UNITED STATESSECURITIES ~~STATES SECURITIES~~ AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 10−-Q (Mark One)

~~(Mark~~[ ~~One~~X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

~~[X]~~For ~~QUARTERLY~~the ~~REPORT~~quarterly ~~PURSUANT~~period TOended: ~~SECTION~~June 1330, OR2012 ~~15(d) OF THE SECURITIES EXCHANGE ACT OF 1934~~

For the quarterly period ended: March 31, 2012

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

For the transition period from ____________to _____________

Commission File Number: 001-34134

CHINA TRANSINFO TECHNOLOGY CORP.
(Exact Name of Registrant as Specified in Its Charter)

Nevada	87-0616524
(State or other jurisdiction of	(I.R.S. Empl. Ident. No.)
incorporation or organization)

9th Floor, Vision Building, No. 39 Xueyuanlu, Haidian District, Beijing, China 100191 (Address of principal executive offices, Zip Code) ~~(86) 10-51691999 (Registrant’s telephone number, including area code)~~

(86) 10-51691999
(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 Web site, 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 [ X ] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

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 Exchange Act).

Yes [ ] No [ X ]

The number of shares outstanding of each of the issuer’s ~~classes~~ classes of common equity, as of ~~May~~August 1110, 2012 is as follows:

Class of Securities	Shares Outstanding
Common Stock, $0.001 par value	25,270,069

TABLE OF CONTENTS

	PART I – Financial Information	Page
Item 1.	Financial Statements	2
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	1516
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	2122
Item 4.	Controls and Procedures	2122
	PART II – Other Information
Item 1.	Legal Proceedings	2224
Item 1A.	Risk Factors	2224
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	2224
Item 3.	Defaults Upon Senior Securities	2224
Item 4.	Mine Safety Disclosures	2324
Item 5.	Other Information	2324
Item 6.	Exhibits	2325

PART I FINANCIAL INFORMATION

PART I FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS. CHINA TRANSINFO TECHNOLOGY CORP. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
		June 30,		December 31,
		2012		2011

ASSETS
Current Assets:
Cash and cash equivalents	$	26,933,703	$	45,032,637
Restricted cash		4,935,448		3,560,246
Accounts receivable, net of allowance for doubtful accounts of $171,938 and $169,060, respectively		45,673,081		36,902,155
Inventories		4,934,799		5,993,121
Costs and estimated earnings in excess of billings on uncompleted contracts		58,945,007		42,917,900
Prepaid expenses and other current assets		12,871,862		8,828,290
Other receivables		22,574,993		15,636,967
Deferred tax assets		26,652		26,467
Total current assets		176,895,545		158,897,783

Long-term investments		11,076,931		10,638,712
Property and equipment, net		10,990,199		10,848,345
Long-term prepayment for land use right		3,720,312		3,694,493
Intangible assets, net		17,934,563		16,383,300
Goodwill		10,782,355		10,707,525
Other assets		397,497		337,258
Total assets	$	231,797,402	$	211,507,416

LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable	$	43,692,235	$	29,010,462
Short-term borrowings from banks		7,433,539		7,791,300
Billings in excess of costs and estimated earnings on uncompleted contracts		11,790,011		12,760,278
Accrued liabilities and other current liabilities		10,109,118		12,043,530
Total current liabilities		73,024,903		61,605,570

Other long-term liabilities		27,104		-

Total liabilities		73,052,007		61,605,570

Commitments and contingencies

Stockholders' equity :
Common stock, par value $0.001 per share, 150,000,000 shares authorized, 25,270,069 and 25,270,069 issued and outstanding as of June 30, 2012 and December 31, 2011, respectively		25,270		25,270
Additional paid-in capital		53,463,342		51,484,878
Retained earnings		66,157,126		61,384,633
Accumulated other comprehensive income		10,538,273		9,618,689
Total China TransInfo Technology Corp Stockholders' equity		130,184,011		122,513,470
Non-controlling interests		28,561,384		27,388,376

Total stockholders' equity		158,745,395		149,901,846

Total liabilities and stockholders' equity	$	231,797,402	$	211,507,416

~~ITEM~~See ~~1.FINANCIAL~~accompanying ~~STATEMENTS.~~notes to condensed consolidated financial statements

~~CHINA TRANSINFO TECHNOLOGY CORP. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)~~2

		March 31,			December 31,
CHINA TRANSINFO TECHNOLOGY CORP. CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (Unaudited)
		2012			2011
		Six Months Ended June 30,						Three Months Ended June 30,
ASSETS
		2012			2011			2012			2011
Current Assets:
Net sales	$	60,336,018		$	73,373,897		$	31,407,301		$	36,874,738
Cash and cash equivalents	$	31,832,178		$	45,032,637
Cost of sales		(40,938,036	)		(52,404,305	)		(21,591,924	)		(26,298,267	)
Restricted cash		4,703,288			3,560,246
Gross profit		19,397,982			20,969,592			9,815,377			10,576,471
Accounts receivable, net of allowance for doubtful accounts of $171,829 and $169,060, respectively		43,507,607			36,902,155
Total operating expenses		(14,382,315	)		(13,718,623	)		(7,445,269	)		(7,397,564	)
Inventories		5,493,449			5,993,121
Income from operations		5,015,667			7,250,969			2,370,108			3,178,907
Costs and estimated earnings in excess of billings on uncompleted contracts		55,430,507			42,917,900
Non-operating income (expense):
Prepayments		7,682,784			8,828,290
Interest income		232,450			86,343			197,562			46,617
Other receivables		18,032,086			15,636,967
Interest expense		(221,160	)		(487,329	)		(111,696	)		(236,756	)
Deferred tax assets		26,635			26,467
Subsidy income		1,426,963			260,962			780,962			65,336
Total current assets		166,708,534			158,897,783
Other income, net		378,137			113,881			225,129			38,405
Long-term investments		11,084,600			10,638,712
Total non-operating income		1,816,390			(26,143	)		1,091,957			(86,398	)
Property and equipment, net		11,122,125			10,848,345
Income before income taxes, non-controlling interests, and gain on equity investments in affiliates net income		6,832,057			7,224,826			3,462,065			3,092,509
Long-term prepayment for land use right		3,717,965			3,694,493
Income taxes		(1,140,449	)		(862,935	)		(562,181	)		(361,810	)
Intangible assets, net		17,414,130			16,383,300
Net income before non-controlling interests and gain on equity investments in affiliates net income		5,691,608			6,361,891			2,899,884			2,730,699
Goodwill		10,775,552			10,707,525
Gain on equity investments in affiliates due to proportional shares of the affiliates net income		734,443			1,355,985			355,190			1,023,349
Other assets		408,646			337,258
Net income before non-controlling interests		6,426,051			7,717,876			3,255,074			3,754,048
Total assets	$	221,231,552		$	211,507,416
Non-controlling interests in net income of subsidiary		(1,653,558	)		(1,961,204	)		(901,877	)		(964,652	)
LIABILITIES AND SHAREHOLDERS' EQUITY
Net income	$	4,772,493		$	5,756,672		$	2,353,197		$	2,789,396
Current Liabilities:
Weighted average number of shares of outstanding:
Accounts payable	$	37,021,042		$	29,010,462
Basic		25,270,069			25,270,069			25,270,069			25,270,069
Short-term borrowings from banks		6,001,047			7,791,300
Diluted		25,295,931			25,273,317			25,320,592			25,273,195
Billings in excess of costs and estimated earnings on uncompleted contracts		14,448,150			12,760,278
Earnings per share -
Accrued liabilities and other current liabilities		6,384,121			12,043,530
Basic	$	0.19		$	0.23		$	0.09		$	0.11
Total current liabilities		63,854,360			61,605,570
Diluted	$	0.19		$	0.23		$	0.09		$	0.11
Other long-term liability		27,086			-
Comprehensive income
Total liabilities		63,881,446			61,605,570
Net income including non-controlling interests	$	6,426,051		$	7,717,876		$	3,255,074		$	3,754,048
Commitments and contingencies
Translation adjustments		919,584			2,117,495			84,051			1,483,308
Stockholders' equity :
Comprehensive income	$	7,345,635		$	9,835,371		$	3,339,125		$	5,237,356
Common stock, par value $0.001 per share, 150,000,000 shares authorized, 25,270,069 and 25,270,069 issued and outstanding, respectively		25,270			25,270
Comprehensive income attributable to non-controlling interests	$	1,653,558		$	1,961,204		$	901,877		$	964,652
Additional paid-in capital		53,191,622			51,484,878
Comprehensive income attributable to CTFO	$	5,692,077		$	7,874,167		$	2,437,248		$	4,272,704
Retained earnings		63,803,929			61,384,633
See accompanying notes to condensed consolidated financial statements
Accumulated other comprehensive income		10,454,222			9,618,689
Total China TransInfo Technology Corp Stockholders equity		127,475,043			122,513,470
Non-controlling interests		29,875,063			27,388,376
Total stockholders' equity		157,350,106			149,901,846
Total liabilities and stockholders' equity	$	221,231,552		$	211,507,416

~~See accompanying notes to condensed consolidated financial statements~~3

CHINA TRANSINFO TECHNOLOGY CORP. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
		Six Months Ended June 30,
		2012			2011
Cash flows from operating activities:
Net income	$	4,772,493		$	5,756,672
Adjustments to reconcile net income to net cash used in operating activities:
Non-controlling interests		1,653,558			1,961,204
Depreciation and amortization expenses		1,488,050			1,350,497
Stock-based compensation		545,468			634,040
Gain on equity investments in affiliates due to proportional shares of the affiliates net income		(734,443	)		(1,355,985	)
Gain on disposal of portion equity of subsidiary to non-controlling interests		-			(40,479	)
Dividends income		(18,689	)		(14,782	)
Loss on disposal of property and equipment		13,764			20,283
Allowance for doubtful accounts		1,698			-
Decrease (Increase) in assets:
Restricted cash		(1,351,684	)		1,210,652
Accounts receivable		(8,523,325	)		(8,272,988	)
Inventories		1,101,317			(1,738,309	)
Prepaid expenses and other current assets		(3,986,142	)		731,880
Other receivables		(6,523,218	)		(1,720,024	)
Costs and estimated earnings in excess of billings on uncompleted contracts		(15,743,049	)		(3,942,025	)
Other assets		(57,944	)		(56,498	)
Increase (Decrease) in liabilities:
Accounts payable		14,493,648			(2,270,555	)
Billings in excess of costs and estimated earnings on uncompleted contracts		(1,060,512	)		(4,461,510	)
Accrued liabilities and other current liabilities		(734,239	)		(794,710	)
Other long-term liabilities		27,131			15,311
Net cash used in operating activities	$	(14,636,118	)	$	(12,987,326	)

See accompanying notes to condensed consolidated financial statements

~~CHINA TRANSINFO TECHNOLOGY CORP.CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (Unaudited)~~4

		Three Months Ended March 31,
		2012			2011
Net sales	$	28,928,717		$	36,499,159
Cost of sales		(19,346,112	)		(26,106,038	)
Gross profit		9,582,605			10,393,121
Total operating expenses		(6,937,046	)		(6,321,059	)
Income from operations		2,645,559			4,072,062
Non-operating income (expense):
Interest income		34,888			39,726
Interest expense		(109,464	)		(250,573	)
Subsidy income		646,001			195,626
Other income, net		153,008			75,476
Total non-operating income		724,433			60,255
Income before income taxes, non-controlling interests, and gain on equity investments in affiliates		3,369,992			4,132,317
Income taxes		(578,268	)		(501,125	)
Net income before non-controlling interests and gain on equity investments in affiliates net income		2,791,724			3,631,192
Gain on equity investments in affiliates due to proportional shares of the affiliates net income		379,253			332,636
Net income before non-controlling interests		3,170,977			3,963,828
Non-controlling interests in net income of subsidiary		(751,681	)		(996,552	)
Net income	$	2,419,296		$	2,967,276
Weighted average number of shares of outstanding:
Basic		25,270,069			25,270,069
Diluted		25,280,702			25,273,542
Earnings per share -
Basic	$	0.10		$	0.12
Diluted	$	0.10		$	0.12
Comprehensive income
Net income including non-controlling interests	$	3,170,977		$	3,963,828
Translation adjustments		835,533			634,187
Comprehensive income	$	4,006,510		$	4,598,015
Comprehensive income attributable to non-controlling interests	$	751,681		$	996,552
Comprehensive income attributable to CTFO	$	3,254,829		$	3,601,463

CHINA TRANSINFO TECHNOLOGY CORP.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

See accompanying notes to condensed consolidated financial statements

		Six Months Ended June 30,
		2012			2011
Cash flows from investing activities:
Proceeds from disposal of property and equipment	$	6,070		$	19,114
Purchases of property and equipment		(1,280,019	)		(1,597,311	)
Purchases of intangible assets		(1,740,114	)		(651,593	)
Payments for acquisition of companies		(209,907	)		(202,565	)
Payments for land use right		-			(3,593,798	)
Dividends from equity or cost investees		-			14,782
Net cash used in investing activities		(3,223,970	)		(6,011,371	)

Cash flows from financing activities:
Proceeds from short-term borrowings		6,727,073			6,889,950
Payments of short-term borrowings		(7,139,700	)		(9,263,155	)
Non-controlling interests' capital contribution		79,330			6,698,563
Payment of dividends to non-controlling interests from subsidiaries		(237,990	)		-
Net cash (used in)/provided by financing activities		(571,287	)		4,325,358

Effect of foreign currency exchange translation		332,441			706,563

Net decrease in cash and cash equivalents		(18,098,934	)		(13,966,776	)

Cash and cash equivalents - beginning		45,032,637			43,916,597
Cash and cash equivalents - ending	$	26,933,703		$	29,949,821

Supplemental disclosures:
Interest paid	$	228,095		$	390,693
Income taxes paid	$	1,056,027		$	1,103,885

3See accompanying notes to condensed consolidated financial statements

~~CHINA~~5 ~~TRANSINFO TECHNOLOGY CORP. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)~~

		Three Months Ended March 31,
		2012			2011
Cash flows from operating activities:
Net income	$	2,419,296		$	2,967,276
Adjustments to reconcile net income to net cash used in operating activities:
Non-controlling interests		751,681			996,552
Depreciation and amortization expenses		671,583			652,129
Stock-based compensation		273,749			310,538
Gain on equity investments in affiliates due to proportional shares of the affiliates net income		(379,253	)		(332,636	)
Dividends income		-			(14,693	)
Loss on disposal of property and equipment		13,776			6,655
Allowance for doubtful accounts		1,699			-
(Increase) Decrease in assets:
Restricted cash		(1,123,252	)		(1,192,248	)
Accounts receivable		(6,388,792	)		(4,785,754	)
Inventories		539,106			(262,205	)
Prepaid expenses and other current assets		1,204,353			1,467,418
Other receivables		(2,371,040	)		(1,749,678	)
Cost and estimated earnings in excess of billings on uncompleted contracts		(12,270,848	)		(3,280,538	)
Other assets		(69,418	)		(228	)
(Decrease) Increase in liabilities:
Accounts payable		7,846,033			(5,689,594	)
Billings in excess of costs and estimated earnings on uncompleted contracts		1,610,860			(2,288,006	)
Accrued liabilities and other current liabilities		(2,156,519	)		(3,115,251	)
Other long-term liability		27,155			-
Net cash used in operating activities	$	(9,399,831	)	$	(16,310,263	)

CHINA TRANSINFO TECHNOLOGY CORP.
Notes to Condensed Consolidated Financial Statements
(Unaudited)

~~See~~ 1. ~~accompanying~~ORGANIZATION ~~notes~~AND toBUSINESS ~~condensed consolidated financial~~OPERATIONS ~~statements~~

4 China TransInfo Technology Corp. is a leading provider of end-to-end intelligent transportation systems (“ITS”) and related comprehensive technology solutions servicing the transportation industry in China. The goal of the Company is to become the largest provider of intelligent transportation system products and related comprehensive technology solutions in China, as well as a major operator and provider of value-added ITS and location based services (“LBS”) to commercial clients and consumers in China. Substantially all of its operations is conducted through its Variable Interest Entities (“VIE”) that are PRC domestic companies owned principally or entirely by its PRC affiliates. Through its VIE, the Company is involved in developing multiple applications in highway ITS, urban ITS, commercial vehicles ITS plus LBS, and to a lesser degree, in digital city, and land and resource filling systems based on Geographic Information Systems (“GIS”), technologies which are used to service both the public and private sector.

~~CHINA~~ China ~~TRANSINFO~~TransInfo ~~TECHNOLOGY~~Technology ~~CORP~~Corp., ~~CONDENSED~~its ~~CONSOLIDATED~~subsidiaries ~~STATEMENTS~~and OFVIE ~~CASH~~hereinafter ~~FLOWS~~are ~~(Unaudited)~~collectively referred as the “Company.”

		Three Months Ended March 31,
		2012			2011
Cash flows from investing activities:
Proceeds from disposal of property and equipment	$	750		$	13,500
Purchases of property and equipment		(798,532	)		(984,331	)
Purchases of intangible assets		(1,029,261	)		(211,214	)
Payments for acquisition of companies		(210,092	)		(201,334	)
Dividends from equity or cost investees		-			14,693
Net cash used in investing activities		(2,037,135	)		(1,368,686	)
Cash flows from financing activities:
Proceeds from short-term borrowings		1,331,602			3,043,600
Payments of short-term borrowings		(3,176,000	)		(4,641,490	)
Non-controlling interest's capital contribution		-			190,225
Payment of dividends to non-controlling interests from subsidiaries		(238,200	)		-
Net cash used in financing activities		(2,082,598	)		(1,407,665	)
Effect of foreign currency exchange translation		319,105			219,746
Net decrease in cash and cash equivalents		(13,200,459	)		(18,866,868	)
Cash and cash equivalents - beginning		45,032,637			43,916,597
Cash and cash equivalents - ending	$	31,832,178		$	25,049,729
Supplemental disclosures:
Interest paid	$	109,464		$	251,866
Income taxes paid	$	569,751		$	444,346

The Company’s primary focus is on providing end-to-end ITS solutions and related services to the transportation industry. The major products and services of the Company include:

~~See~~ Intelligent ~~accompanying~~Transportation ~~notes to condensed consolidated financial~~System ~~statements~~

5Transportation Planning Information System
~~CHINA~~Electronic ~~TRANSINFO~~Toll ~~TECHNOLOGY CORP. Notes to Unaudited Condensed Consolidated Financial Statements~~Collection(ETC)
1.Passenger ~~ORGANIZATION~~Flow ~~AND~~Statistic, ~~BUSINESS~~Detecting ~~OPERATIONS~~and Analysis System (TransPLE)
~~China~~Traffic TransInfo Technology Corp. is a leading provider of end-to-end intelligent transportation systems (“ITS”) and related comprehensive technology solutions servicing the transportation industry in China. The goal of the Company is to become the largest provider of intelligent transportation system products and related comprehensive technology solutions in China, as well as a major operator and provider of value-added ITS and location based services (“LBS”) to commercial clients and consumers in China. Substantially all of its operations is conducted through its Variable Interest Entities (“VIE”) that are PRC domestic companies owned principally or entirely by its PRC affiliates. Through its VIE, the Company is involved in developing multiple applications in highway ITS, urban ITS, commercial vehicles ITS plus LBS, and to a lesser degree, in digital city, and land and resource filling systems based on Geographic Information ~~Systems~~Integration ~~(GIS), technologies which are used to service both the public~~ and ~~private~~Exchange ~~sector.~~ Platform
~~China~~Traffic ~~TransInfo~~Emergency ~~Technology~~Command ~~Corp., its subsidiaries and VIE hereinafter are collectively referred as the “Company.”~~Center
~~The~~Transportation ~~Company’s~~Hub ~~primary~~Comprehensive ~~focus~~Management isInformation ~~on providing end-to-end ITS solutions and related services to the transportation industry. The major products and services of the Company include:~~ System
Intelligent ~~Transportation~~Traffic ~~System~~Management Platform
~~Transportation~~Intelligent ~~Planning~~Parking ~~Information~~ System
~~Electronic~~Traffic ~~Toll~~Flow ~~Collection~~Surveying ~~(ETC)~~ Solutions
~~Passenger~~GIS-T ~~Flow Statistic, Detecting and Analysis System~~ (~~TransPLE~~Transportation) Middleware
~~Traffic~~Highway ~~Information~~Electronics ~~Integration~~& ~~and~~Machinery ~~Exchange~~(E&M) ~~Platform~~System Solution
~~Traffic~~UNISITS ~~Emergency~~Highway ~~Command~~Lighting ~~Center~~and Energy Saving Product (UNIS-LCS)
~~Transportation~~UNISITS ~~Hub~~Weigh-in-Motion ~~Comprehensive Management Information~~ System

~~Intelligent~~ Commercial ~~Traffic~~Vehicle ~~Management~~ITS ~~Platform~~plus LBS

~~Intelligent~~Commercial ~~Parking~~Vehicles ~~System~~Monitoring and Public Service Platform
~~Traffic~~Commercial ~~Flow~~Vehicles ~~Surveying~~Comprehensive ~~Solutions~~Information Service Operation Platform
~~GIS-T~~Commercial ~~(Transportation)~~Vehicles ~~Middleware~~Terminal Products
~~Highway~~Taxi ~~Electronics~~LED ~~&Machinery~~Advertisement ~~(E&M)~~Dynamic ~~System~~Display ~~Solution~~ System
~~UNISITS~~Taxi ~~Highway~~LED ~~Lighting~~GPS Monitoring and ~~Energy~~Coordinating ~~Saving Product (UNIS-LCS)~~ System

~~UNISITS Weigh-in-Motion System~~ 6

~~Commercial~~ CHINA ~~Vehicle~~TRANSINFO ~~ITS~~TECHNOLOGY ~~plus~~CORP. ~~LBS~~ Notes to Condensed Consolidated Financial Statements (Unaudited)

~~Commercial~~ Other ~~Vehicles~~Vehicle ~~Monitoring~~ and ~~Public~~Consumer ~~Service~~ITS ~~Platform~~ Applications

~~Commercial~~Palmcity ~~Vehicles~~Telematics ~~Comprehensive Information~~ Service ~~Operation~~ Platform
~~Commercial~~Palmcity ~~Vehicles~~Real-Time ~~Terminal~~Traffic ~~Products~~Information Terminal Software
~~Taxi~~Plamcity ~~LED~~Smart ~~Advertisement~~Phone ~~Dynamic~~Public ~~Display~~Transport ~~System~~Information Service System
6Palmcity Website (http://www.palmcity.cn)
~~Taxi~~Auto ~~LED~~Energy-saving ~~GPS~~Analysis ~~Monitoring~~Service ~~and Coordinating~~ System
~~Other~~D-TIPS ~~Vehicle~~Dynamic Transportation Information Processing and ~~Consumer~~Prediction ~~ITS~~Service ~~Applications~~System

~~Palmcity~~ The ~~Telematics~~Company ~~Service~~also ~~Platform~~offers comprehensive solutions for transportation oriented GIS (“GIS-T”), covering transportation planning, design, construction, maintenance and operation.

~~Palmcity~~ On ~~Real-Time~~June ~~Traffic~~8, ~~Information~~2012, ~~Terminal~~the ~~Software~~Company entered into an Agreement and Plan of Merger (the "Merger Agreement") with TransCloud Company Limited, a Cayman Islands exempted company with limited liability and indirectly wholly owned by Mr. Shudong Xia ("Parent"), TransCloud Acquisition, Inc., a Nevada corporation and a wholly owned, direct subsidiary of Parent ("Merger Sub"). Under the Merger Agreement, Merger Sub will merge with and into the Company, with the Company continuing as the surviving corporation and a wholly owned subsidiary of Parent.

~~Plamcity~~ According ~~Smart~~to ~~Phone~~the ~~Public~~Merger ~~Transport~~Agreement, ~~Information~~at ~~Service~~the ~~System~~effective time of the Merger, each outstanding share of the Company’s common stock will be converted automatically into the right to receive $5.80 in cash, without interest, excluding certain shares as provided in the Merger Agreement. The Merger remains subject to the satisfaction or waiver of the conditions set forth in the Merger Agreement, including obtaining approval of the existing stockholders of the Company.

~~Palmcity~~ The ~~Website~~foregoing ~~(http://www~~description of the Merger Agreement is qualified in its entirety by reference to the full text of the Merger Agreement, copy of which has been filed as an Exhibit to our current report on Form 8-K dated June 8, 2012, and which is incorporated herein by reference.~~palmcity.cn)~~

~~Auto~~ 2. ~~Energy-saving~~BASIS ~~Analysis~~OF ~~Service~~PRESENTATION ~~System~~AND SIGNIFICANT ACCOUNTING POLICIES

D The accompanying interim unaudited condensed consolidated financial statements (“Interim Financial Statements”) of the Company, its subsidiaries and VIEs have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and are presented in accordance with the requirements of Form 10-~~TIPS~~Q ~~Dynamic~~and ~~Transportation~~Rule ~~Information~~10-01 ~~Processing~~of Regulation S-X. Accordingly, these Interim Financial Statements do not include all of the information and ~~Prediction~~notes ~~Service~~required by GAAP for complete financial statements. These Interim Financial Statements should be read in conjunction with the consolidated financial statements and notes thereto for the fiscal year ended December 31, 2011 ~~System~~included in the Company’s Form 10-K.

~~The Company also offers comprehensive solutions for~~ ~~transportation~~Principles ~~oriented~~of ~~GIS (“GIS-T”), covering transportation planning, design,~~Consolidation ~~construction, maintenance and operation.~~

2 The Company’s unaudited condensed consolidated financial statements include the accounts of the holding company, its subsidiaries, VIEs and VIEs’ majority owned subsidiaries, which are approximately 3% to 70% owned by non-controlling interests. ~~BASIS~~In OFthe ~~PRESENTATION~~opinion ~~AND~~of ~~SIGNIFICANT~~management, ~~ACCOUNTING~~the ~~POLICIES~~Interim Financial Statements included herein contain all adjustments, including normal recurring adjustments considered necessary to present fairly the Company’s financial position, the results of operations and cash flows for the periods presented. The operating results and cash flows for the interim periods presented herein are not necessarily indicative of the results to be expected for any other interim period or the full year.

The ~~accompanying~~Company’s ~~interim~~ unaudited condensed consolidated financial statements ~~(“Interim~~are ~~Financial Statements”) of the Company, its subsidiaries and VIEs have been~~ prepared in accordance with ~~accounting principles~~GAAP. ~~generally~~These ~~accepted~~accounting inprinciples require the ~~United~~Company ~~States~~to ofmake ~~America~~certain ~~(“GAAP”)~~estimates, ~~for interim~~judgments ~~financial information~~ and ~~are~~assumptions ~~presented~~that inaffect ~~accordance~~the ~~with~~reported ~~the requirements~~amounts of assets ~~Form~~and ~~10-Q~~liabilities and ~~Rule~~disclosure ~~10-01~~ of ~~Regulation~~contingent ~~S-X.~~assets ~~Accordingly,~~and ~~these Interim~~liabilities ~~Financial~~at ~~Statements~~the dodate ~~not include all~~ of the ~~information~~financial statements and ~~notes required~~the byreported ~~GAAP~~amounts ~~for~~of ~~complete~~revenues ~~financial~~and ~~statements.~~expenses ~~These~~during ~~Interim~~the ~~Financial Statements~~reporting ~~should~~period. beThe ~~read~~Company inbelieve ~~conjunction~~that ~~with~~ the ~~consolidated~~estimates, ~~financial statements~~judgments and assumptions ~~notes~~are ~~thereto~~reasonable, ~~for~~based on information available at the ~~fiscal~~time ~~year~~they ~~ended~~are ~~December~~made. ~~31,~~Actual ~~2011 included~~results incould ~~the~~differ ~~Company’s~~materially ~~Form~~from ~~10-K~~those estimates.

~~Principles of Consolidation~~ 7

~~The Company’s unaudited condensed consolidated financial~~ ~~statements~~CHINA ~~include~~TRANSINFO ~~the~~TECHNOLOGY ~~accounts~~CORP. ~~of the holding company, its subsidiaries, VIEs~~ ~~and~~Notes ~~VIEs’ majority owned subsidiaries, which are approximately 3%~~ to ~~70%~~Condensed ~~owned by~~Consolidated ~~non-controlling interests. In the opinion of management, the Interim~~ Financial Statements ~~included herein contain all adjustments, including normal~~ ~~recurring~~(Unaudited) ~~adjustments considered necessary to present fairly the Company’s~~ financial position, the results of operations and cash flows for the periods presented. The operating results and cash flows for the interim periods presented herein are not necessarily indicative of the results to be expected for any other interim period or the full year.

~~The Company’s unaudited condensed consolidated financial~~ ~~statements~~Recently ~~are~~Issued ~~prepared~~Accounting ~~in accordance with GAAP. These accounting principles~~Guidance require the Company to make certain estimates, judgments 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 revenues and expenses during the reporting period. The Company believe that the estimates, judgments and assumptions are reasonable, based on information available at the time they are made. Actual results could differ materially from those estimates.

~~Recently~~ In ~~Issued~~December 2011, the Financial Accounting ~~Guidance~~Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2011-11, Disclosures about Offsetting Assets and Liabilities (ASU 2011-11). The amendments in this ASU require an entity to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position. An entity is required to apply the amendments for annual reporting periods beginning on or after January 1, 2013, and interim periods within those annual periods. An entity should provide the disclosures required by those amendments retrospectively for all comparative periods presented. The adoption of ASU 2011-11 is not expected to have a significant impact on the Company’s consolidated financial statements.

~~In December 2011, the Financial Accounting Standards Board~~ ~~(“FASB”)~~The ~~issued~~Company ~~Accounting~~has ~~Standards~~considered ~~Update~~all ~~(“ASU”)~~new ~~No.~~accounting ~~2011-11,~~pronouncements ~~Disclosures about Offsetting Assets~~ and ~~Liabilities~~has ~~(ASU~~concluded ~~2011-11).~~that ~~The~~there ~~amendments~~are inno ~~this ASU~~new ~~require~~pronouncements anthat ~~entity~~may tohave ~~disclose~~a ~~information~~material ~~about~~impact ~~offsetting~~on ~~and~~results ~~related arrangements to enable users~~ of ~~its~~operations, financial ~~statements~~condition, ~~to understand the effect of those arrangements on its financial position. An entity is required to apply the amendments for annual reporting periods beginning on~~ or ~~after~~cash ~~January 1~~flows, ~~2013,~~based and interim periods within those annual periods. An entity should provide the disclosures required by those amendments retrospectively for all comparative periods presented. The adoption of ASU 2011-11 did not have a significant impact on ~~the~~current ~~Company’s consolidated financial statements~~information.

7 3. RESTRICTED CASH

The Company’s ~~has~~restricted ~~considered~~cash ~~all~~balance ~~new~~on ~~accounting~~June ~~pronouncements~~ 30, 2012 and ~~has~~December ~~concluded~~31, ~~that~~2011 ~~there~~was ~~are~~$4,935,448 noand ~~new~~$3,560,246, ~~pronouncements~~respectively. ~~that~~Restricted ~~may~~cash ~~have~~normally aconsists ~~material impact~~of oncash ~~results~~deposited into third party banks with certain period of ~~operations,~~time restrictions ~~financial~~for ~~condition~~various business purposes, orwhich ~~cash~~may ~~flows,~~include ~~based~~contract ~~on current~~performance ~~information~~bonds and registered capital bonds required by governmental authorities. The restrictions expire when the related obligations are fulfilled.

~~3. RESTRICTED CASH~~ 8

~~The~~CHINA ~~Company’s~~TRANSINFO ~~restricted~~TECHNOLOGY ~~cash balance on March 31, 2012 and December 31, 2011 was $4,703,288 and $3,560,246, respectively~~CORP. ~~Restricted cash~~ ~~normally~~Notes ~~consists~~to ~~of cash deposited into third party banks with certain period~~Condensed ofConsolidated ~~time~~Financial ~~restrictions for various business purposes, which may include contract~~Statements ~~performance~~ (Unaudited) ~~bonds and registered capital bonds required by governmental authorities. The restrictions expire when the related obligations are fulfilled.~~

4. COSTS AND ESTIMATED EARNINGS ON UNCOMPLETED CONTRACTS

The costs and estimated earnings on uncompleted contracts were as follows:

		March 31,			December 31,
		June 30,			December 31,
		2012			2011
		(Unaudited)
Costs incurred on uncompleted contracts	$	225,554,886		$	202,676,181
Costs incurred on uncompleted contracts	$	208,281,754		$	202,676,181
Estimated earnings on uncompleted contracts		82,680,551			78,913,748
Estimated earnings on uncompleted contracts		75,105,657			78,913,748
Total		308,235,437			281,589,929
Total		283,387,411			281,589,929
Less – billings to date		(261,080,441	)		(251,432,307	)
Less – billings to date		(242,405,054	)		(251,432,307	)
Costs and estimated earnings on uncompleted contracts, net of billings in excess
Costs and estimated earnings on uncompleted contracts, net of billings in excess of costs and estimated earnings on uncompleted contracts	$	40,982,357		$	30,157,622
of costs and estimated earnings on uncompleted contracts	$	47,154,996		$	30,157,622

The costs and estimated earnings on uncompleted contracts are included in the accompanying balance sheets under the following captions:

		March 31,			December 31,
		June 30,			December 31,
		2012			2011
		(Unaudited)
Costs incurred on estimated earnings in excess of billings on uncompleted contracts	$	58,945,007		$	42,917,900
Costs incurred on estimated earnings in excess of billings on uncompleted contracts	$	55,430,507		$	42,917,900
Billings in excess of costs and estimated earnings on uncompleted contracts		(11,790,011	)		(12,760,278	)
Billings in excess of costs and estimated earnings on uncompleted contracts		(14,448,150	)		(12,760,278	)
Total	$	47,154,996		$	30,157,622
Total	$	40,982,357		$	30,157,622

5. NON-CONTROLLING INTERESTS

On July 12, 2011, a non-controlling interest, Zhongguancun Development Group (“Zhongguancun”), agreed to contribute RMB 50 million (approximately $7.69 million) in cash to ~~the VIE,~~ Beijing Transwiseway ~~Information~~ Information Technology Company (“Beijing Transwiseway”), a VIE, in exchange for a 10% ~~equity~~ equity interest in Beijing Transwiseway. The first installment of RMB 10 million (approximately $1.54 million) was paid by Zhongguancun on August 1, 2011. As a result, China TransInfo Technology Group Co., Ltd. (the “Group Company”) retained a 53.80% equity interest in Beijing Transwiseway. The second installment of RMB 20 million (approximately $3.17 million) was completed on January 12, 2012 and the Group Company retains a 51.56% majority ownership of Beijing Transwiseway.

With the effect of the subsidiary equity transaction, the ~~Company~~ Company recognized $1,735,006 increase in non-controlling interest in Beijing Transwiseway and the remaining $1,432,995 increase in additional paid-in capital for the ~~three~~six months ended ~~March~~June 3130, 2012.

8On April 27, 2012, Beijing UNISITS Technology Co. Ltd. (“UNISITS”) approved a RMB 42,678,402 (approximately $6,800,000) dividend distribution to the shareholders. As a result, the Company recognized $2,294,431 decrease in non-controlling interest in UNISITS.

6On June 5, 2012, Beijing Transwiseway formed a majority owned subsidiary, Hubei Transwiseway Information Technology Company (“Hubei Transwiseway”), and the non-controlling shareholder contributed RMB 500,000 (approximately $79,500). ~~LONG~~As a result, the Company recognized $79,500 increase in non-~~TERM~~controlling ~~INVESTMENTS~~interest in Beijing Transwiseway.

~~The Company had the following long-term investments accounted under the equity method and cost method:~~9

~~Equity~~CHINA ~~and~~TRANSINFO ~~cost~~TECHNOLOGY ~~investments~~CORP. inNotes ~~affiliates~~to ~~consisted~~Condensed Consolidated ofFinancial ~~the following:~~Statements (Unaudited)

Type	Equity Investee	Equity		March 31,		December 31,
		Investment		2012		2011
		Ownership		(Unaudited)
Equity	GanSu Ziguang Intelligent Transportation and Control	33.33%	$	10,476,558	$	9,989,657
Equity	ShanXi Ziguang Trans Technology Co., Ltd.	49.00%		83,509		122,214
Equity	Beijing Chinacommunications Unisplendour Technology Co. , Ltd.	30.00%		155,968		160,603
Sub-total				10,716,035		10,272,474
Cost	Wuhan Optic Times Technology Co., Ltd.	1.04%		226,005		224,578
Cost	ShanDong Hi-speed Information Engineering Co., Ltd.	5.00%		118,800		118,050
Cost	BeiJingZiguangYouma Technology Co., Ltd.	15.00%		23,760		23,610
Sub-total				368,565		366,238
Total			$	11,084,600	$	10,638,712

6. LONG-TERM INVESTMENTS

~~Summarized~~The ~~income~~Company ~~statement~~had ~~information~~the offollowing ~~significant~~long-term ~~equity~~investments accounted ~~investment~~under inthe ~~affiliates~~equity ismethod asand ~~follows~~cost method:

GanSu Ziguang Intelligent Transportation and Control
For the three months ended March 31, 2012
Net sales	$	9,433,672
Gross Profit		2,055,466
Income from operations		1,636,226
Net income	$	1,114,840

Equity and cost investments in affiliates consisted of the following:

ShanXi Ziguang Trans Technology Co., Ltd.
Type			Equity Investee	Equity Investment Ownership		June 30, 2012		December 31, 2011
For the three months ended March 31, 2012
Equity			GanSu Ziguang Intelligent Transportation and Control	33.33%	$	10,538,172	$	9,989,657
Net sales	$	11,216
Equity			ShanXi Ziguang Trans Technology Co., Ltd.	49.00%		84,163		122,214
Gross Profit		(2,493	)
Equity			Beijing Chinacommunications Unisplendour Technology Co. , Ltd.	30.00%		85,798		160,603
Income from operations		(2,859	)
Sub-total						10,708,133		10,272,474
Net income	$	(1,128	)
Cost			Wuhan Optic Times Technology Co., Ltd.	1.04%		226,148		224,578
Cost			ShanDong Hi-speed Information Engineering Co., Ltd.	5.00%		118,875		118,050
Cost			BeijingZiguang Youma Technology Co., Ltd.	15.00%		23,775		23,610
Sub-total						368,798		366,238
Total					$	11,076,931	$	10,638,712

Beijing Chinacommunications Unisplendour Technology Co. , Ltd.
For the three months ended March 31, 2012
Net sales	$	393,100
Gross Profit		126,325
Income from operations		(131	)
Net income	$	539

Summarized income statement information of equity investment in affiliates is as follows:

7.GanSu ~~INTANGIBLE~~Ziguang ~~ASSETS~~Intelligent Transportation and Control

Intangible assets consisted of the following:

		Three months		Six months
		Ended		Ended
		June 30, 2012		June 30, 2012
Net sales	$	9,077,213	$	18,510,885
Gross Profit		2,277,469		4,332,935
Income from operations		2,073,200		3,709,426
Net income	$	1,434,558	$	2,549,398

ShanXi Ziguang Trans Technology Co., Ltd.
		Three months		Six months
		Ended		Ended
		June 30, 2012		June 30, 2012
Net sales	$	4,615	$	15,831
Gross Profit		4,371		1,878
Income from operations		4,439		1,580
Net income	$	1,231	$	103

		March 31, 2012			December 31, 2011
		(Unaudited)
Intangible assets	$	18,211,879		$	17,084,194
Less: accumulated amortization		(797,749	)		(700,894	)
Intangible assets, net	$	17,414,130		$	16,383,300

Beijing Chinacommunications Unisplendour Technology Co. , Ltd.

		Three months			Six months
		Ended			Ended
		June 30, 2012			June 30, 2012
Net sales	$	33,346		$	426,446
Gross Profit		(220,373	)		(94,048	)
Income from operations		(234,923	)		(235,054	)
Net income	$	(235,002	)	$	(234,463	)

~~Intangible assets as of March 31, 2012 and December 31, 2011 were as follows:~~10

Net intangible assets		March 31, 2012			December 31, 2011
CHINA TRANSINFO TECHNOLOGY CORP. Notes to Condensed Consolidated Financial Statements (Unaudited)
		(Unaudited)
7. INTANGIBLE ASSETS
Internal-use software	$	7,485,904		$	6,603,210
Intangible assets consisted of the following:
Purchased software		2,549,577			2,436,847
		June 30, 2012			December 31, 2011
Software from acquisition		310,081			319,299
Intangible assets	$	18,933,673		$	17,084,194
Software from investment		7,068,568			7,023,944
Less: accumulated amortization		(999,110	)		(700,894	)
Total	$	17,414,130		$	16,383,300
Intangible assets, net	$	17,934,563		$	16,383,300
Intangible assets as of June 30, 2012 and December 31, 2011 were as follows:
Net intangible assets		June 30, 2012			December 31, 2011
Internal-use software	$	8,125,542		$	6,603,210
Purchased software		2,436,967			2,436,847
Software from acquisition		299,023			319,299
Software from investment		7,073,031			7,023,944
Total	$	17,934,563		$	16,383,300

The amortization expense was $201,019 and $144,007 for the three ~~month~~months ended ~~March~~June 3130, 2012 and 2011, respectively. For the six months ended June 30, 2012 and ~~March~~June 3130, 2011 was $92293,~~953~~972 and $~~137~~281,~~890~~897, respectively.

8. SHORT-TERM BORROWINGS FROM BANKS

On ~~May 25, May 30 and~~ June 1521, ~~2011~~2012, ~~Beijing~~UNISITS ~~PKU Chinafront High Technology Co., Ltd.(“PKU”)~~ entered into ~~three~~a short-term loan ~~agreements~~ agreement with Qinghuayuan Branch of Bank of Beijing, ~~Zhongguancun Branch~~ (“~~Zhongguancun~~Qinghuayuan Branch”), pursuant to which ~~Zhongguancun~~Qinghuayuan Branch agreed to loan ~~PKU~~UNISITS ana ~~aggregate~~sum of RMB ~~25 million~~10 million (approximately $31.9460 million) ~~as working capital~~. The loan has an annual interest rate equal to 101% above the benchmark interest rate, a standard rate announced by the People's Bank of China, as of the date of the first withdrawal ~~date~~of the principal, with the interest to be paid on a quarterly basis. The loan expires within 126 months offrom the ~~date of the~~ first withdrawal ~~but~~date ~~may be renewed upon receipt~~ of ~~written~~June ~~consent~~25, ~~from~~2012 to ~~Zhongguancun~~December ~~Branch~~24, 2012. AAs ~~principal amount~~ of ~~RMB~~ 5June ~~million was paid off in 2011 and on March 31~~30, 2012, a principal amount of ~~approximately~~ approximately $30.1779 million was outstanding.

On ~~December~~May 2230, ~~2011~~2012, ~~The~~UNISITS ~~Company’s VIE, Beijing Transwiseway,~~ entered into a short-term loan agreement with ~~Zhongguancun~~Dayuncun ~~Haidianyuan~~ Branch of ~~Bank~~ ofMerchants ~~Beijing~~Bank (~~"Haidianyuan~~“Dayuncun Branch"”), pursuant to which ~~Haidianyuan~~Dayuncun Branch agreed to loan ~~Beijing~~UNISITS ~~Transwiseway~~ a sum of RMB 3010 million (approximately $41.72 60 million). The loan has an annual interest rate equal to 105% above the benchmark interest rate, asa ofstandard ~~the~~rate ~~date~~announced ofby the ~~first~~People's Bank ~~withdrawal~~ of ~~the principal~~China, with the interest to be paid on a quarterly basis. The loan expires ~~within~~on 12December ~~months after~~23, ~~the date of the first withdrawal but may be renewed upon the written consent by Haidianyuan Branch~~2012. As of ~~March~~June 3130, 2012, a principal amount of approximately $21.8359 million was outstanding.

~~For~~On ~~the~~April ~~three~~1, ~~months~~2012, ~~ended~~Beijing ~~March~~PKU ~~31,~~Chinafront ~~2012~~High ~~and~~Technology ~~2011~~Co., Ltd.(“PKU”) ~~interest~~entered into a short-term loan agreement with Bank of Beijing, ~~expenses~~Haidianyuan ~~totaled~~Branch ~~$109~~(“Haidianyuan Branch”),~~464~~ ~~and~~pursuant to which Haidianyuan Branch agreed to loan PKU an aggregate of RMB 15 million (approximately $~~250~~2.40 million) as working capital. The loan has an annual interest rate equal to 20% above the benchmark interest rate,~~573,~~ ~~respectively~~a standard rate announced by the People's Bank of China, ~~and~~as of the ~~average~~first withdrawal date, with the interest to be ~~rate~~paid ~~was~~on 7a monthly basis.~~08%~~ ~~and~~The 5loan expires within 12 months after the date of the first withdrawal but may be renewed upon the written consent by Haidianyuan Branch.~~87%~~ As of June 30, ~~respectively~~2012, a principal amount of approximately $2.22 million was outstanding.

9.On ~~STOCK~~December 22, 2011, Beijing Transwiseway, entered into a short-~~BASED~~term ~~COMPENSATION~~loan agreement with Haidianyuan Branch, pursuant to which Haidianyuan Branch agreed to loan Beijing Transwiseway a sum of RMB 30 million (approximately $4.72 million). The loan has an annual interest rate equal to 10% above the benchmark interest rate, a standard rate announced by the People's Bank of China, as of the date of the first withdrawal of the principal, with the interest to be paid on a quarterly basis. The loan expires within 12 months after the date of the first withdrawal but may be renewed upon the written consent by Haidianyuan Branch. As of June 30, 2012, a principal amount of approximately $2.83 million was outstanding.

~~Stock~~The ~~Warrants~~interest expenses were $111,696 and $236,756 for the three months ended June 30, 2012 and 2011, respectively, and the average interest rate was 7.24% and 6.00%, respectively. For the six months ended June 30, 2012 and 2011, interest expenses totaled $221,160 and $487,329, respectively, and the average interest rate was 7.15% and 5.84%, respectively.

The Company issued warrants to Anteaus Capital, Inc., in aggregate, to purchase 277,778 shares of the Company’s common stock in connection with merger related services on May 14, 2007, with an exercise price of $1.80 per share. These warrants will expire on May 13, 2014. As of March 31, 2012, warrants to purchase 5,555 shares were outstanding with the aggregate intrinsic value of $16,943 and the weighted-average remaining contractual term of 25 months.11

~~Stock~~CHINA ~~Options~~TRANSINFO TECHNOLOGY CORP. Notes to Condensed Consolidated Financial Statements(Unaudited)

~~There~~9. ~~were no stock options granted during the three~~STOCK-~~month ended~~BASED ~~March 31, 2012.~~COMPENSATION

~~The~~Stock ~~Company recorded compensation expense of $273,749 and $310,538 for the three months ended March 31, 2012 and 2011, respectively, in connection with the stock options disclosed above.~~Warrants

10The Company issued warrants to Anteaus Capital, Inc., in aggregate, to purchase 277,778 shares of the Company’s common stock in connection with merger related services on May 14, 2007, with an exercise price of $1.80 per share. These warrants will expire on May 13, 2014. As of June 30, 2012, warrants to purchase 5,555 shares were outstanding with the aggregate intrinsic value of $20,831 and the weighted-average remaining contractual term of 22 months.

AStock ~~summary of stock options transactions for the three months ended March 31, 2012 is as follows:~~Options

					Weighted-Average
				Weighted-	Remaining		Aggregate
				Average	Contractual Term		Intrinsic
Stock Options	Shares			Exercise Price	(Months)		Value
Outstanding at January 1, 2012	1,870,801		$	6.2	40		-
Granted	-			-	-		-
Exercised or converted	-			-	-		-
Forfeited or expired	(30,000	)		5.09	-		-
Outstanding at March 31, 2012	1,840,801		$	6.22	37	$	45,900
Non-vested at March 31, 2012	1,129,876		$	6.04	39	$	40,575
Exercisable at March 31, 2012	710,925		$	6.52	34	$	5,325

There were no stock options granted during the six-month period ended June 30, 2012.

The ~~aggregate~~Company ~~intrinsic~~recorded ~~value~~compensation inexpense ~~the~~of ~~preceding~~$271,719 ~~table represents~~and ~~the total pretax intrinsic value~~$323,502 ~~based~~for ~~upon~~ the ~~Company’s~~three ~~closing~~months ~~stock~~ended ~~price of~~June ~~$4.85 as of March 31~~30, 2012, ~~which~~and ~~would~~2011, ~~have~~respectively. ~~been received by~~ For the ~~option holders~~six ~~had~~months ~~all~~ended ~~option~~June ~~holders~~30, ~~exercised~~2012 ~~their~~and ~~option~~2011, ~~awards~~compensation asexpenses oftotaled $545,468 ~~that~~and ~~date.~~$634,040, ~~No options~~respectively, ~~were~~in ~~exercised~~connection ~~during~~with the ~~three~~stock ~~months~~options disclosed ~~ended March 31, 2012~~below.

~~During~~A ~~the~~summary ~~three~~of ~~months ended March 31, 2012,~~ stock options ~~to purchase~~transactions ~~36,556~~for ~~shares~~the ~~were~~six ~~vested. Total unrecognized compensation costs~~months ~~related~~ended toJune ~~unvested stock options were approximately $2~~30,~~100,000~~ ~~as of March 31,~~ 2012. ~~Unvested~~is ~~stock~~as ~~options~~follows: ~~are expected to be recognized over a weighted average period of 2.25 years.~~

10. FAIR VALUE MEASURMENT

					Weighted-Average
				Weighted-	Remaining		Aggregate
				Average Exercise	Contractual Term		Intrinsic
Stock Options	Shares			Price	(Months)		Value
Outstanding at January 1, 2012	1,870,801		$	6.2	40		-
Granted	-			-	-		-
Exercised or converted	-			-	-		-
Forfeited or expired	(57,000	)		6.32	-		-
Outstanding at June 30, 2012	1,813,801		$	6.20	34	$	671,731

Non-vested at June 30, 2012	1,061,319		$	6.04	36	$	455,484
Exercisable at June 30, 2012	752,482		$	6.43	31	$	216,247

~~FASB~~The ~~ASC~~aggregate ~~820,~~intrinsic ~~Fair~~value ~~Value~~in ~~Measurement,~~the ~~defines~~preceding ~~fair~~table ~~value,~~represents ~~establishes~~the atotal ~~framework~~pretax ~~for~~intrinsic ~~measuring fair~~ value, inbased ~~accordance~~upon ~~with~~the ~~generally accepted~~Company’s ~~accounting~~closing ~~principles~~stock ~~and~~price of ~~requires~~$5.55 ~~certain~~as ~~disclosures~~of ~~about~~June ~~fair~~30, ~~value measurement.~~2012, ~~FASB~~which ~~ASC~~would ~~topic~~have ~~820~~been ~~also~~received ~~establishes~~by athe ~~fair~~option holders ~~value~~had ~~hierarchy~~all ~~that requires~~option ~~the~~holders ~~use~~exercised oftheir ~~observable~~option ~~market~~awards ~~data,~~as ~~when~~of ~~available,~~that ~~and~~date. ~~prioritizes the~~No ~~inputs~~options towere ~~valuation~~exercised ~~techniques~~during ~~used~~the tosix ~~measure~~months ~~fair~~ended ~~value~~June in30, ~~the~~2012. ~~following categories:~~

~~Level~~During the six months ended June 30, 2012, stock options to purchase 78,113 shares were vested. Total unrecognized compensation costs related to unvested stock options were approximately $1,800,000 –as ~~Quoted~~of ~~unadjusted~~June ~~prices~~30, 2012. ~~for~~Unvested ~~identical~~stock ~~instruments~~options inare expected to be recognized over a weighted ~~active~~average ~~markets~~period of 2.01 years.

~~Level~~10. 2FAIR –VALUE Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in market that are not active, and model-derived valuations in which all observable inputs and significant value drivers are observable in active markets.MEASURMENT

~~Level~~FASB 3ASC –820, ~~Model-derived~~Fair ~~valuations~~Value Measurement, defines fair value, establishes a framework for measuring fair value in ~~which~~accordance ~~one~~with orgenerally accepted ~~more~~accounting principles and requires certain disclosures about fair value ~~significant~~measurement. ~~inputs~~FASB orASC ~~significant~~topic 820 also establishes a fair value ~~drivers~~hierarchy ~~are~~that requires ~~unobservable~~the use of observable market data, ~~including~~when available, and prioritizes the ~~assumptions~~inputs ~~developed~~to byvaluation techniques used to measure fair value in the ~~Company.~~following categories:

~~Classification~~Level ~~within~~1 ~~the~~– ~~hierarchy~~Quoted isunadjusted ~~determined~~prices ~~based~~for onidentical ~~the~~instruments in ~~lowest~~active ~~level of input that is significant to the fair value measurement~~markets.

~~The~~Level ~~carrying~~2 ~~value~~– ofQuoted ~~financial~~prices ~~instruments~~for ofsimilar ~~the~~instruments ~~Company, included, cash and cash equivalents, restricted cash, accounts receivable, costs and estimated earnings~~ in ~~excess of billings on uncompleted contracts, other~~active ~~receivable~~markets, ~~other~~quoted ~~current~~prices ~~assets,~~for ~~short-term~~identical ~~borrowings~~or ~~from~~similar ~~banks,~~instruments ~~accounts payable, billings~~ in ~~excess~~market ofthat ~~costs and estimated earnings on uncompleted~~are ~~contracts~~not ~~and other current liabilities~~active, ~~approximate~~and ~~their fair values due to their short~~model-~~term~~derived ~~nature~~valuations ~~and~~in ~~are~~which ~~classified~~all ~~within~~observable ~~Level~~inputs ~~1 of the fair value~~and ~~hierarchy.~~significant ~~The Company did not have any financial instruments classified at Level 2 or Level 3 of the fair~~ value ~~hierarchy~~drivers asare atobservable ~~March~~in ~~31,~~active ~~2012~~markets.

1112

11CHINA TRANSINFO TECHNOLOGY CORP. ~~INCOME~~Notes ~~TAXES~~to Condensed Consolidated Financial Statements(Unaudited)

~~For~~Level ~~the~~3 ~~three~~– ~~months~~Model-derived ~~ended~~valuations ~~March~~in ~~31,~~which ~~2012~~one ~~and~~or ~~2011,~~more significant ~~income~~inputs ~~tax~~or significant value drivers are unobservable, including ~~expenses~~assumptions ~~were~~developed asby ~~follows:~~the Company.

		Three Months Ended March 31,
		2012						2011
		Domestic				Foreign		Domestic				Foreign
		Federal		State		China		Federal		State		China
Current	$	-	$	-	$	578,268.00	$	-	$	-	$	501,125.00
Deferred		-		-		-		-		-		-
	$	-	$	-	$	578,268.00	$	-	$	-	$	501,125.00

Classification within the hierarchy is determined based on the lowest level of input that is significant to the fair value measurement.

The ~~Company,~~carrying ~~through~~value ~~its~~of ~~VIE~~financial ~~and~~instruments ~~VIE’s~~of ~~subsidiaries~~the ~~and~~Company, ~~affiliates~~included, iscash ~~governed~~and bycash ~~the~~equivalents, ~~Income~~restricted ~~Tax~~cash, ~~Laws~~accounts receivable, costs and estimated earnings in excess of ~~the~~billings ~~PRC.~~on ~~The~~uncompleted ~~PRC~~contracts, ~~government~~other ~~has~~receivable, ~~provided~~other ~~various~~current ~~incentives~~assets, toshort-term ~~domestic~~borrowings ~~companies~~from banks, accounts payable, billings in ~~the~~excess ~~software~~of ~~industry~~costs and estimated earnings on uncompleted incontracts ~~China~~and inother ~~order~~current liabilities, approximate their fair values due to their ~~encourage~~short-term ~~development~~nature and ~~growth~~are classified within Level 1 of the ~~industry~~fair value hierarchy. ~~For~~The ~~the three~~Company ~~months~~did ~~ended~~not ~~March~~have ~~31,~~any ~~2012,~~financial ~~The~~instruments ~~Company~~classified ~~enjoyed~~at Level 2 or Level 3 of the ~~same~~fair ~~tax~~value ~~holidays~~hierarchy as of ~~last~~at ~~year~~June 30, 2012.

~~The Company recognizes deferred tax assets and liabilities for temporary differences between the financial reporting and tax bases of its assets and liabilities~~11. ~~Deferred~~INCOME assets are reduced by a valuation allowance when deemed appropriate. Operations in the United States of America have incurred net accumulated operating losses of $15,000,000 as of March 31, 2012 and December 31, 2011 for income tax purposes. However, a valuation allowance has been established for the full amount of the deferred tax asset due to uncertainty of its realization.TAXES

~~During~~For the three months and six months ended ~~March~~June 3130, 2012 and 2011, ~~the effective~~ income tax expenses ~~rate~~were ~~was~~as ~~estimated by the Company to be 17.2% and 12.1%, respectively.~~follows:

12. EARNINGS PER SHARE

		Three Months Ended June 30,
	2012						2011
		Domestic				Foreign		Domestic				Foreign
		Federal		State		China		Federal		State		China
Current	$	-	$	-	$	562,181	$	-	$	-	$	361,810
Deferred		-		-		-		-		-		-
	$	-	$	-	$	562,181	$	-	$	-	$	361,810


		Six Months Ended June 30,
	2012						2011
		Domestic				Foreign		Domestic				Foreign
		Federal		State		China		Federal		State		China
Current	$	-	$	-	$	1,140,449	$	-	$	-	$	862,935
Deferred		-		-		-		-		-		-
	$	-	$	-	$	1,140,449	$	-	$	-	$	862,935

~~For~~The ~~the~~Company, ~~three~~through ~~months~~its ~~ended~~VIE ~~March~~and ~~31,~~VIE’s ~~2012~~subsidiaries and ~~2011~~ affiliates, ~~basic~~is governed by the Income Tax Laws of the PRC. The PRC government has provided various incentives to domestic companies in the software industry in China in order to encourage development and growth of the industry. For the ~~diluted~~six ~~net~~months ~~income~~ended ~~per~~June ~~share~~30, ~~are~~2012, ~~calculated~~the Company enjoyed the same tax holidays as ~~follows:~~of last year.

		Three Months Ended March 31
		(Unaudited)
		2012		2011
Net income	$	2,419,296	$	2,967,276
Weighted-average shares of common stock outstanding
Basic		25,270,069		25,270,069
Dilutive effect of warrants and stock options		10,633		3,473
Diluted		25,280,702		25,273,542
Basic earnings per common share	$	0.10	$	0.12
Diluted earnings per common share	$	0.10	$	0.12

The Company recognizes deferred tax assets and liabilities for temporary differences between the financial reporting and tax bases of its assets and liabilities. Deferred assets are reduced by a valuation allowance when deemed appropriate. Operations in the United States of America have incurred net accumulated operating losses of $15,000,000 as of June 30, 2012 and December 31, 2011 for income tax purposes. However, a valuation allowance has been established for the full amount of the deferred tax asset due to uncertainty of its realization.

13The effective tax rate was estimated by the Company to be 16.24% and ~~CONCENTRATION~~11.70% OFfor ~~RISK~~the three months ended June 30, 2012 and 2011, respectively. During the six months ended June 30, 2012 and 2011, the effective income tax rate was estimated by the Company to be 16.69% and 11.94%, respectively.

~~Cash~~13

~~The~~CHINA ~~Company~~TRANSINFO ~~places~~TECHNOLOGY ~~its temporary cash investments in reputable financial institutions in the PRC and the United States~~CORP. ~~All~~Notes funds in US in a noninterest-bearing transaction account are insured in full by the United States Federal Deposit Insurance Corporation (“FDIC”) from December 31, 2010 through December 31, 2012. Although it is generally understood that the PRC central government stands behind all of the banks in China in the event of bank failure, there is no deposit insurance system in China that is similar to ~~the protection~~ ~~provided~~Condensed byConsolidated ~~the~~Financial ~~Federal Deposit Insurance Corporation~~ Statements(~~FDIC~~Unaudited) of the United States. This temporary unlimited coverage on US bank accounts is in addition to, and separate from, the coverage of up to $250,000 available to depositors under the FDIC's general deposit insurance rules. As of March 31, 2012 and December 31, 2011, the Company’s U.S. bank accounts are fully covered by the FDIC insurance.

12. EARNINGS PER SHARE

~~Major~~For ~~Customers~~the three months and six months ended June 30, 2012 and 2011, basic and diluted net income per share are calculated as follows:

The Company had two major customers that individually represented 10% or more of the Company’s total net sales during the three months ended March 31, 2012 and 2011. Total net sales of the top two customers for the three months ended March 31, 2012 and 2011 was as follows:

		Three Months Ended June 30,				Six Months Ended June 30,
		2012		2011		2012		2011
Net income	$	2,353,197	$	2,789,396	$	4,772,493	$	5,756,672

Weighted-average shares of common stock outstanding
Basic		25,270,069		25,270,069		25,270,069		25,270,069
Dilutive effect of warrants and stock options		50,523		3,126		25,862		3,248
Diluted		25,320,592		25,273,195		25,295,931		25,273,317

Basic earnings per common share	$	0.09	$	0.11	$	0.19	$	0.23

Diluted earnings per common share	$	0.09	$	0.11	$	0.19	$	0.23

Sales

Three months ended

March 31, 2012

March 31, 2011

Amount

% to total

Amount

% to total

Largest customer

4,509,110

16%

4,517,939

12%

Second largest customer

N/A

3,811,940

10%

13. CONCENTRATION OF RISK

NoCash ~~customer represented 10% or more of the Company’s accounts receivable balance as of March 31, 2012 and 2011.~~

~~Major~~The ~~Suppliers~~Company places its temporary cash investments in reputable financial institutions in the PRC and the United States. All funds in US are in a non-interest-bearing transaction account which are insured in full by the United States Federal Deposit Insurance Corporation (“FDIC”) from December 31, 2010 through December 31, 2012. Although it is generally understood that the PRC central government stands behind all of the banks in China in the event of bank failure, there is no deposit insurance system in China that is similar to the protection provided by the Federal Deposit Insurance Corporation (FDIC) of the United States. This temporary unlimited coverage on US bank accounts is in addition to, and separate from, the coverage of up to $250,000 available to depositors under the FDIC's general deposit insurance rules. As of June 30, 2012 and December 31, 2011, the Company’s U.S. bank accounts are fully covered by the FDIC insurance.

~~The~~Major Company did not have any suppliers represented 10% of more of the Company’s total net purchases during the three months ended March 31, 2012 and 2011. No concentration risk is noted on the supply of the Company.Customers

14The Company had one major customer that individually represented 10% or more of the Company’s total net sales during the three months ended June 30, 2012 and 2011, respectively. ~~COMMITMENTS~~The ~~AND~~Company ~~CONTINGENCIES~~had nil and one major customer that individually represented 10% or more of the Company’s total net sales during the six months ended June 30, 2012 and 2011, respectively. No customer represented 10% or more of the Company’s accounts receivable balance as of June 30, 2012 and 2011.

~~Capital~~Major ~~commitment~~Suppliers

OnThe ~~April 15, 2011, the Group~~ Company ~~entered~~did ~~into~~not ahave ~~Land Development~~any ~~Compensation~~suppliers ~~Framework~~represented ~~Agreement~~10% ~~(the “Framework Agreement”) with Beijing Strong Science Park Development Co., Ltd. ("Beijing Strong"), pursuant to which Beijing Strong agreed to complete the development~~ of ~~the land block~~more ~~with a site area~~ of ~~48,900 square meters, located at Zhongguancun Innovation Park (~~the ~~“C6-04~~Company’s ~~Land”)~~total ~~within~~net ~~one~~purchases ~~year~~during ~~after~~both the ~~date~~three ofmonths ~~the~~ended ~~Framework Agreement.~~and ~~In exchange,~~ the ~~Group Company agreed to pay an aggregate of RMB~~ ~~117,360,000~~six ~~(approximately~~months ~~$18,000,000)~~ended toJune ~~Beijing Strong~~30, ~~among~~2012 ~~which~~and ~~RMB 23,472,000 (approximately $3,700,000) was required be paid on or before April 25,~~ 2011. ~~The~~No ~~Group~~concentration ~~Company~~risk ~~intends~~is tonoted ~~construct office buildings~~ on the ~~C6-04~~ ~~Land~~suppliers ~~for its own and its subsidiaries’ use to reduce its rental expenses over the long term. The contract is cancellable, and, as~~ of ~~March 31, 2012,~~ the ~~Group~~ Company ~~has paid RMB 23,472,000 (approximately$3,700,000) for deposit~~.

~~Operating Lease~~14

~~The~~CHINA ~~rental~~TRANSINFO ~~expenses~~TECHNOLOGY ~~for~~CORP. ~~the~~Notes ~~three months ended March 31, 2012 and 2011 were $ 397,892 and $388,531, respectively, under the lease agreements~~ to ~~lease office spaces for the Group, its subsidiary and VIEs in various~~ ~~locations~~Condensed inConsolidated ~~the~~Financial ~~PRC.~~Statements(Unaudited)

~~The~~14. ~~aggregate~~COMMITMENTS ~~future~~AND ~~minimum payments under these lease agreements are as follows:~~CONTINGENCIES

Year ending December 31,		Lease Commitments
2012		1,119,558
2013		183,458
2014		13,458
Total	$	1,316,474

Capital commitment

13On April 15, 2011, the Group Company entered into a Land Development Compensation Framework Agreement (the “Framework Agreement”) with Beijing Strong Science Park Development Co., Ltd. ("Beijing Strong"), pursuant to which Beijing Strong agreed to complete the development of the land block with a site area of 48,900 square meters, located at Zhongguancun Innovation Park (the “C6-04 Land”). In exchange, the Group Company agreed to pay an aggregate of RMB 117,360,000 (approximately $18,000,000) to Beijing Strong, among which RMB 23,472,000 (approximately $3,700,000) was required be paid on or before April 25, 2011. The Group Company intends to construct office buildings on the C6-04 Land for its own and its subsidiaries’ use to reduce its rental expenses over the long term. The contract is cancellable, and, as of June 30, 2012, the Group Company has paid RMB 23,472,000 (approximately $3,700,000) for deposit.

~~Pending~~Operating ~~Litigation~~Lease

The ~~Company~~rental ~~and~~expense ~~the~~was ~~members of its board of directors are named as defendants in purported class action lawsuits (the “Stockholder Actions”) brought in the Eighth Judicial District Court~~$361,231 ~~Clark~~and ~~County~~$388,690 ~~Nevada~~for bythe ~~several~~three ~~stockholders:~~months ~~Oswald~~ended ~~Velz~~June ~~v. China TransInfo Technology Corp. et al.~~30, ~~Case No. A-12-657022-C (filed February 24,~~ 2012) and ~~Tim~~2011 ~~Valles v~~respectively. ~~Shudong~~For ~~Xia~~the etsix ~~al. Case~~months ~~No.~~ended ~~A-12-657443-C (filed March 1 , 2012) and Carl M. Domitrovich v. Shudong~~June ~~Xia et al. Case No. A-12-657740-C (filed March 6~~30, 2012). ~~The Stockholder Actions generally allege that the Company~~ and ~~all~~2011 ofwere ~~its directors breached their fiduciary duties in connection with the receipt by the Company of a preliminary~~$759, ~~non-binding~~123 ~~proposal from Shudong Xia, the Company’s Chairman~~ and ~~Chief Executive Officer, to acquire all of the outstanding shares of our common stock not currently owned by him in a going private transaction at a proposed price of~~ $~~5.65 per share in cash (the “Proposed Transaction”). The Stockholder Actions seek~~777,221, ~~among other things~~respectively, tounder ~~declare that~~ the ~~Proposed Transaction is unfair,~~lease ~~unjust~~agreements ~~and inequitable,~~ to ~~enjoin~~lease ~~the~~office ~~Company~~spaces ~~from~~for ~~taking any steps necessary to accomplish or implement~~ the ~~Proposed~~Group ~~Transaction~~Company, ~~and~~its ~~damages~~subsidiary inand ~~the event the~~VIEs ~~Proposed Transaction is consummated. Nevertheless,~~ at ~~this~~various ~~stage~~locations ofin the ~~proceedings,~~ ~~management cannot opine that a favorable outcome for the Company is probable or that an unfavorable outcome to the Company is remote~~PRC. ~~There is no reasonable estimate of any impact of the outcome of the litigation or related legal fees on the financial statements can be made as of the date of this statement.~~

14The aggregate future minimum payments under these lease agreements are as follows:

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Year ending December 31,		Lease Commitments
2012	$	822,842
2013		204,876
2014		11,406
Total	$	1,039,124

~~Special~~Pending ~~Note~~Litigation ~~Regarding Forward Looking Statements~~

~~This~~The ~~Quarterly~~Company ~~Report~~and ~~on Form 10-Q, including~~ the ~~following “Management’s~~members ~~Discussion and Analysis~~ of ~~Financial~~its ~~Condition~~board ~~and Results~~ of ~~Operations,”~~ ~~contains~~directors ~~forward-looking statements that~~ are ~~based on the beliefs~~named ofas ~~our~~defendants ~~management,~~in ~~and~~purported ~~involve~~class ~~risks~~action ~~and~~lawsuits ~~uncertainties,~~(the as“Stockholder ~~well as assumptions,~~Actions”) ~~that,~~brought ifin ~~they~~the ~~ever~~Eighth ~~materialize~~Judicial orDistrict ~~prove incorrect~~Court, ~~could~~Clark ~~cause~~County, ~~actual~~Nevada ~~results~~by toseveral ~~differ~~stockholders: ~~materially~~Oswald ~~from~~Velz ~~those~~v. ~~expressed~~China orTransInfo ~~implied~~Technology ~~by such forward-looking statements~~Corp. ~~The~~et ~~words “believe~~al.,” ~~“expect,”~~Case ~~“anticipate,”~~No. A-12-657022-C ~~“project,”~~(filed ~~“targets,” “optimistic,”~~February ~~“intend~~24,” ~~“aim,”~~2012) ~~“will”~~and orTim ~~similar~~Valles ~~expressions are intended to identify forward-looking statements~~v. ~~All~~Shudong ~~statements,~~Xia ~~other~~et ~~than statements of~~al. ~~historical~~Case ~~fact,~~No. ~~are statements that could be deemed forward~~A-~~looking~~12-657443-C ~~statements, including~~(filed ~~statements~~March ~~regarding~~1 ~~new and existing products~~, ~~technologies~~2012) and ~~opportunities;~~ ~~statements~~Carl ~~regarding~~M. ~~market~~Domitrovich ~~and~~v. ~~industry segment growth and~~Shudong ~~demand~~Xia ~~and~~et ~~acceptance~~al. ofCase ~~new~~No. ~~and~~A-12-657740-C ~~existing~~(filed ~~products;~~March ~~any projections of sales~~6, ~~earnings,~~ ~~revenue,~~2012). ~~margins~~The orStockholder ~~other~~Actions generally ~~financial~~allege ~~items;~~that ~~any statements of~~ the ~~plans,~~ ~~strategies~~Company and ~~objectives~~all of ~~management~~its ~~for~~directors ~~future~~breached ~~operations; any~~their ~~statements~~fiduciary ~~regarding~~duties ~~future~~in ~~economic~~connection ~~conditions~~with orthe ~~performance;~~receipt ~~uncertainties related~~by tothe ~~conducting~~Company ~~business in China; and any statements~~ of ~~belief~~a orpreliminary, ~~intention.~~non-binding Asproposal ~~such,~~from ~~they~~Shudong ~~are~~Xia, ~~subject~~the toCompany’s ~~risks~~Chairman and ~~uncertainties that could cause~~Chief ~~our~~Executive ~~results~~Officer, to ~~differ~~acquire ~~materially~~all ~~from~~of ~~those~~the ~~expressed~~outstanding orshares ~~implied~~of byour ~~such~~common ~~forward~~stock ~~looking~~not ~~statements.~~currently ~~Such~~owned ~~risks~~by ~~and~~him ~~uncertainties~~in ~~include~~a ~~any~~going ofprivate ~~the~~transaction ~~factors~~at ~~and risks~~a ~~mentioned~~proposed inprice ~~the “Risk Factors” sections~~ of $5.65 ~~our~~per ~~Annual~~share ~~Report~~in oncash ~~Form 10-K for~~ (the ~~year~~“Proposed ~~ended~~Transaction”). ~~December~~The 31Stockholder Actions seek, ~~2011and~~among ~~subsequent~~other ~~SEC filings~~things, ~~and~~to ~~any statements~~declare ofthat ~~assumptions underlying any of~~ the ~~foregoing.~~Proposed ~~All~~Transaction ~~forward-looking~~is unfair, ~~statements~~unjust ~~included~~and ininequitable, ~~this~~to ~~report~~enjoin ~~are~~the ~~based~~Company onfrom ~~information~~taking ~~available~~any tosteps usnecessary onto ~~the~~accomplish ~~date~~or ofimplement ~~this~~the ~~report.~~Proposed WeTransaction, ~~assume no obligation~~ and dodamages ~~not~~in ~~intend~~the toevent ~~update~~the ~~these~~Proposed ~~forward-looking~~Transaction ~~statements,~~is ~~except as required by law~~consummated.

~~Certain~~On ~~Terms~~July 13, 2012, these three class action complaints were consolidated into one amended class action complaint, In Re China TransInfo Technology Corp. Shareholders’ Litigation, Consolidated Case No. A-12-657022-B, filed in the Eighth Judicial District Court and against the members of the board of directors of the Company and certain other parties to the Proposed Transaction. Nevertheless, at this stage of the proceedings, management cannot opine that a favorable outcome for the Company is probable or that an unfavorable outcome to the Company is remote. There is no reasonable estimate of any impact of the outcome of the litigation or related legal fees on the financial statements can be made as of the date of this statement.

~~Except where the context otherwise requires and for the purposes of this report only:~~ 15

~~“BVI”~~ITEM ~~refers~~2. toMANAGEMENT’S ~~the~~DISCUSSION ~~British~~AND ~~Virgin~~ANALYSIS ~~Islands;~~ OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

~~“China,” “Chinese” and “PRC” refer to the People’s Republic of China and~~ doSpecial ~~not~~Note ~~include~~Regarding ~~Taiwan~~Forward ~~and~~Looking ~~special administrative regions of Hong Kong and~~Statements ~~Macao;~~

This Quarterly Report on Form 10-Q, including the following “~~China~~Management’s ~~TransInfo~~Discussion and Analysis of Financial Condition and Results of Operations,” “contains forward-looking statements that are based on the ~~Company~~beliefs of our management, and involve risks and uncertainties, as well as assumptions, that, if they ever materialize or prove incorrect, could cause actual results to differ materially from those expressed or implied by such forward-looking statements. The words “believe,” “weexpect,” “usanticipate,” ~~and~~“project,” “~~our~~targets,” ~~refer~~“optimistic,” “intend,” “aim,” “will” or similar expressions are intended to ~~China~~identify forward-looking ~~TransInfo~~statements. ~~Technology~~All ~~Corp.~~statements, ~~its~~other ~~subsidiaries~~than statements of historical fact, are statements that could be deemed forward-looking statements, including statements regarding new and existing products, intechnologies and opportunities; statements regarding market and industry segment growth and demand and acceptance of new and existing products; any projections of sales, earnings, revenue, margins or other financial items; any statements of the ~~context~~plans, strategies and objectives of ~~describing~~ ~~our~~management for future operations; ~~and~~any statements regarding future economic conditions or performance; uncertainties related to conducting business in China; and any statements of belief or intention. As such, they are subject to risks and ~~consolidated~~uncertainties ~~financial~~that could cause ~~information,~~our results to differ materially from those expressed or implied by such forward looking statements. Such risks and uncertainties include any of the factors and risks mentioned in the “Risk Factors” sections of our ~~VIE;~~Annual Report on Form 10-K for the year ended December 31, 2011 and subsequent SEC filings, and any statements of assumptions underlying any of the foregoing. All forward-looking statements included in this report are based on information available to us on the date of this report. We assume no obligation and do not intend to update these forward-looking statements, except as required by law.

~~“Exchange~~ Certain ~~Act” refers to the Securities Exchange Act of 1934, as amended;~~Terms

~~“RMB”~~ Except ~~refers~~where tothe ~~Renminbi,~~context ~~the~~otherwise ~~legal~~requires ~~currency~~and for the purposes of ~~China;~~ this report only:

“~~SEC~~BVI” refers to the ~~United~~British ~~States~~Virgin ~~Securities and Exchange Commission~~Islands;
“~~Securities~~China,” ~~Act~~“Chinese” ~~refers~~and “PRC” refer to the ~~Securities~~People’s ~~Act~~Republic of ~~1933,~~China asand ~~amended~~do not include Taiwan and special administrative regions of Hong Kong and Macao;
“~~U.S.~~China ~~dollar~~TransInfo,” “$the Company,” “we,” “us,” and “~~US$~~our” refer to ~~the~~China ~~legal~~TransInfo ~~currency~~Technology ofCorp., its subsidiaries, and, in the ~~United States;~~context of describing our operations and business, and consolidated financial information, include our VIE;
“~~VIE~~Exchange Act” ~~means~~refers ~~our~~to ~~consolidated~~the ~~variable~~Securities ~~interest~~Exchange ~~entities,~~Act ~~including~~of ~~China TransInfo~~1934, ~~and its subsidiaries~~ as ~~depicted in our organization chart included in our Annual Report on Form 10-K for the year ended December 31, 2011.~~ amended;
~~The~~“RMB” ~~following~~refers ~~discussion and analysis of our financial condition and results of operations includes information with respect~~ to our plans and strategies for our business and should be read in conjunction with our interim unaudited condensed consolidated financial statements and related notes included herein and our consolidated financial statements and related notesRenminbi, ~~and Management’s~~the ~~Discussion~~legal ~~and~~currency ~~Analysis~~ of ~~Financial Condition and Results of Operations contained in our Form 10-K for the year ended December 31, 2011.~~China;
~~Overview~~“SEC” ofrefers ~~Our~~to ~~Business~~the United States Securities and Exchange Commission;
~~We are a leading provider of end-to-end intelligent transportation systems (~~“~~ITS~~Securities Act”) ~~and~~refers ~~related comprehensive technology solutions servicing the transportation industry in China. Our goal is~~ to ~~become~~ the ~~largest~~ ~~provider~~Securities Act of ~~intelligent transportation system products and related comprehensive technology solutions in China~~1933, as well as a major operator and provider of value-added ITS and location based services (“LBS”) to commercial clients and consumers in China. Substantially all of our operations are conducted through our VIEs that are PRC domestic companies owned principally or entirely by our PRC affiliates. Through our VIEs, we are involved in developing multiple applications in highway ITS, urban ITS, commercial vehicles ITS plus LBS, and to a lesser degree, in digital city, and land and resource filling systems based on Geographic Information Systems (“GIS”) technologies which are used to service both the public and private sector. amended;
15“U.S. dollar,” “$” and “US$” refer to the legal currency of the United States; and
~~Our~~“VIE” ~~primary~~means ~~focus~~our isconsolidated onvariable ~~providing~~interest ~~end-to-end~~entities, ~~ITS~~including ~~solutions~~China TransInfo and ~~related~~ ~~services~~its tosubsidiaries ~~the~~as ~~transportation~~depicted ~~industry.~~in Weour ~~also~~organization ~~offer~~chart ~~comprehensive solutions~~included ~~for~~in ~~transportation~~our ~~oriented~~Annual ~~GIS,~~Report ~~encompassing~~on ~~transportation~~Form ~~planning, design,~~10-K ~~construction,~~for ~~maintenance~~the ~~and~~year ~~operation.~~ended December 31, 2011.

~~First~~ The ~~Quarter~~following discussion and analysis of our financial condition and results of operations includes information with respect to our plans and strategies for our business and should be read in conjunction with our interim unaudited condensed consolidated financial statements and related notes included herein and our consolidated financial statements and related notes, and Management’s Discussion and Analysis of Financial ~~Performance~~Condition and Results of Operations contained in our Form ~~Highlights~~10-K for the year ended December 31, 2011.

~~We continued to experience consistent demand for our products~~ ~~and~~Overview ~~services during the first quarter~~ of ~~2012,~~Our ~~which resulted in sustained~~Business growth in our project backlog. In the first quarter of 2012, the Company won new contracts worth $57.85 million, compared to $13.44 million in the same period prior year. The transportation information industry in China is experiencing a rapid and continued development along with a sustained increase in the Chinese government and public demand for advanced transportation information products and services to support more effective and efficient transportation networks within China. This trend is supported by steady governmental spending in the transportation sector. We believe this trend will continue to benefit our business operations.

~~The~~ We ~~following~~ are ~~some~~a ~~financial~~leading ~~highlights~~provider ~~for~~of end-to-end intelligent transportation systems (“ITS”) and related comprehensive technology solutions servicing the ~~first~~transportation industry in China. Our goal is to become the largest provider of intelligent ~~quarter~~transportation system products and related comprehensive technology solutions in China, as well as a major operator and provider of ~~2012:~~value-added ITS and location based services (“LBS”) to commercial clients and consumers in China. Substantially all of our operations are conducted through our VIEs that are PRC domestic companies owned principally or entirely by our PRC affiliates. Through our VIEs, we are involved in developing multiple applications in highway ITS, urban ITS, commercial vehicles ITS plus LBS, and to a lesser degree, in digital city, and land and resource filling systems based on Geographic Information Systems (“GIS”) technologies which are used to service both the public and private sector.

~~Net~~ Our ~~sales~~primary –focus ~~Our~~is ~~net~~on ~~sales~~providing ~~were~~end-to-end ~~approximately~~ITS ~~$28.93~~solutions ~~million for~~and related services to the ~~first~~transportation ~~quarter~~industry. ofWe ~~2012,~~also aoffer ~~decrease~~comprehensive ofsolutions ~~20.74%~~for ~~from~~transportation ~~the~~oriented ~~same~~GIS, ~~quarter~~encompassing oftransportation planning, design, construction, ~~the~~maintenance ~~previous~~and ~~year~~operation.

~~Gross Margin – Gross margin was 33.12% for the first quarter~~ ~~of 2012, as compared to 28.47% for the same period in 2011.~~ 16

~~Operating Profit – Operating profit was approximately $2.65~~ ~~million~~Second ~~for~~Quarter ~~the~~Financial ~~first~~Performance ~~quarter of 2012, a decrease of 35.03% from $4.07 million~~Highlights ~~for the same quarter of the previous year.~~

~~Net~~We ~~Income~~continued –to ~~Net~~experience ~~income~~consistent ~~was~~demand ~~approximately~~for ~~$2.42~~our ~~million for~~products and services during the ~~first~~second quarter of 2012, awhich ~~decrease~~resulted ofin 18sustained growth in our project backlog.~~47%~~ ~~from~~In the second quarter of 2012, the Company won new contracts worth $253.97 million, ~~for~~compared to $35.53 million in the same period ~~quarter~~prior ofyear. The transportation information industry in China is experiencing a continued development along with a sustained increase in the Chinese ~~previous~~government ~~year~~and public demand for advanced transportation information products and services to support more effective and efficient transportation networks within China. This trend is supported by steady governmental spending in the transportation sector. We believe this trend will continue to benefit our business operations.

~~Critical~~The ~~Accounting~~following ~~Estimates~~are some financial highlights for the second quarter of 2012:

AsNet ~~discussed~~sales in– ~~Part~~Our ~~II,~~net ~~Item~~sales 7,were ~~Management’s~~approximately ~~Discussion~~$31.41 ~~and~~million ~~Analysis~~ for ofthe ~~Financial~~second ~~Condition~~quarter ~~and Results~~ of ~~Operations~~2012, ofa ~~our~~decrease ~~Annual~~of ~~Report on~~14.83% ~~Form 10-K~~ for the ~~fiscal~~same ~~year~~quarter ~~ended December 31, 2011, we consider our estimates on revenue recognition, vendor allowances and amortization~~ of ~~intangibles to be~~ the ~~most~~previous ~~critical in understanding the judgments that are involved in preparing our consolidated financial statements~~year. ~~There have been no~~ ~~significant changes to these estimates in the three months ended March 31, 2012.~~
~~Recently~~Gross ~~Issued~~Margin ~~Accounting~~– ~~Guidance~~Gross margin was 31.25% for the second quarter of 2012, as compared to 28.68% for the same period in 2011.
~~See~~Operating ~~Note~~Profit 2– toOperating ~~condensed~~profit ~~consolidated~~was ~~financial~~approximately ~~statements~~$2.37 ~~included~~ million infor ~~Item~~the 1,second ~~Financial~~quarter ~~Information~~of 2012, ofa ~~this~~decrease ~~Quarterly~~of ~~Report~~25.44% onfrom ~~Form~~$3.18 ~~10-Q~~ million for the same quarter of the previous year.
16Net Income – Net income was approximately $2.35 million for the second quarter of 2012, a decrease of 15.64% from $2.79 million for the same quarter of the previous year.

~~RESULTS~~Critical OFAccounting ~~OPERATIONS~~Estimates

~~Three~~As ~~Months~~discussed ~~Ended~~in ~~March~~Part 31II, ~~2012~~Item ~~Compared~~7, toManagement’s ~~Three~~Discussion and ~~Months~~Analysis ~~Ended~~of ~~March~~Financial Condition and Results of Operations, of our Annual Report on Form 10-K for the fiscal year ended December 31, 2011, we consider our estimates on revenue recognition, vendor allowances and amortization of intangibles to be the most critical in understanding the judgments that are involved in preparing our consolidated financial statements. There have been no significant changes to these estimates in the three months ended June 30, 2012.

~~The~~Recently ~~following~~Issued ~~table~~Accounting ~~sets forth selected items from our unaudited condensed consolidated statements of income by dollar and as a percentage of our net sales for the periods indicated:~~ Guidance

		Three Months Ended					Three Months Ended
		March 31, 2012					March 31, 2011
				% of					% of
		Amount		Net Sales			Amount		Net Sales
Net sales	$	28,928,717		100.00%		$	36,499,159		100.00%
Cost of sales		(19,346,112	)	(66.88%	)		(26,106,038	)	(71.53%	)
Gross profit		9,582,605		33.12%			10,393,121		28.47%
Total operating expenses		(6,937,046	)	(23.98%	)		(6,321,059	)	(17.32%	)
Income from operations		2,645,559		9.15%			4,072,062		11.15%
Non-operating income		724,433		2.50%			60,255		0.17%
Income before income taxes, non-controlling interests, and gain on equity investment		3,369,992		11.65%			4,132,317		11.32%
Income taxes		(578,268	)	(2.00%	)		(501,125	)	(1.37%	)
Net income before non-controlling interests and gain
on equity investments in affiliates		2,791,724		9.65%			3,631,192		9.95%
Gain on investments in affiliates due to proportional shares of the affiliates net income		379,253		1.31%			332,636		0.91%
Net income before non-controlling interests		3,170,977		10.96%			3,963,828		10.86%
Non-controlling interests in net income of subsidiary		(751,681	)	(2.60%	)		(996,552	)	(2.73%	)
Net income	$	2,419,296		8.36%		$	2,967,276		8.13%

See Note 2 to condensed consolidated financial statements included in Item 1, Financial Information, of this Quarterly Report on Form 10-Q.

~~Net~~RESULTS ~~Sales~~OF – Net sales decreased by $7.57 million, or 20.74%, to $28.93 million for the three months ended March 31, 2012, from $36.50 million during the same period of 2011. Approximately 95.25% of this decrease is attributable to the decrease of our transportation business in the first quarter of 2012. As compared to the same period of 2011, net sales of our transportation business decreased by approximately 20.52%. Such a decrease predominantly resulted from a temporary fluctuation of the execution process of existing contracts in our ITS business. Because our ITS business is conducted on a contract basis, progress towards contract completion could vary from quarter to quarter, which would affect our revenue recognition. However, we expect the demand for our products and services to be generally steady and consistent over the years.OPERATIONS

~~The~~Three ~~following~~Months ~~table~~Ended ~~illustrates~~June ~~the~~30, ~~revenues~~2012 ~~from~~Compared ~~the~~to ~~major Chinese~~Three ~~government sectors and regulated industries in which we sell our~~Months ~~products~~Ended ~~and~~June ~~services~~30, ~~for~~2011 ~~the periods indicated. The table also provides the percentage of total revenues represented by each listed sector.~~

		Three Months Ended			Three Months Ended
		March 31, 2012			March 31, 2011
			% of Net			% of Net
		Net Sales	Sales		Net Sales	Sales
Transportation	$	27,928,735	96.54%	$	35,139,327	96.27%
Digital City		78,741	0.27%		6,363	0.02%
Land and resources		-	-		3,045	0.01%
Other		921,241	3.19%		1,350,424	3.70%
Net sales	$	28,928,717	100.00%	$	36,499,159	100.00%

The following table sets forth selected items from our unaudited condensed consolidated statements of income by dollar and as a percentage of our net sales for the periods indicated:

Gross Profit – Our gross profit decreased approximately $0.81 million, or 7.80%, to approximately $9.58 million for the three months ended March 31, 2012, from approximately $10.39 million during the same period of 2011. Our gross profit decrease was mainly attributable to the decrease in revenue in the first quarter compared to the same period of prior year. However, our gross profit decrease was proportionally less than our revenue decrease from the same period of 2011 to 2012, which resulted in an increase in our gross margin by 4.65% from 28.47% during the same period of 2011 to 33.12% for the three months ended March 31, 2012. This increase in gross margin was mainly due to the projects we performed in the first quarter of 2012 required less purchased hardware and subcontracting services than the ones that we performed in the same period of prior year.

		Three Months Ended					Three Months Ended
		June 30, 2012					June 30, 2011
				% of					% of
		Amount		Net Sales			Amount		Net Sales
Net sales	$	31,407,301		100.00%		$	36,874,738		100.00%
Cost of sales		(21,591,924	)	(68.75%	)		(26,298,267	)	(71.32%	)
Gross profit		9,815,377		31.25%			10,576,471		28.68%
Total operating expenses		(7,445,269	)	(23.71%	)		(7,397,564	)	(20.06%	)
Income from operations		2,370,108		7.54%			3,178,907		8.62%
Non-operating income (expenses)		1,091,957		3.48%			(86,398	)	(0.23%	)
Income before income taxes, non-controlling interests, and
gain on equity investment in affiliates net income		3,462,065		11.02%			3,092,509		8.39%
Income taxes		(562,181	)	(1.79%	)		(361,810	)	(0.98%	)

Net income before non-controlling interests and gain on equity investments in affiliates net income		2,899,884		9.23%			2,730,699		7.41%
Gain on equity investments in affiliates due to proportional
shares of the affiliates net income		355,190		1.13%			1,023,349		2.78%
Net income before non-controlling interests		3,255,074		10.36%			3,754,048		10.19%
Non-controlling interests in net income of subsidiary		(901,877	)	(2.87%	)		(964,652	)	(2.62%	)

Net income	$	2,353,197		7.49%		$	2,789,396		7.57%

~~Total~~Net ~~Operating~~Sales ~~Expenses~~ – ~~Most~~Net ofsales ~~our~~decreased ~~services~~by ~~and products~~$5.47 ~~are~~million, ~~sold~~or 14.83%, to $31.41 million for the ~~domestic~~three ~~Chinese~~months ~~market~~ended ~~through~~June ~~contracts~~30, ~~commissioned~~2012, from $36.87 bymillion during the ~~Chinese~~same ~~government~~period of 2011. ~~Various~~Approximately ~~government~~82.76% ~~entities~~of ~~and~~this ~~agencies~~decrease ~~either~~is ~~invite~~attributable us to ~~bid~~the ~~for~~decrease aof ~~specific~~our ~~contract~~transportation orbusiness ~~award~~in athe ~~contract~~second quarter of 2012. As compared to usthe onsame aperiod ~~non-bid~~of 2011, net sales of our ~~basis~~transportation business decreased by approximately 13.18% We. ~~are~~Such ~~often~~a ~~invited~~decrease predominantly toresulted ~~bid~~from ona ~~contracts~~temporary ~~through~~fluctuation ~~our~~of ~~professional~~the execution process of ~~relationships~~existing ~~and~~contracts ~~are~~in ~~awarded~~our ~~recurring~~ITS ~~businesses~~business. ~~Historically,~~Because weour ~~did~~ITS ~~not~~business is conducted on ~~incur~~a ~~high~~contract-by-contract ~~costs~~basis, inprogress ~~our~~towards ~~sales~~contract ~~and~~completion ~~marketing~~could ~~activities.~~vary from Wequarter ~~promoted~~to quarter, which would affect our ~~products through~~revenue ~~developments~~recognition. ofHowever, ~~professional~~we expect ~~contacts~~the ~~with~~demand ~~various~~for ~~agencies~~our ~~and municipalities~~products and ~~through~~services ~~participation~~to inbe ~~industry~~generally ~~trade~~steady ~~exhibitions~~and consistent over the years.

~~Our~~The ~~marketing~~following ~~expenses~~table ~~therefore~~illustrates ~~were~~the ~~relatively~~revenues ~~low~~from inthe major ~~comparison~~Chinese togovernment ~~our~~sectors ~~competitors who do not have a record of performance~~ and ~~brand recognition~~regulated orindustries ~~well-established~~in ~~government~~which ~~contacts. Since 2011,~~ we ~~have enhanced~~sell our ~~marketing efforts by organizing various industry trade exhibitions~~ products and ~~conferences~~services infor ~~order~~the toperiods ~~further~~indicated. ~~promote~~The ~~our~~table ~~corporate~~also ~~image~~provides ~~and brand~~the ~~recognition~~percentage ~~within~~of ~~the~~total ~~transportation~~revenues ~~information~~represented ~~industry~~by ineach ~~China~~listed sector.

Total operating expenses increased by $0.62 million, or 9.74%, to $6.94 million for the three months ended March 31, 2012, from $6.32 million during the same period of 2011. The increase is due to the following:

		Three Months Ended			Three Months Ended
		June 30, 2012			June 30, 2011
			% of Net			% of Net
		Net Sales	Sales		Net Sales	Sales
Transportation	$	29,815,718	94.93%	$	34,340,629	93.12%
Digital City		1,144,867	3.65%		1,293,403	3.51%
Land and resources		4,863	0.02%		44,010	0.12%
Other		441,853	1.40%		1,196,696	3.25%
Net sales	$	31,407,301	100.00%	$	36,874,738	100.00%

~~Our~~Gross ~~selling~~Profit ~~expenses~~– ~~including~~Our ~~sales~~gross ~~representative~~profit ~~commissions,~~decreased ~~promotion fees and marketing expenses, increased~~ approximately $0.2476 million, or 297.5420%, to approximately $19.0682 million for the three months ended ~~March~~June 3130, 2012, from approximately $010.8258 million during the same period of 2011. AsOur agross ~~percentage~~profit ofdecrease ~~net~~was ~~sales,~~mainly ~~selling~~attributable ~~expenses increased~~ to ~~3.68% for~~ the ~~three~~decrease ~~months~~in ~~ended March 31, 2012, from 2.25%~~net ~~during~~sales ~~the~~of ~~same~~our ~~period~~ITS ~~of 2011~~business. ~~The~~However, ~~increase~~our ofgross ~~selling~~profit ~~expenses~~decrease was ~~mainly~~proportionally ~~attributable~~less tothan ~~the~~our ~~fact~~revenue ~~that~~decrease from the ~~Company~~same ~~was~~period ~~more~~of ~~active~~2011 into ~~new~~2012 ~~contract~~and our ~~bidding~~gross ~~and~~profit as a ~~result,~~percentage ~~incurred~~of ~~more~~net ~~expenses in connection with selling activities including travelling, lodging, and~~ sales ~~related~~increased ~~administration~~2. ~~The~~57% ~~increase~~from in28.68% ~~selling~~during ~~expenses~~the same asperiod ~~a percentage~~ of ~~net~~2011 ~~sales~~to 31.25% for the three months ended ~~March~~June 3130, 2012. isThe increase in gross margin was mainly ~~attributed~~due to the ~~fact~~transportation ~~that~~projects ~~the Company~~we ~~won~~carried out were more ~~new~~cost ~~contracts,~~effective ~~while~~as ~~the~~a ~~execution~~result of ~~existing~~improvements ~~contracts~~in ~~was~~hardware ~~relatively~~purchasing ~~slower~~practice ~~due~~and tolabor ~~temporary~~management ~~fluctuations which resulted~~ in ~~lower revenue~~these ~~recognition as compared to the same period of prior year~~projects.

~~Our~~Total ~~general~~Operating ~~and~~Expenses ~~administrative~~– ~~expenses~~We ~~were~~sell ~~approximately~~most ~~$5.87~~of ~~million~~our services and products ~~(20.30%~~to ofthe ~~total~~domestic ~~sales)~~Chinese ~~and~~market ~~approximately~~through ~~$5.50~~contracts ~~million~~commissioned by ~~(15~~the Chinese government.~~07%~~ ofVarious ~~total~~government ~~sales)~~entities and agencies either invite us to bid for ~~the~~a ~~three~~specific ~~months~~contract ~~ended~~or ~~March~~award ~~31,~~a ~~2012~~contract ~~and~~to ~~2011,~~us ~~respectively.~~on ~~The~~a ~~increase~~non-bid inbasis. ~~administrative~~We ~~expenses~~are ~~was~~often ~~mainly~~invited ~~attributable~~ to ~~the~~bid ~~development~~on ofcontracts through our professional ~~Beijing~~relationships ~~Transwiseway’s~~and ~~commercial~~are ~~vehicle~~awarded ~~LBS~~recurring ~~business~~businesses. ~~which~~Historically, ~~resulted~~we indid not ~~higher~~incur ~~labor~~high costs in our sales and ~~administration~~marketing ~~expenses~~activities. ~~compared~~We topromoted ~~the~~our ~~same~~products through ~~period~~developments of ~~prior~~professional contacts with various agencies and ~~year~~municipalities and through participation in industry trade exhibitions.

~~Income~~Our ~~Taxes~~marketing –expenses ~~For~~therefore ~~the~~were ~~three~~relatively ~~months~~low ~~ended March 31,~~in ~~2012,~~comparison weto ~~recognized~~our ~~income~~competitors ~~tax~~who ~~expense~~do ofnot ~~$0.58~~have ~~million~~a ~~and~~record ~~effective tax rate~~ of ~~17.16%~~performance ~~while~~and inbrand recognition ~~the~~or ~~same~~well-established ~~period~~government ofcontacts. Since 2011, we ~~recognized income tax expense of~~have ~~$0.50~~enhanced ~~million~~our ~~and~~marketing ~~effective~~efforts ~~tax~~by ~~rate~~organizing ofvarious ~~12.13%~~industry .trade ~~We paid more income taxes with~~exhibitions ~~lower~~and ~~net~~conferences ~~sales~~in ~~mainly~~order ~~because some VIEs with relatively higher tax rates contributed more~~ to ~~the~~further ~~income~~promote ~~before~~our ~~taxes~~corporate ~~than~~image ~~other~~and ~~VIEs with lower tax rates~~brand asrecognition ~~compared~~within to the ~~same~~transportation ~~period~~information ofindustry ~~last~~in ~~year~~China.

~~Liquidity~~Total ~~and~~operating ~~Capital~~expenses ~~Resources~~increased by $0.05 million, or 0.64%, to $7.45 million for the three months ended June 30, 2012, from $7.40 million during the same period of 2011. The increase is due to the following:

Our ~~principal~~selling ~~liquidity~~expenses ~~requirements~~including ~~are~~sales ~~for~~representative ~~working capital~~commissions, promotion ~~capital~~ fees ~~expenditures~~ and ~~cash~~marketing ~~dividends~~expenses, toincreased ~~non-controlling~~approximately ~~shareholders of subsidiaries~~$0.35 Wemillion, ~~fund~~or ~~our~~36.49%, to ~~liquidity~~$1.30 ~~requirements~~million ~~primarily~~for ~~through~~the ~~cash~~three onmonths ~~hand, cash~~ended ~~flow~~June ~~from~~30, ~~operations~~2012, ~~and borrowings~~ from ~~our revolving credit facility~~$0.96 Wemillion ~~believe~~ during ~~our~~the ~~cash~~same onperiod ~~hand,~~of ~~future~~2011. ~~funds~~The ~~generated~~increase ~~from~~in ~~operations~~selling ~~and~~expenses ~~borrowings~~was mainly ~~from~~ attributable to our ~~revolving~~enhanced ~~credit~~efforts ~~facility~~in ~~will~~bidding befor ~~sufficient~~new tocontracts. ~~fund~~Combined with our ~~cash requirements~~lower ~~for~~net atsales ~~least~~recognized for the ~~next~~three ~~twelve~~ months. ~~There~~ended isJune no30, ~~assurance~~2012, ~~however,~~ selling ~~that~~expenses weas ~~will~~a bepercentage ~~able~~of tonet ~~generate~~sales ~~sufficient~~for ~~cash~~the ~~flow~~three ormonths ~~that~~ended ~~we will~~June be 30, ~~able~~2012 increased to ~~maintain~~4.15% ~~our~~from ~~ability~~2.59% toduring ~~borrow~~the ~~under~~same ~~our~~period ~~revolving~~of ~~credit facility~~2011.
AsOur ofgeneral ~~March~~and ~~31,~~administrative ~~2012,~~expenses wewere ~~had~~approximately ~~cash~~$6.14 ~~and cash equivalents~~million (~~excluding~~19.55% ~~restricted~~of ~~cash~~total sales) ofand approximately $316.8344 million ~~and~~(17.47% ~~restricted~~of ~~cash~~total of sales) ~~approximately~~for ~~$4.70~~the ~~million~~three months ended June 30, 2012 and 2011, respectively. The decrease ~~following~~in ~~table~~administrative ~~provides~~expenses ~~detailed~~was mainly attributable to the fact that ~~information~~ we ~~about~~incurred ~~our~~less ~~net~~sales ~~cash~~related ~~flow~~bonus payment for ~~all~~the ~~financial~~three ~~statements~~months ~~periods~~ended June ~~presented~~ 30, in2012, ~~this~~compared ~~report~~to the same period of prior year.

18Income Taxes – For the three months ended June 30, 2012, we recognized income tax expense of $0.56 million and effective tax rate of 16.24% while in the same period of 2011, we recognized income tax expense of $0.36 million and effective tax rate of 11.70% . The increase in the income tax expense was mainly due to some VIEs with relatively higher tax rates contributed more to the income before taxes than other VIEs with lower tax rates, which also resulted in higher effective tax rate as compared to the same period of last year.

~~Cash Flow~~ 18

	Three Months Ended March 31,
	2012	2011
Net cash used in operating activities	$(9,399,831)	$(16,310,263)
Net cash used in investing activities	(2,037,135)	(1,368,686)
Net cash used in financing activities	(2,082,598)	(1,407,665)
Effect of foreign currency translation	319,105	219,746
Net decrease in cash and cash equivalents	$(13,200,459)	$(18,866,868)

Six Months Ended June 30, 2012 Compared to Six Months Ended June 30, 2011

~~Operating~~The ~~Activities~~following table sets forth selected items from our unaudited condensed consolidated statements of income by dollar and as a percentage of our net sales for the periods indicated:

Net cash used in operating activities was approximately $9.40 million for the three-month period ended March 31, 2012, while for the same period of 2011, we had approximately $16.31 million net cash used in operating activities. The decrease in the cash used in operating activities was mainly attributable to the decrease in cost and material input related to lower volume of project execution in the first quarter of 2012 compared to the same period of prior year. With respect to the main contributing factors of the $6.91 million decrease in net cash used, $13.54 million was attributable to the increase in accounts payables, offset by $0.55 million that was attributable to the reduction in net income due to the decrease in revenue, $1.60 million attributable to the change in cash flow from accounts receivable due to relatively slower collections, and $5.09 million attributable to the decrease in net billings, that is, the difference between cost and estimated earnings in excess of billings on uncompleted contracts (when our work was performed ahead of customer payments in some of our contracts per the contract payment terms) and billings in excess of costs and estimated earnings on uncompleted contracts (when we receive payments from clients ahead of cost and earnings realization).

		Six Months Ended					Six Months Ended
		June 30, 2012					June 30, 2011
				% of					% of
		Amount		Net Sales			Amount		Net Sales
Net sales	$	60,336,018		100.00%		$	73,373,897		100.00%
Cost of sales		(40,938,036	)	(67.85%	)		(52,404,305	)	(71.42%	)
Gross profit		19,397,982		32.15%			20,969,592		28.58%
Total operating expenses		(14,382,315	)	(23.84%	)		(13,718,623	)	(18.70%	)
Income from operations		5,015,667		8.31%			7,250,969		9.88%
Non-operating income (expenses)		1,816,390		3.01%			(26,143	)	(0.04%	)
Income before income taxes, non-controlling interests, and gain on equity investments in affiliates net income		6,832,057		11.32%			7,224,826		9.84%
Income taxes		(1,140,449	)	(1.89%	)		(862,935	)	(1.18%	)

Net income before non-controlling interests and gain on equity investments in affiliates net income		5,691,608		9.43%			6,361,891		8.66%
Gain on equity investments in affiliates due to proportional shares of the affiliates net income		734,443		1.22%			1,355,985		1.85%
Net income before non-controlling interests		6,426,051		10.65%			7,717,876		10.51%
Non-controlling interests in net income of subsidiary		(1,653,558	)	(2.74%	)		(1,961,204	)	(2.67%	)

Net income	$	4,772,493		7.91%		$	5,756,672		7.84%

~~Investing~~Net ~~Activities~~Sales – Net sales decreased by $13.04 million, or 17.77%, to $60.34 million for the six months ended June 30, 2012, from $73.37 million during the same period of 2011. Approximately 90.01% of this decrease is attributable to the decrease of our transportation business for the six months ended June 30, 2012. As compared to the same period of 2011, net sales of our transportation business decreased by approximately 16.89% . Such a decrease predominantly resulted from a temporary fluctuation of the execution process of existing contracts in our ITS business. Because our ITS business is conducted by contract basis, progress towards contract completion could vary from quarter to quarter, which would affect our revenue recognition. However, we expect the demand for our products and services to be generally steady and consistent over the years.

~~Our~~The ~~primary~~following ~~uses~~table ofillustrates ~~cash~~the ~~for~~revenues ~~investing~~from ~~activities~~the ~~are~~major Chinese ~~payments~~government sectors and regulated industries in which we sell our products and services for the ~~acquisition~~periods ofindicated. ~~property,~~The ~~plant~~table ~~and~~also ~~equipment,~~provides asthe percentage ~~well~~of astotal ~~intangible assets~~revenues represented by each listed sector.

Net cash used in investing activities for the three-month period ended March 31, 2012 was approximately $2.04 million, which is an increase of approximately $0.67 million from net cash used in investing activities of approximately $1.37 million for the same period of 2011. The increase in the cash used in investing activities was mainly attributable to the increase in intangible assets related to the software development related to the National Public Safety Monitoring Platform for Passenger and Hazardous Material Carrying Vehicles.

		Six Months Ended			Six Months Ended
		June 30, 2012			June 30, 2011
			% of Net			% of Net
		Net Sales	Sales		Net Sales	Sales
Transportation	$	57,744,453	95.70%	$	69,479,956	94.69%
Digital City		1,223,609	2.03%		1,299,766	1.77%
Land and resources		4,863	0.01%		47,055	0.06%
Other		1,363,093	2.26%		2,547,120	3.48%
Net sales	$	60,336,018	100.00%	$	73,373,897	100.00%

~~Financing~~Gross ~~Activities~~Profit – Our gross profit decreased approximately $1.57 million, or 7.49%, to approximately $19.40 million for the six months ended June 30, 2012, from approximately $20.97 million during the same period of 2011. Our gross profit decrease was mainly attributable to the decrease of sales during the six months ended June 30, 2012. However, our gross profit decrease was proportionally less than our revenue decrease from the same period of 2011 to 2012 and our gross profit as a percentage of net sales increased 3.57% from 28.58% to 32.15% . This increase in gross margin was mainly due to the transportation projects that we carried out were more cost effective due to the improvement in hardware purchase practice and labor management achieved in these projects.

~~Net~~Total ~~cash~~Operating ~~used~~Expenses in– ~~financing~~Total ~~activities~~operating ~~for the three-month~~expenses ~~period~~increased ~~ended~~by ~~March~~$0.66 31million, ~~2012~~or ~~was approximately $2~~4.~~08million~~84%, ~~while~~to ~~for the same period of 2011 we had approximately~~ $114.4138 million ~~net~~for ~~cash~~the ~~used~~six inmonths ~~financing~~ended ~~activities.~~June ~~This~~30, ~~was~~2012, ~~attributable~~from ~~to the repayment of short-term in an amount of~~ $113.8472 million ~~and~~during athe ~~dividend~~same ~~payment~~period of $02011.24 ~~million~~The ~~to the holders of the~~increase ~~Company’s~~is ~~non-controlling~~due ~~interest~~to ~~for~~ the ~~three-month period ended March 31, 2012.~~following:

~~Financing~~Our ~~Agreements~~selling expenses increased approximately $0.59 million, or 33.28%, to $2.37 million for the six months ended June 30, 2012, from $1.78 million during the same period of 2011. The increase of selling expenses was mainly attributable to our enhanced efforts in bidding for new contracts. Combined with our lower net sales recognized for the six months ended June 30, 2012, selling expenses as a percentage of net sales for the six months ended June 30, 2012 increased to 3.93% from 2.42% during the same period of 2011.

~~On January~~ 19, 2011, our VIE, Beijing PKU Chinafront High Technology Co., Ltd. (“PKU”) entered into a short-term loan agreement with Bank of Communications, Jiuxianqiao Branch (“Bank of Communications”), pursuant to which Bank of Communications has agreed to loan PKU a sum of RMB 20 million (approximately $3.15 million) for working capital use. The loan has an annual interest rate equal to 10% above the benchmark interest rate as of the actual launch day, with the interest to be paid on a quarterly basis. The loan expires within 12 months after the date of the first withdrawal. As of December 31, 2011, a principal amount of approximately $3.15 million was outstanding. This loan was paid off in January 2012.

Our general and administrative expenses were approximately $12.01 million (19.91% of total sales) and approximately $11.94 million (16.27% of total sales) for the six months ended June 30, 2012 and 2011, respectively. Our general and administrative expenses for the six months ended June 31, 2012 were relatively stable compared to the same period of the prior year. However, the increase of general and administrative expenses as a percentage of net sales was mainly attributable to the lower net sales recognized for the six months ended June 30, 2012 compared to the same period of prior year.

OnIncome ~~May~~Taxes ~~25,~~– ~~May~~For 30the ~~and~~six months ended June 1530, ~~2011~~2012, ~~PKU entered into three~~ ~~short-term~~we ~~loan~~recognized ~~agreements~~income ~~with~~tax ~~Bank~~expense of ~~Beijing, Zhongguancun Branch (“Zhongguancun Branch”), pursuant to which Zhongguancun Branch agreed to loan PKU an aggregate of RMB 25 million (approximately~~ $31.9414 million) asand ~~working capital.~~effective ~~The~~tax ~~loan has an annual interest~~ rate ~~equal to 10~~of 16.69% ~~above~~while in the ~~benchmark interest~~same ~~rate~~period as of ~~the first withdrawal date~~2011, ~~with~~we ~~the~~recognized ~~interest~~income totax beexpense ~~paid on a~~of ~~quarterly basis~~$0.86 ~~The~~million ~~loan~~and ~~expires~~effective ~~within~~tax 12rate ~~months~~ of ~~the date of the first withdrawal but may be renewed upon receipt of written consent from Zhongguancun Branch~~11.94% ~~Under the terms of the loan agreements, PKU is subject to customary affirmative and negative covenants~~. The ~~repayment~~increase ofin the ~~loan~~income ~~may~~tax expense bewas ~~accelerated and~~mainly ~~Zhongguancun~~due ~~Branch~~to ~~may~~some ~~demand~~VIEs ~~immediate~~with ~~repayment~~relatively ofhigher ~~the~~tax ~~principal~~rates ~~and~~contributed ~~accrued~~more ~~interests~~to ~~upon~~ the ~~occurrence~~income ofbefore antaxes ~~event~~than ~~of default that includes, among~~ other ~~things,~~VIEs awith ~~failure~~lower totax ~~make principal or interest payments~~rates, awhich ~~failure~~also toresulted ~~comply~~in ~~with~~higher ~~other~~effective ~~covenants~~tax ~~and~~rate ~~certain~~compared ~~events~~to ofthe ~~liquidation~~same orperiod ~~bankruptcy. A principal amount~~ of ~~RMB~~last ~~5 million was paid off in 2011 and on March 31, 2012, a principal amount of approximately $3~~year.~~17 million was outstanding.~~

OnLiquidity December 22, 2011, our VIE, Beijing Transwiseway Information Technology Co., Ltd. (“Beijing Transwiseway”) entered into a short-term loan agreement with Zhongguancun Haidianyuan Branch of Bank of Beijing ("Haidianyuan Branch"), pursuant to which Haidianyuan Branch agreed to loan Beijing Transwiseway a sum of RMB 30 million (approximately $4.72 million). On December 23, 2011, February 6, 2012 and ~~February~~Capital 26, 2012, the withdrawal of RMB 17,885,400 (approximately $2.83 million) was completed. The loan has an annual interest rate equal to 10% above the benchmark interest rate as of the date of the first withdrawal of the principal, with the interest to be paid on a quarterly basis. The loan expires within 12 months after the date of the first withdrawal but may be renewed upon the written consent by Haidianyuan Branch. Under the terms of the loan agreement, Beijing Transwiseway is subject to customary affirmative and negative covenants. The repayment of the loan may be accelerated and Haidianyuan Branch may demand immediate repayment of the principal and accrued interests upon the occurrence of an event of default which includes, among other things, a failure to make principal or interest payments timely, material breach of representations and warranties by Beijing Transwiseway, and certain events of liquidation or bankruptcy. As of March 31, 2012, a principal amount of approximately $2.83 million was outstanding. Resources

~~Future~~Our ~~Capital~~principal ~~Requirements~~liquidity –requirements Weare ~~believe~~for ~~that~~working ~~our current cash and cash equivalents and anticipated cash flow from operations will be sufficient to meet our anticipated cash needs~~capital, ~~including our cash needs for~~ ~~working~~ capital ~~and capital~~ expenditures ~~for~~and ~~at least the next 12 months. We may, however, require additional~~ cash ~~due~~dividends to ~~changing~~non-controlling ~~business~~shareholders ~~conditions or~~of ~~other future developments, including any investments or acquisitions we may decide to pursue~~subsidiaries. InWe ~~addition,~~fund ~~because substantially all of~~ our ~~revenues~~liquidity ~~are generated~~requirements ~~from~~primarily ~~our~~through ~~indirect~~cash ~~PRC~~on ~~subsidiary~~hand, ~~Oriental Intra-Asia Entertainment~~ ~~(China)~~cash ~~Limited,~~flow orfrom ~~Oriental~~operations ~~Intra-Asia,~~and ~~after~~borrowings ~~it receives payments~~ from our ~~VIE under~~revolving ~~various~~credit ~~services and other arrangements, the ability of Oriental Intra-Asia to make dividends and other payments to us is subject to the PRC dividend restrictions~~facility. ~~Current PRC law permits payments of dividend by Oriental~~We ~~Intra-Asia~~believe ~~only~~our ~~out~~cash ofon ~~its accumulated after-tax profits~~hand, iffuture ~~any,~~funds ~~determined~~generated ~~in accordance~~from ~~with~~operations ~~PRC accounting standards~~ and ~~regulations. Oriental Intra-Asia is~~borrowings ~~also~~from ~~required~~our ~~under~~revolving ~~PRC~~credit ~~laws~~facility ~~and~~will ~~regulations~~be tosufficient ~~allocate at least 10% of its annual after-tax profits determined in accordance with PRC GAAP~~ to ~~a statutory general reserve~~ fund ~~until~~our ~~the amounts in said fund reaches 50% of Oriental~~cash ~~Intra-Asia’s~~requirements ~~registered capital. Allocations to the statutory reserve fund can only be used~~ for ~~specific~~at ~~purposes~~least ~~and are not transferable to us in~~ the ~~form~~next ~~of loans,~~twelve ~~advances or cash dividends~~months. AsThere ais ~~result,~~no ~~if our existing cash and amount available under existing bank loans are insufficient to meet our requirements~~assurance, ~~we may seek to sell additional equity securities~~however, ~~debt securities or borrow additional funds from lending institutions. We can make no assurances~~ that ~~financing~~ we will be ~~available~~able ~~in the amounts we need or on terms acceptable~~ to ~~us, if~~generate atsufficient ~~all. The sale of additional equity securities, including convertible debt securities, would dilute the interests of our current shareholders. The incurrence of debt would divert~~ cash ~~for~~flow ~~working~~or ~~capital~~that ~~and~~we ~~capital~~will ~~expenditures~~be able to ~~service~~maintain ~~debt obligations and could result in operating and financial covenants that restrict~~ our ~~operations and our~~ ability to ~~pay dividends~~borrow tounder our ~~shareholders.~~revolving ~~If we are unable to obtain additional equity or~~credit ~~debt financing as required, our business operations and prospects may suffer~~facility.

~~Off-Balance~~As ~~Sheet~~of ~~Arrangements~~June 30, 2012, we had cash and ~~Contractual~~cash equivalents ~~Obligations~~(excluding restricted cash) of approximately $26.93 million and restricted cash of approximately $4.94 million. The following table provides detailed information about our net cash flow for all financial statements periods presented in this report.

~~None~~Cash Flow

~~Seasonality~~ Six Months Ended June 30, 2012 2011 Net cash used in operating activities $(14,636,118) $(12,987,326) Net cash used in investing activities (3,223,970) (6,011,371) Net cash (used in) / provided by financing activities (571,287) 4,325,358 Effect of foreign currency exchange translation 332,441 706,563 Net decrease in cash and cash equivalents (18,098,934) $(13,966,776)

~~Our~~Operating ~~results~~Activities of operations are affected by seasonality and we typically see lower sales during the first half than the second half of a year. Such seasonality is mainly caused by governmental seasonal budgeting activities and behaviors.

20Net cash used in operating activities was approximately $14.64 million for the six-month period ended June 30, 2012, while for the same period of 2011, we had approximately $12.99 million net cash used in operating activities. The increase in cash used in operating activities was mainly attributable to the reduction in net income of $0.98 million, the increase in restricted cash of $2.56 million due to increased new contracts that require the establishment of contracts performance bonds, the change in cash flow from accounts receivable due to relatively slower collections of $0.25 million, the increase in prepaid expenses and other current assets of $4.72 million, the increase in other receivables of $4.80 million related to increased activities in bidding for new contracts, the decrease in net billings of $8.4 million, that is, the difference between costs and estimated earnings in excess of billings on uncompleted contracts (when our work was performed ahead of customer payments in some of our contracts per the contract payment terms) and billings in excess of costs and estimated earnings on uncompleted contracts (when we receive payments from clients ahead of cost and earnings realization), the decrease in accrued liabilities and other current liabilities of $0.06 million, offset by the decrease of gain on equity investments in affiliates of $0.62 million due to less net income from these affiliates, the decrease of inventories of $2.84 million and the increase of accounts payable of $16.76 million.

~~ITEM 3.QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK.~~20

~~Pursuant~~Investing toActivities ~~Item 305(e) of Regulation S-K, the Company is not required to provide the information required by this Item as it is a “smaller reporting company.”~~

Our primary uses of cash for investing activities are payments for the acquisition of property, plant and equipment, as well as intangible assets.

Net cash used in investing activities for the six-month period ended June 30, 2012 was approximately $3.22 million, which is a decrease of approximately $2.79 million from net cash used in investing activities of approximately $6.01 million for the same period of 2011. The decrease of the cash used in investing activities was mainly due to the fact that for the six months ended June 30, 2011, we made a one-time payment of $3.59 million as down payment to acquire a land use right while in the same period of 2012, we did not have such investing activity. In addition, compared with the same period of 2011, we had an increase in intangible assets related to the software development of $1.09 million in the first half of 2012.

Financing Activities

Net cash used in financing activities for the six-month period ended June 30, 2012 was approximately $0.57 million, while for the same period of 2011 we had approximately $4.33 million net cash provided by financing activities. Such change was mainly attributable to the fact that for the period ended June 30, 2012, the repayment of short term loans was $2.12 million less than the same period of prior year, and offset by the decrease of non-controlling interests’ capital contribution of $6.62 million.

Financing Agreements

On May 25, May 30 and June 15, 2011, our VIE, Beijing PKU Chinafront High Technology Co., Ltd. (“PKU”) entered into three short-term loan agreements with Bank of Beijing, Zhongguancun Branch (“Zhongguancun Branch”), pursuant to which Zhongguancun Branch agreed to loan PKU an aggregate of RMB 25 million (approximately $3.94 million). The loan has an annual interest rate equal to 10% above the benchmark interest rate as of the first withdrawal date. The interest is to be paid in a quarterly basis. The loan matures within 12 months from the date of the first withdrawal, the loan may be renewed upon receipt of written consent from Zhongguancun Branch. Under the terms of the loan agreements, PKU is subject to customary affirmative and negative covenants. The repayment of the loan may be accelerated. Zhongguancun Branch has the right to demand immediate repayment of the principal and accrued interests in an event of default which includes, among other things, failure to make principal or interest payments, failure to comply with other covenants and certain events of liquidation or bankruptcy. A principal amount of RMB 5 million was paid off in 2011, RMB 15 million was paid off on May 29, 2012, and the remaining was paid off on June 15, 2012.

On December 22, 2011, our VIE, Beijing Transwiseway Information Technology Co., Ltd. (“Beijing Transwiseway”) entered into a short-term loan agreement with Zhongguancun Haidianyuan Branch of Bank of Beijing ("Haidianyuan Branch"), pursuant to which Haidianyuan Branch agreed to loan Beijing Transwiseway a sum of RMB 30 million (approximately $4.72 million). By February 26, 2012, we had withdrew RMB 17,885,400 (approximately $2.83 million). The loan has an annual interest rate equal to 10% above the benchmark interest rate as of the date of the first withdrawal of the principal. The interest is to be paid on a quarterly basis. The loan matures within 12 months from the date of the first withdrawal. The loan can be renewed upon the written consent by Haidianyuan Branch. Under the terms of the loan agreement, Beijing Transwiseway is subject to customary affirmative and negative covenants. The repayment of the loan may be accelerated. Haidianyuan Branch may also demand immediate repayment of the principal and accrued interests in an event of default which includes, among other things, failure to make principal or interest payments timely, material breach of representations and warranties by Beijing Transwiseway, and liquidation or bankruptcy. As of June 30, 2012, a principal amount of approximately $2.83 million was outstanding.

On April 1, 2012, PKU entered into a short-term loan agreement with Haidianyuan Branch, pursuant to which Haidianyuan Branch agreed to loan PKU an aggregate of RMB15 million (approximately $2.40 million). The loan has an annual interest rate equal to 20% above the benchmark interest rate as of the first withdrawal date. The interest is to be paid on a monthly basis. The loan matures within 12 months from the date of the first withdrawal. The loan may be renewed upon the written consent by Haidianyuan Branch. As of June 30, 2012, a principal amount of RMB 14,013,899 (approximately $2.22 million) was outstanding.

On May 30, 2012, UNISITS entered into a short-term loan agreement with Dayuncun Branch of Merchants Bank (“Dayuncun Branch”), pursuant to which Dayuncun Branch agreed to loan UNISITS a sum of RMB 10 million (approximately $1.60 million). The loan has an annual interest rate equal to 5% above the benchmark interest rate. The interest is to be paid on a quarterly basis. The Loan matures on December 23, 2012. As of June 30, 2012, a principal amount of approximately $1.59 million was outstanding.

On June 21, 2012, UNISITS entered into a short-term loan agreement with Qinghuayuan Branch of Bank of Beijing (“Qinghuayuan Branch”), pursuant to which Qinghuayuan Branch agreed to loan UNISITS a sum of RMB 10 million (approximately $1.60 million). The loan has an annual interest rate equal to 1% above the benchmark interest rate as of the date of the first withdrawal of the principal, with the interest to be paid on a quarterly basis. The loan matures in 6 months from the first withdrawal date of June 25, 2012. As of June 30, 2012, the first withdrawal of RMB 5 million was completed and a principal amount of approximately $0.79 million was outstanding.

Future Capital Requirements – We believe that our current cash and cash equivalents and anticipated cash flow from operations will be sufficient to meet our anticipated cash needs, including our cash needs for working capital and capital expenditures for at least the next 12 months. We may, however, require additional cash due to changing business conditions or other future developments, including any investments or acquisitions we may decide to pursue. In addition, because substantially all of our revenues are generated from our indirect PRC subsidiary, China TransInfo Technology Limited or China TransInfo Limited, after it receives payments from our VIE under various services and other arrangements, the ability of China TransInfo Limited to make dividends and other payments to us is subject to the PRC dividend restrictions. Current PRC law permits payments of dividend by China TransInfo Limited only out of its accumulated after-tax profits, if any, determined in accordance with PRC accounting standards and regulations. Oriental Intra-Asia is also required under PRC laws and regulations to allocate at least 10% of its annual after-tax profits determined in accordance with PRC GAAP to a statutory general reserve fund until the amounts in said fund reaches 50% of China TransInfo Limited’s registered capital. Allocations to the statutory reserve fund can only be used for specific purposes and are not transferable to us in the form of loans, advances or cash dividends. As a result, if our existing cash and amount available under existing bank loans are insufficient to meet our requirements, we may seek to sell additional equity securities, debt securities or borrow additional funds from lending institutions. We can make no assurances that financing will be available in the amounts we need or on terms acceptable to us, if at all. The sale of additional equity securities, including convertible debt securities, would dilute the interests of our current shareholders. The incurrence of debt would divert cash for working capital and capital expenditures to service debt obligations and could result in operating and financial covenants that restrict our operations and our ability to pay dividends to our shareholders. If we are unable to obtain additional equity or debt financing as required, our business operations and prospects may suffer.

Off-Balance Sheet Arrangements and Contractual Obligations

As previously disclosed, on June 8, 2012, we entered into an Agreement and Plan of Merger (the "Merger Agreement") with TransCloud Company Limited, a Cayman Islands exempted company with limited liability and indirectly wholly owned by Mr. Shudong Xia ("Parent"), TransCloud Acquisition, Inc., a Nevada corporation and a wholly owned, direct subsidiary of Parent ("Merger Sub"). Under the Merger Agreement, Merger Sub will merge with and into the Company, with the Company continuing as the surviving corporation and a wholly owned subsidiary of Parent.

According to the Merger Agreement, at the effective time of the Merger, each outstanding share of the Company’s common stock will be converted automatically into the right to receive $5.80 in cash, without interest, excluding certain shares as provided in the Merger Agreement. The Merger remains subject to the satisfaction or waiver of the conditions set forth in the Merger Agreement, including obtaining approval of the existing stockholders of the Company.

The foregoing description of the Merger Agreement is qualified in its entirety by reference to the full text of the Merger Agreement, copy of which has been filed as an Exhibit to our current report on Form 8-K dated June 8, 2012, and which is incorporated herein by reference.

Seasonality

Our results of operations are affected by seasonality and we typically see lower sales as well as lower cash collection during the first half than the second half of a year. Such seasonality is mainly caused by governmental seasonal budgeting activities and behaviors.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK.

Pursuant to Item 305(e) of Regulation S-K, the Company is not required to provide the information required by this Item as it is a “smaller reporting company.”

ITEM 4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures.

Our management, with the participation of our chief executive officer and chief financial officer, Mr. Shudong Xia and Mr. Rong Zhang, respectively, evaluated the effectiveness of our disclosure controls and procedures. The term “disclosure controls and procedures” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports, such as this report, that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on that evaluation, Mr. Shudong Xia and Mr. Rong Zhang concluded that as of ~~March~~June 3130, 2012, our disclosure controls and procedures were effective at the reasonable assurance level.

Changes in Internal Control Over Financial Reporting.

During the fiscal quarter ended ~~March~~June 3130, 2012, there were no changes in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

21 23

PART ~~IIOTHER~~II OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

From time to time, we may have disputes that arise in the ordinary course of our business. Currently, there are no material legal proceedings to which we are a party, or to which any of our property is subject, that we expect to have a material adverse effect on our financial condition, except as follows:

The Company and the members of our board of directors are named as defendants in purported class action lawsuits (the “Stockholder Actions”) brought in the Eighth Judicial District Court, Clark County, Nevada (the “Eighth Judicial Districted Court”) by several stockholders: Oswald Velz v. China TransInfo Technology Corp. et al., Case No. A-12-657022-C (filed February 24, 2012), Tim Valles v. Shudong Xia et al. Case No. A-12-657443-C (filed March 1, 2012) and Carl M. Domitrovich v. Shudong Xia et al. Case No. A-12-657740-C (filed March 6, 2012). The Stockholder Actions generally allege that the Company and all of our directors breached their fiduciary duties in connection with the receipt by the Company of a preliminary, non-binding proposal from Shudong Xia, the Company’s Chairman and Chief Executive Officer, to acquire all of the outstanding shares of our common stock not currently owned by him in a going private transaction at a proposed price of of $5.65 per share in cash (the “Proposed Transaction”). The Stockholder Actions seek, among other things, to declare that the Proposed Transaction is unfair, unjust and inequitable, to enjoin the Company from taking any steps necessary to accomplish or implement the Proposed Transaction, and damages in the event the Proposed Transaction is consummated.

On July 13, 2012, the above three class action complaints were consolidated into one amended class action complaint, In Re China TransInfo Technology Corp. Shareholders’ Litigation, Consolidated Case No. A-12-657022-B, filed in the Eighth Judicial District Court and against our directors and some other parties to the Proposed Transaction.

ITEM 1A. RISK FACTORS

Our Annual Report on Form 10-K for the fiscal year ended December 31, 2011 contains a detailed discussion of risk factors that could materially adversely affect our business, our operating results, or our financial condition. The following risk factor should be read in conjunction with that discussion. Except for the addition of this risk factor, there are no material changes from the risk factors previously disclosed in Item 1A “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2011.

Our auditor, like other independent registered public accounting firms operating in China, is not inspected by the U.S. Public Company Accounting Oversight Board (the“PCAOB”), and as such, our investors currently do not have the benefits of PCAOB oversight.

Auditors of companies that are public in the U.S. must be registered with the PCAOB. US audit firms that are registered with the PCAOB are required by U.S. law to undergo regular inspection by the PCAOB to assess their compliance with professional auditing standards in connection with their audits of public company. Because our auditor is located in China, a jurisdiction where the PCAOB is currently unable to conduct inspections without the approval of the Chinese authorities, the audit work and practices of our auditor, like other registered audit firms operating in China, is currently not inspected by the PCAOB.

The inability of the PCAOB to conduct inspections of auditors in China makes it more difficult to evaluate the effectiveness of our auditor’s audit procedures or quality control procedures as compared to auditors outside of China that are subject to PCAOB inspections. As a result, investors may be deprived of the benefits of PCAOB inspections. Investors may also lose confidence in our reported financial information and procedures and the quality of our financial statements.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

We have not sold any unregistered equity securities during the fiscal quarter ended ~~March~~June 3130, 2012 that were not previously disclosed in a current report on Form 8-K that was filed during that period.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

ITEM 5. OTHER INFORMATION.

None.

ITEM 6. EXHIBITS.

EXHIBITS.

31.1	Certification of Principal Executive Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Principal Financial Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Principal Executive Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Principal Financial Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101	The following financial information from The China TransInfo Technology Corp.'s Quarterly Report on Form 10-Q for the quarter ended ~~March~~June 3130, 2012, formatted in XBRL (eXtensible Business Reporting Language): (i) Condensed Consolidated Balance Sheets at ~~March~~June 3130, 2012 and December 31, 2011, (ii) Condensed Consolidated Statements of Income for the three and six months ended ~~March~~June 3130, 2012 and 2011, (iii) Condensed Consolidated Statements of Cash Flows for the ~~three~~six months ended ~~March~~June 3130, 2012 and 2011, and (iv) the Notes to ~~Unaudited~~ Condensed Consolidated Financial Statements (Unaudited).

2325

SIGNATURES

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

DATED: ~~May~~August 1514, 2012

CHINA TRANSINFO TECHNOLOGY CORP. ~~By: /s/ Shudong Xia Shudong Xia Chief Executive Officer (Principal Executive Officer) By: /s/ Rong Zhang Rong Zhang Chief Financial Officer (Principal Financial Officer)~~

By: /s/ Shudong Xia
Shudong Xia
Chief Executive Officer
(Principal Executive Officer)

By: /s/ Rong Zhang
Rong Zhang
Chief Financial Officer
(Principal Financial Officer)

EXHIBIT INDEX

Exhibit
Exhibit Number	Description
Number	Description
31.1	Certification of Principal Executive Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Principal Financial Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Principal Executive Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Principal Financial Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101	The following financial information from The China TransInfo Technology Corp.'s Quarterly Report on Form 10-Q for the quarter ended ~~March~~June 3130, 2012, formatted in XBRL (eXtensible Business Reporting Language): (i) Condensed Consolidated Balance Sheets at ~~March~~June 3130, 2012 and December 31, 2011, (ii) Condensed Consolidated Statements of Income for the three and six months ended ~~March~~June 3130, 2012 and 2011, (iii) Condensed Consolidated Statements of Cash Flows for the ~~three~~six months ended ~~March~~June 3130, 2012 and 2011, and (iv) the Notes to ~~Unaudited~~ Condensed Consolidated Financial Statements (Unaudited).

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