect to the acquisition as if it occurred on January 1, 2011 and the pro-forma statement of operations gives effect to the acquisition as if it occurred on January 1, 2011.The acquisition is treated as a reverse acquisition of CMG by ATeam since the stockholders of ATeam obtained a controlling interest in the voting Common Stock of CMG and management control of CMG as a result of the acquisition.Accordingly, the assets and liabilities of ATeam are recorded at their historical cost and the assets and liabilities of CMG are measured in accordance with the value at the date of combination. The retained earnings and other equity balances of ATeam before the business combination becomes the retained earnings and other equity balances of CMG after the combination. In addition, the amount recognized as issued share capital interests is determined by adding the issued share capital of acquiring ATeam immediately prior to the business combination and the equity interests CMG issued to effect the combination. Under reverse acquisition accounting, the historical results of operations are those of ATeam and the results of operations of CMG are included only from the acquisition date.

(2)

Significant assumptions include (a) the Common Stock of CMG based on December 31, 2011 shares outstanding and the newly issued 558,779,837 Common Stock in acquiring ATeam, (b) the operation of CMG and ATeam were combined from January 1, 2011, the as if acquisition date, to December 31, 2011. In addition, no transactions that may have occurred subsequent to December 31, 2011 have been considered.

(3)	The following reflect the pro forma adjustments as of December 31, 2011.
	First adjustment is to reflect the effect of the acquisition of ATeam by CMG by treating it as a reverse acquisition.


	Dr	Cr

Share capital - CMG	7,773,902
Additional paid in capital - CMG	1,799,358
Comprehensive income - CMG	67,176
Accumulated deficits - CMG		13,867,043
Uncontrolled interests - CMG	130,508
Goodwill on acquisition of A-Team	6,093,535
Share capital - CMG		1,997,436

P - 3

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