UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-Q

 

(Mark One)

 

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended March 31, 2020

 

or

 

o 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: 333-206450

 

AJIA INNOGROUP HOLDINGS, LTD

(Name of registrant in its charter)

 

Nevada

 

82-1063313

(State or jurisdiction of incorporation or organization)

 

(IRS Employer Identification No.)

 

1980 Festival Plaza Drive Suite 530
Las Vegas, NV 89135

(Address of principal executive offices)

 

Phone: (702)360-0652

(Registrant's telephone number, including area code)

 

Securities registered pursuant to Section 12(b) of the Act: None

 

Securities registered pursuant to Section 12(g) of the Act:

 

Common Stock, par value $0.001

(Title of class)

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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 o

 

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 (ss. 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 o No x

 

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

 

Large accelerated filer

¨

Accelerated filer

¨

Non-accelerated filer

¨

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 o No x

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

 

Emerging growth company x

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). o Yes     x No

 

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant's most recently completed second fiscal quarter. Not available

 

APPLICABLE ONLY TO CORPORATE ISSUERS:

 

As of May 14, 2020, the registrant had 101,120,000 issued and outstanding shares of common stock.

 

 

 

  

AJIA INNOGROUP HOLDINGS, LTD

 

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

The statements contained in this Quarterly Report on Form 10-Q that are not historical facts are “forward-looking statements. We have based these forward- looking statements largely on our current expectations and projections about future events and financial trends affecting the financial condition of our business. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including, among other things:

 

Factors that might cause these differences include the following:

 

 

·

the integration of multiple technologies and programs;

 

·

the ability to successfully complete development and commercialization of sites and our company’s expectations regarding market growth;

 

·

changes in existing and potential relationships with collaborative partners;

 

·

the ability to retain certain members of management;

 

·

our expectations regarding general and administrative expenses;

 

·

our expectations regarding cash balances, capital requirements, anticipated revenue and expenses, including infrastructure expenses;

 

·

other factors detailed from time to time in filings with the SEC.

 

In addition, we use words such as “anticipate,” “believe,” “plan,” “expect,” “future,” “intend,” and similar expressions to identify forward-looking statements.

 

We undertake no obligation to update publicly or revise any forward -looking statements, whether as a result of new information, or future events. In light of these risks and uncertainties, the forward-looking events and circumstances discussed in this may not occur and actual results could differ materially from those anticipated or implied in the forward-looking statements.

 

 

2

 

 

AJIA INNOGROUP HOLDINGS, LTD

TABLE OF CONTENTS

 

PART I – FINANCIAL INFORMATION

 

ITEM 1.

FINANCIAL STATEMENTS

 

F-1

 

ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

4

 

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

 

8

 

ITEM 4.

CONTROLS AND PROCEDURES

 

9

 

 

 

 

 

PART II OTHER INFORMATION

ITEM 1.

LEGAL PROCEEDINGS

 

10

 

ITEM 1A.

RISK FACTORS

 

10

 

ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

10

 

ITEM 3.

DEFAULTS UPON SENIOR SECURITIES

 

10

 

ITEM 4.

MINE SAFETY DISCLOSURES

 

10

 

ITEM 5.

OTHER INFORMATION

 

10

 

ITEM 6.

EXHIBITS

 

11

 

 
3

Table of Contents

 

PART I – FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

AJIA INNOGROUP HOLDINGS, LTD

 

INDEX TO CONDENSED CONSOLIDATED FINANCIAL STATEMENT

 

Condensed Consolidated Balance Sheets

 

F-2

 

Condensed Consolidated Statements of Operations and Other Comprehensive Loss

 

F-3

 

Condensed Consolidated Statement of Stockholders’ Deficit

 

F-4

 

Condensed Consolidated Statements of Cash Flows

 

F-5

 

Notes to Condensed Consolidated Financial Statements

 

F-6

 

 
F-1

Table of Contents

  

AJIA INNOGROUP HOLDINGS, LTD.

CONDENSED CONSOLIDATED BALANCE SHEETS

March 31, 2020 and June 30, 2019

(Unaudited)

 

 

 

 

 

 

 

 

 

March 31,

 

 

June 30,

 

 

 

2020

 

 

2019

 

 

 

(Unaudited)

 

 

(Audited)

 

ASSETS

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Cash and cash equivalents

 

$ 7,007

 

 

$ 31,867

 

Earnest deposit

 

 

105,000

 

 

 

-

 

Prepayments and other receivables

 

 

-

 

 

 

4,738

 

 

 

 

 

 

 

 

 

 

Total current assets

 

 

112,007

 

 

 

36,605

 

 

 

 

 

 

 

 

 

 

Non-current assets

 

 

 

 

 

 

 

 

Plant and equipment, net

 

 

552

 

 

 

696

 

Total assets

 

$ 112,559

 

 

$ 37,301

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ DEFICIT

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

 

Other payables and accrued liabilities

 

$ 54,000

 

 

$ 28,710

 

Amount due to a related party

 

 

99,866

 

 

 

387,665

 

 

 

 

 

 

 

 

 

 

Total current liabilities

 

 

153,866

 

 

 

416,375

 

 

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ Deficit

 

 

 

 

 

 

 

 

Preferred stock, $0.001 par value, 100,000,000 shares authorized; no shares are issued

 

 

-

 

 

 

-

 

Common stock: $0.001 par value, 500,000,000 shares authorized, 101,120,000 & 7,270,000 shares issued and outstanding as of March 31, 2020 and June 30, 2019 respectively

 

$ 101,120

 

 

$ 7,270

 

Additional paid-in capital

 

 

503,550

 

 

 

192,400

 

Accumulated other comprehensive income (loss)

 

 

961

 

 

 

(458 )

Accumulated deficit

 

 

(646,938 )

 

 

(578,286 )

 

 

 

 

 

 

 

 

 

Total stockholders’ deficit

 

 

(41,307 )

 

 

(379,074 )

 

 

 

 

 

 

 

 

 

Total liabilities and stockholders’ deficit

 

$ 112,559

 

 

$ 37,301

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

 
F-2

Table of Contents

  

Condensed Consolidated Statements of Operations and Other Comprehensive Loss

For the three and nine months ended March 31, 2020 and 2019

(Unaudited)

 

 

 

For the Three Months Ended

March 31,

 

 

For the Nine Months Ended

March 31,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$ 10,037

 

 

$ -

 

 

$ 30,117

 

 

$ 30,000

 

Cost of sales

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit

 

 

10,037

 

 

 

-

 

 

 

30,117

 

 

 

30,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative expense

 

 

35,496

 

 

 

9,969

 

 

 

165,641

 

 

 

53,232

 

Professional fees

 

 

44,866

 

 

 

25,735

 

 

 

82,611

 

 

 

124,663

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total operating expenses

 

 

80,362

 

 

 

35,704

 

 

 

248,252

 

 

 

177,895

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

-

 

 

 

-

 

 

 

3

 

 

 

1

 

Sundry income

 

 

64,387

 

 

 

-

 

 

 

149,480

 

 

 

126,006

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total other income

 

 

64,387

 

 

 

-

 

 

 

149,483

 

 

 

126,007

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$ (5,938 )

 

$ (35,704 )

 

$ (68,652 )

 

$ (21,888 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive income (loss)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation gain (loss)

 

 

167

 

 

 

(46 )

 

 

1,419

 

 

 

(149 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Comprehensive loss

 

 

(5,771 )

 

 

(35,750 )

 

 

(67,233 )

 

 

(22,037 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted loss per common share

 

$ (0.00 )

 

$ (0.00 )

 

$ (0.00 )

 

$ (0.00 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of common shares outstanding - basic and diluted

 

 

101,022,198

 

 

 

7,270,000

 

 

 

86,361,636

 

 

 

9,240,803

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

 
F-3

Table of Contents

 

Condensed Consolidated Statement of Stockholders’ Deficit

For the three and nine months ended March 31, 2020 and 2019

(Unaudited)

 

 

 

Common stock

 

 

Common stock

 

 

Additional

 

 

Accumulated

other

 

 

 

 

 

Total

 

 

 

No. of

shares

 

 

Amount

 

 

to be

cancelled

 

 

paid-in

capital

 

 

comprehensive

income

 

 

Accumulated deficit

 

 

stockholders’

deficit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of July 1, 2018

 

 

7,270,000

 

 

$ 7,270

 

 

$ 3,000

 

 

$ 189,400

 

 

$ 421

 

 

$ (333,302 )

 

$ (133,211 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss for the period

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(21,888 )

 

 

(21,888 )

Foreign currency translation adjustment

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(149 )

 

 

-

 

 

 

(149 )

Shares cancelled

 

 

-

 

 

 

-

 

 

 

(3,000 )

 

 

(125,700 )

 

 

-

 

 

 

-

 

 

 

(128,700 )

Balance as of March 31, 2019

 

 

7,270,000

 

 

$ 7,270

 

 

$ -

 

 

$ 63,700

 

 

$ 272

 

 

$ (355,190 )

 

$ (283,948 )

 

 

 

Common stock

 

 

Common stock

 

 

Additional

 

 

Accumulated

other

 

 

 

 

 

Total

 

 

 

No. of

shares

 

 

Amount

 

 

to be

cancelled

 

 

paid-in

capital

 

 

comprehensive

income

 

 

Accumulated deficit

 

 

stockholders’

deficit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of January 1, 2019

 

 

7,270,000

 

 

$ 7,270

 

 

$ -

 

 

$ 63,700

 

 

$ 318

 

 

$ (319,486 )

 

$ (248,198 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss for the period

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(35,704 )

 

 

(35,704 )

Foreign currency translation adjustment

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(46 )

 

 

-

 

 

 

(46 )

Balance as of March 31, 2019

 

 

7,270,000

 

 

$ 7,270

 

 

$ -

 

 

$ 63,700

 

 

$ 272

 

 

$ (355,190 )

 

$ (283,948 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of July 1, 2019

 

 

7,270,000

 

 

$ 7,270

 

 

$ -

 

 

$ 192,400

 

 

$ (458 )

 

$ (578,286 )

 

$ (379,074 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issuance of shares on promissory note

 

 

93,750,000

 

 

 

93,750

 

 

 

-

 

 

 

206,250

 

 

 

-

 

 

 

-

 

 

 

300,000

 

Issuance of shares as earnest deposit

 

 

100,000

 

 

 

100

 

 

 

-

 

 

 

104,900

 

 

 

-

 

 

 

-

 

 

 

105,000

 

Net loss for the period

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(68,652 )

 

 

(68,652 )

Foreign currency translation adjustment

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,419

 

 

 

-

 

 

 

1,419

 

Balance as of March 31, 2020

 

 

101,120,000

 

 

$ 101,120

 

 

$ -

 

 

$ 503,550

 

 

$ 961

 

 

$ (646,938 )

 

$ (41,307 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of January 1, 2020

 

 

101,020,000

 

 

$ 101,020

 

 

$ -

 

 

$ 398,650

 

 

$ 794

 

 

$ (641,000 )

 

$ (140,536 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issuance of shares as earnest deposit

 

 

100,000

 

 

 

100

 

 

 

-

 

 

 

104,900

 

 

 

-

 

 

 

-

 

 

 

105,000

 

Net loss for the period

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(5,938 )

 

 

(5,938 )

Foreign currency translation adjustment

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

167

 

 

 

-

 

 

 

167

 

Balance as of March 31, 2020

 

 

101,120,000

 

 

$ 101,120

 

 

$ -

 

 

$ 503,550

 

 

$ 961

 

 

$ (646,938 )

 

$ (41,307 )

 

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

 

 
F-4

Table of Contents

   

Condensed Consolidated Statements of Cash Flows

For the nine months ended March 31, 2020 and 2019

(Unaudited)

 

 

 

For the nine months ended

March 31,

 

 

 

2020

 

 

2019

 

Cash flow from operating activities

 

 

 

 

 

 

Net loss

 

$ (68,652 )

 

$ (21,888 )

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

 

Depreciation

 

 

146

 

 

 

145

 

Changes in Operating Assets and Liabilities:

 

 

 

 

 

 

 

 

Decrease in prepayments and other receivables

 

 

4,738

 

 

 

2,765

 

Increase in other payables and accrued liabilities

 

 

25,290

 

 

 

27,705

 

 

 

 

 

 

 

 

 

 

Net cash (used in) provided by operating activities

 

 

(38,478 )

 

 

8,727

 

 

 

 

 

 

 

 

 

 

Cash flow from financing activities

 

 

 

 

 

 

 

 

Advance from a director

 

 

12,201

 

 

 

140,934

 

Cancellation of shares

 

 

-

 

 

 

(128,700 )

 

 

 

 

 

 

 

 

 

Net cash provided by financing activities

 

 

12,201

 

 

 

12,234

 

 

 

 

 

 

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents

 

 

1,417

 

 

 

(149 )

 

 

 

 

 

 

 

 

 

Net (decrease) increase in cash

 

 

(24,860 )

 

 

20,812

 

 

 

 

 

 

 

 

 

 

Cash, at beginning of period

 

 

31,867

 

 

 

1,816

 

 

 

 

 

 

 

 

 

 

Cash, at end of period

 

$ 7,007

 

 

$ 22,628

 

 

 

 

 

 

 

 

 

 

Supplemental cash flow information:

 

 

 

 

 

 

 

 

Cash paid for interest

 

$ -

 

 

$ -

 

Cash paid for income taxes

 

$ -

 

 

$ -

 

 

 

 

 

 

 

 

 

 

NON-CASH FINANCING AND INVESTING TRANSACTIONS

 

 

 

 

 

 

 

 

Shares issued for the settlement of promissory note

 

$ 300,000

 

 

$ -

 

Shares issued as earnest deposit for potential investment

 

$ 105,000

 

 

$ -

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

 
F-5

Table of Contents

 

AJIA INNOGROUP HOLDINGS, LTD.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2020

(UNAUDITED)

 

NOTE 1 BASIS OF PRESENTATION

 

The accompanying unaudited condensed consolidated financial statements have been prepared by management in accordance with both accounting principles generally accepted in the United States (“GAAP”), and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Certain information and note disclosures normally included in audited financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading.

 

In the opinion of management, the consolidated balance sheet as of June 30, 2019 which has been derived from audited financial statements and these unaudited condensed consolidated financial statements reflect all normal and recurring adjustments considered necessary to state fairly the results for the periods presented. The results for the period ended March 31, 2020 are not necessarily indicative of the results to be expected for the entire fiscal year ending June 30, 2020 or for any future period.

 

These unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the Management’s Discussion and the audited financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended June 30, 2019.

 

NOTE 2 ORGANIZATION AND BUSINESS BACKGROUND

 

Ajia Innogroup Holdings, Ltd., formerly “AJIA INNOGROUP HOLDINGS, LTD” (the “Company” or “AJIA”) was incorporated in the State of Nevada on March 19, 2014. The Company had intended to provide a website and mobile app to assist event planners in locating performers, bands and speakers, booking locations and planning events in areas around the United States and Canada. However, The Company changed its business plan in 2017 and is currently planning to pursue the business in having self-help photo kiosks to be implemented at major convenient locations, such as shopping mall, buildings near subway stations, etc. to attract customers to use the service. In addition, the Company provides system development consulting and training services. The main revenue for these businesses will be generated from the self-help photo kiosks at which one can do photo printing, Wechat printing, game commemorative photos, copying documents, etc., as well as from consulting contracts.

 

The details of the Company’s subsidiaries are described below:

 

Name

 

Place of incorporation and

kind of legal entity

 

Principal activities

and place of operation

 

Particulars of issued/ registered

share capital

 

Effective interest

Held

 

Splendor Radiant Limited

 

British Virgin Islands, a limited liability company

 

Investment holding

 

1 issued shares of US$1 each

 

 

100 %

A Jia Creative Holdings Limited

 

Hong Kong, a limited liability company

 

Provision of system setup and maintenance services, investment holding

 

100 issued shares of HK$1 each

 

 

100 %

Guangzhou Shengjia Trading Co., Ltd

 

The PRC, a limited liability company

 

Trading business

 

HK$1,000,000

 

 

100 %

 

AJIA and its subsidiaries are hereinafter referred to as (the “Company”)

 

 
F-6

Table of Contents

  

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

The accompanying condensed consolidated financial statements reflect the application of certain significant accounting policies as described in this note and elsewhere in the accompanying condensed consolidated financial statements and notes.

 

Use of estimates

 

In preparing these condensed consolidated financial statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheet and revenues and expenses during the periods reported. Actual results may differ from these estimates.

 

Basis of consolidation

 

The condensed consolidated financial statements include the financial statements of AJIA and its subsidiaries. All significant inter-company balances and transactions within the Company have been eliminated upon consolidation.

 

Cash and cash equivalents

 

Cash and cash equivalents consist primarily of cash in readily available checking and saving accounts. Cash equivalents consist of highly liquid investments that are readily convertible to cash and that mature within three months or less from the date of purchase. The carrying amounts approximate fair value due to the short maturities of these instruments.

 

Plant and equipment

 

Plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual values:

 

 

Expected useful lives

Computer equipment

 

5 years

 

Expenditures for repairs and maintenance are expensed as incurred. When assets have been retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations.

 

Depreciation expense for the three months ended March 31, 2020 and 2019 were $48 and $48, respectively.

 

Depreciation expense for the nine months ended March 31, 2020 and 2019 were $146 and $145, respectively.

 

Impairment of long-lived assets

 

In accordance with the provisions of ASC Topic 360, “Impairment or Disposal of Long-Lived Assets”, all long-lived assets such as plant and equipment and intangible assets held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is evaluated by a comparison of the carrying amount of an asset to its estimated future undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the fair value of the assets. There has been no impairment charge for the periods presented.

 

Revenue recognition

 

The Company’s revenue recognition policies are in compliance with FASB ASC 605-35 “Revenue Recognition”. Revenue is recognized when a formal arrangement exists, the price is fixed or determinable, all obligations have been performed pursuant to the terms of the formal arrangement and collectability is reasonably assured.

 

For the Company’s business in catering system development and training, monthly revenue is recognized when the Company satisfies its obligation by transferring control of the promised goods or performance of services to the customer.

 

The Company recognizes revenues on sales of its services, based on the terms of the customer agreement. The customer agreement takes the form of either a contract or a customer purchase order and each provides information with respect to the service being sold and the sales price. If the customer agreement does not have specific delivery or customer acceptance terms, revenue is recognized at the time the service is provided to the customer.

 

 
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Comprehensive income or loss

 

ASC Topic 220, “Comprehensive Income” establishes standards for reporting and display of comprehensive income or loss, its components and accumulated balances. Comprehensive income or loss as defined includes all changes in equity during a period from non-owner sources. Accumulated comprehensive income or loss, as presented in the accompanying consolidated statement of stockholders’ deficit consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive income or loss is not included in the computation of income tax expense or benefit.

 

Income taxes

 

The provision for income taxes is determined in accordance with the provisions of ASC Topic 740, “ Income Taxes ” (“ASC 740”). Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

 

ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts.

 

The Company did not have any unrecognized tax positions or benefits and there was no effect on the financial condition or results of operations for the years ended June 30, 2019. The Company and its subsidiaries are subject to local and various foreign tax jurisdictions. The Company’s tax returns remain open subject to examination by major tax jurisdictions.

 

Net loss per share

 

The Company calculates net loss per share in accordance with ASC Topic 260 “ Earnings per Share ”. Basic loss per share is computed by dividing the net loss by the weighted-average number of common shares outstanding during the period. Diluted loss per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common stock equivalents had been issued and if the additional common shares were dilutive.

 

Foreign currencies translation

 

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statement of operations.

 

 
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The reporting currency of the Company is United States Dollars (“US$”). The Company’s subsidiaries operating in Hong Kong and the PRC maintained their books and records in their local currency, Hong Kong Dollars (“HK$”) and Renminbi Yuan (“RMB”), which are functional currencies as being the primary currency of the economic environment in which these entities operate.

 

In general, for consolidation purposes, assets and liabilities of its subsidiaries whose functional currency is not the US$ are translated into US$, in accordance with ASC Topic 830-30, “ Translation of Financial Statement”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiaries are recorded as a separate component of accumulated other comprehensive income within the statement of stockholders’ equity.

 

Translation of amounts from its reporting currencies into US$ has been made at the following exchange rates for the respective period:

 

 

 

2020

 

 

2019

 

Period-end HK$:US$1 exchange rate

 

 

7.7525

 

 

 

7.8493

 

Period average HK$:US$1 exchange rate

 

 

7.8081

 

 

 

7.8396

 

Period-end RMB:US$1 exchange rate

 

 

7.0876

 

 

 

6.7111

 

Period average RMB:US$1 exchange rate

 

 

7.0124

 

 

 

6.8218

 

 

Related parties

 

Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Companies are also considered to be related if they are subject to common control or common significant influence.

 

Concentration of credit risk

 

The Company is subject to credit risk through its accounts receivable consisting primarily of amounts due from franchisees for royalty income, and other products. The financial condition of these franchisees is largely dependent upon the underlying business trends of our brands and market conditions within the vending industry. This concentration of credit risk is mitigated, in part, by the large number of franchisees spread over a large geographical area and the short-term nature of the receivables.

 

Fair value of financial instruments

 

The carrying value of the Company’s financial instruments: cash and cash equivalents, prepayments and other receivables, accounts payable, amount due to a related party, other payables and accrued liabilities approximate at their fair values because of the short-term nature of these financial instruments.

 

The Company also follows the guidance of the ASC Topic 820-10, “ Fair Value Measurements and Disclosures ” (“ASC 820-10”), with respect to financial assets and liabilities that are measured at fair value. ASC 820-10 establishes a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:

 

Level 1 : Observable inputs such as quoted prices in active markets;

 

Level 2 : Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

 

Level 3 : Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions

 

 
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Fair value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

 

Recent accounting pronouncements

 

In June 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”). ASU 2016-13 amends the impairment model by requiring entities to use a forward-looking approach based on expected losses to estimate credit losses on certain types of financial instruments, including trade receivables. In November 2018, the FASB issued ASU No. 2018-19, “Codification Improvements to Topic 326, Financial Instruments - Credit Losses” (“ASU 2018-19”) which clarifies that receivables arising from operating leases are accounted for using lease guidance and not as financial instruments. In April 2019, the FASB issued ASU No. 2019-04, “Codification Improvements to Topic 326, Financial Instruments - Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments” (“ASU 2019-04”) which clarifies treatment of certain credit losses. In May 2019, the FASB issued ASU No. 2019-05, “Financial Instruments - Credit Losses (Topic 326): Targeted Transition Relief ” (“ASU 2019-05”) which provides an option to irrevocably elect to measure certain individual financial assets at fair value instead of amortized cost. In November 2019, the FASB issued ASU No. 2019-11, “Codification Improvements to Topic 326, Financial Instruments - Credit Losses” (“ASU 2019-11”), which provides guidance around how to report expected recoveries. In February 2020, the Financial Accounting Standards Board issued ASU No. 2020-02, “Financial Instruments - Credit Losses” (Topic 326) (“ASU 2020-02”) which provides updated guidance on how an entity should measure credit losses on financial instruments and delayed the effective date of the original pronouncement for smaller reporting companies. ASU 2016-13, ASU 2018-19, ASU 2019-04, ASU 2019-05, ASU 2019-11 and ASU 2020-02 (collectively, “ASC 326”) are effective for public entities for fiscal years beginning after December 15, 2019, with early adoption permitted. The adoption of ASC 326 did not have a material impact on the Company’s recognition of financial instruments within the scope of the standard.

 

In January 2017, the FASB issued ASU No. 2017-04, “Intangibles - Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment” (“ASU 2017-04”), which eliminates step two from the goodwill impairment test and instead requires an entity to perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. The guidance is effective for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019 and should be adopted on a prospective basis. The adoption of ASU 2017-04 did not have a material effect on the Company’s current financial position, results of operations or financial statement disclosures.

 

In August 2018, the FASB issued ASU No. 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement” (“ASU 2018-13”). ASU 2018-13 modifies the disclosure requirements on fair value measurements. ASU 2018-13 is effective for public entities for fiscal years beginning after December 15, 2019, with early adoption permitted for any removed or modified disclosures. The adoption of ASU 2018-13 did not have a material effect on the Company’s current financial position, results of operations or financial statement disclosures.

 

In December 2019, the FASB issued ASU No 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” (“ASU 2019-12”). ASU 2019-12 removes certain exceptions to the general principles in Topic 740 in Generally Accepted Accounting Principles. ASU 2019-12 is effective for public entities for fiscal years beginning after December 15, 2020, with early adoption permitted. The Company does not expect ASU 2019-12 to have a material effect on the Company’s current financial position, results of operations or financial statement disclosures.

 

In March 2020, the FASB issued ASU 2020-03, “Codification Improvements to Financial Instruments” (“ASU 2020-03”). ASU 2020-03 improves and clarifies various financial instruments topics. ASU 2020-03 includes seven different issues that describe the areas of improvement and the related amendments to GAAP, intended to make the standards easier to understand and apply by eliminating inconsistencies and providing clarifications. The Company adopted ASU 2020-03 upon issuance, which did not have a material effect on the Company’s current financial position, results of operations or financial statement disclosures.

 

In March 2020, the FASB issued ASU No 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting” (“ASU 2020-04”). ASU 2020-04 provides temporary optional expedients and exceptions to the US GAAP guidance on contract modifications and hedge accounting to ease the financial reporting burdens related to the expected market transition from the London Interbank Offered Rate (LIBOR) and other interbank offered rates to alternative reference rates. ASU 2020-04 is effective beginning on March 12, 2020, and the Company may elect to apply the amendments prospectively through December 31, 2022. The Company does not expect ASU 2020-04 to have a material effect on the Company’s current financial position, results of operations or financial statement disclosures.

 

Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the Company’s consolidated financial statements upon adoption.

 

 
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NOTE 4 – GOING CONCERN

 

The accompanying condensed consolidated financial statements have been prepared using the going concern basis of accounting, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

 

The Company has experienced a net loss of $68,652 and negative operating cash flows of $38,478 for the period ended March 31, 2020. Also, at March 31, 2020, the Company has incurred an accumulated deficit of $646,938 and its total current liabilities exceeded its total current assets by $41,859.

 

The continuation of the Company as a going concern through March 31, 2021 is dependent upon the continued financial support from its stockholders. Management believes the Company is currently pursuing additional financing for its operations. In addition, with respect to the ongoing and evolving coronavirus (COVID-19) outbreak, which was designated as a pandemic by the World Health Organization on March 11, 2020, the outbreak has caused substantial disruption in international economies and global trades and if repercussions of the outbreak are prolonged, could have a significant adverse impact on the Company’s business. However, there is no assurance that the Company will be successful in securing sufficient funds to sustain the operations.

 

These and other factors raise substantial doubt about the Company’s ability to continue as a going concern. These condensed consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets and liabilities that may result in the Company not being able to continue as a going concern.

 

 
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NOTE 5 – PREFERRED STOCK AND COMMON STOCK

 

(A) Preferred stock

 

The Company was authorized to issue one hundred million (100,000,000) shares of preferred stock, par value $0.001 per share. On March 31, 2020 and 2019, none of the preferred shares have been issued.

 

(B) Common stock

 

Shares authorized

 

Upon formation, the total number of shares of all classes of stock which the Company was authorized to issue seventy-five million (75,000,000) shares of common stock, par value $0.001 per share. On December 15, 2017, the Company increased its authorized common shares to 500,000,000 shares at par value $0.001 per share.

 

Common stock issued

 

On July 28, 2018, the Company issued a convertible promissory note in the amount of $300,000 to Full Yick International Ltd, a major shareholder to settle with the related party loan. Pursuant to the terms of the convertible promissory note, the note has an option to convert into 93,750,000 common shares of the Company at $0.0032 per share, on or the earlier of July 31, 2019. On July 31, 2019, Full Yick International Limited exercised their option to convert the $300,000 note into 93,750,000 common shares of the Company, at the price of $0.0032 per share. On August 9, 2019, the Company approved the share issuance of 93,750,000 common shares to Full Yick International Limited.

 

On March 30, 2020, the Company, through its wholly-owned subsidiary entered into a Memorandum of Understanding (“MOU”) with Allied Precision Medicine Consultants Limited ("Allied"), a Hong Kong corporation, in which the Parties have committed to jointly promote stem cell products and services in Hong Kong and Macau. The Company agreed to issue 100,000 shares of its common stock at the current market value of $1.05 per share, to Allied as a non-refundable deposit of $105,000 to anticipate the business collaboration in this project. The Company shall appoint an independent third party to carry out due diligence and valuation of this project.

 

As of March 31, 2020 and June 30, 2019, the Company had a total of 101,120,000 and 7,270,000 shares of its common stock issued and outstanding.

 

 
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NOTE 6 – RELATED PARTY TRANSACTIONS

 

From time to time, the stockholder and director of the Company advanced funds to the Company for working capital purpose. Those advances are unsecured, non-interest bearing and due on demand. The imputed interest on the loan from a related party was not significant.

 

As of March 31, 2020, the balance $99,866 represented the loan account of the Director - Wan Yin Ling, which is unsecured, non-interest bearing, and due on demand.

 

NOTE 7 – COMMITMENTS AND CONTINGENCIES

 

As of March 31, 2020, the Company has no material commitments and contingencies.

 

NOTE 8 – SUBSEQUENT EVENTS

 

In accordance with ASC Topic 855, “ Subsequent Events ”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued, the Company has evaluated all events or transactions that occurred after March 31, 2020 up through the date the Company issued the unaudited condensed consolidated financial statements. During the period, the Company had the following material recognizable subsequent events.

 

On April 7, 2020, the Board of Directors authorized the issuance of 1,000 shares of Series A Preferred Stock to Ms. Yin Ling WAN ("Ms. Wan"), the Company’s Executive Director, Company Secretary and treasurer. Ms. Wan has advance significant capital and expended significant time to the company without compensation. As an effort to give Ms. Wan security for her advances and as a precaution to prevent hostile takeover in future, 1,000 shares of Series A of Preferred Shares ("Preferred Shares") were issued to Ms. Wan. These Preferred Shares have the following features attached:

 

 

1)

Non-participating in the dividends to the Common Shareholders

 

2)

No Liquidation Preference

 

3)

Voting Rights to include: the right to vote in an amount equal to 51% of the total vote with respect to any proposal relating to (a) increasing the authorized share capital of the Company, (b) effecting any forward stock split of the Company’s authorized, issued or outstanding shares of capital stock, and (c) any other matter subject to a shareholder vote.

 

4)

No conversion rights

 

5)

Redemption Rights: The Series A shares shall be automatically redeemed upon (a) Ms. Wan ceases to serve as an officer or director of the Company, (b) on the date that the Company’s shares or common stock first trade on any national securities exchange. In these circumstances, the Board shall further consider and resolve the treatment of these shares, including but limited to, reissue to other party, forfeiture thereof.

 

 
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Item 2. Management’s Discussion and Analysis of Financial Condition And Results Of Operations

 

THE FOLLOWING DISCUSSION SHOULD BE READ IN CONJUNCTION WITH OUR AUDITED FINANCIAL STATEMENTS AND THE RELATED NOTES THAT APPEAR ELSEWHERE IN THIS ANNUAL REPORT. THE FOLLOWING DISCUSSION CONTAINS FORWARD-LOOKING STATEMENTS THAT REFLECT OUR PLANS, ESTIMATES AND BELIEFS. OUR ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THOSE DISCUSSED IN THE FORWARD LOOKING STATEMENTS. FACTORS THAT COULD CAUSE OR CONTRIBUTE TO SUCH DIFFERENCES INCLUDE THOSE DISCUSSED BELOW AND ELSEWHERE IN THIS ANNUAL REPORT.

 

FORWARD-LOOKING STATEMENTS

 

Certain statements made in this report may constitute “forward-looking statements on our current expectations and projections about future events “. These forward-looking statements involve known or unknown risks, uncertainties and other factors that may cause the actual results, performance, or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. In some cases you can identify forward-looking statements by terminology such as “may,” “should,” “potential,” “continue,” “expects,” “anticipates,” “intends,” “plans,” “believes,” “estimates,” and similar expressions. These statements are based on our current beliefs, expectations, and assumptions and are subject to a number of risks and uncertainties. Although we believe that the expectations reflected-in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. These forward-looking statements are made as of the date of this report, and we assume no obligation to update these forward-looking statements whether as a result of new information, future events, or otherwise, other than as required by law. In light of these assumptions, risks, and uncertainties, the forward-looking events discussed in this report might not occur and actual results and events may vary significantly from those discussed in the forward-looking statements .

 

Overview

 

Business Development

 

Ajia was incorporated in the State of Nevada on March 19, 2014, and our fiscal year end is June 30. The Company’s administrative address is 1980 Festival Plaza Drive Suite 530, Las Vegas, NV 89135. The telephone number is: (702) 360-0652 .

 

The Company had intended to provide a website and mobile app to assist event planners in locating performers, bands and speakers, booking locations and planning events in areas around the United States and Canada. However, The Company changed its business plan in 2017 and is currently planning to pursue the business in having self-help photo kiosks to be implemented at major convenient locations, such as shopping mall, buildings near subway stations, etc. to attract customers to use the service. In addition, the Company provides system development consulting and training services. The main revenue for these businesses will be generated from the self-help photo kiosks at which one can do photo printing, Wechat printing, game commemorative photos, copying documents, etc., as well as from consulting contracts.

 

On November 24, 2017, the Board of Directors (the “Board”) accepted the resignation of Ms. Elaine Yin Ling Wan as Chief Executive and Chief Financial Officer of the Company. At the same time, the Board elected the following individuals to the following positions: Mr. Zhi Qiang Liang was elected as President, Chief Executive Officer and Director of the Company; Mr. Wai Hing Samuel Lai was elected as Chief Financial Officer of the Company; Shun Ching (Dickson) Wong was elected as a Director and a Member of the Audit Committee of the Company; Ms. Sin Kei Stella Hui was elected as a Director and a Member of the Audit Committee; Ms. Kiu Chung Jacqueline Tang was elected as Chief Operating Officer of the Company; Mr. Jeffrey Firestone was elected as Director and Vice President of Investor Relations of the Company; Dr. Kwai Lam Terence Wong was elected as Vice President of Investor Relations and Elaine Yin Ling Wan was elected as Director, Secretary and Treasurer.

 

 
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On December 1, 2017, the Company acquired a ten percent (10%) ownership interest in a collection code project ("Project"), the purpose of which is to improve the marketability and market penetration of Alipay Network Technology Co., Ltd. ("Alipay") collection code system. As a part of the agreement, the Company will share 10% of expenses and profit on the Project.

 

Effective February 9, 2018, the Board accepted the resignation of Jeffrey S. Firestone from his position as Vice President and director of the Company.

 

On April 25, 2018, the Company announced that its wholly owned subsidiary, Guangzhou Shengjia Trading Co., Ltd. of Guangzhou, China (“Shengjia”) has entered into an agreement with Guangzhou Renhai Network Technology Co., Ltd. (“Renhai”) in which Shengjia would replace its 10% interest in the Alipay payment code business development project (“Alipay Project”), with a 30% interest of Renhai’s new China Mobile project. Renhai has recently reached an agreement with China Mobile Communications Corporation (“China Mobile”) whereby Renhai and China Mobile are to sign an agreement appointing Renhai as one of China Mobile’s marketers in promoting China Mobile’s business products for the period from April 1, 2018 to September 30, 2018. Renhai’s China Mobile agreement will be extended once certain business targets are fulfilled

 

Nevertheless, even with the above remedies, the returns from the projects are still not satisfied by the Company’s management and are far below the estimations made from Renhai to the Company. In this regard, on December 28, 2018, both parties agreed that the agreements between Shengia and Renhai are rescinded and voided. Renhai shall return the Company’s 3,000,000 shares to the Company for cancellation and the Company shall return all the incomes previously received from Renhai. The Company cancelled these 3,000,000 shares of common stock on December 28, 2018.

 

The Company’s activities are subject to significant risks and uncertainties including failing to secure additional funding to operationalize the Company’s website and apps before another company develops similar websites or apps.

  

On July 28, 2018, the Company issued a convertible promissory note in the amount of $300,000.00 to Full Yick International Ltd. Pursuant to the terms the convertible promissory note was convertible into 93,750,000 common shares of the Company at $0.0032 per share on July 31, 2019. On or about August 9, 2019, Full Yick International Ltd. exercised their option to convert the $300,000.00 note into 93,750,000 common shares of the Company, which constitutes approximately 92.8% of the issued and outstanding common shares of the Company, and instructed the Company to issue the shares to approximately 84 shareholders. Of those approximately 84 shareholders, the largest, Full Yick International, Ltd., holds 12,038,723 shares, or approximately 11.9% of the issued and outstanding shares of the Company. There are no arrangements between the members of the former and new control groups and their associates with respect to election of directors or other matters.

 

On September 20, 2019, Mr. Kin Chung Ken Tam was appointed as members of the Board of Directors (the “Board”) of the Company’s Executive directors. Mr. Hung Hin Samuel Leung and Mr. Kwok Fai Thomas Yip were appointed as members of the Board of the Company’s Independent and Non-executive directors – Audit committee. On September 20, 2019, Ms. Sin Kei Stella Hui and Mr. Shun Ching (Dickson) Wong were resigned from the member of the Board of the Company.

 

On March 30, 2020, Splendor Radiant Limited, a wholly-owned subsidiary of Ajia Innogroup Holdings, Ltd. ("Ajia"), entered into a Memorandum of Understanding (“MOU”) with Allied Precision Medicine Consultants Limited ("Allied"), a Hong Kong corporation, in which the Parties have committed to jointly promote stem cell products and services in Hong Kong and Macau. Ajia has initially issued 100,000 shares of its common stock to Allied to acquire 50% sharing of the profits in this project. The Board shall then appoint an independent third party to carry out due diligence and valuation of the project and, based upon the recommendation of this valuation report, the Board shall issue additional common shares of Ajia to Allied as fair consideration and compensation to acquire 50% profit sharing interest in the project.

 

 
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Business Plan

 

On December 1, 2017, the Company acquired a ten percent (10%) ownership interest in a collection code project ("Project"), the purpose of which is to improve the marketability and market penetration of Alipay Network Technology Co., Ltd. ("Alipay") collection code system. The Company plans to acquire additional interest in this project as the project develops.

 

In addition to the Alipay collection code project, the Company is planning to acquire a business in the development of self-help photo kiosks, which is to be implemented at major convenient locations, such as shopping mall, buildings nearby subway station, etc. to attract customers to use the service. Arising from the growing needs of identity verification and photos for official processing of formal permit applications (e.g. such as driving license, individual identification card, passport and visa application, and etc.), this new business will implement innovative photo kiosks in major locations in cities to provide economic and convenient self-help service. This type of mini photo kiosks provides a one stop self-help service center to allow the customers to apply varieties of permits through a simple process from the identity verification, photo taking, document scanning, and electronic signature to making payment.

 

The management will have further announcements when there are further developments in these new business opportunities in the future.

 

Principal Products, Services and Their Markets

 

In last year, our business plan was to create a website and an independent mobile application that enabled consumers to find the best performers, entertainers, bands, speakers and event services easily and which are expected to be accessible for everyone in the United States and Canada. Nevertheless, the management attempts to invest in other IT project and considers acquiring the self-help photo kiosks.

 

In recent outbreak of Corona virus, people shall be more concern in health products and there shall be a big market potential in this respect and as such, the Board has approved the MOU with Allied mentioned above and the Company shall prepare to start its businesses in promoting stem cell products in the last quarter of the year. The Board did expect that new businesses shall improve the Company’s revenue and shall able to derive profits to the shareholders in the coming months and shall be reflected in the financial statements for the year ending 30 June 2020.

 

For the photo kiosks business, despite the negative effects caused by Corona Virus such as the disruptions of both local and overseas travelling, the Board would advise that the relevant technology was improving and the user level was also still increasing. The Board hopes that with work and business resumptions in the PRC is on the way, the photo kiosks business shall have better results in the coming months.

 

Despite of these activities, the Board is still working and looking for other new business opportunities in the future.

 

Status of Publicly Announced New Products or Services

 

Ajia currently has no new publicly announced products or services.

 

 
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Patents, Trademarks, Licenses, Agreements or Contracts

 

There are no aspects of our business plan currently which require a patent, trademark, or product license. We have not entered into any vendor agreements or contracts that give or could give rise to any obligations or concessions.

 

Governmental Controls, Approval and Licensing Requirements

 

None

 

Research and Development Activities and Costs

 

We have spent no time on specialized research and development activities.

 

Number of Employees

 

Ajia has no employees and where necessary in expanding the Company’s business, the Company may consider hiring additional employees.

 

Plan of Operation

 

Ajia have limited business activity to generate revenue in preliminary stages and also no significant assets. Our executive offices are located at Room 1001, 10/F., Grandmark, No.10 Granville Road, Tsim Sha Tsui, Hong Kong. The office is a location at which the Company receives mail, has office services and can hold meetings. Our officer, Ms. Wan Yin Ling, Elaine, works on Company business in Hong Kong.

 

Results of Operations

 

Comparison for the Three Months Ended March 31, 2020 and 2019

 

Revenues

 

During the three months ended March 31, 2020, we have derived income of $10,037 (2018: $0).

 

Operating Expenses

 

The Company’s operating expenses for the three months ended March 31, 2020 is $80,362 and for the three months ended March 31, 2019 is $35,704.

 

Net Income (Loss)

 

During the three months ended March 31, 2020 and 2019 the company recognized net loss $5,938 and $35,704 respectively.

 

Comparison for the Nine Months Ended March 31, 2020 and 2019

 

Revenues

 

During the nine months ended March 31, 2020, we have derived income of $30,117 (2018: $30,000).

 

Operating Expenses

 

The Company’s operating expenses for the nine months ended March 31, 2020 is $248,252 and for the nine months ended March 31, 2019 is $177,895.

 

Net Income (Loss)

 

During the nine months ended March 31, 2020 and 2019 the company recognized net loss $68,652 and $21,888 respectively.

 

Liquidity and Capital Resources

 

As at March 31, 2020, we had total current assets of $112,007 which consist of $7,007 cash and cash equivalents and $105,000 earnest deposit. We had total current liabilities of $153,866, which consist of $99,866 amount due to a related party and $54,000 other payables and accrued liabilities.

 

 
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We have limited business activity to generate revenue in preliminary stages from our operations. We will require additional funds to fully implement our plans. These funds may be raised through equity financing, debt financing, or other sources, which may result in the dilution in the equity ownership of our shares. We currently do not have any arrangements for additional financing and we may not be able to obtain financing when required. Our future is dependent upon our ability to obtain financing, a successful marketing and promotion program and, further in the future, achieving a profitable level of operations. The issuance of additional equity securities by us could result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments. We will require additional funds to maintain our reporting status with the SEC and remain in good standing with the state of Nevada.

 

Going Concern

 

We have incurred net loss since our inception on March 19, 2014 through March 31, 2020 totaling $646,938 and experienced a net loss of $68,652 and negative operating cash flows of $38,478 for the period ended March 31, 2020. As at March 31, 2020, the total current liabilities exceeded the total current assets by $41,859. We have completed only the preliminary stages of our business plan. We anticipate incurring additional losses before realizing any revenues and will depend on additional financing in order to meet our continuing obligations and ultimately, to attain profitability. Our ability to obtain additional financing, whether through the issuance of additional equity or through the assumption of debt, is uncertain. Accordingly, our independent auditors’ report on our financial statements for the year ended June 30, 2019 includes an explanatory paragraph regarding concerns about our ability to continue as a going concern, including additional information contained in the notes to our financial statements describing the circumstances leading to this disclosure. The financial statements do not include any adjustments that might result from the uncertainty about our ability to continue our business.

 

Recently Issued Accounting Pronouncements

 

We do not expect the adoption of any recently issued accounting pronouncements to have a significant impact on our net results of operations, financial position, or cash flows.

 

Off-Balance Sheet Arrangements

 

We have no off-balance sheet arrangements.

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk

 

Not Required

 

 
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Item 4. Controls and Procedures

 

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

 

As required by Rule 13a-15/15d-15 under the Securities and Exchange Act of 1934,as amended (the “Exchange Act”), as of March 31, 2020, we have carried out an evaluation of the effectiveness of the design and operation of our Company’s disclosure controls and procedures. This evaluation was carried out under the supervision and with the participation of our Company’s management, our President (Principal Executive Officer) and Treasurer (Principal Accounting Officer). Based upon the results of that evaluation, our management has concluded that, as of March 31, 2020, our Company’s disclosure controls and procedures were not effective and did not provide reasonable assurance that material information related to our Company required to be disclosed in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management to allow timely decisions on required disclosure.

 

MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

 

Management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control system is designed to provide reasonable assurance to our management and board of directors regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that:

 

 

Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;

 

 

Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles in the United States of America, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and

 

 

Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

 

Management assessed the effectiveness of our internal control over financial reporting as of March 31, 2020. In making this assessment, we used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in INTERNAL CONTROL -- INTEGRATED FRAMEWORK.

 

Our management concluded that, as of March 31, 2020, our internal control over financial reporting was not effective based on the criteria in INTERNAL CONTROL -- INTEGRATED FRAMEWORK issued by the COSO.

 

This quarterly report does not include an attestation report of the Company’s independent registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s independent registered public accounting firm pursuant to rules of the SEC that permit the Company to provide only management’s report in this annual report.

 

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

 

There were no changes in our internal control over financial reporting identified in connection with the evaluation described above during this current quarter ended March 31, 2020, that has materially affected or is reasonably likely to materially affect our internal controls over financial reporting.

 

 
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PART II - OTHER INFORMATION

 

Item 1. Legal Proceedings

 

We are not aware of any legal proceedings to which we are a party or of which our property is the subject. None of our directors, officers, affiliates, any owner of record or beneficially of more than 5% of our voting securities, or any associate of any such director, officer, affiliate or security holder are (i) a party adverse to us in any legal proceedings, or (ii) have a material interest adverse to us in any legal proceedings. We are not aware of any other legal proceedings that have been threatened against us.

 

Item 1A. Risk Factors

 

As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 1A.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

 

None.

 

Item 3. Defaults Upon Senior Securities

 

None.

 

Item 4. Mine Safety Disclosure

 

None.

 

Item 5. Other Information

 

None.

 

 
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Item 6. Exhibits

 

Exhibit Description

 

Exhibit

Number

 

Exhibit Description

31.1

 

Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2

 

Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1

 

Certification of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 _________

* XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

 

 

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 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.

 

AJIA INNOGROUP HOLDINGS, LTD.

 

(Registrant)

 

 

 

Dated: May 15, 2020

/s/ Mr. Zhi Qiang Liang

 

Mr. Zhi Qiang Liang

 

Chief Executive Officer

 

(Principal Executive Officer)

 

 

 

Dated: May 15, 2020

/s/ Mr. Wai Hing (Samuel) Lai

 

Mr. Wai Hing (Samuel) Lai

 

Chief Financial Officer

 

(Principal Financial Officer and Principal Accounting Officer)

 

 

 

12

 

 

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