NOTE 5 – PREPAID EXPENSES AND OTHER ASSETS

Prepaid expenses and other assets as of December 31, 2012 and March 31, 2012 were as follows:

On February 2, 2012 the Company entered into a Management and Services Agreement, dated as of February 2, 2012, between BMB Munai, Inc. and Lakeview International, LLC (the “Services Agreement”). Pursuant to the Services Agreement, the Company engaged Lakeview International, LLC (“Lakeview”) to provide management, administrative and support personnel and services to the Company in furtherance of fulfilling its obligations pursuant to the Purchase Agreement, and other activities, including the winding down of the Company’s representative office in Kazakhstan.  Lakeview is a company controlled by a former Company director.

The Services Agreement commenced on February 2, 2012 and continued through December 31, 2012.  In exchange for the services under the Services Agreement, the Company paid $1,947,500 to Lakeview, which included anticipated out-of-pocket expenses required to perform the services through the term of the Agreement in the amount of $1,900,000 and a management fee of $47,500.  The full amount was due and payable upon execution of the Services Agreement.  The Services Agreement provides that in the event of early termination, Lakeview will be required to return to the Company any portion of the $1,900,000 that has not been paid to cover out-of-pocket expenses as of the date the Services Agreement is terminated.

From February 2, 2012 (the date the Services Agreement became effective) to December 31, 2012 the Company has accrued and expensed consulting services in the amount of $1,947,501.  For the three and nine months ended December 31, 2012, $536,099 and $1,608,296 was expensed as general and administrative expense.