We have implemented a series of measures in an effort to enhance the effectiveness of our corporate governance:

Internal control

We engaged an international accounting firm to assist us in strengthening our internal control and to address certain issues identified by another international accounting firm before Listing. Please see "Regulatory Matters" for further details of the issues identified and how we are dealing with the issues. Going forward, we have engaged the international accounting firm which assisted us before Listing to act as our internal controls adviser with the principal objective of assisting us in performing risk assessment, development of an internal audit plan and conducting internal audits with a view to enhance our internal control systems, including accounting, information and operational systems. They will also provide observations and recommendations to further strengthen our internal control systems. We have adopted an internal control framework which covers our risk assessment, ongoing monitory, communications and reporting procedures so as to ensure compliance with the Listing Rules. We have also hired Mr. Zhao Jun as our internal control manager who is responsible for the self-assessment programme for our business processes and will focus on the effectiveness of our internal controls. Mr. Zhao has over 7 years' experience in KPMG, providing audit services to large domestic and multi-national enterprises. Mr. Zhao holds Bachelor degrees in Engineering and Economics from Beijing University of Technology and has obtained the necessary qualification for registration as a member of the Chinese Institute of Certified Public Accountants (CICPA). He began his empolyment with us on 21 May 2007.

Compliance Committee

We have set up a compliance committee which is chaired by Dr. Ramin Khadem, one of our independent non-executive Directors. The compliance committee comprises all our Directors, including our independent non-executive Directors, chief financial controller, chief operating officer, qualified accountant, and company secretary. The compliance committee will continue to be chaired by an independent non-executive Director. Representatives from our internal legal department and our external legal advisers will be invited to attend the meetings to ensure that we will be in full compliance with all applicable laws and regulations upon Listing. We will have our first compliance committee meeting within one month after Listing and will hold meetings subsequently on a quarterly basis.

Management reporting system

We are formulating a policy to require the head of each department to provide a management reporting package for the Board to review on a quarterly basis. The management reporting package will include management analysis on financial information, budget variance analysis, internal audit issues summary and risk assessment analysis.

Risk management committee

We have established a risk management committee consisting of senior management of the Company and an in-house lawyer. The committee will be responsible for coordinating and overseeing the risk management process of the Company. External PRC legal advisers will also be invited to attend the meetings.

Ongoing PRC legal advisers

We will continue to retain Zhonglun as our ongoing PRC legal advisers and will continue to communicate with them on various PRC compliance issues. Zhonglun will review and approve contracts of significant value and advise on compliance with legal, regulatory and other requirements.

Internal legal support

Our legal department has two members, Mr. Xia Guorong and Ms. Wang Nan. Mr. Xia is a qualified PRC lawyer and has over 12 years' legal experience in property-related areas. He joined us in June 2000 and is currently the head of the legal department. Mr. Xia was working in the legal department of China Grand Enterprises before joining us. Ms. Wang is a qualified PRC lawyer since 2005 and has a masters degree in law. She joined the team in April 2006. Before joining us, Ms. Wang worked at Beijing T&C Law Firm.

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