UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-K

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

For the fiscal year ended December 31, ~~2009~~2010

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

Commission file number 333-156352

E & M GROUP, INC.

(Exact name of registrant as specified in its charter)

Nevada		88-0492246
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

2373 208th St., Unit F4
Torrance, CA		90501
(Address of principal executive offices)		(Zip Code)

Registrant's telephone number: (213) 995-5036

Copies of Communications to:

Stoecklein Law Group

402 West Broadway, Suite 690

San Diego, CA 92101.

(619) 704-1310 • Fax (619) 704-1325

Fax (619) 704-1325

Securities registered under Section 12(b) of the Act: None

Securities registered under Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes ¨ No x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Yes ¨ No x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes ¨ No ¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ¨

Indicate by check mark whether the registrant a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "small reporting company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ¨	Accelerated filer ¨

Non-accelerated filer ¨ (Do not check if a smaller reporting company)	Smaller reporting company x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).

Yes x No ¨

The aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was sold, or the average bid and asked price of such common equity, as of June 30, ~~2009~~2010 (the last business day of the registrant's most recently completed second fiscal quarter) was $~~150~~300,000 based on a share value of $0.0102.

The number of shares of Common Stock, $0.001 par value, outstanding on March 255, ~~2010~~2012 was 31,500,000 shares.

E & M GROUP, INC.

FOR THE FISCAL YEAR ENDED

DECEMBER 31, ~~2009~~2010

Index to Report on Form 10-K

PART I		Page
Item 1.	Business	2
Item 1A.	Risk Factors	43
Item 1B.	Unresolved Staff Comments	76
Item 2.	Properties	86
Item 3.	Legal Proceedings	86
Item 4.	~~Submission~~(Removed ofand ~~Matters to a Vote of Security Holders~~Reserved)	8
PART II
Item 5.	Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	87
Item 6.	Selected Financial Data	98
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	98
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	11
Item 8.	Financial Statements and Supplementary Data	11
Item 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	11
Item 9A (T)	Controls and Procedures	1312
Item 9B.	Other Information	1412
PART III
Item 10.	Directors, Executive Officers and Corporate Governance	1513
Item 11.	Executive Compensation	2017
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	2118
Item 13.	Certain Relationships and Related Transactions, and Director Independence	2119
Item 14	Principal Accounting Fees and Services	2220
PART IV
Item 15.	Exhibits, Financial Statement Schedules	2321

FORWARD-LOOKING STATEMENTS

This ~~document~~Annual ~~contains~~Report ~~“forward-looking~~on ~~statements”. All~~Form ~~statements~~10-K ~~other~~contains ~~than statements of historical fact are “~~forward-looking statements” ~~for~~and ~~purposes~~involves ofrisks ~~federal~~ and ~~state~~uncertainties ~~securities~~that ~~laws,~~could ~~including,~~materially ~~but~~affect ~~not~~expected ~~limited~~results ~~to, any projections~~ of ~~earnings~~operations, ~~revenue~~liquidity, orcash ~~other financial items; any statements of the plans~~flows, ~~strategies~~ and ~~objections~~business ofprospects. These ~~management for future operations; any~~ statements ~~concerning~~include, ~~proposed~~among ~~new~~other ~~services~~things, ~~or developments; any~~ statements regarding ~~future economic conditions or performance; any statements or belief; and any statements of assumptions underlying any of the foregoing.~~:

~~Forward-looking~~o statements may include the words “may,” “could,” “estimate,” “intend,” “continue,” “believe,” “expect” or “anticipate” or other similar words. These forward-looking statements present our ~~estimates~~ability ~~and assumptions only as of the date of this report. Accordingly, readers are cautioned not~~ to ~~place~~diversify ~~undue reliance on forward-looking statements, which speak only as of the dates on which they are made. Except for~~ our ongoing securities laws, we do not intend, and undertake no obligation, to update any forward-looking statement. You should, however, consult further disclosures we make in future filings of our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.operations;

~~Although~~o ~~we believe the expectations reflected in any of~~ our ~~forward-looking~~ability ~~statements~~to ~~are~~implement ~~reasonable, actual results could differ materially from those projected or assumed in any of~~ our ~~forward-looking~~business ~~statements. Our~~plan ~~future~~as ~~financial~~a ~~condition~~provider ~~and results~~ of ~~operations,~~communications ~~as well as any forward-looking statements, are subject to change~~ and ~~inherent~~digital ~~risks and uncertainties. The factors impacting these risks and uncertainties include, but are not limited to:~~services;

·o ~~our~~unavailability ~~current~~of ~~lack~~funds offor capital expenditures and/or general working capital;

·o ~~inability~~the fact that our accounting policies and methods are fundamental to ~~raise~~how ~~additional~~we ~~financing~~report our financial condition and results of operations, and they may require management to make estimates about matters that are inherently uncertain;

·o ~~the fact that~~ our ~~accounting~~ability ~~policies and methods are fundamental~~ to ~~how~~attract wekey ~~report our financial condition and results of operations, and they may require our management to make estimates about matters that are inherently uncertain~~personnel;

·o ~~deterioration~~our inability ~~general~~to oroperate ~~regional economic conditions~~profitably;

·o ~~adverse~~deterioration ~~state~~in orgeneral ~~federal legislation~~ or ~~regulation~~regional ~~that~~economic ~~increases the costs of compliance, or adverse findings by a regulator with respect to existing operations~~conditions;

·o changes in U.S. GAAP or in the legal, regulatory and legislative environments in the markets in which we operate;

·o ~~inability~~adverse tostate ~~efficiently~~or ~~manage~~federal ~~our~~legislation or regulation that increases the costs of compliance, or adverse findings by a regulator with respect to existing operations;

·o inability to achieve future sales levels or other operating results; ~~and~~

·o the ~~unavailability~~inability of ~~funds~~management ~~for~~to ~~capital~~effectively ~~expenditures.~~implement our strategies and business plans;

~~For~~as awell ~~detailed~~as ~~description~~other statements regarding our future operations, financial condition and prospects, and business strategies. Forward-looking statements may appear throughout this report, including without limitation, the following sections: Item 1 “Business,” Item 1A “Risk Factors,” and Item 7 “Management’s Discussion and Analysis of ~~these~~Financial Condition and ~~other~~Results ~~factors~~of Operations.” Forward-looking statements generally can be identified by words such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “plans,” “predicts,” “projects,” “will be,” “will continue,” “will likely result,” and similar expressions. These forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties, which could cause our actual results to differ materially from those ~~expressed~~reflected in ~~any~~the forward-looking ~~statement~~statements. Factors that could cause or contribute to such differences include, ~~please~~but ~~see~~are ~~“Item~~not ~~1A.~~limited to, those discussed in this Annual Report on Form 10-K, and in particular, the risks discussed under the caption “Risk Factors” in ~~this~~Item ~~document~~1A and those discussed in other documents we file with the Securities and Exchange Commission (SEC). We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements, except as required by law. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements.

Throughout this Annual Report references to “we”, “our”, “us”, “E & M”, “the Company”, and similar terms refer to E & M Group, Inc.

PART I

ITEM 1. BUSINESS

~~Business~~E ~~Development~~& M Group, Inc. is a development stage company, originally incorporated in the state of Nevada on March 2, 2001 under the name Madison Management, Inc. We were formed to provide business development, market development and financial goal-setting to prospective clients particularly, small corporations.

EAs &a Mresult ~~Group~~of our lack of revenue generation, ~~Inc~~we re-assessed our business plan, and aggressively searched for other business opportunities in an effort to substantiate stockholder value. We ishave been in preliminary discussions with PT E&M, a ~~development~~private ~~stage~~Indonesian company, ~~originally~~who ~~incorporated~~is in the ~~state~~mineral ofresource ~~Nevada~~business, oninterested ~~March~~in 2,a ~~2001~~potential ~~under~~merger. As of the ~~name~~date ~~Madison~~of ~~Management~~this filing, ~~Inc~~there have been no definitive agreements reached with this company. WeIf ~~were~~and ~~formed~~when towe ~~provide~~enter ~~business~~into ~~development~~a definitive agreement with any company, ~~market~~we ~~development~~will ~~and~~file ~~financial~~a ~~goal~~current report on Form 8-~~setting~~K towith ~~prospective~~the ~~clients~~Securities ~~(small~~and ~~corporations)~~Exchange Commission.

OnDuring ~~July~~the 24year ended December 31, ~~2009~~2010, ~~the~~we ~~officers~~established ~~and~~a ~~directors~~relationship ofwith ~~the~~PT ~~Company~~E&M, ~~Ms.~~and ~~Pam~~will ~~Elliott,~~act ~~Ms.~~as ~~Sharilyn~~their ~~Gallison,~~agent ~~Ms.~~by ~~Sandra~~seeking ~~Lary,~~buyers ~~and~~for ~~Ms.~~their ~~Elaine~~iron ~~Evans~~ore ~~gave~~sand. ~~the~~The ~~Company~~ore ~~notice~~will ofbe ~~their~~shipped ~~resignations~~directly from ~~their~~PT ~~positions~~E&M asto ~~officers and members of~~ the ~~Board~~customer. ofOur ~~Directors~~director, ~~which~~Dong ~~resignations~~Hwan ~~were~~Kim ~~accepted~~is bya ~~the~~major ~~Company~~owner onin ~~August~~PT ~~6, 2009~~E&M.

~~Prior~~In toSeptember ~~the~~2010, ~~resignations~~we ofsigned ~~Ms.~~an ~~Pam~~Iron ~~Elliott~~Ore ~~and~~Sales ~~Ms.~~Contract ~~Sandra~~with ~~Lary~~International Economic & Trading Corp., Wuang Group for the ~~Board~~sale of ~~Directors~~30,000 ~~appointed~~tons ~~Mr.~~of ~~Donghwan~~iron ~~Kim~~sand from Indonesia pursuant to ~~serve~~our asagency ~~the~~relationship ~~Company’s~~with ~~President,~~PT ~~Secretary~~E&M. ~~and~~In ~~Treasurer~~connection ~~and~~with tothis ~~serve~~contract aswe aobtained ~~member~~an Irrevocable Letter of Credit for $44,400. For more information about the ~~Company’s~~contract ~~Board~~with PT E&M please see Exhibit 10.1 of ~~Directors~~Form 10-Q filed on November 22, 2010.

On ~~December~~January 1125, ~~2009~~2011, we ~~amended~~signed ~~our~~an ~~articles~~Iron Ore Sales Contract with Jin Tai International Trading (HK) LED., for the sale of ~~incorporation~~20,000 ~~changing~~Dry ~~our~~Metric ~~name~~tons ~~from~~of ~~Madison~~iron ~~Management~~sand from Indonesia, ~~Inc.~~pursuant to Eour &agency Mrelationship ~~Group,~~with ~~Inc~~PT E&M.

On December 18, 2009, Mr. Donghwan Kim gave the Company notice of his resignation from his position as President, CEO, Secretary and Treasurer of the Company, which resignation was accepted by the Company on December 18, 2009. Mr. Kim remained as a director of the Company. Concurrently, on December 18, 2009, the Board of Directors appointed Jooin Kim to serve as President and CEO, Misun Kim to serve as Secretary and a Director, Jisun Kim to serve as Treasurer and a Director, and Peter Duchine to serve as a Director of the Company.

On January 14, 2010, we increased our total number of shares which we are authorized to issue from 25,000,000 to 100,000,000 shares of common stock of $0.001 par value.

On March 3, 2010, we effectuated a 10-for-1 forward stock split of our $0.001 par value common stock.

Business of Issuer

Initially, we were seeking to establish E & M Group in the business of providing business development, market development and financial goal-setting to prospective clients (small corporations). As a result of our lack of revenue generation, we plan to re-assess our business plan, and aggressively seek out other business opportunities. In an effort to substantiate stockholder value, we are seeking compatible business opportunities. We can provide no assurance that we will be able to locate compatible business opportunities. Currently, we are in preliminary discussions with a private company, who is in the mineral resource business, interested in a potential merger with us. The mineral resource business generally consists of three stages: exploration, development and production. Mineral resource companies that are in the exploration stage have not yet found mineral resources in commercially exploitable quantities and are engaged in exploring land in an effort to discover them. Mineral resource companies that have located a mineral resource in commercially exploitable quantities and are preparing to extract that resource are in the development stage, while those engaged in the extraction of a known mineral resource are in the production stage. The private company is in the exploration stage.

As of the date of this filing, there have been no definitive agreements reached with this company. If and when we enter into a definitive agreement with any company, we will file a current report on Form 8-K.

Until we enter into a transaction with another viable entity, we will continue to sustain ourselves through continuing with our current attempt to build the Company to provide business development, market development and financial goal-setting to prospective small businesses. Unless we pursue and establish ourselves with other business ventures in the near term, which we intend to do, we anticipate it will be extremely difficult without sufficient capital and a turnaround in the economy for us to generate revenues during the next twelve months.

Personnel

We are a development stage company and currently do not have any employees. We look to our officers and directors who collectively have a varied background in business management, marketing, and sales. We do not anticipate hiring employees over the next 12 months. We intend to use the services of consultants to perform various professional services. We believe that this use of third-party service providers may enhance our ability to contain general and administrative expenses.

3Available Information

Our periodic reports filed with the SEC, which include Form 10-K, Form 10-Q, Form 8-K and amendments thereto, may be accessed by the public free of charge from the SEC. Electronic copies of these reports can be accessed at the SEC’s website (http://www.sec.gov). Copies of these reports may also be obtained, free of charge, upon written request to: E & M Group, Inc. 2373 W. 208th St., Unit F4, Torrance, CA 90501, Attn: Corporate Secretary. The public may read or obtain copies of these reports from the SEC at the SEC’s Public Reference Room at 450 Fifth Street N.W., Washington, D.C. 20549 (1-800-SEC-0330).

ITEM 1A. RISK FACTORS

An evaluation of us is extremely difficult. At this stage of our business operations, even with our good faith efforts, potential investors have a high probability of losing their investment.

There is nothing at this time on which to base an assumption that our business operations will prove to be successful or that we will ever be able to operate profitably. Our future operating results will depend on many factors, including our ability to raise adequate working capital, demand and acceptance of our business plan, the level of our competition and our ability to attract and maintain key management and employees.

We are highly dependent on our officers and directors.

We rely heavily on our officers and directors to provide services and for continued business development. It would be difficult to replace our officers and directors at such an early stage of development of the Company. Our business could be materially adversely affected if our officers and directors were to leave and if we were unable to retain qualified replacements.

We depend on a business relationship with an entity controlled by one of our Directors.

We have entered into an agency relationship with PT E&M, a private Indonesian company owned and controlled by one of our Directors. Our success will depend not only on our continued relationship with this party, but also on our ability to enter into additional strategic arrangements with additional companies on commercially reasonable terms. As there is no contractual obligation for PT E&M to maintain this relationship, they may revoke their agreement with us at any time in the future, or may no longer need our services by seeking their own buyers for their product. Accordingly, our strategic relationship may not result in a sustained business alliance, or the generation of significant revenues.

Potential issuance of additional common stock could dilute existing stockholders.

We are authorized to issue up to 100,000,000 shares of common stock. To the extent of such authorization, our Board of Directors has the ability, without seeking stockholder approval, to issue additional shares of common stock in the future for such consideration as the Board of Directors may consider sufficient. We are not currently seeking additional equity financing, which if sought or obtained may result in additional shares of our common stock being issued. The issuance of additional common stock in the future will reduce the proportionate ownership and voting power of the common stock held by our existing stockholders.

Our auditor’s report reflects the fact that without realization of additional capital, it would be unlikely for us to continue as a going concern.

Our financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. We have suffered losses from operations during our operating history and our ability to continue as a going concern is dependent upon obtaining future profitable operations. Additionally, our auditor’s report reflects that the ability of the Company to continue as a going concern is dependent upon its ability to obtain additional sources of capital or borrowings and, ultimately, the achievement of significant operating revenues. Although management believes that the proceeds from the sale of securities, together with funds from operations, will be sufficient to cover anticipated cash requirements, we will be required to seek additional capital to fund future growth and expansion. No assurance can be given that such financing will be available or, if available, that it will be on commercially favorable terms. Moreover, favorable financing may be dilutive to investors.

We will need additional capital in the future to finance our operations, which we may not be able to raise or it may only be available on terms unfavorable to us or our stockholders, which may result in our inability to fund our working capital requirements and harm our operational results.

We believe that current cash on hand and the other sources of liquidity may not be sufficient enough to fund our operations through fiscal ~~2010~~2012. In that event, we would need to raise additional funds to continue our operations.

Additional financing might not be available on terms favorable to us, or at all. If adequate funds were not available or were not available on acceptable terms, our ability to fund our operations, take advantage of unanticipated opportunities, develop or enhance our business or otherwise respond to competitive pressures would be significantly limited.

We may acquire assets or other businesses in the future.

We may consider acquisitions of other assets or other businesses. Any acquisition involves a number of risks that could fail to meet our expectations and adversely affect our profitability. For example:

·	The acquired assets or business may not achieve expected results;

·	We may incur substantial, unanticipated costs, delays or other operational or financial problems when integrating the acquired assets;

·	We may not be able to retain key personnel of an acquired business;

·	Our management’s attention may be diverted; or

·	Our management may not be able to manage the acquired assets or combined entity effectively or to make acquisitions and grow our business internally at the same time.

If these problems arise we may not realize the expected benefits of an acquisition.

Risks Relating To Our Common Stock

IfOur wecommon ~~fail~~stock tois ~~remain~~thinly ~~current~~traded ~~on our reporting requirements, we could be removed from the OTC Bulletin Board, which would limit the ability of broker-dealers to sell our securities~~ and ~~the~~largely ~~ability of stockholders to sell their securities in the secondary market~~illiquid.

~~Companies~~Our ~~trading~~stock onis ~~the~~currently ~~OTC~~quoted ~~Bulletin~~on ~~Board, such as us, generally must be reporting issuers under Section 12 of~~ the ~~Securities~~OTC ~~Exchange~~Pink ~~Act~~(“Pink ofSheets”). ~~1934,~~Being asquoted ~~amended, and must be current in their reports under Section 13, in order to maintain price quotation privileges~~ on the ~~OTC~~Pink ~~Bulletin~~Sheets ~~Board. More specifically, FINRA~~ has ~~enacted~~made ~~Rule~~it ~~6530, which~~more ~~determines~~difficult ~~eligibility~~to ofbuy ~~issuers~~or ~~quoted~~sell onour ~~the~~stock ~~OTC~~and ~~Bulletin~~has ~~Board~~lead ~~by requiring an issuer~~ to bea ~~current~~decline in ~~its filings with~~ the ~~Commission.~~frequency ~~Pursuant~~of totrades ~~Rule~~and ~~6530(e),~~trading ifvolume. weContinued ~~file~~trading ~~our~~on ~~reports late with~~ the ~~Commission~~Pink ~~three~~Sheets ~~times~~will inalso alikely ~~two-year~~adversely ~~period~~affect ~~or our securities are removed from~~ the ~~OTC~~Company’s ~~Bulletin~~ability ~~Board for failure~~ to ~~timely~~obtain ~~file~~financing ~~twice~~ in ~~a two-year period, then we will be ineligible for quotation on~~ the ~~OTC~~future ~~Bulletin~~due ~~Board.~~to ~~As a result,~~ the ~~market~~decreased liquidity ~~for~~of ~~our securities could be severely adversely affected by limiting~~ the ~~ability~~Company’s ofshares ~~broker-dealers to sell our securities~~ and ~~the~~other ~~ability~~restrictions ofthat ~~stockholders~~certain toinvestors ~~sell~~have ~~their~~for ~~securities~~investing in ~~the~~Pink ~~secondary~~Sheets ~~market~~traded securities.

Because our common stock is deemed a low-priced “Penny” stock, an investment in our common stock should be considered high risk and subject to marketability restrictions.

Since our common stock is a penny stock, as defined in Rule 3a51-1 under the Securities Exchange Act, it will be more difficult for investors to liquidate their investment even if and when a market develops for the common stock. Until the trading price of the common stock rises above $5.00 per share, if ever, trading in the common stock is subject to the penny stock rules of the Securities Exchange Act specified in rules 15g-1 through 15g-10. Those rules require broker-dealers, before effecting transactions in any penny stock, to:

·	Deliver to the customer, and obtain a written receipt for, a disclosure document;

·	Disclose certain price information about the stock;

·	Disclose the amount of compensation received by the broker-dealer or any associated person of the broker-dealer;

·	Send monthly statements to customers with market and price information about the penny stock; and

·	In some circumstances, approve the purchaser’s account under certain standards and deliver written statements to the customer with information specified in the rules.

Consequently, the penny stock rules may restrict the ability or willingness of broker-dealers to sell the common stock and may affect the ability of holders to sell their common stock in the secondary market and the price at which such holders can sell any such securities. These additional procedures could also limit our ability to raise additional capital in the future.

FINRA sales practice requirements may also limit a stockholder's ability to buy and sell our stock.

In addition to the “penny stock” rules described above, FINRA has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer's financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low priced securities will not be suitable for at least some customers. The FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit the ability to buy and sell our stock and have an adverse effect on the market for our shares.

Our internal controls may be inadequate, which could cause our financial reporting to be unreliable and lead to misinformation being disseminated to the public.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. As defined in Exchange Act Rule 13a-15(f), internal control over financial reporting is a process designed by, or under the supervision of, the principal executive and principal financial officer and effected by the board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that: (i) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company, and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

We have a limited number of personnel that are required to perform various roles and duties as well as be responsible for monitoring and ensuring compliance with our internal control procedures. As a result, our internal controls may be inadequate or ineffective, which could cause our financial reporting to be unreliable and lead to misinformation being disseminated to the public. Investors relying upon this misinformation may make an uninformed investment decision.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 2. PROPERTIES

We currently maintain an executive office at 2373 208th St., Unit F4, Torrance, California, for which we have executed a 36 month lease, commencing on January 12, 2010. Our monthly rent for this office is $2,500. We believe our current office space is adequate for our immediate needs; however, as our operations expand, we may need to locate and secure additional office space. We sublease the office space from ENSAP International, Inc., a related party. ENSAP International, Inc. is an entity that is owned and controlled by the officers and directors of E & M Group, Inc. and their immediate family members.

ITEM 3. LEGAL PROCEEDINGS

We are not a party to any material legal proceedings.

~~ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS~~6

None.

PART II

ITEM 5.

MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS AND SMALL BUSINESS ISSUER PURCHASE OF EQUITY SECURITIES

Market Information

On May 19, 2009, we were cleared for trading by the Financial Industry Regulatory Authority on the Over- the- Counter Bulletin Board (OTCBB) now known as OTC Markets QB (OTCQB) under the symbol “MMGT.” We changed our name to E & M Group, Inc. and at the same time requested our symbol be changed to “EMGR”. ~~Our~~Historically, ~~common~~there ~~stock~~has isnot ~~currently~~been ~~thinly~~an ~~traded~~active ontrading ~~the~~market ~~Over-the-Counter Bulletin~~for ~~Board,~~our ~~with~~common ~~a closing price of $0~~stock.~~02 on March 26, 2010.~~

Currently, our common stock is quoted on the OTC Pink (Pink Sheets) under the symbol “EMGR”, with a closing price of $0.02 on March 5, 2012.

Holders of Common Stock

As of March 255, ~~2010~~2012, we had approximately 16 stockholders of record of the 31,500,000 shares outstanding ~~(post split)~~.

Dividends

The payment of dividends is subject to the discretion of our Board of Directors and will depend, among other things, upon our earnings, our capital requirements, our financial condition, and other relevant factors. We have not paid or declared any dividends upon our common stock since our inception and, by reason of our present financial status and our contemplated financial requirements, do not anticipate paying any dividends upon our common stock in the foreseeable future.

We have never declared or paid any cash dividends. We currently do not intend to pay cash dividends in the foreseeable future on the shares of common stock. We intend to reinvest any earnings in the development and expansion of our business. Any cash dividends in the future to common stockholders will be payable when, as and if declared by our Board of Directors, based upon the Board’s assessment of:

·	our financial condition;

earnings;

·	need for funds;

·	capital requirements;

·	other factors, including any applicable laws.

Therefore, there can be no assurance that any dividends on the common stock will ever be paid.

Recent Sales of Unregistered Securities

We have no recent sales of unregistered securities.

Issuer Purchases of Equity Securities

The Company did not repurchase any of its equity securities during the fourth quarter ended December 31, ~~2009~~2010.

ITEM 6. SELECTED FINANCIAL DATA

Not applicable.

ITEM 7.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

OVERVIEW ~~AND OUTLOOK~~

We are a development stage company incorporated in the State of Nevada in March 2001. ~~We were formed to provide business development, market development and financial goal-setting to prospective small businesses.~~

We have established a relationship with a private Indonesian company, PT E&M, and act as their agent by seeking buyers for their iron ore sand. The ore is shipped directly from PT E&M to the customer. Our director, Dong Hwan Kim is a major owner in PT E&M. This relationship enables the Company to broaden our potential business opportunities.

Since our inception on March 2, 2001 through December 31, 2010, we have generated $63,470 in revenues and have incurred a net loss of $188,958. For the year ended December 31, 2010, we generated $9,970 in revenues and incurred a net loss of $73,264.

RESULTS OF OPERATIONS

Revenues. Sales revenues increased to $9,970 in the fiscal year ended December 31, 2010 from $5,000 in the fiscal year ended December 31, 2009, representing a 99% increase. The increase in revenues is a result of commission generated from the sale of iron ore.

General and Administrative. General and administrative expenses increased $45,444, or 290%, to $61,097 for the fiscal year ended December 31, 2010 from $15,653 for the fiscal year ended December 31, 2009. The increase was the result of an increase in rent expenses and accounting fees.

Depreciation. Our depreciation expenses increased $1,474 or 100% in the fiscal year ended December 31, 2010 from the fiscal year ended December 31, 2009. The increase was the result of depreciation on a vehicle that was purchased and sold in 2010.

Executive Compensation – Related Party. Executive compensation – related party increased $655 or 100% in the fiscal year ended December 31, 2010 from the fiscal year ended December 31, 2009. The increase in executive compensation – related party was the result of personal expenses that were paid for by the Company.

Legal and Professional. Legal and professional expenses decreased $38,835, or 65%, to $21,265 in the fiscal year ended December 31, 2010 from $60,100 for the fiscal year ended December 31, 2009. The decrease in legal and professional fees was the result of the Company completing the process of going public. In 2010, the Company was responsible for the ongoing costs of the SEC reporting requirements as compared to the previous year when the Company was in the process of going public.

Net Loss from Operations. The Company had $74,521 in net loss from operations in the fiscal year ended December 31, 2010, as compared to net loss from operations of $70,753 during the period ended December 31, 2009. The increase was the result of primarily the increase in general and administrative expenses.

Gain on Sale of Assets. Gain on sale of assets increased $1,210 or 100% in the fiscal year ended December 31, 2010 from the fiscal year ended December 31, 2009. The increase was the result of a sale of a vehicle.

Interest Income. Interest income increased $47 or 100% in the fiscal year ended December 31, 2010 from the fiscal year ended December 31, 2009. The increase was the result of cash held in an interest bearing account.

Net Loss. In the fiscal year ended December 31, 2010, we generated a net loss of $73,264, an increase of $4,440, or 6%, from $68,824 for the period ended December 31, 2009. The increase was the result of primarily the increase in general and administrative expenses.

Going Concern

Our financial statements have been prepared assuming that we will continue as a going concern. We are in the development stage and, accordingly, have generated minimal revenues from operations. Since our inception, we have been engaged substantially in financing activities and developing our business plan and incurring start up costs and expenses. As a result, we have incurred accumulated net losses from inception. In addition, our development activities since inception have been financially sustained through equity and debt financing. These issues raise substantial doubt about our ability to continue as a going concern. Our ability to continue as a going concern is dependent upon our ability to raise additional capital from the sale of common stock, debt financing and, ultimately, the achievement of significant operating revenues.

Since our inception on March 2, 2001 through December 31, 2009, we have generated $53,500 in revenues and have incurred a net loss of $115,694. For the year ended December 31, 2009, we generated $5,000 in revenues and incurred a net loss of $68,824.

Operation Plan

During the next twelve months we plan to continue to focus our efforts on enhancing and marketing our business management, marketing and sales consulting services. However, and alternatively, we have been seeking other ventures, which may provide us opportunities which are more likely to provide us greater financial reward.

Liquidity and Capital Resources

As of December 31, 2010, we had $1,794,848 in cash. The following table ~~summarizes~~provides ~~total~~detailed ~~current~~information ~~assets,~~about ~~total~~our ~~current~~net ~~liabilities~~cash ~~and~~flow ~~working~~for ~~capital~~the atyears ended December 31, 2010 and 2009. ~~compared~~To todate, ~~December~~we 31have financed our operations through the issuance of stock, ~~2008~~borrowings, and minimal cash flows from operations.

	December 31, 2009	December 31, 2008	Increase / (Decrease)
			$	%
Current Assets	$38,307	$6,559	$31,748	484%
Current Liabilities	2,508	21,929	(19,421)	(89%)
Working Capital (deficit)	$35,799	$(15,370)	$51,169	333%

In summary, our cash flows were as follows:

Financing

	Fiscal Year Ended December 31,
	2010	2009
Net cash used in operating activities	$1,717,502	$(75,029)
Net cash used in investing activities	(45,711)	-
Net cash provided by financing activities	96,000	55,993
Net increase/(decrease) in Cash	1,767,791	(19,036)
Cash, beginning of year	27,057	6,559
Cash, end of year	$1,794,848	$(12,477)

InOperating ~~November 2009, Donghwan Kim, a Director of the Company, loaned the Company $49,000. The loan bears no interest and is due upon demand but cannot be demanded before December 2020.~~activities

~~Satisfaction~~Net ofcash ~~our~~used ~~cash~~in ~~obligations~~operating activities was $1,717,502 for the ~~next~~year 12ended ~~months~~December 31, 2010, as compared to $75,029 used in operating activities for the same period in 2009. The increase in net cash used in operating activities was primarily due to the significant increases in accounts payable and accounts payable – related party. In 2011, the Company did pay down significant portions of the accounts payable and accounts payable – related party.

AsInvesting of December 31, 2009, our cash balance was $27,057. Our plan for satisfying our cash requirements for the next twelve months is through sale of shares of our common stock, third party financing, and/or traditional bank financing. We anticipate sales-generated income during that same period of time, but do not anticipate generating sufficient amounts of revenues to meet our working capital requirements. Consequently, we intend to make appropriate plans to insure sources of additional capital in the future to fund growth and expansion through additional equity or debt financing or credit facilities.activities

Net cash used in investing activities was $45,711 for the year ended December 31, 2010, as compared to $0 used in investing activities for the same period in 2009. The increase in net cash used in investing activities was primarily due to the purchase of a certificate of deposit.

Financing activities

Net cash provided by financing activities for the year ended December 31, 2010 was $96,000, as compared to $55,993 for the same period of 2009. The increase of net cash provided by financing activities was mainly attributable to proceeds received for notes payable due to a related party.

On a short-term basis, we have only generated revenues of $9,970 during the year ended December 31, 2010 to cover operations. Based on prior history, we will continue to have insufficient revenue to satisfy current and recurring liabilities as we continue development activities. For short term needs, we will be dependent on our ability to raise additional capital from the sale of common stock and debt financing.

~~Since~~We ~~inception,~~believe wethat ~~have~~cash ~~financed~~flow ~~our~~from ~~cash~~operations ~~flow~~will ~~requirements~~meet ~~through~~only ~~issuance~~a part of ~~common~~our ~~stock.~~present Asand near-term cash needs and thus we ~~expand~~will ~~our~~require ~~activities~~additional cash resources, weincluding ~~may~~the sale of equity or debt securities, to meet our planned capital expenditures and ~~most~~working ~~likely~~capital requirements for the next 12 months. We will require additional cash resources due to changed business conditions, ~~continue~~implementation of our strategy to ~~experience~~locate ~~net~~buyers ~~negative~~for ~~cash~~iron ore sand and/or acquisitions we may decide to pursue. If our own financial resources and then current cash-flows from operations are insufficient to satisfy our capital requirements, ~~pending~~we ~~receipt~~may ofseek ~~listing~~to sell additional equity or ~~some~~debt ~~form~~securities or obtain additional credit facilities. The sale of ~~advertising~~additional ~~revenues~~equity securities will result in dilution to our stockholders. ~~Additionally~~The weincurrence ~~anticipate~~of ~~obtaining~~indebtedness ~~additional~~will ~~financing~~ result in increased debt service obligations and could require us to ~~fund~~agree to operating and financial covenants that could restrict our operations ~~through~~or ~~common~~modify ~~stock~~our ~~offerings,~~plans to grow the ~~extent~~business. Financing may not be available, in amounts or on terms acceptable to ~~obtain~~us, if at all. Any failure by us to raise additional ~~financing~~funds on terms favorable to ~~the~~us, ~~extent~~or ~~necessary~~at all, will limit our ability to ~~augment~~expand our ~~working~~business ~~capital~~operations and could harm our overall business prospects.

WeOperation anticipate that we will incur operating losses in the next twelve months. Our lack of operating history makes predictions of future operating results difficult to ascertain. Our prospects must be considered in light of the risks, expenses and difficulties frequently encountered by companies in their early stage of development, particularly companies in new and rapidly evolving markets. Such risks for us include, but are not limited to, an evolving and unpredictable business model and the management of growth. To address these risks, we must, among other things, obtain a customer base, implement and successfully execute our business and marketing strategy, respond to competitive developments, and attract, retain and motivate qualified personnel. There can be no assurance that we will be successful in addressing such risks, and the failure to do so can have a material adverse effect on our business prospects, financial condition and results of operations.Plan

~~Going~~During ~~Concern~~the next twelve months we plan to continue to focus our efforts on acting as a reselling agent of iron ore sand for PT E&M and continue to seek out buyers for their iron ore sand. The ore is shipped directly from PT E&M to the customer.

The financial statements included in this filing have been prepared in conformity with generally accepted accounting principles that contemplate the continuance of the Company as a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company is in the development stage and, accordingly, has generated minimal revenues from operations. As shown on the accompanying financial statements, the Company has incurred a net loss of $115,694 for the period from inception (March 2, 2001) to December 31, 2009. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

The future of the Company is dependent upon its ability to obtain financing and upon future profitable operations from the development of its business opportunities.

Summary of product and research and development that we will perform for the term of our plan.

We do not anticipate performing any significant product research and development under our plan of operation. In lieu of product research and development we anticipate maintaining control over our advertising to assist us in determining the allocation of our limited advertising dollars.

Expected purchase or sale of plant and significant equipment.

We do not anticipate the purchase or sale of any plant or significant equipment, as such items are not required by us at this time or in the next 12 months.

Significant changes in the number of employees.

We are a development stage company and currently do not have any employees. We look to our officers and directors who collectively have a varied background in business management, marketing and sales consulting. We do not anticipate hiring employees over the next 12 months. We intend to use the services of consultants to perform various professional services. We believe that this use of third-party service providers may enhance our ability to contain general and administrative expenses.

Off-Balance Sheet Arrangements

WeAs doof the date of this Report, we did not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results orof operations, liquidity, capital expenditures or capital resources that is material to investors.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We do not expect to enter into financial instruments for trading or hedging purposes. We do not currently anticipate entering into interest rate swaps and/or similar instruments.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

See Index to Financial Statements and Financial Statement Schedules appearing on page F-1 through F-1615 of this Form 10-K.

ITEM 9.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

We have had no disagreements with our independent auditors on accounting or financial disclosures.

1211

ITEM 9a9A (T). CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our Principal Executive Officer and Principal Financial Officer, Jooin Kim, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this Report. Based on his evaluation, ~~Mr.~~he ~~Kim~~ concluded that our disclosure controls and procedures are ~~effective~~not indesigned ~~timely~~at ~~alerting~~a ~~him~~reasonable toassurance ~~material~~level ~~information~~and ~~relating~~are tonot useffective ~~required~~ to beprovide ~~included~~reasonable inassurance ~~our periodic SEC filings and in ensuring~~ that information we are required to bedisclose ~~disclosed by us~~ in the reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal ~~executive and principal~~ financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Management’s Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control, as is defined in the Securities Exchange Act of 1934. These internal controls are designed to provide reasonable assurance that the reported financial information is presented fairly, that disclosures are adequate and that the judgments inherent in the preparation of financial statements are reasonable. There are inherent limitations in the effectiveness of any system of internal controls, including the possibility of human error and overriding of controls. Consequently, an effective internal control system can only provide reasonable, not absolute, assurance with respect to reporting financial information.

Our internal control over financial reporting includes policies and procedures that: (i) pertain to maintaining records that in reasonable detail accurately and fairly reflect our transactions; (ii) provide reasonable assurance that transactions are recorded as necessary for preparation of our financial statements in accordance with generally accepted accounting principles and the receipts and expenditures of company assets are made and in accordance with our management and directors authorization; and (iii) provide reasonable assurance regarding the prevention or timely detection of unauthorized acquisition, use or disposition of assets that could have a material effect on our financial statements.

Management has undertaken an assessment of the effectiveness of our internal control over financial reporting based on the framework and criteria established in the Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Based upon this evaluation, management concluded that our internal control over financial reporting was not effective as of December 31, ~~2009~~2010.

13This report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to the temporary rules of the Securities and Exchange Commission that permit the company to provide only management’s report in this report.

This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to the temporary rules of the Securities and Exchange Commission that permit the company to provide only management’s report in this annual report.12

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during our most recent fiscal quarter that have materially affected, or reasonably likely to materially affect, our internal control over financial reporting.

ITEM 9B. OTHER INFORMATION

~~(a) Article I Name-~~None.

As of December 11, 2009, the Company amended its articles of incorporation changing its company name from Madison Management, Inc. to E & M Group, Inc. The name change occurred as a result of a stockholder proposal which was approved by a Majority Consent of Stockholders on October 26, 2009.

The Company’s trading symbol changed from MMGT to EMGR, effective March 2, 2010, in conjunction with the Company’s name change.

(b) Resignation of Director and Officers

On December 18, 2009, the Board of Directors appointed Jooin Kim to serve as President and CEO, Misun Kim to serve as Secretary, and Jisun Kim to serve as Treasurer of the Company.

Jooin Kim – President and CEO, (See Resumé in Item 10 below).

Misun Kim – Secretary, (See Resumé in Item 10 below).

Jisun Kim – Treasurer, (See Resumé in Item 10 below).

(d) Appointment of Director

On December 18, 2009, the Board of Directors appointed Misun Kim, Jisun Kim and Peter Duchine to serve as members of the Company’s Board of Directors. Currently, the Company does not have separate committees within the Board of Directors such as an Audit, Nominating, or Governance committees due to having limited resources. Therefore, the Company’s entire board of directors will perform some of the functions associated with these separate committees.

Peter Duchine, (See Resumé in Item 10 below).

Misun Kim (See Resumé in Item 10 below).

Jisun Kim (See Resumé in Item 10 below).

PART III

ITEM 10.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

~~The~~Directors ~~members of our board of directors serve for one year terms~~ and ~~are~~Executive ~~elected at the next annual meeting of stockholders, or until their successors have been elected. The officers serve at the pleasure of the board of directors.~~Officers

OnThe ~~July~~names ~~24,~~of ~~2009,~~our ~~the~~directors ~~officers~~ and ~~directors~~executive ofofficers ~~the~~and ~~Company,~~their ~~Ms. Pam Elliott~~ages, ~~Ms. Sharilyn Gallison~~positions, ~~Ms. Sandra Lary,~~ and ~~Ms.~~biographies ~~Elaine~~are ~~Evans~~set ~~gave~~forth ~~the~~below. Our ~~Company~~executive ~~notice~~officers ofare ~~their~~appointed ~~resignations~~by, ~~from~~and ~~their~~serve ~~positions~~at asthe ~~officers~~discretion ~~and members~~ of, ~~the~~our ~~Board~~board of ~~Directors,~~directors. There ~~which~~are ~~resignations~~no ~~were~~family ~~accepted~~relationships byamong ~~the~~any ~~Company~~of onour ~~August~~directors 6,or ~~2009~~executive officers.

Prior to the resignations of Ms. Pam Elliott and Ms. Sandra Lary, the Board of Directors appointed Mr. Donghwan Kim to serve as the Company’s President, Secretary and Treasurer and to serve as a member of the Company’s Board of Directors.

Directors	Age	Title	Term
Jooin Kim	29	President & Chief Executive Officer	Since December 2009
Misun Kim	33	Secretary & Director	Since December 2009
Jisun Kim	31	Treasurer & Director	Since December 2009
Peter Duchine	62	Director	Since December 2009
Dong Hwan Kim	60	Director	Since July 2009

OnJooin ~~December 18~~Kim, ~~2009,~~has ~~Mr.~~served ~~Donghwan Kim gave the Company notice of his resignation from his position~~ as our President, ~~CEO, Secretary~~ and ~~Treasurer~~Chief ofExecutive ~~the~~Officer ~~Company,~~since ~~which resignation was accepted by the Company on~~ December 18, 2009. Mr. Jooin Kim ~~remained~~has asbeen a ~~director~~Director of ~~the~~Hydroderm ~~Company~~U.S.A. ~~Concurrently,~~since ~~on December~~2006. Between ~~18,~~2008 and 2009, ~~the~~Mr. ~~Board~~Jooin ofKim ~~Directors~~was ~~appointed~~the ~~Jooin~~owner ~~Kim~~of toHappy ~~serve~~Technology. Between as2005 ~~President~~ and ~~CEO~~2007, ~~Misun~~Mr. Jooin Kim towas ~~serve~~a asGeneral ~~Secretary~~Manager ~~and~~for aCompu ~~Director,~~USA. Mr. ~~Jisun~~Jooin Kim tostudied ~~serve~~computer asprogramming ~~Treasurer~~at ~~and~~ITT aTechnical ~~Director,~~Institute ~~and~~between ~~Peter~~2002 ~~Duchine~~and ~~to serve as a Director of the Company~~2004.

15Misun Kim, has served as our Secretary and a Director since December 18, 2009. Since 2005, Ms. Misun Kim has been the Chief Executive Officer of Hydroderm U.S.A. Ms. Misun Kim is also a songwriter and works in the Artists and Repertoire division for Can Entertainment since 2004. Between 2005 and 2009, Ms. Misun Kim was the Stage Manager for Redwon Production. Between 2004 and 2005, Ms. Misun Kim attended Patton College. Between 2001 and 2003 Ms. Misun Kim attended New York University and received a cello performance degree.

~~Information~~Jisun asKim, tohas served as our ~~current~~Treasurer ~~directors~~and a Director since Secember 18, 2009. From 2006 through present, Ms. Jisun Kim has been a Director of Hydroderm U.S.A. Between 2008 and ~~executive~~2009, ~~officers~~Ms. isJisun asKim ~~follows:~~was a loan officer for CPS Mortgage Company and between 2005 and 2007 she was a loan officer for Compass Finance. From 2001 through 2004 Ms. Jisun Kim attended Santa Monica College where she received a degree in business administration.

Name	Age	Title	Term
Jooin Kim	27	President & Chief Executive Officer	12/18/09
Misun Kim	31	Secretary & Director	12/18/09
Jisun Kim	29	Treasurer & Director	12/18/09
Donghwan Kim	58	Director	07/24/09
Peter Duchine	60	Director	12/18/09

~~Duties~~Peter Duchine, ~~Responsibilities~~has served as a Director of the Company since December 18, 2009. Mr. Peter Duchine has been an Assembly and ~~Experience~~Test Subcontractor for Amkor Technologies since March of 1992. As an Assembly and Test Subcontractor, Mr. Peter Duchine provides services as a technical test advisor, manages test business of $100,000,000 to $200,000,000 per year and provides leading edge technology solutions. Between August of 1987 and February of 1992, Mr. Peter Duchine served as a semiconductor manufacturer for California Micro Devices.

~~Jooin~~Dong Hwan Kim, –has ~~President~~served &as ~~Chief~~a ~~Executive~~Director ~~Officer~~of the Company since July 24, 2009. Mr. ~~Jooin~~Dong Hwan Kim ishas been the President ~~and~~of ~~Chief~~the ~~Executive~~Korean ~~Officer~~division of EENSAP &International MCo., ~~Group~~LTD. since June 1, ~~Inc~~2009. From October 1, 1980 through present, Mr. Dong Hwan Kim has been athe ~~Director~~Chairman of Taerim Electronics. Mr. Dong Hwan Kim also holds the position of President for both Hydroderm U.S.A., ~~since 2006~~Inc., ~~Between 2008~~ and ~~2009~~Hydroderm Asia, ~~Mr.~~from ~~Kim~~March ~~was~~1, ~~the~~2008 ~~owner~~through ofpresent ~~Happy~~and ~~Technology.~~August ~~Between~~8, ~~2005~~2003 ~~and~~through ~~2007~~present, respectively. Mr. Dong Hwan Kim ~~was~~also acurrently ~~General~~resides ~~Manager~~as ~~for~~Chairman ~~Compu~~and ~~USA.~~Chief ~~Mr.~~Financial ~~Kim~~Officer ~~studied~~of ~~computer~~Charista ~~programming~~Global atCorp., ~~ITT~~a ~~Technical~~position ~~Institute~~he ~~between~~has ~~2002~~held ~~and~~since ~~2004~~December 1, 2008.

~~Misun Kim – Secretary & Director Ms~~Mr. ~~Misun~~Dong Hwan Kim is ~~the~~a ~~Secretary~~major ~~and~~owner ain ~~Director~~PT of E & M ~~Group~~, ~~Inc.~~a ~~Since~~private ~~2005,~~Indonesian Mscompany. ~~Kim~~The ~~has~~Company ~~been~~acts ~~the~~as ~~Chief~~PT ~~Executive~~E&M’s ~~Officer~~agent ofby ~~Hydroderm U.S.A.~~seeking ~~Ms.~~out ~~Kim~~buyers ~~is also a songwriter and works in the Artists and Repertoire division~~ for ~~Can~~their ~~Entertainment~~iron ~~since~~ore ~~2004~~sand. ~~Between~~None ~~2005~~of ~~and~~our ~~2009,~~other ~~Ms.~~Officers ~~Kim was the Stage Manager for Redwon Production. Between 2004~~ and/or ~~2005,~~Directors ~~Ms.~~businesses ~~Kim~~are ~~attended~~affiliated ~~Patton~~with ~~College.~~or ~~Between~~currently ~~2001~~doing ~~and~~business ~~2003~~with ~~Ms.~~the ~~Kim attended New York University and received a cello performance degree~~Company.

~~Jisun~~Family Kim – Treasurer & Director Ms. Jisun Kim is the Treasurer and a Director of E & M Group, Inc. From 2006 through present, Ms. Kim has been a Director of Hydroderm U.S.A. Between 2008 and 2009, Ms. Kim was a loan officer for CPS Mortgage Company and between 2005 and 2007 she was a loan officer for Compass Finance. From 2001 through 2004 Ms. Kim attended Santa Monica College where she received a degree in business administration.Relationships

~~Charles~~Dong ~~Kim~~Hwan ~~– Director Mr. Donghwan~~ Kim, ~~a citizen of South Korea,~~ is ~~a Director of E & M Group, Inc. Mr. Kim has been~~ the ~~President~~father of ~~the~~Jooin ~~Korean division of ENSAP International Co., LTD. since June 1, 2009. From October 1, 1980 through present, Mr.~~ Kim ~~has been the Chairman of Taerim Electronics. Mr. Kim also holds the position of President for both Hydroderm U.S.A.~~, ~~Inc.,~~Misun ~~and Hydroderm Asia, from March 1, 2008 through present and August 8, 2003 through present, respectively. Mr.~~ Kim ~~also currently resides as Chairman~~ and ~~Chief~~Jisun ~~Financial Officer of Charista Global Corp~~Kim.~~, a position he has held since December 1, 2008.~~

16Indemnification of Directors and Officers

~~Peter~~Our ~~Duchine~~Articles ~~– Director Mr. Duchine is a Director~~ of EIncorporation ~~& M Group, Inc. Mr. Duchine has been an Assembly~~ and ~~Test~~Bylaws ~~Subcontractor~~both provide for ~~Amkor~~the ~~Technologies~~indemnification ~~since March~~ of ~~1992.~~our ~~As an~~officers ~~Assembly~~ and ~~Test~~directors ~~Subcontractor, Mr. Duchine provides services as a technical test advisor, manages test business of $100,000,000~~ to ~~$200,000,000~~the ~~per~~fullest ~~year~~extent ~~and~~permitted ~~provides~~by ~~leading~~Nevada ~~edge technology solutions~~law. ~~Between August of 1987 and February of 1992, Mr. Duchine served as a semiconductor manufacturer for California Micro Devices.~~

None of the above Officers and/or Directors businesses are affiliated with or currently doing business with E & M Group, Inc.

Limitation of Liability of Directors

Pursuant to the Nevada General Corporation Law, our Articles of Incorporation exclude personal liability for our Directors for monetary damages based upon any violation of their fiduciary duties as Directors, except as to liability for any breach of the duty of loyalty, acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, or any transaction from which a Director receives an improper personal benefit. This exclusion of liability does not limit any right which a Director may have to be indemnified and does not affect any Director’s liability under federal or applicable state securities laws. We have agreed to indemnify our directors against expenses, judgments, and amounts paid in settlement in connection with any claim against a Director if he acted in good faith and in a manner he believed to be in our best interests.

Election of Directors and Officers

Directors are elected to serve until the next annual meeting of stockholders and until their successors have been elected and qualified. Officers are appointed to serve until the meeting of the Board of Directors following the next annual meeting of stockholders and until their successors have been elected and qualified.

No Executive Officer or Director of the Corporation has been the subject of any Order, Judgment, or Decree of any Court of competent jurisdiction, or any regulatory agency permanently or temporarily enjoining, barring suspending or otherwise limiting him from acting as an investment advisor, underwriter, broker or dealer in the securities industry, or as an affiliated person, director or employee of an investment company, bank, savings and loan association, or insurance company or from engaging in or continuing any conduct or practice in connection with any such activity or in connection with the purchase or sale of any securities.14

No Executive Officer or Director of the Corporation has been convicted in any criminal proceeding (excluding traffic violations) or is the subject of a criminal proceeding which is currently pending.

No Executive Officer or Director of the Corporation is the subject of any pending legal proceedings.

Involvement in Certain Legal Proceedings

No Executive Officer or Director of the Corporation has been the subject of any Order, Judgment, or Decree of any Court of competent jurisdiction, or any regulatory agency permanently or temporarily enjoining, barring suspending or otherwise limiting him/her from acting as an investment advisor, underwriter, broker or dealer in the securities industry, or as an affiliated person, director or employee of an investment company, bank, savings and loan association, or insurance company or from engaging in or continuing any conduct or practice in connection with any such activity or in connection with the purchase or sale of any securities.

No Executive Officer or Director of the Corporation has been convicted in any criminal proceeding (excluding traffic violations) or is the subject of a criminal proceeding which is currently pending.

Audit Committee and Financial Expert

We do not have an Audit Committee. Our directors perform some of the same functions of an Audit Committee, such as: recommending a firm of independent certified public accountants to audit the annual financial statements; reviewing the independent auditors independence, the financial statements and their audit report; and reviewing management's administration of the system of internal accounting controls. The Company does not currently have a written audit committee charter or similar document.

We have no financial expert. We believe the cost related to retaining a financial expert at this time is prohibitive. Further, because of our start-up operations, we believe the services of a financial expert are not warranted.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), requires executive officers and directors, and persons who beneficially own more than ten percent of an issuer's common stock, which has been registered under Section 12 of the Exchange Act, to file initial reports of ownership and reports of changes in ownership with the SEC.

As a company with securities registered under Section 15(d) of the Exchange Act, our executive officers and directors, and persons who beneficially own more than ten percent of our common stock are not required to file Section 16(a) reports.

Code of Ethics

A code of ethics relates to written standards that are reasonably designed to deter wrongdoing and to promote:

(1)	Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;

(2)	Full, fair, accurate, timely and understandable disclosure in reports and documents that are filed with, or submitted to, the Commission and in other public communications made by an issuer;

(3)	Compliance with applicable governmental laws, rules and regulations;

(4)	The prompt internal reporting of violations of the code to an appropriate person or persons identified in the code; and

(5)	Accountability for adherence to the code.

We have not adopted a corporate code of ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions.

Our decision to not adopt such a code of ethics results from our having ~~only~~a ~~three~~small ~~officers and two directors operating as the~~ management for the Company. We believe that the limited interaction which occurs having such a small management structure for the Company eliminates the current need for such a code, in that violations of such a code would be reported to the party generating the violation.

~~Corporate~~Audit ~~Governance~~Committee

We do not have an Audit Committee; our Board of Directors perform some of the same functions of an Audit Committee, such as: recommending a firm of independent certified public accountants to audit the annual financial statements; reviewing the independent auditor’s independence, the financial statements and their audit report; and reviewing management's administration of the system of internal accounting controls. The Company does not currently have a written audit committee charter or similar document.

Nominating Committee

We do not have a Nominating Committee or Nominating Committee Charter. Our Board of Directors ~~performs~~perform some of the functions associated with a Nominating Committee. We have elected not to have a Nominating Committee in that we are ana ~~initial-stages~~development ~~operating~~stage company with limited operations and resources.

~~Director~~Involvement ~~Nomination~~in ~~Procedures~~Certain Legal Proceedings

~~Generally,~~To ~~nominees~~the ~~for~~best ~~Directors~~of ~~are~~our ~~identified~~knowledge, ~~and~~none ~~suggested by the members~~ of ~~the~~our ~~Board~~directors or ~~management~~executive ~~using~~officers ~~their business networks. The Board~~ has, ~~not~~during ~~retained any executive search firms or other third parties to identify or evaluate director candidates in~~ the past ~~and~~ten ~~does~~(10) ~~not intend to in the near future. In selecting a nominee for director, the Board or management considers the following criteria~~years:

19· been convicted in a criminal proceeding or been subject to a pending criminal proceeding (excluding traffic violations and other minor offences);

1.· ~~whether~~had ~~the~~any ~~nominee~~bankruptcy ~~has~~petition ~~the~~filed ~~personal~~by ~~attributes~~or ~~for~~against ~~successful~~the ~~service~~business onor property of the ~~Board~~person, ~~such~~or asof ~~demonstrated~~any ~~character~~partnership, ~~and~~corporation ~~integrity;~~or ~~experience~~business atassociation aof ~~strategy/policy~~which ~~setting~~he ~~level;~~was ~~managerial~~a ~~experience~~general ~~dealing~~partner ~~with~~or ~~complex~~executive ~~problems;~~officer, aneither ~~ability~~at tothe ~~work~~time ~~effectively~~of ~~with~~the ~~others;~~bankruptcy ~~and~~filing ~~sufficient~~or ~~time~~within totwo ~~devote~~years prior to ~~the~~that ~~affairs of the Company~~time;

2.· ~~whether~~been ~~the~~subject ~~nominee~~to ~~has~~any ~~been~~order, ~~the~~judgment, ~~chief~~or ~~executive~~decree, ~~officer~~not subsequently reversed, suspended or ~~senior~~vacated, ~~executive~~of any court of acompetent ~~public~~jurisdiction ~~company~~or federal or astate ~~leader~~authority, permanently or temporarily enjoining, barring, suspending or otherwise limiting, his involvement in any type of abusiness, ~~similar~~securities, ~~organization~~futures, ~~including~~commodities, ~~industry~~investment, ~~groups~~banking, ~~universities~~savings and loan, or ~~governmental~~insurance ~~organizations~~activities, or to be associated with persons engaged in any such activity;

3.· ~~whether~~been ~~the~~found ~~nominee,~~ by ~~virtue~~a court of ~~particular~~competent ~~experience,~~jurisdiction ~~technical~~in ~~expertise~~a civil action or ~~specialized~~by ~~skills~~the SEC or ~~contacts~~the ~~relevant~~Commodity Futures Trading Commission to ~~the~~have ~~Company’s~~violated ~~current~~a federal or ~~future~~state ~~business~~securities or commodities law, ~~will~~and ~~add~~the ~~specific~~judgment ~~value~~has asnot abeen ~~Board~~reversed, ~~member;~~suspended, ~~and~~or vacated;

4.· ~~whether~~been ~~there~~the ~~are~~subject ~~any~~of, ~~other~~or ~~factors~~a ~~related~~party to, ~~the~~any ~~ability~~federal ~~and~~or ~~willingness~~state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated (not including any settlement of a ~~new~~civil ~~nominee~~proceeding among private litigants), relating to ~~serve~~an alleged violation of any federal or state securities or commodities law or regulation, any law or anregulation ~~existing~~respecting ~~Board~~financial ~~member~~institutions or insurance companies including, but not limited to, ~~continue~~a ~~his~~temporary ~~service.~~or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order, or any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or

~~The~~been ~~Board~~the orsubject ~~management~~of, ~~has~~or ~~not established any specific minimum qualifications that~~ a ~~candidate~~party ~~for~~to, ~~director~~any ~~must~~sanction ~~meet~~or in order, tonot besubsequently ~~recommended for Board membership. Rather~~reversed, ~~the~~suspended ~~Board~~ or ~~management~~vacated, ~~will~~of ~~evaluate~~any ~~the~~self-regulatory ~~mix~~organization of(as ~~skills~~defined ~~and~~in ~~experience~~Section ~~that~~3(a)(26) of the ~~candidate~~Exchange ~~offers,~~Act ~~consider~~(15 ~~how~~U.S.C. 78c(a)(26)), ~~given~~any ~~candidate~~registered ~~meets~~entity ~~the~~(as ~~Board’s current~~defined ~~expectations~~in ~~with~~Section ~~respect~~1(a)(29) toof ~~each~~the ~~such~~Commodity ~~criterion~~Exchange ~~and~~Act ~~make~~(7 aU.S.C. ~~determination regarding whether~~ 1(a)(29), ~~candidate~~or ~~should~~any beequivalent ~~recommended~~exchange, toassociation, ~~the~~entity ~~stockholders~~or ~~for~~organization ~~election~~that ashas adisciplinary ~~Director. During~~authority ~~2009,~~over ~~the~~its ~~Company~~members ~~received~~or nopersons ~~recommendation~~associated ~~for~~with ~~Directors~~a ~~from its stockholders~~member.

The Company will consider for inclusion in its nominations of new Board of Directors nominees proposed by stockholders who have held at least 1% of the outstanding voting securities of the Company for at least one year. Board candidates referred by such stockholders will be considered on the same basis as Board candidates referred from other sources. Any stockholder who wishes to recommend for the Company’s consideration a prospective nominee to serve on the Board of Directors may do so by giving the candidate’s name and qualifications in writing to the Company’s Secretary at the following address: 2373 208th Street, Unit F4, Torrance, CA 90501.16

ITEM 11. EXECUTIVE COMPENSATION

Overview of Compensation Program

We currently have not appointed members to serve on the Compensation Committee of the board of directors. Until a formal committee is established, our entire board of directors has responsibility for establishing, implementing and continually monitoring adherence with the Company’s compensation philosophy. The board of directors ensures that the total compensation paid to the executives is fair, reasonable and competitive.

Compensation Philosophy and Objectives

The board of directors believes that the most effective executive compensation program is one that is designed to reward the achievement of specific annual, long-term and strategic goals by the Company, and which aligns executives’ interests with those of the stockholders by rewarding performance above established goals, with the ultimate objective of improving stockholder value. As a result of the size of the Company and only having three executive officers, the board evaluates both performance and compensation on an informal basis. Upon hiring additional executives, the board intends to establish a Compensation Committee to evaluate both performance and compensation to ensure that the Company maintains its ability to attract and retain superior employees in key positions and that compensation provided to key employees remains competitive relative to the compensation paid to similarly-situated executives of our peer companies. To that end, the board believes executive compensation packages provided by the Company to its executives, including the named executive officers, should include both cash and stock-based compensation that reward performance as measured against established goals.

Role of Executive Officers in Compensation Decisions

The board of directors makes all compensation decisions for, and approves recommendations regarding equity awards to, the executive officers and directors of the Company. Decisions regarding the non-equity compensation of other employees of the Company are made by management.

Summary Compensation

~~Our~~During ~~executive~~the ~~officers~~year ~~have~~ended ~~not~~December 31, 2010, our President and Chief Executive Officer Mr. Jooin Kim, received ~~any~~$655 compensation,. ~~including~~During ~~plan~~the oryear ~~non-plan~~ended ~~compensation~~December 31, ~~nor~~2009, ~~has~~Mr. ~~our~~Jooin ~~executive~~Kim ~~officers~~did ~~earned~~not receive any compensation, asincluding ofplan ~~the~~or ~~date~~non-plan ~~of this Prospectus~~compensation.

During the years ended December 31, 2010 and 2009, our Secretary Ms. Misun Kim and our Treasurer Ms. Jisun Kim, did not receive any compensation, including plan or non-plan compensation.

Future Compensation

Our executive officers have agreed to provide services to us without compensation until such time as we have earnings from our revenue.

2017

Option Grants in Last Fiscal Year

During the years ended December 31, 2010 and 2009, we did not grant any options to our officers and directors.

Board Committees

We currently do not have any committees of the board of directors.

Director Compensation

During the years ended December 31, 2010 and 2009, our members of the board of directors, did not receive any compensation.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The following table sets forth information, to the best of our knowledge, about the beneficial ownership of our common stock on March 255, ~~2010~~2012 relating to the beneficial ownership of our common stock by those persons known to beneficially own more than 5% of our capital stock and by our directors and executive officers. The percentage of beneficial ownership for the following table is based on 31,500,000 shares of common stock outstanding.

Name of Beneficial Owner	Number Of Shares	Percent Beneficially Owned
Jooin Kim, President & Chief Executive Officer	0	--
Misun Kim, Secretary & Director	2,000,000	6%
Jisun Kim, Treasurer & Director	2,000,000	6%
Donghwan Kim, Director	12,500,000	40%
Peter Duchine, Director	0	--
All Directors, Officers and Principle Stockholders as a Group	16,500,000	52%

Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission and does not necessarily indicate beneficial ownership for any other purpose. Under these rules, beneficial ownership includes those shares of common stock over which the stockholder has sole or shared voting or investment power. It also includes shares of common stock that the stockholder has a right to acquire within 60 days after March 5, 2012 pursuant to options, warrants, conversion privileges or other rights. The percentage of ownership of the outstanding common stock, however, is based on the assumption, expressly required by the rules of the Securities and Exchange Commission, that only the person or entity whose ownership is being reported has converted options or warrants into shares of our common stock.

“Beneficial ownership” means the sole or shared power to vote or to direct the voting of, a security, or the sole or shared investment power with respect to a security (i.e., the power to dispose of or to direct the disposition of, a security). In addition, for purposes of this table, a person is deemed, as of any date, to have “beneficial ownership” of any security that such person has the right to acquire within 60 days from the date of this prospectus.

Title of Class	Name and address of Beneficial Owner	Amount of Beneficial Ownership	Percent of Class
Common	Jooin Kim, President & Chief Executive Officer	0	--
Common	Misun Kim, Secretary & Director	2,000,000	6.3%
Common	Jisun Kim, Treasurer & Director	2,000,000	6.3%
Common	Donghwan Kim, Director	12,500,000	39.6%
Common	Peter Duchine, Director	0	--

	All Beneficial Ownders as a Group	16,500,000	52.3%

(1)

As used in this table, “beneficial ownership” means the sole or united power to vote, or to direct the voting of, a security, or the sole or united investment power with respect to a security (i.e., the power to dispose of, or to direct the disposition of, a security). The Party’s address is in care of the Company at 2373 W. 208th St., Unit F4, Torrance, CA 90501.

Changes in Control

There are no arrangements, known to the Company, including any pledge by any person of securities of the Company, the operation of which may at a subsequent date result in a change in control of the Company.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPNDENCE

InTransactions ~~November~~with ~~2009,~~Related ~~Donghwan Kim, a Director of the Company, loaned the Company $49,000. The loan bears no interest and is due upon demand but cannot be demanded before December 2020.~~Persons

InOn ~~November~~January ~~2009~~12, ~~the Company loaned $30~~2010,~~000~~ towe ~~ENSAP~~executed ~~International Co., Ltd.,~~ a ~~California~~sublease ~~Corporation~~agreement ~~owned~~with byENSAP ~~Donghwan Kim~~International, aInc. ~~Director~~(“ENSAP”). The ofterm ~~the~~is ~~Company.~~for ~~The~~three ~~loan~~years ~~bears~~commencing noJanuary ~~interest~~12, 2010 and isending ~~due~~on ~~upon~~January ~~demand~~12, ~~but~~2013 ~~cannot~~with bea ~~demanded~~monthly ~~before~~rent ~~November~~of ~~2010~~$2,500. InENSAP ~~December~~is ~~2009,~~a ~~the~~related ~~Company received~~party aand ~~partial~~is ~~repayment~~an ofentity ~~$20,000~~that ~~from~~is ~~ENSAP. As~~owned ofand ~~December~~controlled ~~31,~~by ~~2009,~~ the ~~balance~~officers ~~owed~~and todirectors of the Company ~~was~~and ~~$10,000~~their immediate family members.

21The following is a schedule by year of future minimum lease payment required under the sublease agreement:

The officers and directors are involved in other business activities and may, in the future, become involved in other business opportunities. If a specific business opportunity becomes available, such persons may face a conflict in selecting between the Company and their other business interests. The Company has not formulated a policy for the resolution of such conflicts.

Year Ending December 31,		Amount
2011		$ 30,000
2012		$ 30,000
2013		$ 2,500

During the year ended December 31, 2010 and 2009, the rent expense was $31,603 and $0, respectively.

As of December 31, 2010 and 2009, we had accounts payable of $944,000 and $0, respectively due to PT E&M. Dong Hwan Kim, a Director of the Company, has a significant ownership percentage in PT E&M. The Company is a sales agent for PT E&M and was able to locate buyers for PT E&M.

Promoters and Certain Control Persons

We did not have any promoters at any time since our inception in March 2001.

Director Independence

~~The~~We ~~Board~~currently ofdo ~~Directors~~not ~~has~~have ~~not~~any ~~made~~independent directors, as the ~~determination~~term if“independent” ~~any~~is defined in Section 803A of ~~its~~the ~~Directors~~NYSE ~~are~~Amex ~~considered~~LLC ~~independent~~Company ~~directors~~Guide. inSince ~~accordance~~the ~~with~~Over the Counter Bulletin Board (“OTCBB”) does not have rules regarding director independence, ~~standards~~the ofBoard makes its determination as to director independence based on the ~~American~~definition ~~Stock~~of ~~Exchange. Therefore,~~“independence” as ofdefined under the ~~date~~rules of ~~this~~the ~~filing,~~New ~~each~~York ~~director~~Stock ~~should~~Exchange be(“NYSE”) ~~considered~~and asAmerican ~~non-independent~~Stock Exchange (“Amex”).

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

(1) AUDIT FEES

The aggregate fees billed for professional services rendered by the principal accountant, ~~Moore~~De Joya Griffith & ~~Associates~~Company, ~~Chartered~~LLC, for the audit of our annual financial statements and review of the financial statements included in our Form 10-Q or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for fiscal years ~~2009~~2010 and ~~2008~~2009 were $610,~~500~~000 and $51,~~000~~250, respectively.

~~In October 2009, the registrant engaged De Joya Griffith & Company, LLC to serve as the registrant’s independent registered public accountants.~~ The aggregate fees billed for professional services rendered by Dethe ~~Joya~~principal ~~Griffith Company~~accountant, ~~LLC~~Moore & Associates, for the ~~review~~audit of ~~the~~our ~~period~~annual ~~ended~~financial ~~September 30,~~statements ~~2009,~~and ~~for~~review of the ~~audit~~financial ofstatements included in our ~~annual~~Form ~~financial~~10-Q ~~statements~~or ~~for~~services ~~the~~that ~~fiscal~~are ~~year~~normally ~~ended~~provided ~~December~~by ~~31,~~the ~~2009,~~accountant ~~and~~in ~~re-audit~~connection ofwith ~~our~~statutory ~~annual~~and ~~financial~~regulatory ~~statement~~filings ~~for~~or ~~the~~engagements for fiscal ~~year~~years ~~ended~~2010 ~~December~~and ~~2008~~2009 ~~was~~were $70 and $6,~~250~~500, respectively.

(2) AUDIT-RELATED FEES

None.

(3) TAX FEES

None.

(4) ALL OTHER FEES

None.

(5) AUDIT COMMITTEE POLICIES AND PROCEDURES

We do not have an audit committee.

(6) If greater than 50 percent, disclose the percentage of hours expended on the principal accountant's engagement to audit the registrant's financial statements for the most recent fiscal year that were attributed to work performed by persons other than the principal accountant's full-time, permanent employees.

Not applicable.

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

(a)

1. The financial statements listed in the "Index to Financial Statements" on page 2322 are filed as part of this report.

2.	Financial statement schedules are omitted because they are not applicable or the required information is shown in the financial statements or notes thereto.

3.	Exhibits included or incorporated herein: See index to Exhibits.

(b) Exhibits

			Incorporated by reference
Exhibit number	Exhibit description	Filed herewith	Form	Period ending	Exhibit	Filing date
3(i)(a)	Articles of Incorporation of Madison Management, Inc. filed on March 2, 2001		S-1		3(i)(a)	12/19/08
3(i)(b)	Amended and Restated Articles of Incorporation, filed on December 11, 2009	X
3(i)(c)	Amended and Restated Articles of Incorporation, filed on January 14, 2010	X
3(ii)(a)	Bylaws of Madison Management, Inc.		S-1		3(ii)(a)	12/19/08
31.1	Certification of Jooin Kim pursuant to Section 302 of the Sarbanes-Oxley Act	X
32.1	Certification of Jooin Kim pursuant to Section 906 of the Sarbanes-Oxley Act	X
10.1	Sales Contract International Economic & Trading Corp., Wugang Group		10-Q			11/22/10

2321

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

E & M GROUP, INC.

By: /S/ Jooin Kim

Jooin Kim, President

Date: March 315, ~~2010~~2012

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature	Title	Date
/S/ Jooin Kim	President, Chief Executive Officer,	March 315, ~~2010~~2012
Jooin Kim	Principal Executive Officer and Principal Accounting Officer
/S/ Misun Kim	Secretary & Director	March 315, ~~2010~~2012
Misun Kim
/S/ Jisun Kim	Treasurer & Director	March 315, ~~2010~~2012
Jisun Kim
/S/ Donghwan Kim	Director	March 315, ~~2010~~2012
Donghwan Kim
/S/ Peter Duchine	Director	March 315, ~~2010~~2012
Peter Duchine

2422

E & M GROUP, INC.

INDEX TO FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, ~~2009~~2010 AND ~~2008~~2009

	Pages
	PAGES
Report of Independent Registered Public Accounting Firm	F-1
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM	F-1
Balance Sheets, December 31, 2009 and 2008	F-2
BALANCE SHEETS	F-2
Statements of Operations for the Years Ended December 31, 2009 and 2008 and the period from Inception (March 2, 2001) to December 31, 2009	F-3
STATEMENTS OF OPERATIONS	F-3
Statement of Stockholders' Deficit for the period from Inception (March 2, 2001) to December 31, 2009	F-4 – F-6
STATEMENT OF STOCKHOLDERS’ DEFICIT	F-4
Statements of Cash Flows for the Years Ended December 31, 2009 and 2008 and the period from Inception (March 2, 2001) to December 31, 2009	F-7
STATEMENTS OF CASH FLOWS	F-5
Notes to Financial Statements	F-8 – F-16
NOTES TO FINANCIAL STATEMENTS	F-6

2523

De Joya Griffith & Company, LLC

CERTIFIED PUBLIC ACCOUNTANTS & CONSULTANTS

Report of Independent Registered Public Accounting Firm

To ~~The~~the Board of Directors and Stockholders

E & M Group, Inc.

~~Torrance~~We have audited the accompanying balance sheets of E & M Group, CAInc. ~~90501~~(A Development Stage Company) as of December 31, 2010 and 2009 and the related statements of operations, stockholder’s deficit and cash flows for the years then ended and from inception (March 2, 2001) to December 31, 2010. 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 ~~have~~conducted ~~audited~~our ~~the~~audits ~~accompanying~~in ~~balance~~accordance ~~sheets~~with standards of Ethe &Public MCompany ~~Group,~~Accounting ~~Inc.~~Oversight Board (~~formerly~~United ~~Madison Management~~States). (AThose ~~Development~~standards ~~Stage~~require ~~Company)~~that aswe ofplan ~~December~~and ~~31,~~perform ~~2009~~the ~~and~~audit ~~2008,~~to ~~and~~obtain reasonable assurance about whether the ~~related~~financial statements are free of ~~operations~~material misstatement. The Company is not required to have, ~~stockholders’~~nor ~~deficit~~were we engaged to perform, ~~and~~an ~~cash~~audit ~~flows~~of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for ~~the~~designing ~~years~~audit ~~then~~procedures ~~ended~~that ~~and~~are ~~from~~appropriate ~~inception~~in ~~(March~~the 2circumstances, ~~2001)~~but tonot ~~December~~for ~~31,~~the ~~2009.~~purpose ~~These financial~~of ~~statements~~expressing ~~are~~an opinion on the ~~responsibility~~effectiveness of the Company'’s ~~management.~~internal ~~Our~~control ~~responsibility~~over isfinancial toreporting. Accordingly, we express anno such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, ~~based~~assessing onthe accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

WeIn ~~conducted~~ our ~~audit~~opinion, ~~in accordance with standards of~~ the ~~Public~~financial ~~Company~~statements ~~Accounting~~referred ~~Oversight~~to ~~Board~~above ~~(United~~present ~~States). Those~~fairly, ~~standards~~in ~~require~~all ~~that~~material werespects, ~~plan and perform~~ the ~~audit~~financial toposition ~~obtain~~of ~~reasonable~~E ~~assurance~~& ~~about~~M ~~whether~~Group, ~~the~~Inc. ~~financial~~(A ~~statements~~Development ~~are~~Stage ~~free~~Company) as of ~~material~~December ~~misstatement. An audit includes examining~~31, on2010 ~~a test~~and ~~basis,~~2009 ~~evidence~~and ~~supporting~~ the ~~amounts~~results ~~and~~of ~~disclosures~~its inoperations ~~the~~and ~~financial~~cash ~~statements. An~~flows ~~audit~~for ~~also includes assessing~~ the ~~accounting~~years ~~principles~~then ~~used~~ended and ~~significant~~from ~~estimates~~inception ~~made~~(March ~~by management~~2, as2001) ~~well~~to asDecember ~~evaluating~~31, ~~the~~2010 ~~overall~~in ~~financial~~conformity ~~statement~~with ~~presentation. We~~accounting ~~believe~~principles ~~that~~generally ~~our~~accepted ~~audit~~in ~~provides~~the aUnited ~~reasonable~~States ~~basis~~of ~~for our opinion~~America.

InThe ~~our~~accompanying ~~opinion, the~~ financial statements ~~referred~~have tobeen ~~above~~prepared ~~present~~assuming ~~fairly,~~the inCompany ~~all~~will ~~material~~continue ~~respects,~~as ~~the~~a ~~financial~~going ~~position~~concern. ofAs Ediscussed &in MNote ~~Group~~2 to the financial statements, ~~Inc.~~the ~~(formerly~~Company ~~Madison~~has ~~Management)~~suffered (Alosses ~~Development~~from ~~Stage~~operations, ~~Company)~~which asraise ofsubstantial ~~December~~doubt ~~31,~~about ~~2009~~its ~~and~~ability ~~2008,~~to ~~and~~continue ~~the~~as ~~results~~a ofgoing ~~their~~concern. ~~operations~~Management’s ~~and~~plans ~~cash~~in ~~flows~~regard ~~for~~to ~~the~~these ~~years~~matters ~~then~~are ~~ended~~also ~~and~~described ~~from~~in ~~inception (March~~Note 2,. ~~2001)~~The tofinancial ~~December~~statements ~~31,~~do ~~2009~~not ininclude ~~conformity~~any ~~with~~adjustments ~~accounting~~that ~~principles~~might ~~generally~~result ~~accepted~~from in the ~~United~~outcome ~~States~~of this uncertainty.

The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has suffered recurring losses from operations, which raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

De Joya Griffith & Company, LLC

/s/ De Joya Griffith & Company, LLC

Henderson, Nevada

~~March~~February 3023, ~~2010~~2012

2580 Anthem Village Drive, Henderson, NV 89052

Telephone (702) 563-1600 ● Facsimile (702) 920-8049

F-1

E & M GROUP, INC. (FORMERLY MADISON MANAGEMENT, INC.)
E&M GROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
	December 31,
(audited)
	2009			2008
	December 31,			December 31,
	2010			2009
ASSETS
Current assets:
Cash	$	271,~~057~~794,848		$	627,~~559~~057
Prepaid expenses		1,250			-
Certificates of deposit		44,447			-
Notes receivable - related party		10,000			-
Prepaid expenses		2,674			1,250
Total current assets		38,307			6,559
Deposits		485			-
Total assets	$	38,307		$	6,559
Notes receivable - related party		10,000			10,000
Total current assets		1,852,454			38,307
Other assets:
Notes receivable - related party		1,000			-
Total other assets		1,000			-
Total assets	$	1,853,454		$	38,307
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Accounts payable	$	2850,~~508~~919		$	62,~~929~~508
Notes payable - related party		-			15,000
Accounts payable - related party		944,000			-
Total current liabilities		21,~~508~~794,919			212,~~929~~508
Long-term liabilities:
Notes payable - related party		49145,000			-49,000
Total long-term liabilities		49145,000			-49,000
Total liabilities		511,~~508~~939,919			2151,~~929~~508
Stockholders' deficit:
Common stock, $0.001 par value, 100,000,000 shares
authorized, 31,500,000 and 31,500,000 shares issued and outstanding
as of December 31, 2009 and 2008, respectively		31,500			31,500
as of December 31, 2010 and December 31, 2009, respectively		31,500			31,500
Additional paid-in capital		70,993			-70,993
Deficit accumulated during development stage		(~~115~~188,~~694~~958	)		(46115,~~870~~694	)
Total stockholders' deficit		(1386,~~201~~465	)		(1513,~~370~~201	)
Total liabilities and stockholders' deficit	$	381,~~307~~853,454		$	638,~~559~~307

~~The~~See ~~accompanying~~Accompanying ~~notes~~Notes ~~are~~to anFinancial ~~integral part of these statements~~Statements.

F-2

E & M GROUP, INC. (FORMERLY MADISON MANAGEMENT, INC.)
E&M GROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS
STATEMENTS OF OPERATIONS
(audited)
							Inception
							(March 2, 2001)
	For the years ended						to
	December 31,						December 31,
	2009			2008			2009
	2010			2009			2010
Revenue	$	59,~~000~~970		$	-5,000		$	1563,~~000~~470
Revenue - related party		-			8,500			38,500
Total revenue		9,970			5,000			63,470
Total revenue		5,000			8,500			53,500
Expenses:
General and administrative		1561,~~653~~097			815,~~237~~653			3091,~~243~~340
Consulting fees		-			~~1,100~~-			11,100
Consulting fees - stock based		-			-			22,500
Consulting fees - related party		-			-			5,000
Legal and professional fees		60,100			23,938			102,280
Depreciation		1,474			-			1,474
Total expenses		75,753			33,275			171,123
Executive compensation - related party		655			-			655
Net operating loss		(70,753	)		(24,775	)		(117,623	)
Legal and professional fees		21,265			60,100			123,545
Other income:
Total expenses		84,491			75,753			255,614
Forgiveness of debt		1,929			-			1,929
Net operating income/(loss)		(74,521	)		(70,753	)		(192,144	)
Total other income		1,929			-			1,929
Other Income:
Net loss	$	(68,824	)	$	(24,775	)	$	(115,694	)
Forgiveness of debt		-			1,929			1,929
Weighted average number of common shares		31,500,000			31,500,000
Gain on sale of assets		1,210			-			1,210
outstanding - basic
Interest income		47			-			47
Total other income		1,257			1,929			3,186
Net loss	$	(73,264	)	$	(68,824	)	$	(188,958	)
Weighted average number of common		31,500,000			31,500,000
shares outstanding - basic
Net loss per share - basic	$	(0.00	)	$	(0.00	)

~~The~~See ~~accompanying~~Accompanying ~~notes~~Notes ~~are~~to anFinancial ~~integral part of these statements~~Statements.

F-3

E & M GROUP, INC. (FORMERLY MADISON MANAGEMENT, INC.)
E&M GROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF STOCKHOLDERS' DEFICIT
							Deficit
(audited)
							Accumulated
													Deficit
				Additional			During		Total
													Accumulated
	Common Shares			Paid-In		Subscriptions	Development		Stockholders'
							Additional						During			Total
	Shares		Amount	Capital		Receivable	Stage		Deficit
	Common Shares						Paid-In			Subscriptions			Development			Stockholders'
March 2001
	Shares			Amount			Capital			Receivable			Stage			Deficit
Issuance of common stock for services	12,500,000		$ 12,500	$ -		$ -	$ -		$ 12,500
March 2001
April 2001
Issuance of common stock for services		12,500,000		$	12,500		$	-		$	-		$	-		$	12,500
Issuance of common stock for services	10,000,000		10,000	-		-	-		10,000
April 2001
August - December 2001
Issuance of common stock for services		10,000,000			10,000			-			-			-			10,000
Issuance of common stock for cash	9,000,000		9,000	-		(1,500)	-		7,500
August - December 2001
Net loss	-		-	-		-	(23,048)		(23,048)
Issuance of common stock for cash		9,000,000			9,000			-			(1,500	)		-			7,500
Balance, December 31, 2001	31,500,000		31,500	-		(1,500)	(23,048)		6,952
Net loss		-			-			-			-			(23,048	)		(23,048	)
Balance, December 31, 2001		31,500,000			31,500			-			(1,500	)		(23,048	)		6,952
January 2002
Cash received for subscriptions receivable		-			-			-			500			-			500
February 2002
Cash received for subscriptions receivable		-			-			-			1,000			-			1,000
Net loss		-			-			-			-			(2,309	)		(2,309	)
Balance, December 31, 2002		31,500,000			31,500			-			-			(25,357	)		6,143
Net loss		-			-			-			-			(4,318	)		(4,318	)
Balance, December 31, 2003		31,500,000			31,500			-			-			(29,675	)		1,825
Net loss		-			-			-			-			(320	)		(320	)
Balance, December 31, 2004		31,500,000			31,500			-			-			(29,995	)		1,505
Net loss		-			-			-			-			(320	)		(320	)
Balance, December 31, 2005		31,500,000			31,500			-			-			(30,315	)		1,185

F-4

E & M GROUP, INC. (FORMERLY MADISON MANAGEMENT, INC.)
E&M GROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF STOCKHOLDERS' DEFICIT
STATEMENT OF STOCKHOLDERS' DEFICIT (CONTINUED)
January 2002
(audited)
Cash received for subscriptions receivable	-		-	-		500	-		500
												Deficit
February 2002
												Accumulated
Cash received for subscriptions receivable	-		-	-		1,000	-		1,000
							Additional					During			Total
Net loss	-		-	-		-	(2,309)		(2,309)
	Common Shares						Paid-In			Subscriptions		Development			Stockholders'
Balance, December 31, 2002	31,500,000		31,500	-		-	(25,357)		6,143
	Shares			Amount			Capital			Receivable		Stage			Deficit
Net loss	-	-	-	-	-	-	~~(4,318)~~	-	~~(4,318)~~		-		14,380			14,380
Balance, December 31, 2003	31,500,000		31,500	-		-	(29,675)		1,825
Balance, December 31, 2006		31,500,000			31,500			-			-		(15,935	)		15,565
Net loss	-	-	-	-	-	-	~~(320)~~	-	~~(320)~~		-		(6,160	)		(6,160	)
Balance, December 31, 2004	31,500,000		31,500	-		-	(29,995)		1,505
Balance, December 31, 2007		31,500,000			31,500			-			-		(22,095	)		9,405
Net loss	-	-	-	-	-	-	~~(320)~~	-	~~(320)~~		-		(24,775	)		(24,775	)
Balance, December 31, 2005	31,500,000		31,500	-		-	(30,315)		1,185
Balance, December 31, 2008		31,500,000			31,500			-			-		(46,870	)		(15,370	)
August 2009
Forgiveness of debt from a related party		-			-			70,993			-		-			70,993
Net loss		-			-			-			-		(68,824	)		(68,824	)
Balance, December 31, 2009		31,500,000			31,500			70,993			-		(115,694	)		(13,201	)
Net loss		-			-			-			-		(73,264	)		(73,264	)
Balance, December 31, 2010		31,500,000		$	31,500		$	70,993		$	-	$	(188,958	)	$	(86,465	)

See Accompanying Notes to Financial Statements.

F-5

E & M GROUP, INC. (FORMERLY MADISON MANAGEMENT, INC.)
E&M GROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF STOCKHOLDERS' DEFICIT
STATEMENTS OF CASH FLOWS
Net loss	-		-	-		-	14,380		14,380
(audited)
Balance, December 31, 2006	31,500,000		31,500	-		-	(15,935)		15,565
							Inception
Net loss	-		-	-		-	(6,160)		(6,160)
							(March 2, 2001)
Balance, December 31, 2007	31,500,000		31,500	-		-	(22,095)		9,405
	For the years ended						to
Net loss	-		-	-		-	(24,775)		(24,775)
	December 31,						December 31,
Balance, December 31, 2008	31,500,000		31,500	-		-	(46,870)		(15,370)
	2010			2009			2010
August 2009
CASH FLOWS FROM OPERATING ACTIVITIES
Forgiveness of debt from a related party	-		-	70,993		-	-		70,993
Net loss	$	(73,264	)	$	(68,824	)	$	(188,958	)
Net loss	-		-	-		-	(68,824)		(68,824)
Adjustments to reconcile net loss
Balance, December 31, 2009	31,500,000		$ 31,500	$ 70,993		$ -	$ (115,694)		$ (13,201)
to net cash used in operating activities:
Shares issued for services		-			-			22,500
Depreciation		1,474			-			1,474
Gain on sale of assets		(1,210	)					(1,210	)
Changes in operating assets and liabilities:
(Increase) in prepaid expenses		(1,424	)		-			(2,674	)
(Increase) in deposits		(485	)		-			(485	)
Increase in accounts payable - related party		944,000			-			944,000
Increase (decrease) in accounts payable		848,411			(6,205	)		850,919
Net cash used in operating activities		1,717,502			(75,029	)		1,625,566
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase certificates of deposit		(44,447	)		-			(44,447	)
Proceeds from repayment of notes receivable - related party		-			-			20,000
Payments for notes receivable - related party		(1,000	)		-			(31,000	)
Purchase of fixed assets		(25,264	)		-			(25,264	)
Sale of fixed assets		25,000			-			25,000
Net cash used in investing activities		(45,711	)		-			(55,711	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from sale of common stock, net of offering costs		-			-			9,000
Proceeds from donated capital		-			-			70,993
Proceeds from notes payable		-			-			49,000
Proceeds from notes payable - related party		121,000			55,993			136,000
Payments to notes payable - related party		(25,000	)		-			(40,000	)
Net cash provided by financing activities		96,000			55,993			224,993
NET CHANGE IN CASH		1,767,791			(19,036	)		1,794,848
CASH AT BEGINNING OF YEAR		27,057			6,559			-
CASH AT END OF YEAR	$	1,794,848		$	(12,477	)	$	1,794,848
SUPPLEMENTAL INFORMATION:
Interest paid	$	-		$	-		$	-
Income taxes paid	$	-		$	-		$	-
Non-cash activities:
Number of shares issued for services		-			-			22,500,000
Fair value of shares issued for services	$	-		$	-		$	22,500

~~The~~See ~~accompanying~~Accompanying ~~notes~~Notes ~~are~~to anFinancial ~~integral part of these statements~~Statements.

F-6

E & M GROUP, INC. (FORMERLY MADISON MANAGEMENT, INC.)
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
							Inception
							(March 2, 2001)
	For the years ended						to
	December 31,						December 31,
	2009			2008			2009
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(68,824	)	$	(24,775	)	$	(115,694	)
Adjustments to reconcile net loss
to net cash used in operating activities:
Shares issued for services		-			-			22,500
Changes in operating assets and liabilities:
(Increase) in prepaid expenses		(1,250	)		-			(1,250	)
Increase (decrease) in accounts payable		(4,421	)		4,803			2,508
Net cash used in operating activities		(74,495	)		(19,972	)		(91,936	)
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from repayment of notes receivable - related party		20,000			-			20,000
Payments for notes receivable - related party		(30,000	)		-			(30,000	)
Net cash provided by investing activities		(10,000	)		-			(10,000	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from sale of common stock, net of offering costs		-			-			9,000
Proceeds from donated capital		70,993			-			70,993
Proceeds from notes payable		49,000			-			49,000
Proceeds from notes payable - related party		-			15,000			15,000
Payments to notes payable - related party		(15,000	)		-			(15,000	)
Net cash provided by financing activities		104,993			15,000			128,993
NET CHANGE IN CASH		20,498			(4,972	)		27,057
CASH AT BEGINNING OF YEAR		6,559			11,531			-
CASH AT END OF YEAR	$	27,057		$	6,559		$	27,057
SUPPLEMENTAL INFORMATION:
Interest paid	$	-		$	-		$	-
Income taxes paid	$	-		$	-		$	-
Non-cash activities:
Number of shares issued for services		-			-			22,500,000

E & M GROUP, INC.

The accompanying notes are an integral part of these statements.

F-7

E & M GROUP, INC. (FORMERLY MADISON MANAGEMENT, INC.)

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization

The Company was incorporated on March 2, 2001 (Date of Inception) under the laws of the State of Nevada, as Madison Management, Inc. On December 11, 2009, the Company amended its articles of incorporation and changed its name to E & M Group, Inc.

The Company has not commenced significant operations and, in accordance with ASC Topic 915, the Company is considered a development stage company.

Nature of operations

The Company’s ~~primary business~~ is toa ~~establish~~sales oragent ~~reestablish~~and ~~solid~~plans ~~management~~to ~~organizations~~locate buyers for ~~its~~iron ~~clients~~ore sand. ~~The~~Currently, the Company ~~provides~~is ~~placement~~a ofsales ~~professional~~agent ~~and~~for ~~competent~~a ~~personnel~~private ~~into~~Indonesian ~~key~~company. The ~~slots~~private toIndonesian ~~create~~company is a ~~strong,~~related ~~focused~~party ~~management~~because ~~and~~a ~~marketing~~director ~~group~~of ~~for~~ the ~~benefit~~Company ofis a significant shareholder in the ~~client~~Indonesian company.

Use of estimates

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

Cash and cash equivalents

For the purpose of the statements of cash flows, all highly liquid investments with an original maturity of three months or less are considered to be cash equivalents. The carrying value of these investments approximates fair value. As of December 31, ~~2009~~2010 and ~~2008~~2009, there are no cash equivalents. The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. As of December 31, 2010 and through December 31, 2012, the Company’s account is fully insured by FDIC Deposit Insurance Coverage.

Fixed assets

Fixed assets are recorded at cost. Expenditures for major additions and improvements are capitalized and minor replacements, maintenance, and repairs are charged to expense as incurred. When fixed assets are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is included in the results of operations for the respective period. Depreciation is provided over the estimated useful lives of the related assets using the straight-line method for financial statement purposes. The Company uses other depreciation methods (generally accelerated) for tax purposes where appropriate.

F-7

E & M GROUP, INC.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

The Company reviews the carrying value of property and equipment for impairment whenever events and circumstances indicate that the carrying value of an asset may not be recoverable from the estimated future cash flows expected to result from its use and eventual disposition. In cases where undiscounted expected future cash flows are less than the carrying value, an impairment loss is recognized equal to an amount by which the carrying value exceeds the fair value of assets. The factors considered by management in performing this assessment include current operating results, trends and prospects, the manner in which the property is used, and the effects of obsolescence, demand, competition and other economic factors.

Revenue Recognition

The Company recognizes revenue when itall of the following conditions are satisfied: (1) there is ~~earned~~persuasive onevidence of an arrangement; (2) the ~~accrual~~product ~~basis~~or service has been provided to the customer; (3) the amount of ~~accounting~~fees to be paid by the customer is fixed or determinable; and (4) the collection of our fees is probable. The Company recorded net revenue for the year ended December 31, 2010 in accordance with ~~generally~~ASC ~~accepted accounting principles~~605-45.

The Company records revenue upon shipment of the iron ore sand between the buyer and the seller.

Advertising Costs

Advertising costs are anticipated to be expensed as incurred; however there were no advertising costs included in general and administrative expenses for years ended December 31, ~~2009~~2010 and ~~2008~~2009.

Fair value of financial instruments

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of December 31, ~~2009 and 2008~~2010. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values. These financial instruments include cash, ~~and~~notes receivable, accounts payable and notes payable. Fair values were assumed to approximate carrying values for cash, ~~prepaid expenses~~ and payables because they are short term in nature and their carrying amounts approximate fair values or they are payable on demand.

~~Stock-~~Level 1: The preferred inputs to valuation efforts are “quoted prices in active markets for identical assets or liabilities,” with the caveat that the reporting entity must have access to that market. Information at this level is based ~~compensation~~on direct observations of transactions involving the same assets and liabilities, not assumptions, and thus offers superior reliability. However, relatively few items, especially physical assets, actually trade in active markets.

~~The~~Level ~~Company~~2: ~~records~~FASB ~~stock~~acknowledged ~~based~~that ~~compensation~~active inmarkets ~~accordance~~for ~~with~~identical ~~the~~assets ~~guidance~~and inliabilities ~~ASC~~are ~~Topic~~relatively ~~718~~uncommon ~~which~~and, ~~requires~~even ~~the~~when ~~Company~~they todo ~~recognize~~exist, ~~expenses~~they ~~related~~may tobe ~~the~~too ~~fair~~thin ~~value~~to ofprovide ~~its~~reliable ~~employee stock option awards~~information. ~~This~~ ~~eliminates~~To ~~accounting~~deal ~~for~~with ~~share-based~~this ~~compensation~~shortage ~~transactions~~of ~~using~~direct data, the ~~intrinsic~~board ~~value~~provided ~~and requires instead that such transactions be accounted for using~~ a ~~fair-value-based~~second ~~method.~~level ~~The Company recognizes the cost~~ of ~~all~~inputs ~~share-based~~that ~~awards~~can onbe aapplied ~~graded~~in ~~vesting~~three ~~basis over the vesting period of the award~~situations.

Earnings per share

The Company follows ASC Topic 260 to account for the earnings per share. Basic earning per common share (“EPS”) calculations are determined by dividing net income by the weighted average number of shares of common stock outstanding during the year. Diluted earning per common share calculations are determined by dividing net income by the weighted average number of common shares and dilutive common share equivalents outstanding. During periods when common stock equivalents, if any, are anti-dilutive they are not considered in the computation.

F-8

E & M GROUP, INC. ~~(FORMERLY MADISON MANAGEMENT, INC.)~~

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

~~NOTE~~Level 3: If inputs from levels 1 –and ~~SUMMARY~~2 OFare ~~SIGNIFICANT~~not ~~ACCOUNTING~~available, ~~POLICIES~~FASB ~~(CONTINUED)~~acknowledges that fair value measures of many assets and liabilities are less precise. The board describes Level 3 inputs as “unobservable,” and limits their use by saying they “shall be used to measure fair value to the extent that observable inputs are not available.” This category allows “for situations in which there is little, if any, market activity for the asset or liability at the measurement date”. Earlier in the standard, FASB explains that “observable inputs” are gathered from sources other than the reporting company and that they are expected to reflect assumptions made by market participants.

Stock-based compensation

The Company records stock based compensation in accordance with the guidance in ASC Topic 505 and 718 which requires the Company to recognize expenses related to the fair value of its employee stock option awards. This eliminates accounting for share-based compensation transactions using intrinsic value and requires instead that such transactions be accounted for using a fair-value-based method. The Company recognizes the cost of all share-based awards on a graded vesting basis over the vesting period of the award.

The Company accounts for equity instruments issued in exchange for the receipt of goods or services from other than employees in accordance with FASB ASC 718-10 and the conclusions reached by the FASB ASC 505-50. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment or completion of performance by the provider of goods or services as defined by FASB ASC 505-50.

Earnings per share

Income taxes

The Company follows ASC Topic 740 for recording the provision for income taxes. Deferred tax assets and liabilities are computed based upon the difference between the financial statement and income tax basis of assets and liabilities using the enacted marginal tax rate applicable when the related asset or liability is expected to be realized or settled. Deferred income tax expenses or benefits are based on the changes in the asset or liability each period. If available evidence suggests that it is more likely than not that some portion or all of the deferred tax assets will not be realized, a valuation allowance is required to reduce the deferred tax assets to the amount that is more likely than not to be realized. Future changes in such valuation allowance are included in the provision for deferred income taxes in the period of change.

Deferred income taxes may arise from temporary differences resulting from income and expense items reported for financial accounting and tax purposes in different periods. Deferred taxes are classified as current or non-current, depending on the classification of assets and liabilities to which they relate. Deferred taxes arising from temporary differences that are not related to an asset or liability are classified as current or non-current depending on the periods in which the temporary differences are expected to reverse.

The Company applies a more-likely-than-not recognition threshold for all tax uncertainties. ASC Topic 740 only allows the recognition of those tax benefits that have a greater than fifty percent likelihood of being sustained upon examination by the taxing authorities. As of December 31, 2009 and 2008, the Company reviewed its tax positions and determined there were no outstanding, or retroactive tax positions with less than a 50% likelihood of being sustained upon examination by the taxing authorities, therefore this standard has not had a material affect on the Company.

The Company does not anticipate any significant changes to its total unrecognized tax benefits within the next 12 months.

The Company classifies tax-related penalties and net interest as income tax expense. As of December 31, 2009 and 2008, no income tax expense has been incurred.

Use of estimates

Concentrations

In 2009 and 2008, one customer accounted for 100% and 100% of sales, respectively.

F-9

E & M GROUP, INC. ~~(FORMERLY MADISON MANAGEMENT, INC.)~~

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

~~NOTE~~Deferred 1income –taxes ~~SUMMARY~~may OFarise ~~SIGNIFICANT~~from ~~ACCOUNTING~~temporary ~~POLICIES~~differences ~~(CONTINUED)~~resulting from income and expense items reported for financial accounting and tax purposes in different periods. Deferred taxes are classified as current or non-current, depending on the classification of assets and liabilities to which they relate. Deferred taxes arising from temporary differences that are not related to an asset or liability are classified as current or non-current depending on the periods in which the temporary differences are expected to reverse.

The Company applies a more-likely-than-not recognition threshold for all tax uncertainties. ASC Topic 740 only allows the recognition of those tax benefits that have a greater than fifty percent likelihood of being sustained upon examination by the taxing authorities. As of December 31, 2010 and 2009, the Company reviewed its tax positions and determined there were no outstanding, or retroactive tax positions with less than a 50% likelihood of being sustained upon examination by the taxing authorities, therefore this standard has not had a material effect on the Company.

The Company does not anticipate any significant changes to its total unrecognized tax benefits within the next 12 months.

The Company classifies tax-related penalties and net interest as income tax expense. As of December 31, 2010 and 2009, no income tax expense has been incurred.

Concentrations

In 2010 and 2009, one customer accounted for 100% and 100% of revenue, respectively.

Recent pronouncements

~~Below~~The isCompany ahas ~~listing~~evaluated of the ~~most~~ recent accounting ~~standards~~pronouncements through January 2012 and ~~their~~believes that none of them will have a material effect on the Company’s financial statements.

InNOTE February 2010, the FASB (Financial Accounting Standards Board) issued Accounting Standards Update 2010-08 (ASU 2010-08), Technical Corrections to Various Topics. This amendment eliminated inconsistencies and outdated provisions and provided the needed clarifications to various topics within Topic 815. The amendments are effective for the first reporting period (including interim periods) beginning after issuance (February 2, ~~2010),~~– ~~except~~GOING for certain amendments. The amendments to the guidance on accounting for income taxes in reorganization (Subtopic 852-740) should be applied to reorganizations for which the date of the reorganization is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008. For those reorganizations reflected in interim financial statements issued before the amendments in this Update are effective, retrospective application is required. The clarifications of the guidance on the embedded derivates and hedging (Subtopic 815-15) are effective for fiscal years beginning after December 15, 2009, and should be applied to existing contracts (hybrid instruments) containing embedded derivative features at the date of adoption. The Company does not expect the provisions of ASU 2010-08 to have a material effect on the financial position, results of operations or cash flows of the Company.CONCERN

InThe ~~January~~accompanying ~~2010~~financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the ~~FASB~~recoverability ~~(Financial~~of ~~Accounting~~assets ~~Standards~~and ~~Board)~~the ~~issued~~satisfaction ~~Accounting~~of ~~Standards~~liabilities ~~Update~~in ~~2010-07~~the ~~(ASU~~normal ~~2010-07)~~course of business. As noted above, ~~Not-for-Profit~~the ~~Entities~~Company ~~(Topic~~is ~~958):~~in ~~Not-for-Profit~~the ~~Entities:~~development ~~Mergers~~stage and, ~~Acquisitions~~accordingly, has generated minimal revenues from operations. ~~This~~ ~~amendment~~Since toits ~~Topic~~inception, ~~958~~the Company has ~~occurred~~been asengaged asubstantially ~~result~~in offinancing ~~the~~activities ~~issuance~~and ofdeveloping ~~FAS~~its ~~164~~business plan and incurring start up costs and expenses. ~~The~~ ~~Company~~As ~~does~~a ~~not~~result, ~~expect~~ the ~~provisions~~Company ofincurred ~~ASU~~accumulated ~~2010-07~~net tolosses ~~have~~from aInception ~~material~~(March ~~effect~~2, on2001) through the ~~financial~~period ~~position~~ended December 31, ~~results~~2010 of ~~operations~~($188,958). orIn ~~cash~~addition, ~~flows of~~ the Company’s development activities since inception have been financially sustained through equity and debt financing.

InThe ~~January~~ability ~~2010,~~of the ~~FASB~~Company ~~(Financial~~to ~~Accounting~~continue ~~Standards~~as ~~Board)~~a ~~issued~~going ~~Accounting~~concern ~~Standards~~is ~~Update~~dependent ~~2010-06~~upon ~~(ASU~~its ~~2010-06),~~ability ~~Fair Value Measurements and Disclosures (Topic 820): Improving Disclosures about Fair Value Measurements. This amendment~~ to ~~Topic~~raise ~~820~~additional ~~has~~capital ~~improved disclosures about fair value measurements on the basis of input received~~ from the ~~users~~sale of ~~financial~~common ~~statements. This~~stock, isdebt ~~effective~~financing ~~for interim~~ and ~~annual reporting periods beginning after December 15~~, ~~2009~~ultimately, ~~except for~~ the ~~disclosures~~achievement ~~about purchases, sales, issuances, and settlements in the roll forward~~ of ~~activity~~significant inoperating ~~Level 3 fair value measurements~~revenues. ~~Those~~ ~~disclosures~~These ~~are~~financial ~~effective~~statements ~~for~~do ~~fiscal~~not ~~years~~include ~~beginning~~any ~~after~~adjustments ~~December~~relating ~~15,~~to ~~2010,~~the recoverability and ~~for~~classification ~~interim periods within those fiscal years. Early adoption is permitted. The Company does not expect the provisions~~ of ~~ASU~~recorded ~~2010-06~~asset toamounts, ~~have~~or aamounts ~~material~~and ~~effect~~classification ~~on the financial position, results~~ of ~~operations~~liabilities orthat ~~cash~~might ~~flows~~result offrom ~~the~~this ~~Company~~uncertainty.

In January 2010, the FASB (Financial Accounting Standards Board) issued Accounting Standards Update 2010-05 (ASU 2010-05), Compensation – Stock Compensation (Topic 718). This standard codifies EITF Topic D-110 Escrowed Share Arrangements and the Presumption of Compensation.

In January 2010, the FASB (Financial Accounting Standards Board) issued Accounting Standards Update 2010-04 (ASU 2010-04), Accounting for Various Topics—Technical Corrections to SEC Paragraphs.

F-10

E & M GROUP, INC. ~~(FORMERLY MADISON MANAGEMENT, INC.)~~

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

NOTE 13 – ~~SUMMARY~~PREPAID ~~OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)~~EXPENSES

~~Recent~~As ~~pronouncements~~of ~~(continued)~~December 31, 2010 and 2009, the Company had prepaid expenses totaling $2,674 and $1,250. The prepaid expenses comprise prepaid accounting, rent and telephone expenses. The expenses will get amortized as the services are rendered.

InNOTE ~~January~~4 ~~2010,~~– ~~the~~FIXED FASB (Financial Accounting Standards Board) issued Accounting Standards Update 2010-03 (ASU 2010-03), Extractive Activities—Oil and Gas (Topic 932): Oil and Gas Reserve Estimation and Disclosures. This amendment to Topic 932 has improved the reserve estimation and disclosure requirements by (1) updating the reserve estimation requirements for changes in practice and technology that have occurred over the last several decades and (2) expanding the disclosure requirements for equity method investments. This is effective for annual reporting periods ending on or after December 31, 2009. However, an entity that becomes subject to the disclosures because of the change to the definition oil- and gas- producing activities may elect to provide those disclosures in annual periods beginning after December 31, 2009. Early adoption is not permitted. The Company does not expect the provisions of ASU 2010-03 to have a material effect on the financial position, results of operations or cash flows of the Company.ASSETS

InFixed ~~January~~assets ~~2010,~~consist ~~the FASB issued Accounting Standards Update 2010-02, Consolidation (Topic 810): Accounting and Reporting for Decreases in Ownership~~ of ~~a Subsidiary. This amendment to Topic 810 clarifies, but does not change,~~ the ~~scope~~following of current US GAAP. It clarifies the decrease in ownership provisions of Subtopic 810-10 and removes the potential conflict between guidance in that Subtopic and asset derecognition and gain or loss recognition guidance that may exist in other US GAAP. An entity will be required to follow the amended guidance beginning in the period that it first adopts FAS 160 (now included in Subtopic 810-10). For those entities that have already adopted FAS 160, the amendments are effective at the beginning of the first interim or annual reporting period ending on or after December 15, 2009. The amendments should be applied retrospectively to the first period that an entity adopted FAS 160. The Company does not expect the provisions of ASU 2010-02 to have a material effect on the financial position, results of operations or cash flows of the Company.:

In January 2010, the FASB issued Accounting Standards Update 2010-01, Equity (Topic 505): Accounting for Distributions to Shareholders with Components of Stock and Cash (A Consensus of the FASB Emerging Issues Task Force). This amendment to Topic 505 clarifies the stock portion of a distribution to shareholders that allows them to elect to receive cash or stock with a potential limitation on the total amount of cash that all shareholders can elect to receive in the aggregate is considered a share issuance that is reflected in EPS prospectively and is not a stock dividend for purposes of applying Topics 505 and 260. Effective for interim and annual periods ending on or after December 15, 2009, and would be applied on a retrospective basis. The Company does not expect the provisions of ASU 2010-01 to have a material effect on the financial position, results of operations or cash flows of the Company.

	December 31, 2010		December 31, 2009
Vehicles	$	-	$	-
Accumulated depreciation		-		-
	$	-	$	-

InOn ~~December~~June ~~2009~~30, ~~the FASB issued Accounting Standards Update 2009-17~~2010, ~~Consolidations~~the ~~(Topic~~Company ~~810):~~sold ~~Improvements~~its vehicle to ~~Financial~~a ~~Reporting~~director byof ~~Enterprises~~the ~~Involved~~Company ~~with~~for ~~Variable Interest Entities~~$25,000. ~~This~~The ~~Accounting~~Company ~~Standards~~recorded ~~Update~~a ~~amends~~gain ~~the~~of ~~FASB~~$1,210 ~~Accounting~~on ~~Standards~~the ~~Codification for Statement 167~~sale. ~~(See FAS 167 effective date below)~~

InDepreciation ~~December~~for ~~2009,~~ the ~~FASB~~years ~~issued~~ended ~~Accounting~~December ~~Standards Update 2009-16~~31, ~~Transfers~~2010 and ~~Servicing~~2009 ~~(Topic~~was ~~860):~~$1,474 ~~Accounting~~and ~~for~~$0, ~~Transfers of Financial Assets~~respectively. ~~This Accounting Standards Update amends the FASB Accounting Standards Codification for Statement 166. (See FAS 166 effective date below)~~

NOTE 5 – NOTES RECEIVABLE – RELATED PARTY

Notes receivable consists of the following at December 31, 2010 and 2009:

	December 31, 2010		December 31, 2009
Note receivable to an entity owned and controlled by officers and directors of the Company, unsecured, 0% interest, due upon demand but cannot be demanded before November 2010	$	10,000	$	10,000

Note receivable to an entity owned and controlled by officers and directors of the Company, unsecured, 0% interest, due upon demand but cannot be demanded before December 2020		1,000		-

	$	11,000	$	10,000

Interest income for the years ended December 31, 2010 and December 31, 2009 was $0 and $0, respectively.

F-11

E & M GROUP, INC. ~~(FORMERLY MADISON MANAGEMENT, INC.)~~

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

NOTE 16 – ~~SUMMARY~~NOTES OFPAYABLE ~~SIGNIFICANT~~– ~~ACCOUNTING~~RELATED ~~POLICIES (CONTINUED)~~PARTY

~~Recent~~Notes ~~pronouncements~~payable ~~(continued)~~consists of the following at December 31, 2010 and 2009:

In October 2009, the FASB issued Accounting Standards Update 2009-15, Accounting for Own-Share Lending Arrangements in Contemplation of Convertible Debt Issuance or Other Financing. This Accounting Standards Update amends the FASB Accounting Standard Codification for EITF 09-1. (See EITF 09-1 effective date below)

	December 31, 2010		December 31, 2009
Notes payable to an entity owned and controlled by officers and directors of the Company, unsecured, 0% interest, due upon demand but cannot be demanded before December 2020	$	145,000	$	49,000

	$	145,000	$	49,000

InInterest ~~October~~expense ~~2009,~~for the ~~FASB~~years ~~issued~~ended ~~Accounting~~December ~~Standards Update 2009-14~~31, ~~Software~~2010 ~~(Topic 985): Certain Revenue Arrangements That Include Software Elements. This update changed the accounting model for revenue arrangements that include both tangible products~~ and ~~software~~December ~~elements. Effective prospectively for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15~~31, ~~2010. Early adoption is permitted. The Company does not expect the provisions of ASU~~ 2009~~-14~~ towas ~~have~~$0 aand ~~material effect on the financial position~~$0, ~~results of operations or cash flows of the Company~~respectively.

InNOTE ~~October~~7 ~~2009,~~– ~~the~~INCOME FASB issued Accounting Standards Update 2009-13, Revenue Recognition (Topic 605): Multiple-Deliverable Revenue Arrangements. This update addressed the accounting for multiple-deliverable arrangements to enable vendors to account for products or services (deliverables) separately rather than a combined unit and will be separated in more circumstances under existing US GAAP. This amendment has eliminated that residual method of allocation. Effective prospectively for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010. Early adoption is permitted. The Company does not expect the provisions of ASU 2009-13 to have a material effect on the financial position, results of operations or cash flows of the Company.TAXES

InAt ~~September~~December ~~2009~~31, ~~the~~2010 ~~FASB~~and ~~issued Accounting Standards Update~~ 2009~~-12~~, ~~Fair~~the ~~Value~~Company ~~Measurements~~had ~~and~~federal ~~Disclosures~~operating ~~(Topic~~loss ~~820):~~carryforwards ~~Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent). This update provides amendments to Topic 820 for the fair value measurement~~ of ~~investments~~$188,958 ~~in certain entities that calculate net asset value per share (or its equivalent). It is effective for interim~~ and ~~annual~~$115,695, ~~periods ending after December 15~~respectively, ~~2009. Early~~which ~~application~~begins isto ~~permitted~~expire in ~~financial statements for earlier interim and annual periods that have not been issued~~2021. ~~The Company does not expect the provisions of ASU 2009-12 to have a material effect on the financial position, results of operations or cash flows of the Company.~~

InThe ~~July~~provision ~~2009, the FASB ratified the consensus reached by EITF (Emerging Issues Task Force) issued EITF No. 09-1, (ASC Topic 470) “Accounting~~ for ~~Own-Share~~income ~~Lending~~taxes ~~Arrangements~~consisted ~~in Contemplation~~ of ~~Convertible Debt Issuance” (“EITF 09-1”). The provisions of EITF 09-1, clarifies~~ the ~~accounting~~following ~~treatment~~components ~~and disclosure~~for ~~of share-lending arrangements that are classified as equity in~~ the financial statements of the share lender. An example of a share-lending arrangement is an agreement between the Company (share lender) and an investment bank (share borrower) which allows the investment bank to use the loaned shares to enter into equity derivative contracts with investors. EITF 09-1 is effective for fiscal years ~~that~~ended ~~beginning on or after~~ December 1531, ~~2009~~2010 and ~~requires retrospective application for all arrangements outstanding as of the beginning of fiscal years beginning on or after December 15,~~ 2009. Share-lending arrangements that have been terminated as a result of counterparty default prior to December 15, 2009, but for which the entity has not reached a final settlement as of December 15, 2009 are within the scope. Effective for share-lending arrangements entered into on or after the beginning of the first reporting period that begins on or after June 15, 2009. The Company does not expect the provisions of EITF 09-1 to have a material effect on the financial position, results of operations or cash flows of the Company.:

	2010		2009
Current:
Federal	$	-	$	-
State		-		-
Deferred		-		-
	$	-	$	-

Components of net deferred tax assets, including a valuation allowance, are as follows at December 31, 2010 and 2009:

	2010			2009
Deferred tax assets:
Net operating loss carryforward	$	66,135		$	40,493
Total deferred tax assets		66,135			40,493
Less: Valuation allowance		(66,135	)		(40,493	)
Net deferred tax assets	$	-		$	-

The valuation allowance for deferred tax assets as of December 31, 2010 and 2009 was $66,135 and $40,493, respectively, which will begin to expire 2021. In assessing the recovery of the deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income in the periods in which those temporary differences become deductible. Management considers the scheduled reversals of future deferred tax assets, projected future taxable income, and tax planning strategies in making this assessment. As a result, management determined it was more likely than not the deferred tax assets would not be realized as of December 31, 2010 and 2009 and maintained a full valuation allowance.

F-12

E & M GROUP, INC. ~~(FORMERLY MADISON MANAGEMENT, INC.)~~

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

~~NOTE~~Reconciliation 1between –the ~~SUMMARY~~statutory OFrate ~~SIGNIFICANT~~and ~~ACCOUNTING~~the ~~POLICIES~~effective ~~(CONTINUED)~~tax rate is as follows at December 31, 2010 and 2009:

Recent pronouncements (continued)

	2010			2009
Federal statutory rate		(35.0	)%		(35.0	)%
State taxes, net of federal benefit		(0.00	)%		(0.00	)%
Change in valuation allowance		35.0	%		35.0	%
Effective tax rate		0.0	%		0.0	%

InNOTE ~~June~~8 ~~2009,~~– ~~the~~STOCKHOLDERS’ FASB issued SFAS No. 167 (ASC Topic 810), “Amendments to FASB Interpretation No. 46(R) (“SFAS 167”). SFAS 167 amends the consolidation guidance applicable to variable interest entities. The provisions of SFAS 167 significantly affect the overall consolidation analysis under FASB Interpretation No. 46(R). SFAS 167 is effective as of the beginning of the first fiscal year that begins after November 15, 2009. SFAS 167 will be effective for the Company beginning in 2010. The Company does not expect the provisions of SFAS 167 to have a material effect on the financial position, results of operations or cash flows of the Company.EQUITY

In June 2009, the FASB issued SFAS No. 166, (ASC Topic 860) “Accounting for Transfers of Financial Assets—an amendment of FASB Statement No. 140” (“SFAS 166”). The provisions of SFAS 166, in part, amend the derecognition guidance in FASB Statement No. 140, eliminate the exemption from consolidation for qualifying special-purpose entities and require additional disclosures. SFAS 166 is effective for financial asset transfers occurring after the beginning of an entity’s first fiscal year that begins after November 15, 2009. The Company does not expect the provisions of SFAS 166 to have a material effect on the financial position, results of operations or cash flows of the Company.

NOTE 2 – GOING CONCERN

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the recoverability of assets and the satisfaction of liabilities in the normal course of business. As noted above, the Company is in the development stage and, accordingly, has generated minimal revenues from operations. Since its inception, the Company has been engaged substantially in financing activities and developing its business plan and incurring start up costs and expenses. As a result, the Company incurred accumulated net losses from Inception (March 2, 2001) through the period ended December 31, 2009 of ($115,377). In addition, the Company’s development activities since inception have been financially sustained through equity and debt financing.

The ability of the Company to continue as a going concern is dependent upon its ability to raise additional capital from the sale of common stock, debt financing and, ultimately, the achievement of significant operating revenues. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty.

NOTE 3 – NOTES RECEIVABLE – RELATED PARTY

Notes receivable consists of the following at December 31, 2009 and 2008:

	December 31, 2009	December 31, 2008
Note receivable to an entity owned and controlled by officers and directors of the Company, unsecured, 0% interest, due upon demand but cannot be demanded before November 2010	$ 10,000	$ -
	$ 10,000	$ -

Interest income for the years ended December 31, 2009 and December 31, 2008 was $0 and $0, respectively.

F-13

E & M GROUP, INC. (FORMERLY MADISON MANAGEMENT, INC.)

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

NOTE 4 – NOTES PAYABLE – RELATED PARTY

Notes payable consists of the following at December 31, 2009 and 2008:

	December 31, 2009	December 31, 2008
Note payable to an entity owned by a former officer and director, unsecured, 0% interest, due upon demand	$ -	$ 15,000
Note payable to an entity owned and controlled by officers and directors of the Company, unsecured, 0% interest, due upon demand but cannot be demanded before December 2020	49,000	-
	$ 49,000	$ 15,000

Interest expense for the years ended December 31, 2009 and December 31, 2008 was $0 and $0, respectively.

NOTE 5 – INCOME TAXES

At December 31, 2009 and 2008, the Company had federal operating loss carryforwards of $115,377 and $46,870, respectively, which begins to expire in 2021.

The provision for income taxes consisted of the following components for the years ended December 31, 2009 and 2008:

	2009	2008
Current:
Federal	$ -	$ -
State	-	-
Deferred	-	-
	$ -	$ -

Components of net deferred tax assets, including a valuation allowance, are as follows at December 31, 2009 and 2008:

	2009	2008
Deferred tax assets:
Net operating loss carryforward	$ 40,382	$ 16,405
Total deferred tax assets	40,382	16,405
Less: Valuation allowance	(40,382)	(16,405)
Net deferred tax assets	$ -	$ -

The valuation allowance for deferred tax assets as of December 31, 2009 and 2008 was $40,382 and $16,405, respectively, which will begin to expire 2021. In assessing the recovery of the deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income in the periods in which those temporary differences become deductible. Management considers the scheduled reversals of future deferred tax assets, projected future taxable income, and tax planning strategies in making this assessment. As a result, management determined it was more likely than not the deferred tax assets would not be realized as of December 31, 2009 and 2008 and maintained a full valuation allowance.

F-14

E & M GROUP, INC. (FORMERLY MADISON MANAGEMENT, INC.)

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

NOTE 5 – INCOME TAXES (CONTINUED)

Reconciliation between the statutory rate and the effective tax rate is as follows at December 31, 2009 and 2008:

	2009	2008
Federal statutory rate	(35.0)%	(35.0)%
State taxes, net of federal benefit	(0.00)%	(0.00)%
Change in valuation allowance	35.0%	35.0%
Effective tax rate	0.0%	0.0%

NOTE 6 – STOCKHOLDERS’ EQUITY

Common Stock

The Company iswas authorized to issue 25,000,000 shares of its $0.001 par value common stock. Holders of shares of common stock are entitled to one vote for each share on all matters to be voted on by the stockholders. Holders of common stock do not have cumulative voting rights and are entitled to share ratably in dividends, if any. In the event of a liquidation, dissolution or winding up of our Company, the holders of common stock are entitled to share pro rata all assets remaining after payment in full of all liabilities. All of the outstanding shares of common stock are fully paid and non-assessable. Holders of common stock have no preemptive rights to purchase our common stock. There are no conversion or redemption rights or sinking fund provisions with respect to the common stock.

On December 11, 2009, the Company amended its articles of incorporation and increased its authorized capital to 100,000,000 shares of itits $0.001 par value common stock.

On March 2, 2010, the Company effected a 10-for-1 forward stock split of its $0.001 par value common stock.

All share and per share amounts have been retroactively restated to reflect the ~~splits~~split discussed below.

On March 5, 2001, the Company issued 12,500,000 shares of its par value common stock to its founders, officers and directors for services rendered to the Company valued at $12,500.

On April 5, 2001, the Company issued 10,000,000 shares of its par value common stock to various consultants for services rendered to the company valued at $10,000.

During August – December 2001, the Company received subscriptions for 900,000 shares of stock for cash of $7,500 and subscriptions receivable of $1,500.

In January 2002, the Company received cash of $500 and reduced the balance of subscriptions receivable.

~~In February 2002, the Company received cash of $1,000 and reduced the remaining balance of subscriptions receivable.~~F-13

~~In August 2009,~~ E ~~Venture~~& ~~Resources,~~M ~~Inc. forgave $70~~GROUP,~~993~~ ~~of debt which was recorded as donated capital~~INC. ~~EVR, Inc. is an entity that is owned and controlled by a former officer of the Company.~~

As of December 31, 2009, there have been no other issuances of common stock.

F-15

E & M GROUP, INC. (FORMERLY MADISON MANAGEMENT, INC.)

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

~~NOTE~~In 7February –2002, ~~WARRANTS~~the ~~AND~~Company ~~OPTIONS~~received cash of $1,000 and reduced the remaining balance of subscriptions receivable.

As of December 31, 2010 and 2009, there ~~were~~have been no ~~warrants~~other orissuances ~~options outstanding to acquire any additional shares~~ of common stock.

NOTE 89 – ~~RELATED~~WARRANTS ~~PARTY~~AND ~~TRANSACTIONS~~OPTIONS

~~The~~As ~~Company had a month-to-month lease at $250 per month to lease office space from a former officer, director and shareholder~~ of ~~the Company. During the years ended~~ December 31, ~~2009~~2010 and ~~2008, the Company had rent expense of $1,750 and $0, respectively. In September~~ 2009, ~~the~~there ~~Company~~were ~~ceased~~no ~~leasing~~warrants ~~office~~or ~~space.~~options ~~Office services~~outstanding ~~are~~to ~~provided~~acquire ~~without~~any ~~charge~~additional byshares ~~an officer and director~~ of ~~the~~common ~~Company~~stock. ~~Such costs are immaterial to the financial statements and, accordingly, have not been reflected therein.~~

NOTE 910 – ~~SUBSEQUENT~~RELATED ~~EVENTS~~PARTY TRANSACTIONS

The Company ~~has~~had ~~evaluated~~a ~~subsequent~~month-to-month ~~events~~lease ~~through~~at ~~March~~$250 30per month to lease office space from a former officer, director and shareholder of the Company. During the years ended December 31, 2010 and 2009, the ~~date~~Company ~~which~~had rent expense of $0 and $1,750, respectively. In September 2009, the Company ceased leasing office space. Office services are provided without charge by an officer and director of the Company. Such costs are immaterial to the financial statements ~~were~~and, ~~available~~accordingly, tohave benot ~~issued~~been reflected therein.

On January 12, 2010, the Company executed a sublease agreement with ENSAP International, Inc. (“ENSAP”). The term is for three years commencing January 12, 2010 and ending on January 12, 2013 with a monthly rent of $2,500. ENSAP is a related party and is an entity that is owned and controlled by the officers and directors of the Company and their immediate family members.

~~F-16~~The following is a schedule by year of future minimum lease payment required under the sublease agreement:

Year Ending December 31,		Amount
2011		$ 30,000
2012		$ 30,000
2013		$ 2,500

During the years ended December 31, 2010 and 2009, the rent expense was $31,603 and $0, respectively.

As of December 31, 2010 and 2009, the Company had accounts payable of $944,000 and $0, respectively due a related party. The Company received funds from the buyers in December 2010 for the sale of iron ore which resulted in the large cash position. Consequently, the Company recorded a balance in accounts payable related party of $944,000 which related to the value of the goods sold. The amount is due to a related party and the accounts payable was paid in 2011. The related party is an entity that a director of the Company has a significant ownership percentage in. The Company is a sales agent for the related party and was able to locate buyers for the related party.

F-14

E & M GROUP, INC.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

NOTE 11 – SUBSEQUENT EVENTS

The Company has evaluated subsequent events through February 23, 2012, the date which the financial statements were available to be issued.

During the three months ended March 31, 2011, a significant portion of the cash balance was utilized to pay down the accounts payable and accounts payable – related party.

During the year ended December 31, 2011, the Company received notes payable from a related party totaling approximately $150,000. The loan is unsecured, due upon demand and bears 0% interest.

On January 2012, an officer of the Company agreed to deduct and offset the amount due to the Company of $10,000 by the note payable due to him.

F-15

Filing Compare · E & M Group, Inc.