Intangible Assets

3 Months Ended

Sep. 30, 2011

NOTE 10 – INTANGIBLE ASSETS

Intangible net assets consisted of the following:

	Balance at										Foreign		Balance at
	December 31, 2010		Additions		Amortization Expense			Impairment Charge			Currency Transl Adj		September 30, 2011 (Unaudited)
Amortized intangible assets:

Patent technology in Shenzhen Hyper (a)	$	718,452	$	-	$	(61,273	)	$	-		$	20,030	$	677,209

Patent technology in Portola Medical, Inc. (b)		243,750		-		(9,375	)		-			-		234,375

Operating rights (c)		-		10,910,827		(761,935	)		(1,973,858	)		-		8,175,034

	$	962,202	$	10,910,827	$	(832,583	)	$	(1,973,858	)	$	20,030	$	9,086,618

(a)	Patent represents a patent technology for the production of a component of the radiation treatment system. Pursuant to the patent certificate, the patent is valid for 20 years from the application date, May 1999.

(b)	Patent acquired in Portola Medical, Inc. (“Portola”). Patent technology is utilized in the production of medical equipment and is amortized over its estimated useful life of 20 years.

(c)

Operating rights represents the contractual rights of receiving net income from four medical centers which utilize the medical accelerator systems owned by Changdu Huiheng, which have been acquired from Jiancheng on March 30, 2011. The operating rights were acquired from its major customer and are amortized over contractual periods ranging from 7 to 10 years. These operating rights are amortized over their contractual periods by straight-line method.

For the nine months ended September 30, 2011 and 2010, amortization expenses amounted to $832,583 and $65,276, respectively. For the three months ended September 30, 2011 and 2010, amortization expenses amounted to $357,622 and $23,966, respectively. The expected amortization which was based on the closing rate as of September 30, 2011 for the next five years and thereafter is as follows:

	Patent technology in Portola Medical, Inc.		Patent technology in Shenzhen Hyper		Operating rights in Changdu Huiheng		Total
December 31,
2011	$	3,125	$	22,083	$	266,260	$	291,468
2012		12,500		88,332		1,065,037		1,165,869
2013		12,500		88,332		1,065,037		1,165,869
2014		12,500		88,332		1,065,037		1,165,869
2015		12,500		88,332		1,065,037		1,165,869
Thereafter		181,250		301,800		3,648,624		4,131,674
Total	$	234,375	$	677,211	$	8,175,032	$	9,086,618

HUIHENG MEDICAL, INC. 10-Q