Notes to the Consolidated Financial Statements
September 30, 2018
Expressed in United States Dollars
(
Unaudited
)
NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS
Resort Savers, Inc. (“we,” “us,” “our,” the “Company,” “Resort Savers” or “RSSV”) is a Nevada corporation incorporated on June 25, 2012. It is based in Shenzhen, the People’s Republic of China (the “PRC”). The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America, and the Company’s fiscal year end is December 31.
The Company makes investments and acquisitions into sound, transparent markets and industries throughout the world. The Company is principally engaged in the trading of oil, gas and lubricant, as well as an agricultural business and provides nutrition consultancy services and training as well as selling health products through an online store.
Admall Share Exchange and Recapitalization
Admall Sdn. Bhd.
On May 16, 2018, the Company closed the acquisition of Admall Sdn. Bhd., a limited liability company incorporated in Malaysia (“Admall”) by way of share exchange (the “Admall Acquisition”). The Company effected the Admall Acquisition pursuant to the terms of that certain Share Exchange Agreement (the “Admall Agreement”), dated February 9, 2018, by and between the Company, Admall, and Mr. Boon Jin “Patrick” Tan, an individual who prior to the closing of the Admall Acquisition held 100% of the outstanding equity interests of Admall. See Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Securities Exchange Commission on February 9, 2018, which is incorporated herein by reference, for a detailed description of the Admall Agreement.
At the closing of the Admall Acquisition, the Company acquired 100% of the outstanding equity interests of Admall from Mr. Tan, and the Company issued 400,000,000 shares of its common stock, par value $0.0001 per share (“Common Stock”) to Mr. Tan, which at the time of closing represented approximately 81.47% of the Company’s issued and outstanding Common Stock. As a result, Mr. Tan became a stockholder of the Company and Admall became a wholly-owned subsidiary of the Company. For federal income tax purposes, the Admall Acquisition was intended to qualify as a tax-free reorganization under the provisions of Section 368(a) of the Internal Revenue Code of 1986, as amended.
For financial accounting purposes, the Admall Agreement has been accounted for as a reverse acquisition by Admall and resulted in a recapitalization of the Company, with Admall being the accounting acquirer and the Company as the acquired entity. The consummation of the Admall Agreement resulted in a change of control of RSSV. Accordingly, the historical financial statements prior to the acquisition are those of the accounting acquirer, Admall, and have been prepared to give retroactive effect to the reverse acquisition completed on May 16, 2018 and represent the operations of Admall.
As a result of the above, these consolidated financial statements represent Admall as the accounting acquirer (legal acquiree) and RSSV, from May 16, 2018 forward, as the accounting acquiree (legal acquirer), and the legal capital stock (number and type of equity interests issued) is that of RSSV, the legal parent, in accordance with guidance on reverse acquisitions accounted for as a business combination. Therefore, the Company recognized goodwill of $3,199,594.
Change in Fiscal Year
On July 3, 2018, our Board of Directors approved a change in our Fiscal Year End from January 31 to December 31, and the Company’s bylaws were immediately amended subsequent to the decision. The Company now operates on a fiscal year ending on December 31.
Reverse Stock Split
On July 3, 2018, our Board of Directors approved a reverse one-for-thirty (1-for-30) stock split (the “Reverse Split”) of the Company’s issued and outstanding Common Stock. The Reverse Split will have no effect on the number of authorized Common Stock of the Company, nor will it effect the authorized or issued and outstanding shares of preferred stock, par value $0.0001 per share (“Preferred Stock”), since the Company has no shares of Preferred Stock issued or outstanding. The Reverse Split will take effect upon approval by the Financial Industry Regulatory Authority (“FINRA”). No adjustments have been made to the financial statements as a result of the Reverse Split.
Name Change
On July 3, 2018, our Board of Directors approved a change in corporate name of the Company from Resort Savers, Inc. to SGCI Group Holding, Inc. (the “Name Change”). The Name Change will be effective upon approval by FINRA.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The Company prepares its financial statements in accordance with rules and regulations of the U.S. Securities and Exchange Commission (SEC) and generally accepted accounting principles (“GAAP”) in the United States of America. The accompanying interim financial statements have been prepared in accordance with GAAP for interim financial information in accordance with Article 8 of Regulation S-X and presented in United States dollars.
The amounts shown in these financial statements for periods prior to May 16, 2018 are those of Admall. For the period from May 16, 2018 through September 30, 2018, the amounts shown in these financial statements are the consolidated results of the Company including its wholly owned subsidiary, Admall.
Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s Form 8-K/A filed on November 11, 2018. The results of operations for the periods ended September 30, 2018 and the same period last year are not necessarily indicative of the operating results for the full years. In the opinion of management, the unaudited consolidated financial statements include all adjustments necessary for the fair presentation of the Company’s financial position and of the results of operations and cash flows for the periods presented, all such adjustments were of a normal and recurring nature, with the exception of the recapitalization related to the reverse acquisition transaction that occurred on May 16, 2018 which of a non-recurring nature.
Principles of Consolidation
At September 30, 2018, the principal subsidiaries of the Company were listed as follows:
Entity Name
|
|
Acquisition
Date
|
|
Ownership
|
|
|
Jurisdiction
|
|
Investments
Held By
|
|
Nature of
Operation
|
|
Fiscal
Year
|
|
Admall Sdn. Bhd.
|
|
May 16,
2018
|
|
100
|
%
|
|
Malaysia
|
|
RSSV
|
|
Nutritional
Services
|
|
December
31
|
|
Xing Rui International Investment Holding Group Co., Ltd. (“Xing Rui”)
|
|
December 22,
2014
|
|
|
100
|
%
|
|
Seychelles
|
|
RSSV
|
|
Holding
Company
|
|
January
31
|
|
Xing Rui International Investment Group Ltd. (“Xing Rui HK”)
|
|
December 22,
2014
|
|
|
100
|
%
|
|
Hong Kong,
the PRC
|
|
Xing Rui
|
|
Holding
Company
|
|
January
31
|
|
Huaxin Changrong (Shenzhen) Technology Service Co., Ltd. (“Huaxin”) *
|
|
August 27,
2015
|
|
|
100
|
%
|
|
the PRC
|
|
Xing Rui
|
|
Holding
Company
|
|
December
31
|
|
Shenzhen Amuli Industrial Development Company Limited (“Amuli”) *
(1)
|
|
October 1,
2015
|
|
|
60
|
%
|
|
the PRC
|
|
Huaxin
|
|
Beverage
Producer
|
|
December
31
|
|
Beijing Yandong Tieshan Oil Products Co., Ltd. (“Tieshan Oil”) *
|
|
January 29,
2016
May 16, 2018
|
|
|
51
49
|
%
%
|
|
the PRC
|
|
Huaxin
|
|
Trading of oil
products
|
|
December
31
|
|
__________
*
|
The English names used are translated only.
|
(1)
|
Please see Part II, Item 5 (Other Information) in this Quarterly Report on Form 10-Q for a description of the November 19, 2018 disposition of Amuli.
|
These consolidated financial statements include the accounts of the Company and its subsidiaries. All material intercompany balances and transactions have been eliminated.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. The estimates and judgments will also affect the reported amounts for certain revenues and expenses during the reporting period. Actual results could differ from these good faith estimates and judgments.
Foreign Currency Translation and Re-measurement
The Company translates its foreign operations to U.S. dollars in accordance with ASC 830, “
Foreign Currency Matters
”.
The Company’s functional currency and reporting currency is the U.S. dollar, and our subsidiaries’ functional currency is the Chinese Yuan Renminbi (“CNY”), Malaysian Ringgit (“MYR”) and Hong Kong Dollar (“HKD”).
The translate its records into U.S. dollar as follows:
|
·
|
Assets and liabilities at the rate of exchange in effect at the balance sheet date
|
|
|
|
|
·
|
Equities at historical rate
|
|
|
|
|
·
|
Revenue and expense items at the average rate of exchange prevailing during the period
|
Concentrations of Credit Risk
The Company’s financial instruments that are exposed to concentrations of credit risk primarily consist of its cash and cash equivalents, and accounts receivable. The Company places its cash and cash equivalents with financial institutions of high credit worthiness. At times, its cash and cash equivalents with a particular financial institution may exceed any applicable government insurance limits. The Company also reviews its accounts receivable in a timely manner. The Company’s management plans to assess the financial strength and credit worthiness of any parties to which it extends funds, and as such, it believes that any associated credit risk exposures are limited.
Tieshan Oil
During the nine months ended September 30, 2018, one customer, who is a related party, accounted for 98% of revenues from related party.
As of September 30, 2018, one customer accounted for approximately 81% of accounts receivable, one customer accounted for 98% of accounts receivable – related party, two vendors account for approximately 96% of accounts payable, two vendors account for approximately 98% of accounts payable – related parties.
Financial Instruments
The Company’s financial instruments consist primarily of cash and cash equivalents, accounts receivable, prepaid expenses and deposits, amount due from related parties, accounts payable and accrued liabilities, short-term loan, deferred revenue and due to related parties. The carrying amounts of such financial instruments approximate their respective estimated fair value due to the short-term maturities and approximate market interest rates of these instruments.
Inventory
Inventories, consisting of raw material, are primarily accounted for using the first-in-first-out (“FIFO”) method of accounting. Inventories are measured at the lower of cost and net realizable value. The Company estimates the net realizable value of inventories based on an assessment of expected sales prices. Demand levels and pricing competition could change from time to time. If such factors result in an adverse effect on the Company’s products, the Company might be required to reduce the value of its inventories.
Property and equipment
Fixed assets are recorded at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets. The useful lives are as follows:
Computer and software
|
|
3 years
|
Furniture and fittings
|
|
6 years
|
Office equipment
|
|
4 years
|
Plant and machinery
|
|
5 ~ 10 years
|
Renovation
|
|
3.3 years
|
Maintenance and repairs are charged to operations as incurred. Expenditures which substantially increase the useful lives of the related assets are capitalized. When properties are disposed of, the related costs and accumulated depreciation are removed from the accounts and any gain or loss is reported in the period the transaction takes place.
Accounting for the impairment of long-lived assets
The long-lived assets held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of assets may not be recoverable. It is reasonably possible that these assets could become impaired as a result of technology or other industry changes. Determination of recoverability of assets to be held and used is by comparing the carrying amount of an asset to future net undiscounted cash flows to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. During the nine months ended September 30, 2018 and 2017, the Company did not impair any long-lived assets.
Revenue Recognition
Revenues are recognized when control of the promised goods or services are transferred to a customer, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements:
|
·
|
identify the contract with a customer;
|
|
|
|
|
·
|
identify the performance obligations in the contract;
|
|
|
|
|
·
|
determine the transaction price;
|
|
|
|
|
·
|
allocate the transaction price to performance obligations in the contract; and
|
|
|
|
|
·
|
recognize revenue as the performance obligation is satisfied.
|
Income Taxes and Deferred Taxes
Tax expense in profit or loss comprises current and deferred tax. Current tax and deferred tax are recognized in profit or loss except to the extent that it relates to a business combination or items recognized directly in equity or other comprehensive income.
Deferred tax is recognized using the liability method for all temporary differences between the carrying amounts of assets and liabilities in the statement of financial position and their tax bases. Deferred tax is not recognized for the temporary differences arising from the initial recognition of goodwill, the initial recognition of assets and liabilities in a transaction which is not a business combination and that affects neither accounting nor taxable profit or loss. Deferred tax is measured at the tax rates that are expected to be applied to the temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the end of the reporting period.
Recent Accounting Pronouncements
Management has considered all recent accounting pronouncements issued since the last audit of our financial statements. The Company’s management believes that these recent pronouncements will not have a material effect on the Company’s financial statements.
NOTE 3 - GOING CONCERN
The Company’s financial statements are prepared using GAAP applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet had sufficient revenues to cover its operating cost, and requires additional capital to commence its operating plan. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations. These factors raise substantial doubt about its ability to continue as a going concern.
In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plan to obtain such resources for the Company include: sales of equity instruments; traditional financing, such as loans; and obtaining capital from management and significant stockholders sufficient to meet its minimal operating expenses. However, management cannot provide any assurance that the Company will be successful in accomplishing any of its plans.
There is no assurance that the Company will be able to obtain sufficient additional funds when needed or that such funds, if available, will be obtainable on terms satisfactory to the Company. In addition, profitability will ultimately depend upon the level of revenues received from business operations. However, there is no assurance that the Company will attain profitability. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
NOTE 4 – ACCOUNTS RECEIVABLE
The Company has performed an analysis on all of its accounts receivable and determined that all amounts are collectible by the Company. As such, all accounts receivable are reflected as a current asset and no allowance for bad debt has been recorded as of September 30, 2018 and December 31, 2017. For the nine months ended September 30, 2018 and 2017, the Company recorded bad debt of $7,755 and $0, respectively. The Company’s accounts receivable consists of only trade receivables from customers which are unrelated to the Company. Trade receivables from customers which are related to the Company are categorized in amount due from related parties (Note 11). As at September 30, 2018 and December 31, 2017, the Company had accounts receivable of $1,109,480 and $129,435, respectively.
NOTE 5 – INVENTORIES
Inventories at September 30, 2018 and December 31, 2017 consist of the following:
|
|
September 30,
|
|
|
December 31,
|
|
|
|
2018
|
|
|
2017
|
|
|
|
|
|
|
|
|
Finished goods
|
|
$
|
94,238
|
|
|
$
|
124,343
|
|
NOTE 6 - PREPAID AND OTHER CURRENT ASSETS
Prepaid expense and other current assets at September 30, 2018 and December 31, 2017 consist of the following
|
|
September 30,
|
|
|
December 31,
|
|
|
|
2018
|
|
|
2017
|
|
|
|
|
|
|
|
|
Other receivables
|
|
$
|
2,659
|
|
|
$
|
3,250
|
|
Deposits
|
|
|
433
|
|
|
|
13,961
|
|
Prepaid expenses
|
|
|
38,614
|
|
|
|
58,892
|
|
|
|
$
|
41,706
|
|
|
$
|
76,103
|
|
NOTE 7 – PLANT AND EQUIPMENT
Plant and equipment at September 30, 2018 and December 31, 2017 consist of the following:
|
|
September 30,
|
|
|
December 31,
|
|
|
|
2018
|
|
|
2017
|
|
Cost:
|
|
|
|
|
|
|
Computer and software
|
|
$
|
77,102
|
|
|
$
|
93,893
|
|
Furniture and fittings
|
|
|
4,289
|
|
|
|
39,969
|
|
Office equipment
|
|
|
5,159
|
|
|
|
42,799
|
|
Plant and machinery
|
|
|
962,081
|
|
|
|
738,662
|
|
Renovation
|
|
|
-
|
|
|
|
48,978
|
|
|
|
|
1,048,631
|
|
|
|
964,301
|
|
Less: accumulated depreciation
|
|
|
(473,076
|
)
|
|
|
(204,023
|
)
|
Equipment, net
|
|
$
|
575,555
|
|
|
$
|
760,278
|
|
During the nine months ended September 30, 2018 and 2017, the Company recorded depreciation of $80,091 and $75,055, respectively.
During the nine months ended September 30, 2018 and 2017, the Company acquired assets of $550 and $2,263, respectively, and sold assets for $4,596 and $8,923, respectively and recorded loss on sales of assets of $31,392 and $6,928, respectively.
During the nine months ended September 30, 2018 and 2017, the Company recorded an impairment loss of $64,563 and $0, respectively.
NOTE 8 –ACCRUED LIABILITIES AND OTHER PAYABLE
The Company’s accounts payable and accrued liabilities consist of the followings:
|
|
September 30,
|
|
|
December 31,
|
|
|
|
2018
|
|
|
2017
|
|
Accrued expenses
|
|
$
|
43,652
|
|
|
$
|
35,121
|
|
Deposit received
|
|
|
242
|
|
|
|
308
|
|
Other payables
|
|
|
52,196
|
|
|
|
22,959
|
|
|
|
$
|
96,090
|
|
|
$
|
58,388
|
|
NOTE 9 – SHORT-TERM LOAN
There are no provisions in the Company’s bank borrowings that would accelerate repayment of debt as a result of a change in credit ratings or a material adverse change in the Company’s business.
The interest rate is 0.5% per month. The loan is secured by 48.83% shares of Tieshan Oil held by Mr. Yang Baojin (“Mr. Yang”). The Loan was due on October 7, 2017 and the outstanding amount of $789,500 (RMB 5,000,000) is currently in default. The Company believes that the carrying value of the equity interest in Tieshan Oil, which is a financial instrument, and which has been pledged by Mr. Yang as collateral for the loan is sufficient to underlie the loan, and the Company has not been requested to add any additional credit enhancements.
During the nine months ended September 30, 2018, the Company repaid $934,800 (RMB 6,000,000). On September 30, 2018 and December 31, 2017, the Company had a short-term loan balance of $0.
NOTE 10 – CONVERTIBLE NOTE
Onn May 21, 2018, the Company issued the convertible note of $100,000 with a conversion price of one-third of one cent to the related party to repay related party contribution. The convertible note is non-bearing interest and due on May 21, 2019. The Company recorded a discount on the convertible note due to a beneficial conversion feature of $100,000.
On May 30, 2018, the note was fully converted into 30,000,000 shares of common stock.
During the nine months ended September 30, 2018, the Company recognized amortization of discount of $100,000.
NOTE 11 - STOCKHOLDERS’ EQUITY
The capitalization of the Company consists of the following classes of capital stock as of September 30, 2018:
Preferred Stock
The Company has authorized 15,000,000 shares of preferred stock with a par value of $0.0001 per share. The Board of Directors are authorized to divide the authorized shares of Preferred Stock into one or more series, each of which shall be so designated as to distinguish the shares thereof from the shares of all other series and classes. No shares of preferred stock have been issued.
Common Stock
The Company has authorized 1,000,000,000 shares of common stock with a par value of $0.0001 per share. Each common share entitles the holder to one vote, in person or proxy, on any matter on which action of the stockholders of the corporation is sought.
During the nine months ended September 30, 2018, the Company issued 30,000,000 shares of common stock for conversion of debt of $100,000.
As at September 30, 2018 and December 31, 2017, the Company had 520,976,241 and 400,000,000 common shares issued and outstanding.
The Company has no stock option plan, warrants or other dilutive securities.
Additional Paid-In Capital
During the nine months ended September 30, 2018, related parties contributed additional paid-in capital in the amount of $104,494, to fund operating expenses and related party contribution of $100,000 was cancelled (see Note 9).
NOTE 12 – RELATED PARTY TRANSACTIONS
Revenue and receivable
During the nine months ended September 30, 2018, the Company generated revenue from related parties of $14,714,437, which were related company under common control with the Company.
The Company’s amount due from related parties consist of the followings:
|
|
September 30,
|
|
|
December 31,
|
|
|
|
2018
|
|
|
2017
|
|
Accounts receivable
|
|
$
|
19,177,766
|
|
|
$
|
-
|
|
Loan to related parties
|
|
|
175,700
|
|
|
|
157,863
|
|
|
|
$
|
19,353,466
|
|
|
$
|
157,863
|
|
Accounts payable, other liabilities and loans
As of September 30, 2018, and December 31, 2017, Due to related parties consist of the follows;
|
|
September 30,
|
|
|
December 31,
|
|
|
|
2018
|
|
|
2017
|
|
Accounts payable
|
|
$
|
13,755,131
|
|
|
$
|
-
|
|
Accrued liabilities and other
|
|
|
16,469
|
|
|
|
-
|
|
Loan from related parties
|
|
|
282,800
|
|
|
|
136,070
|
|
|
|
$
|
14,054,400
|
|
|
$
|
136,070
|
|
Contribution
During the nine months ended September 30, 2018, related parties, who are shareholders of the Company, forgave debt, in the amount of $104,494 for payments made on behalf of the Company for operating expenses. The amount has been recognized as a contribution to capital.
During the nine months ended September 30, 2018, $100,000 recorded as a contribution to capital was cancelled (see Note 9)
NOTE 13 – COMMITMENTS AND CONTINGENCIES
On August 23, 2016, Amuli entered into a lease agreement for office space in Shenzhen city, Guangdong Province, P.R.C. commencing on August 23, 2016 for a three-year lease term. The monthly rental expense is approximately $6,762 (RMB 42,526).
As of December 31, 2017, the outstanding lease commitments are:
Year 1
|
|
$
|
81,140
|
|
Year 2
|
|
|
47,332
|
|
|
|
$
|
128,472
|
|
NOTE 14 - SEGMENTED INFORMATION
At September 30, 2018, the Company operates in two industry segments, health beverage and oil and gas, and two geographic segments, Malaysia and China, where majority current assets and equipment are located.
Segment assets and liabilities as of September 30, 2018 and December 31, 2017 were as follows:
September 30, 2018
|
|
Holding Company
|
|
|
Oil and gas
|
|
|
Nutritional Services
|
|
|
Health beverage – Assets and liabilities held for sale
|
|
|
Total Consolidated
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets
|
|
$
|
4,860
|
|
|
$
|
19,817,523
|
|
|
$
|
824,053
|
|
|
$
|
86,096
|
|
|
$
|
20,732,532
|
|
Non-current assets
|
|
|
1,219,807
|
|
|
|
1,983,442
|
|
|
|
571,900
|
|
|
|
-
|
|
|
|
3,775,149
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
91,762
|
|
|
|
14,914,942
|
|
|
|
501,873
|
|
|
|
505,485
|
|
|
|
16,014,062
|
|
Long term liabilities
|
|
|
-
|
|
|
|
-
|
|
|
|
57,224
|
|
|
|
-
|
|
|
|
57,224
|
|
Net assets (liabilities)
|
|
$
|
1,132,905
|
|
|
$
|
6,886,023
|
|
|
$
|
836,856
|
|
|
$
|
(419,389
|
)
|
|
$
|
8,436,395
|
|
December 31, 2017
|
|
Holding
Company
|
|
|
Health
beverage
|
|
|
Oil and
gas
|
|
|
Nutritional
Services
|
|
|
Total
Consolidated
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
490,045
|
|
|
$
|
490,045
|
|
Non-current assets
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
760,278
|
|
|
|
760,278
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
414,584
|
|
|
|
414,584
|
|
Long term liabilities
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
78,414
|
|
|
|
78,414
|
|
Net assets (liabilities)
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
757,325
|
|
|
$
|
757,325
|
|
Segment revenue and net loss for the three and nine months ended September 30, 2018 and 2017 were as follows:
Nine Months Ended September 30, 2018
|
|
Holding
Company
|
|
|
Oil and gas
|
|
|
Nutritional
Services
|
|
|
Health beverage – discontinued operations
|
|
|
Total
Consolidated
|
|
Revenue
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
299,200
|
|
|
$
|
-
|
|
|
$
|
299,200
|
|
Revenue from related parties
|
|
|
-
|
|
|
|
14,411,155
|
|
|
|
303,282
|
|
|
|
-
|
|
|
|
14,714,437
|
|
Cost of goods sold
|
|
|
-
|
|
|
|
(13,940,996
|
)
|
|
|
(58,525
|
)
|
|
|
-
|
|
|
|
(13,999,521
|
)
|
Operating expenses
|
|
|
(37,811
|
)
|
|
|
(31,706
|
)
|
|
|
(472,295
|
)
|
|
|
-
|
|
|
|
(541,812
|
)
|
Other income (expenses)
|
|
|
(100,000
|
)
|
|
|
(1,572
|
)
|
|
|
3,069
|
|
|
|
-
|
|
|
|
(98,503
|
)
|
Provision for income taxes
|
|
|
(1,653
|
)
|
|
|
(120,697
|
)
|
|
|
20,797
|
|
|
|
-
|
|
|
|
(101,553
|
)
|
Loss from discontinued operations
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(4,559
|
)
|
|
|
(4,559
|
)
|
Net income (loss)
|
|
$
|
(139,464
|
)
|
|
$
|
316,184
|
|
|
$
|
95,528
|
|
|
$
|
(4,559
|
)
|
|
$
|
267,689
|
|
Nine Months Ended
September 30, 2017
|
|
Holding
Company
|
|
|
Oil and gas
|
|
|
Nutritional
Services
|
|
|
Health beverage – discontinued operations
|
|
|
Total
Consolidated
|
|
Revenue
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
621,552
|
|
|
$
|
-
|
|
|
$
|
621,552
|
|
Cost of goods sold
|
|
|
-
|
|
|
|
-
|
|
|
|
(192,007
|
)
|
|
|
-
|
|
|
|
(192,007
|
)
|
Operating expenses
|
|
|
-
|
|
|
|
-
|
|
|
|
(829,104
|
)
|
|
|
-
|
|
|
|
(829,104
|
)
|
Other income (expenses)
|
|
|
-
|
|
|
|
-
|
|
|
|
97,540
|
|
|
|
-
|
|
|
|
97,540
|
|
Provision for income taxes
|
|
|
-
|
|
|
|
-
|
|
|
|
21,027
|
|
|
|
-
|
|
|
|
21,027
|
|
Net loss
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
(280,992
|
)
|
|
$
|
-
|
|
|
$
|
(280,992
|
)
|
Three Months Ended September 30, 2018
|
|
Holding
Company
|
|
|
Oil and gas
|
|
|
Nutritional Services
|
|
|
Health beverage – discontinued operations
|
|
|
Total Consolidated
|
|
Revenue
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
3,800
|
|
|
$
|
-
|
|
|
$
|
3,800
|
|
Revenue from related parties
|
|
|
-
|
|
|
|
9,923,997
|
|
|
|
303,282
|
|
|
|
-
|
|
|
|
10,227,279
|
|
Cost of goods sold
|
|
|
-
|
|
|
|
(9,516,994
|
)
|
|
|
(1,341
|
)
|
|
|
-
|
|
|
|
(9,518,335
|
)
|
Operating expenses
|
|
|
(14,027
|
)
|
|
|
(19,579
|
)
|
|
|
(175,201
|
)
|
|
|
-
|
|
|
|
(208,807
|
)
|
Other income (expenses)
|
|
|
-
|
|
|
|
497
|
|
|
|
397
|
|
|
|
-
|
|
|
|
894
|
|
Provision for income taxes
|
|
|
(1,653
|
)
|
|
|
(101,692
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
(103,345
|
)
|
Loss from discontinued operations
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(3,615
|
)
|
|
|
(3,615
|
)
|
Net income (loss)
|
|
$
|
(15,680
|
)
|
|
$
|
286,229
|
|
|
$
|
130,937
|
|
|
$
|
(3,615
|
)
|
|
$
|
397,871
|
|
Three Months Ended September 30, 2017
|
|
Holding
Company
|
|
|
Oil and gas
|
|
|
Nutritional
Services
|
|
|
Health beverage – discontinued operations
|
|
|
Total
Consolidated
|
|
Revenue
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
27,258
|
|
|
$
|
-
|
|
|
$
|
27,258
|
|
Cost of goods sold
|
|
|
-
|
|
|
|
-
|
|
|
|
(1,984
|
)
|
|
|
-
|
|
|
|
(1,984
|
)
|
Operating expenses
|
|
|
-
|
|
|
|
-
|
|
|
|
(124,098
|
)
|
|
|
-
|
|
|
|
(124,098
|
)
|
Other income (expenses)
|
|
|
-
|
|
|
|
-
|
|
|
|
39,352
|
|
|
|
-
|
|
|
|
39,352
|
|
Provision for income taxes
|
|
|
-
|
|
|
|
-
|
|
|
|
(2,266
|
)
|
|
|
-
|
|
|
|
(2,266
|
)
|
Net loss
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
(61,738
|
)
|
|
$
|
-
|
|
|
$
|
(61,738
|
)
|
NOTE 15 – ASSETS/LIABILITIES HELD FOR SALE
On November 19, 2018, the Company entered into the share purchase agreement to sell 60% of the total issued and outstanding equity of Amuli. In exchange for the shares, the Company will receive a purchase price of seven (7) Chinese Yuan. The Purchaser shall become the majority equity owner of the Amuli and the Company shall have no further interest in Amuli.
The following table shows the results of operations of Amuli for the three and nine months ended September 30, 2018 and 2017 which are included in the loss from discontinued operations:
|
|
Three months ended
|
|
|
|
September 30,
|
|
|
|
2018
|
|
|
2017
|
|
Revenue
|
|
$
|
-
|
|
|
$
|
-
|
|
General and administrative
|
|
|
(3,615
|
)
|
|
|
-
|
|
Total Other Income Expenses
|
|
|
-
|
|
|
|
-
|
|
Loss from discontinued operations
|
|
$
|
(3,615
|
)
|
|
$
|
-
|
|
|
|
Nine months ended
|
|
|
|
September 30,
|
|
|
|
2018
|
|
|
2017
|
|
Revenue
|
|
$
|
-
|
|
|
$
|
-
|
|
General and administrative
|
|
|
(4,559
|
)
|
|
|
-
|
|
Total Other Income Expenses
|
|
|
-
|
|
|
|
-
|
|
Loss from discontinued operations
|
|
$
|
(4,559
|
)
|
|
$
|
-
|
|
The following table summarizes the carrying amounts of the assets and liabilities held for sale,
|
|
September 30,
|
|
|
December 31,
|
|
Assets held for sale
|
|
2018
|
|
|
2017
|
|
Cash and cash equivalents
|
|
$
|
37,107
|
|
|
$
|
-
|
|
Accounts receivable
|
|
|
1,217
|
|
|
|
-
|
|
Prepaid and Other current assets
|
|
|
47,772
|
|
|
|
-
|
|
Total
|
|
$
|
86,096
|
|
|
$
|
-
|
|
|
|
September 30,
|
|
|
December 31,
|
|
Liabilities held for sale
|
|
2018
|
|
|
2017
|
|
Accounts payable
|
|
$
|
24,735
|
|
|
$
|
-
|
|
Accrued liabilities and other payable
|
|
|
42,688
|
|
|
|
-
|
|
Deferred revenue
|
|
|
261,512
|
|
|
|
-
|
|
Due to related parties
|
|
|
176,550
|
|
|
|
-
|
|
Total
|
|
$
|
505,485
|
|
|
$
|
-
|
|
NOTE 16 - SUBSEQUENT EVENTS
Management has evaluated subsequent events through the date these financial statements were available to be issued. Based on our evaluation no material events have occurred that require disclosure