Well I have just updated to the latest Horde and components.
The fix for the flags works now, thank you very much.

Also in regard to the Calendar thing it also is fixed. No idea why, 
but the logs show that the activesync for both Flags and Calendar 
creation are working I can see that in real time with a simple tail -f 
/var/log/horde/*special_characters*.txt

Cheers mate.

Regards,
Steven Swarts

This works fine for me. Enable the sync log and watch to be sure that 
the device is actually sending the device-created data. If it's not 
initiating the sync, there is nothing Horde can do about it, that's 
the device's responsibility. If it *is* sending the data, but Horde is 
not displaying it, please create another ticket.
Nope, not related at all.

Changes have been made in Git (master):

commit 978db249e32667f69162fe0c6ce6a10f4a8063c3
Author: Michael J Rubinsky <mrubinsk@horde.org>
Date:   Wed Nov 21 23:36:17 2012 -0500

     This method only returns a single stat array.

     Fixes Bug: 11732

  .../Core/lib/Horde/Core/ActiveSync/Driver.php      |    2 +-
  1 files changed, 1 insertions(+), 1 deletions(-)

http://git.horde.org/horde-git/-/commit/978db249e32667f69162fe0c6ce6a10f4a8063c3

Please note I also am having issues with device side calendar creations.
If I create a new calendar item, it WILL NOT sync with the server.

I don't know if that is related, as I'm about to head out the door. 
Will look into it more tomorrow.

Yes.

I will try to diagnose tomorrow if not it will be the next day.

Does this mean that you have the same issue on your end? That it isn't 
just my problem?

Regards,
Steven Swarts
Swarts IT

I can reproduce this locally.

To further debug this issue, we need details of the Horde -> Device 
connection. It may also be beneficial to obtain a network capture.

To enable debugging, see instructions contained in the ActiveSync 
section of Horde's configuration. Also, see 
http://wiki.horde.org/ActiveSync for more details.

Debugging should not be enabled on a production server,   Attach/post 
only the portion of the log that directly deals with the problem 
reported (it may be simplest to clear the log file and then perform 
the event that causes the error).

Listed initially on horde@lists.horde.org

Problem: Flag function not syncing with server from Samsung Galaxy S3 device.

Server: Debian 6, Horde 5, ISPConfig 3, latest updates from pear.

Elaborated Problem: Using the Exchange Account setup in the Android OS 
everything sync?s fine (Calendar, Contacts, Email) but when I flag 
something on my phone it refuses to sync with the server. I understand 
(read somewhere) that a simple flag function won?t initiate a full 
sync, however I have tried to send emails after flagging an email and 
forcing a full sync and still no luck.

Things I?ve tried:
?        Sending emails after flagging mail
?        Initiating full sync through settings on Android OS
?        Removing Activesync partnership through Webmail login using 
Administrator account
?        Checking for updates regularly
?        Setting up an IMAP email account separate to Exchange account and 
that works as expected.