UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-Q/A

(Amendment No. 1)

 

Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

For the quarterly period ended December 31, 2022

or

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 333-214469

 

BITMIS CORP., now known as

CAMBELL INTERNATIONAL HOLDING CORP.

(Exact name of registrant as specified in its charter)

 

Nevada   98-1310024
(State or other jurisdiction of   (I.R.S. Employer
incorporation or organization)   Identification No.)

 

1-17-1 Zhaojia Road

Xinglongtai District
Panjin City, Liaoning Province

People’s Republic of China

(Address of principal executive offices, Zip Code)

 

+86 15842767931

(Registrant’s telephone number, including area code)

 

None

(Former name, former address and former fiscal year, if changed since last report)

 

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

 

Title of each class   Trading Symbol(s)   Name of each exchange on which registered
None   N/A   N/A

 

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 No

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes  No

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” accelerated filer” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

 

Large accelerated filer Accelerated filer
Non-accelerated filer Smaller reporting company
  Emerging growth company

 

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.

 

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

 

As of February 21, 2023, there were 7,250,750 common shares issued and outstanding.

 

 

 

 

 

 

EXPLANATORY NOTE

 

This Amendment No. 1 on Form 10-Q/A (this “Amendment”) amends the Quarterly Report on Form 10-Q for the quarter ended December 31, 2022 of Bitmis Corp. (now known as Cambell International Holding Corp.) (the “Company”), originally filed with the U.S. Securities and Exchange Commission (“SEC”) on February 21, 2023 (the “Original Report”). The purpose of this Amendment is to accurately reflect on the cover page of the Original Report that the Company is not required to file reports pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The fiscal year in which the Company’s registration statement was declared effective ended on June 30, 2017. No shares were sold pursuant to that registration statement. The Company’s reporting obligation under Section 15(d) of the Exchange Act was automatically suspended as of July 1, 2017 as it had fewer than 300 shareholders of record. The Company has been filing periodic reports on a voluntary basis, and continues to do so.

 

This Amendment further reflects that the Company qualifies as an emerging growth company as it consistently has had total annual gross revenues of less than $1.235 billion and none of the events that would cause termination of its status as an emerging growth company has occurred.

 

This Amendment does not amend, modify or otherwise update any other information in the Original Report. In addition, this Amendment does not reflect events that may have occurred subsequent to the date of the Original Report.

 

 

 

 

BITMIS CORP.

 

QUARTERLY REPORT ON FORM 10-Q

 

Table of Contents

 

    Page
PART I FINANCIAL INFORMATION: 1
Item 1. Financial Statements (Unaudited) 1
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 20
Item 3. Quantitative and Qualitative Disclosures About Market Risk 24
Item 4. Controls and Procedures 25
PART II OTHER INFORMATION: 26
Item 1 Legal Proceedings 26
Item 1A Risk Factors 26
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 26
Item 3. Defaults Upon Senior Securities 26
Item 4. Mine Safety Disclosures. 26
Item 5. Other Information 26
Item 6. Exhibits 26

 

i

 

 

PART I - FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

BITMIS CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF December 31, 2022 AND June 30, 2022

(Expressed in U.S. dollar, except for the number of shares)

 

  

December 31,
2022

  

June 30,
2022

 
   (Unaudited)     
ASSETS        
CURRENT ASSETS        
Cash  $398,023   $204,004 
Accounts receivable, net of $60,990 and $62,804 allowance for doubtful accounts as of December 31, 2022 and June 30, 2022, respectively   
-
    
-
 
Prepayments   170,829    105,216 
Other receivables   1,277,852    1,310,866 
Amounts due from related parties   239,431    7,567,786 
Inventory   631,331    305,046 
Total current assets   2,717,466    9,492,918 
           
NON-CURRENT ASSETS          
Long-term other receivable   
-
    615,987 
Property, plant and equipment, net   68,879    87,590 
Total non-current assets   68,879    703,577 
           
TOTAL ASSETS  $2,786,345   $10,196,495 
           
LIABILITIES AND SHAREHOLDERS’ EQUITY          
           
CURRENT LIABILITIES          
Accounts payable  $29,010   $82,365 
Advance from customers   39,688    6,668,713 
Amounts due to related parties   4,392,993    1,208,644 
Payroll payable   23,572    22,447 
Tax payable   6,465    11,400 
Other payables   406,042    4,376,943 
Total current liabilities   4,897,770    12,370,512 
           
TOTAL LIABILITIES   4,897,770    12,370,512 
           
COMMITMENTS AND CONTINGENCIES   
 
    
 
 
           
SHAREHOLDERS’ DEFICIT          
Preferred stock, par value $0.001, 10,000,000 shares authorized, 10,000,000 and 0 shares issued and outstanding as of December 31, 2022 and June 30, 2022, respectively   10,000    
-
 
Common stock, par value $0.001; 75,000,000 shares authorized, 7,250,750 and 6,250,750 shares issued and outstanding as of December 31, 2022 and June 30, 2022, respectively   7,251    6,251 
Additional paid-in capital   (17,251)   (6,251)
Accumulated deficit   (2,434,863)   (2,200,149)
Accumulated other comprehensive gain   323,438    26,132 
Total Shareholders’ Deficit   (2,111,425)   (2,174,017)
           
TOTAL LIABILITIES AND SHAREHOLDERS’ DEFICIT  $2,786,345   $10,196,495 

 

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

 

1

 

 

BITMIS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE INCOME (LOSS)

FOR THE SIX MONTHS ENDED DECEMBER 31, 2022 AND 2021

(Expressed in U.S. dollar, except for the number of shares)

 (Unaudited)

 

   For the six months ended
December 31,
 
   2022   2021 
         
REVENUES  $286,273   $590,798 
           
COST OF REVENUES   232,648    400,596 
           
GROSS PROFIT   53,625    190,202 
           
OPERATING EXPENSES          
Selling expenses   1,231    93,539 
General and administrative expenses   307,162    349,313 
Total operating expenses   308,393    442,852 
           
LOSS FROM OPERATIONS   (254,768)   (252,650)
           
OTHER INCOME (EXPENSE), NET          
Other incomes   24,950    2,821 
Other expenses   (4,896)   (296)
Total other income net   20,054    2,525 
           
NET LOSS BEFORE INCOME TAX   (234,714)   (250,125)
           
Income tax expense   
-
    
-
 
           
NET LOSS   (234,714)   (250,125)
           
Other comprehensive income (loss):          
Foreign currency translation income (loss)   297,306    (26,877)
           
Total comprehensive income (loss)  $62,592   $(277,002)
           
Weighted average number of ordinary shares outstanding - basic and diluted
   7,250,750    6,250,750 
           
Net loss per share - basic and diluted
  $(0.03)  $(0.04)

 

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

 

2

 

 

BITMIS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ DEFICIT

FOR THE SIX MONTHS ENDED DECEMBER 31, 2022 AND 2021

(EXPRESSED IN U.S. DOLLAR, EXCEPT FOR THE NUMBER OF SHARES)

(Unaudited)

 

   Ordinary shares           Accumulated other     
   Number       Subscription   Accumulated   comprehensive     
   of shares   Amount   receivable   deficit   income   Total 
Balance, June 30, 2022   6,250,750   $6,251   $(6,251)  $(2,200,149)  $26,132   $(2,174,017)
                               
Reverse acquisition recapitalization   1,000,000    1,000    (1,000)   
-
    
-
    
-
 
                               
Net loss   -    
-
    
-
    (234,714)   
-
    (234,714)
                               
Foreign currency translation adjustment   -    
-
    
-
    
-
    297,306    297,306 
                               
Balance, December 31, 2022   7,250,750   $7,251   $(7,251)  $(2,434,863)  $323,438   $(2,111,425)

 

   Ordinary shares           Accumulated other     
   Number of       Additional   Accumulated   comprehensive     
   shares   Amount   paid-in capital   deficit   income (loss)   Total 
Balance, June 30, 2021    6,250,750   $6,251   $(6,251)  $(1,535,367)  $(56,041)  $(1,591,408)
                               
Net loss   -    
-
    
-
    (250,125)   
-
    (250,125)
                               
Foreign currency translation adjustment    -    
-
    
-
    
-
    (26,877)   (26,877)
                               
Balance, December 31, 2021    6,250,750   $6,251   $(6,251)  $(1,785,492)  $(82,918)  $(1,868,410)

 

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

 

3

 

 

BITMIS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED DECEMBER 31, 2022 AND 2021

(Expressed in U.S. dollars)

(Unaudited)

 

   December 31,   December 31, 
   2022   2021 
CASH FLOWS FROM OPERATING ACTIVITIES:        
Net loss  $(234,714)  $(250,125)
Adjustments to reconcile net loss to net cash used in operating activities:          
Impairment on equipment        2,991 
Depreciation and amortization   17,167    54,403 
Changes in operating assets and liabilities:          
Accounts receivable, net   
-
    30,946 
Other receivables   631,451    (378,475)
Prepayments   (67,864)   (117,356)
Inventory   (331,250)   97,080 
Accounts payable   (50,391)   27,836 
Advance from customers   (6,362,606)   2,193,576 
Payroll payable   1,753    (1,154)
Tax payable   (4,555)   (1,447)
Other payables   (3,800,399)   31,101 
Net cash (used in) provided by operating activities   (10,201,408)   1,689,376 
           
CASH FLOWS FROM INVESTING ACTIVITIES          
Purchase of property, plant and equipment   (1,170)   (93,539)
Cash used in investing activities   (1,170)   (93,539)
           
CASH FLOWS FROM FINANCIING ACTIVITIES          
Repayment to related parties   
-
    (1,440,328)
Proceeds from advances from related parties   10,210,570    
-
 
Cash provided by (used in) financing activities   10,210,570    (1,440,328)
           
EFFECT OF EXCHANGE RATE ON CASH   186,027    2,717 
           
NET CHANGE IN CASH AND CASH EQUIVALENTS   194,019    158,226 
           
CASH AT BEGINNING OF PERIOD   204,004    63,793 
           
CASH AT END OF PERIOD  $398,023   $222,019 
           
SUPPLEMENTAL CASH FLOW INFORMATION          
Cash paid during the period for:          
Income taxes  $
-
   $
-
 
Interest  $
-
   $
-
 

 

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

 

4

 

 

BITMIS CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in U.S. dollars)

(Unaudited)

 

1. ORGANIZATION AND BUSINESS

  

Bitmis Corp., via the PRC affiliated entity Liaoning Kangbaier Biotechnology Development Co., Ltd. (“Liaoning Kangbaier”), engages in the research and development of extraction processes of natural β -carotene, the planting and harvesting of raw materials as well as the production, distribution marketing and sales of natural β -carotene health food products.

 

On December 30, 2022, the Company entered into a share exchange agreement (“Share Exchange Agreement”) with (i) Cambell International Holding Limited (“Cambell International”) which indirectly wholly owns Liaoning Kangbaier, a limited liability company incorporated in British Virgin Islands on September 23, 2020 and (ii) the shareholders of Cambell International (the “Cambell Shareholders”) to acquire all the issued and outstanding capital stock of Cambell International in exchange for the issuance to the Cambell Shareholders of an aggregate of 1,000,000 shares (the “Shares”) of the Company’s common stock and the transfer by Ms. Yuan Xiaoyan, the original controlling shareholder of the Company, to the Cambell Shareholders of 9,000,000 shares of our Series A Preferred Stock owned by her (“Reverse Acquisition”). The Reverse Acquisition was closed on December 30, 2022. 

 

Contractual Arrangements 

 

The Company, through its wholly-owned foreign subsidiary, WFOE in the PRC, Baijiakang (LiaoNing) Health Information Consulting Service Co., Ltd., entered into a series of contractual arrangements with Liaoning Kangbaier (collectively known as “the VIE”) and its respective shareholders that enable the Company to (1) have power to direct the activities that most significantly affects the economic performance of the VIE, and (2) receive the economic benefits of the VIE that could be significant to the VIE. As PRC laws and regulations prohibit and restrict foreign ownership of business in certain industries, while it has not been definitely determined by the Company that operates in an industry that is subject to such constraints over foreign ownership, the Company’s management has elected to operates its business, primarily through the VIE to mitigate the risk of being subject to such regulation. As such, Liaoning Kangbaier is controlled through contractual arrangements in lieu of direct equity ownership by the Company or any of its subsidiaries. The material terms of the VIE Agreements are summarized as follows:

 

Consulting Service Agreement

 

Pursuant to the terms of the Exclusive Consulting and Service Agreement dated November 27 2022, between Baijiakang Consulting and Kangbaier Liaoning (the “Consulting Service Agreement”), Baijiakang Consulting is the exclusive consulting and service provider to Kangbaier Liaoning to provide business-related software research and development services; design, installation, and testing services; network equipment support, upgrade, maintenance, monitor, and problem-solving services; employees training services; technology development and sublicensing services; public relations services; market investigation, research, and consultation services; short to medium term marketing plan-making services; compliance consultation services; marketing events and membership related activities planning and organizing services; intellectual property permits; equipment and rental services; and business-related management consulting services. Pursuant to the Consulting Service Agreement, the service fee is the remaining amount after Kangbaier Liaoning’s profit before tax in the corresponding year deducts Kangbaier Liaoning’s losses, if any, in the previous year, the necessary costs, expenses, taxes, and fees incurred in the corresponding year, and the withdraws of the statutory provident fund. Kangbaier Liaoning agreed not to transfer its rights and obligations under the Consulting Service Agreement to any third party without prior written consent from Baijiakang Consulting. In addition, Baijiakang Consulting may transfer its rights and obligations under the Consulting Service Agreement to Baijiakang Consulting’s affiliates without Kangbaier Liaoning’s consent, but Baijiakang Consulting shall notify Kangbaier Liaoning of such transfer. This Agreement is valid for a term of 10 years subject to any extension requested by Baijiakang Consulting unless terminated by Baijiakang Consulting unilaterally prior to the expiration.

 

5

 

 

The foregoing summary of the Consulting Service Agreement does not purport to be complete and is subject to, and qualified in its entirety by, the Consulting Service Agreement, which is filed as Exhibit 10.2 to this Form 8-K.

 

Business Operation Agreement

 

Pursuant to the terms of the Business Operation Agreement dated November 27, 2022, among Baijiakang Consulting, Kangbaier Liaoning and the shareholders of Kangbaier Liaoning (the “Business Operation Agreement”), Kangbaier Liaoning has agreed to subject the operations and management of its business to the control of Baijiakang Consulting. According to the Business Operation Agreement, Kangbaier Liaoning is not allowed to conduct any transactions that has substantial impact upon its operations, assets, rights, obligations and personnel without the Baijiakang Consulting’s written approval. The shareholders of Kangbaier Liaoning and Kangbaier Liaoning will take Baijiakang Consulting’s advice on appointment or dismissal of directors, employment of Kangbaier Liaoning’s employees, regular operation, and financial management of Kangbaier Liaoning. The shareholders of Kangbaier Liaoning have agreed to transfer any dividends, distributions or any other profits that they receive as the shareholders of Kangbaier Liaoning to Baijiakang Consulting without consideration. The Business Operation Agreement is valid for a term of 10 years or longer upon the request of Baijiakang Consulting prior to the expiration thereof. The Business Operation Agreement might be terminated earlier by Baijiakang Consulting with a 30-day written notice.

 

The foregoing summary of the Business Operation Agreement does not purport to be complete and is subject to, and qualified in its entirety by, the Business Operation Agreement, which is filed as Exhibit 10.3 to this Form 8-K.

 

Proxy Agreement

 

Pursuant to the terms of the Proxy Agreements dated November 27, 2022, among Baijiakang Consulting, and the shareholders of Kangbaier Liaoning (each, the “Proxy Agreement”, collectively, the “Proxy Agreements”), each shareholder of Kangbaier Liaoning has irrevocably entrusted his/her shareholder rights as Kangbaier Liaoning’s shareholder to Baijiakang Consulting , including but not limited to, proposing the shareholder meeting, accepting any notices with regard to the convening of shareholder meeting and any other procedures, conducting voting rights, and selling or transferring the shares held by such shareholder, for 10 years or earlier if the Business Operation Agreement was terminated for any reasons.

 

The foregoing summary of the Proxy Agreements does not purport to be complete and is subject to, and qualified in its entirety by, the Proxy Agreements, which are filed as Exhibit 10.4 to this Form 8-K.

 

Equity Disposal Agreement

 

Pursuant to the terms of the Equity Disposal Agreement dated November 27, 2022, among Baijiakang Consulting, Kangbaier Liaoning, and the shareholders of Kangbaier Liaoning (the “Equity Disposal Agreement”), the shareholders of Kangbaier Liaoning granted Baijiakang Consulting or its designees an irrevocable and exclusive purchase option (the “Option”) to purchase Kangbaier Liaoning’s all or partial equity interests and/or assets at the lowest purchase price permitted by PRC laws and regulations. The option is exercisable at any time at Baijiakang Consulting’s discretion in full or in part, to the extent permitted by PRC law. The shareholders of Kangbaier Liaoning agreed to give Kangbaier Liaoning the total amount of the exercise price as a gift, or in other methods upon Baijiakang Consulting’s written consent to transfer the exercise price to Kangbaier Liaoning. The Equity Disposal Agreement is valid for a term of 10 years or longer upon the request of Baijiakang Consulting.

 

The foregoing summary of the Equity Disposal Agreement does not purport to be complete and is subject to, and qualified in its entirety by, the Equity Disposal Agreement, which is filed as Exhibit 10.5 to this Form 8-K.

 

Equity Pledge Agreement

 

Pursuant to the terms of the Equity Pledge Agreement dated November 27, 2022, among Baijiakang Consulting and the shareholders of Kangbaier Liaoning (the “Pledge Agreement”), the shareholders of Kangbaier Liaoning pledged all of their equity interests in Kangbaier Liaoning to Baijiakang Consulting, including the proceeds thereof, to guarantee Kangbaier Liaoning’s performance of its obligations under the Business Operation Agreement, the Consulting Service Agreement and the Equity Disposal Agreement (each, a “Agreement”, collectively, the “Agreements”). If Kangbaier Liaoning or its shareholders breach its respective contractual obligations under any Agreements, or cause to occur one of the events regards as an event of default under any Agreements, Baijiakang Consulting, as pledgee, will be entitled to certain rights, including the right to dispose of the pledged equity interest in Kangbaier Liaoning. During the term of the Pledge Agreement, the pledged equity interests cannot be transferred without Baijiakang Consulting’s prior written consent. The Pledge Agreements is valid until all the obligations due under the Agreements have been fulfilled.

 

6

 

 

The foregoing summary of the Equity Pledge Agreement does not purport to be complete and is subject to, and qualified in its entirety by, the Equity Pledge Agreement, which is filed as Exhibit 10.6 to this Form 8-K.

 

Based on these contractual arrangements, the Company consolidates the VIE in accordance with SEC Regulation S-X Rule 3A-02 and Accounting Standards Codification (“ASC”) topic 810 (“ASC 810”), Consolidation.

 

The accompanying consolidated financial statements reflect the activities of each of the following entities of the Company:

 

Name   Background   Ownership
Cambell International     A British Virgin Islands company   100%
Holding Limited   Principal activities: Investment holding    
         
Win&win Industrial     A British Virgin Islands company   100%
Development Limited   Principal activities: Investment holding    
         
BJK Holding Group     A Hong Kong company   100%
Limited   Principal activities: Investment holding    
           
Baijiakang (LiaoNing) Health Information   A PRC limited liability company and deemed a wholly foreign-invested enterprise   100%
Consulting Service Co., Ltd   Principal activities: Consultancy and information technology support    
           
LiaoNing KangBaiEr   A PRC limited liability company   VIE by contractual
Biotechnology   Incorporated on September 22, 2015   arrangements
Development Co., Ltd.   Principal activities: research and development of extraction processes of natural β -carotene, the planting and harvesting of raw materials as well as the production, distribution marketing and sales of natural β -carotene health food products.    
           
Doron KangBaier   A PRC limited liability company   100% owned by
Biotechnology Co.LTD   Principal activities: research and support   LiaoNing KangBaiEr
           
LiaoNing BaiJiaKang   A PRC limited liability company   100% owned by
Health Technology Co.LTD   Principal activities: promotion and support   LiaoNing KangBaiEr

   

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

  

Basis of Presentation

 

The consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”).

 

The unaudited interim condensed consolidated financial statements do not include all the information and footnotes required by the U.S. GAAP for complete financial statements. Certain information and note disclosures normally included in the annual financial statements prepared in accordance with the U.S. GAAP have been condensed or omitted consistent with Article 10 of Regulation S-X. In the opinion of the Company’s management, the unaudited interim consolidated financial statements have been prepared on the same basis as the audited financial statements and include all adjustments, in normal recurring nature, as necessary for the fair statement of the Company’s financial position as of December 31, 2022, and results of operations and cash flows for the six-month periods ended December 31, 2022 and 2021. The unaudited interim condensed consolidated balance sheet as of June 30, 2022 has been derived from the audited financial statements at that date but does not include all the information and footnotes required by the U.S. GAAP. Interim results of operations are not necessarily indicative of the results expected for the full fiscal year or for any future period. These financial statements should be read in conjunction with the audited consolidated financial statements as of and for the years ended June 30, 2022 and 2021, and related notes included in the Company’s audited consolidated financial statements.

 

Principle of Consolidation

 

The consolidated financial statements include the accounts of the Company and its subsidiaries, and the VIE. All inter-company transactions and balances are eliminated upon consolidation.

 

7

 

 

Going Concern

 

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The realization of assets and the satisfaction of liabilities in the normal course of business are dependent on, among other things, the Company’s ability to operate profitably, to generate cash flows from operations, and to pursue financing arrangements to support its working capital requirements.

 

In assessing the Company’s liquidity, the Company monitors and analyzes its cash and cash equivalents and its operating and capital expenditure commitments. The Company’s liquidity needs are to meet its working capital requirements, operating expenses and capital expenditure obligations. As of December 31, 2022, the Company’s current liabilities exceeded the current assets by $2,180,304, its accumulated deficit was $2,434,863 and the Company has incurred losses during the six months ended December 31, 2022 and 2021. Accordingly, we may not be able to obtain additional financing. If we are unable to raise additional capital, we may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending the pursuit of our business plan, and reducing overhead expenses. We cannot provide any assurance that new financing will be available to us on commercially acceptable terms, if at all.

 

In evaluating if there is substantial doubt about the ability to continue as a going concern, the Company are trying to alleviate the going concern risk through (1) increasing cash generated from operations by controlling operating expenses, (2) financing from domestic banks and other financial institutions, and (3) equity or debt financing. The Company has certain plans to mitigate these adverse conditions and to increase the liquidity.

 

On an on-going basis, the Company will also receive financial support commitments from the Company’s related parties.

 

These conditions raise substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result should the Company be unable to continue as a going concern.

 

Liquidity

 

The Company had a working deficit of $2,180,304 as of December 31, 2022, an increase of $697,290 from a working deficit of $2,877,594 as of June 30, 2022. As of December 31, 2022 and June 30, 2022, the Company’s cash was $398,023 and $204,004, respectively.

 

The Company’s primary need for liquidity stems from its need to fund working capital requirements of the Company’s businesses, its capital expenditures and its general operations, including debt repayment. The Company has historically financed its operations through loans from directors and shareholders, and other third party. The Company routinely monitors current and expected operational requirements and financial market conditions to evaluate the use of available financing sources. In addition, the existing major shareholder committed not to request for repayment of the amount due to shareholders by December 31, 2022. Considering the existing working capital position and the ability to access debt funding sources, the management believes that the Company’s operations and borrowing resources are sufficient to provide for its current and foreseeable capital requirements to support its ongoing operations for the next twelve months. 

 

Use of Estimates

 

The preparation of these consolidated financial statements requires management of the Company to make estimates and judgments that affect the reported amounts of assets including application of discount on long-term other receivables with present value, liabilities, revenues, costs and expenses, and related disclosures. On an on-going basis, the Company evaluates its estimates based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Identified below are the accounting policies that reflect the Company’s most significant estimates and judgments, and those that the Company believes are the most critical to fully understanding and evaluating its consolidated financial statements.

 

8

 

 

In March 2020 the World Health Organization declared coronavirus COVID-19 a global pandemic. The COVID-19 pandemic has negatively impacted the global economy, workforces, customers, and created significant volatility and disruption of financial markets. The pandemic may impact Company’s future estimates including, but not limited to, our allowance for doubtful accounts, inventory valuations, fair value measurements, asset impairment charges. It is not possible for the Company to predict the duration or magnitude of the adverse results of the outbreak and its effects on its business or results of operations at this time.

  

Fair Value of Financial Instruments

 

U.S. GAAP establishes a three-tier hierarchy to prioritize the inputs used in the valuation methodologies in measuring the fair value of financial instruments. This hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three-tier fair value hierarchy is:

 

Level 1 - observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

 

Level 2 - include other inputs that are directly or indirectly observable in the market place.

 

Level 3 - unobservable inputs which are supported by little or no market activity.

 

The carrying value of the Company’s financial instruments, including cash, accounts receivable, other current assets, accounts payable, and accruals and other payable approximate their fair value due to their short maturities. 

 

In accordance with ASC 825, for investments in financial instruments with a variable interest rate indexed to performance of underlying assets, the Company elected the fair value method at the date of initial recognition and carried these investments at fair value. Changes in the fair value are reflected in the accompanying consolidated statements of operations and comprehensive loss as other income (expense). To estimate fair value, the Company refers to the quoted rate of return provided by banks at the end of each period using the discounted cash flow method. The Company classifies the valuation techniques that use these inputs as Level 2 of fair value measurements.

 

As of December 31, 2022 and June 30, 2022, the Company had no investments in financial instruments.

 

Cash

 

Cash consists of cash on hand and at banks and highly liquid investments, which are unrestricted from withdrawal or use, and which have original maturities of three months or less when purchased.

 

Cash denominated in RMB with a U.S. dollar equivalent of $398,023 and $204,004 at December 31, 2022 and June 30, 2022, respectively, were held in accounts at financial institutions located in the PRC‚ which is not freely convertible into foreign currencies. In addition, these balances are not covered by insurance. While management believes that these financial institutions are of high credit quality, it also continually monitors their credit worthiness. The Company, its subsidiaries and VIE have not experienced any losses in such accounts and do not believe the cash is exposed to any significant risk.

 

Accounts Receivable, Net and Allowance for Doubtful Accounts

 

Accounts receivable represents the revenue earned from the customers not yet collected. The carrying value of accounts receivable is reduced by an allowance that reflects the Company’s best estimate of the amounts that will not be collected. Account balances are charged off against the provision after all means of collection have been exhausted and the likelihood of collection is not probable. For the year ended June 30, 2022, the Company adopted ASU 2016- 13, “Financial Instruments - Credit Losses (Topic 326): Measurement on Credit Losses on Financial Instruments”, including certain subsequent amendments, transitional guidance and other interpretive guidance within ASU 2018-19, ASU 2019-04, ASU 2019-05, ASU 2019-11, ASU 2020-02 and ASU 2020-03 (collectively, including ASU 2016-13, “ASC 326”). ASC 326 introduces an approach based on expected losses to estimate the allowance for doubtful accounts, which replaces the previous incurred loss impairment model. The Company’s estimation of allowance for doubtful accounts considers factors such as historical credit loss experience, age of receivable balances, current market conditions, reasonable and supportable forecasts of future economic conditions, as well as an assessment of receivables due from specific identifiable counterparties to determine whether these receivables are considered at risk or uncollectible. The Company assesses collectibility by pooling receivables that have similar risk characteristics and evaluates receivables individually when specific receivables no longer share those risk characteristics. For receivables evaluated individually, when it is determined that foreclosure is probable or when the debtor is experiencing financial difficulty at the reporting date and repayment is expected to be provided substantially through the operation or sale of collateral, expected credit losses are based on the fair value of the collateral at the reporting date, adjusted for selling costs as appropriate. The balance of allowance of December 31, 2022 and June 30, 2022 were $60,990 and $62,804, respectively.

 

9

 

 

Inventory

 

Inventory primarily consists of 1) raw materials, primarily ingredients such as carrots, 2) finished goods, primarily β-carotene series products including carrot juice, carrot meal and carrot noodle, and 3) miscellaneous such as packages.

 

Inventories are stated at the lower of cost or net realizable value (market value). The cost of raw materials is determined on the basis of weighted average. The cost of finished goods is determined on the basis of weighted average and comprises direct materials, direct labor and an appropriate proportion of overhead.

 

Net realizable value is based on estimated selling prices less selling expenses and any further costs expected to be incurred for completion. Adjustments to reduce the cost of inventory to net realizable value are made, if required, for estimated excess, obsolescence, or impaired balances.

 

Property, Plant and Equipment

 

Property, plant and equipment, net is recorded at cost less accumulated depreciation and accumulated impairment. Depreciation is computed using the straight-line method over the estimated useful lives of the assets.

 

   Useful
Lives
Categories  (Years)
Furniture and equipment  3
Machinery  5
Motor vehicles  4

  

Expenditure for maintenance and repairs is expended as incurred.

 

The gain or loss on the disposal of equipment is the difference between the net sales proceeds and the lower of the carrying value or fair value less cost to sell the relevant assets and is recognized in general and administrative expenses in the consolidated statements of income and comprehensive income.

 

Impairment of Long-lived Assets

 

In accordance with ASC 360-10-35, the Company reviews the carrying values of long-lived assets, including property and equipment with finite lives and intangible assets subject to amortization, for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be recoverable. The Company assesses the recoverability of the assets based on the undiscounted future cash flows the assets are expected to generate and recognize an impairment loss when estimated undiscounted future cash flows expected to result from the use of the asset plus net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. If an impairment is identified, the Company would reduce the carrying amount of the asset to its estimated fair value based on a discounted cash flows approach or, when available and appropriate, to comparable market values. The estimation of future cash flows requires significant management judgment based on the Company’s historical results and anticipated results and is subject to many factors. The discount rate that is commensurate with the risk inherent in the Company’s business model is determined by its management. An impairment loss would be recorded if the Company determined that the carrying value of long-lived assets may not be recoverable. The impairment to be recognized is measured by the amount by which the carrying values of the assets exceed the fair value of the assets. Impairment of $2,788 and $2,871 has been recorded by the Company as of December 31, 2022 and June 30, 2022.

 

10

 

 

Revenue Recognition

 

Effective January 1, 2018, the Company adopted ASC Topic 606, Revenue from Contracts with Customers, which replaced ASC Topic 605, using the modified retrospective method of adoption.

 

 The Company recognizes revenues when its customer obtains control of promised goods, in an amount that reflects the consideration which the Company expects to receive in exchange for those goods. The Company recognizes revenues following the five-step model prescribed under ASU No. 2014-09: (i) identify contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenues when (or as) the Company satisfies the performance obligation. The application of the five-step model to the revenue streams compared to the prior guidance did not result in significant changes in the way the Company records its revenue. Upon adoption, the Company evaluated its revenue recognition policy for all revenue streams within the scope of the ASU under previous standards and using the five-step model under the new guidance and confirmed that there were no differences in the pattern of revenue recognition. Hence, the Company’s accounting for revenue remains substantially unchanged. There were no cumulative effect adjustments for service contracts in place prior to the adoption. The effect from the adoption of ASC Topic 606 was not material to the Company’s consolidated financial statements.

 

The Company applies judgment in determining the customer’s ability and intention to pay, which is based on a variety of factors including the customer’s historical payment experience.

 

Judgment is used in determining: (1) whether the financing component in the sales agreement is significant and, if so, (2) the discount rate used in calculating the significant financing component. The Company assesses the significance of the financing component based on the timing of payments agreed to by the parties to the contract that provides the customer with a significant benefit of financing. If determined to be significant, the Company adjusts the promised amount of consideration for the effects of the time value of money.

 

Judgment is also used in assessing whether the long-term accounts receivable results in variable consideration and, if so, the amount to be included in the transaction price. The Company applies the portfolio approach to estimating the amount of variable consideration in these arrangements using the most likely amount method that is based on the Company’s historical collection experience under similar arrangements.

 

Based on the above significant judgements, the financing component, arising from the long-term accounts receivable was recognized as financing revenue over the time of payment. There was no financing revenue for the six months ended December 31, 2022 and 2021, respectively.

 

The Company is in traditional production business operation and its performance obligation is delivery of the products to customers with agreed time and location. Customers sign on the delivery note as acceptance. The typical payment term is either advance payment or agreed-upon credit term after delivery of products. There is no warranty and return policy for the customers.

 

There are two revenue streams within the Company’s operations: (1) sales of health products which constitutes the majority of the revenues, and (2) others.

 

   For the Six Months Ended 
   2022   2021 
    Sales    Sales 
Health product sales  $286,273   $590,798 
Others   
-
    
-
 
Total revenues  $286,273    590,798 

 

11

 

 

There is no variable consideration and non-cash consideration agreed with the customers. The transaction price is fixed and allocated to the agreed product, the only performance obligation. The revenue is recognized at a point in time once the Company has determined that the customers have obtained control over the products. Control is typically deemed to have been transferred to the customers when the performance obligation is fulfilled, usually at the time of delivery, at the net sales price (transaction price).

 

There is no contract asset that the Company has right to consideration in exchange for the product sales that the Company has transferred to customers. Such right is not conditional on something other than the passage of time.

 

The standard warranty included in the price of the products is an assurance-type warranty for a period not to exceed one year from the point when the customers have obtained control over the products, and the nature of tasks under the warranty only remedying defective product. It is not considered as a distinct performance obligation.

 

Practical expedients and exemption

 

The Company elected a practical expedient that it does not adjust the promised amount of consideration for the effects of a significant financing component if the Company expects that, upon the inception of revenue contracts, the period between when the Company transfers its promised deliverables to its customers and when the customers pay for those deliverables will be more than one year.

 

Advertising and Promotional Expenses

 

Advertising costs are expensed as incurred and included in selling expenses. Advertising costs amounted to $308 and $93,483 for the six months ended December 31, 2022 and 2021, respectively.

 

Income Tax

 

The Company’s subsidiary in China are subject to the income tax laws of the relevant tax jurisdiction. No taxable income was generated outside the PRC for the six months ended December 31, 2022 and 2021. The Company accounts for income tax in accordance with U.S. GAAP.

 

Current income taxes are provided on the basis of net profit (loss) for financial reporting purposes, adjusted for income and expense items which are not assessable or deductible for income tax purposes, in accordance with the regulations of the relevant tax jurisdictions.

 

Deferred income taxes are recognized for temporary differences between the tax bases of assets and liabilities and their reported amounts in the consolidated financial statements, net operating loss carry forwards and credits. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Current income taxes are provided in accordance with the laws of the relevant taxing authorities. Deferred tax assets and liabilities are measured using enacted rates expected to apply to taxable income in which temporary differences are expected to be reversed or settled. The effect on deferred tax assets and liabilities of changes in tax rates is recognized in the statement of comprehensive loss in the period of the enactment of the change.

 

The Company considers positive and negative evidence when determining whether a portion or all of its deferred tax assets will more likely than not be realized. This assessment considers, among other matters, the nature, frequency and severity of current and cumulative losses, forecasts of future profitability, the duration of statutory carry-forward periods, its experience with tax attributes expiring unused, and its tax planning strategies. The ultimate realization of deferred tax assets is dependent upon its ability to generate sufficient future taxable income within the carry-forward periods provided for in the tax law and during the periods in which the temporary differences become deductible. When assessing the realization of deferred tax assets, the Company has considered possible sources of taxable income including (i) future reversals of existing taxable temporary differences, (ii) future taxable income exclusive of reversing temporary differences and carry-forwards, (iii) future taxable income arising from implementing tax planning strategies, and (iv) specific known trend of profits expected to be reflected within the industry.

 

12

 

 

An uncertain tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized upon examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the period incurred. PRC tax returns filed in 2022 and 2021 are subject to examination by any applicable tax authorities. The Company had no uncertain tax position for the six months ended December 31, 2022 and 2021.

 

Value Added Tax

 

The Company was subject to VAT at the rate of 13% and related surcharges on revenue generated from selling products for the six months ended December 31, 2022 and 2021. Entities that are VAT general taxpayers are allowed to offset qualified input VAT paid to suppliers against their output VAT liabilities. 

 

Earnings Per Share

 

The Company has adopted ASC Topic 260, “Earnings per Share,” (“EPS”) which requires presentation of basic EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation. In the accompanying consolidation financial statements, basic earnings per share is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period.

 

Diluted EPS includes the effect from potential issuance of ordinary shares. There was no potentially dilutive share to be issued during the six months ended December 31, 2022 and 2021.

 

Related Parties

 

The Company adopted ASC 850, Related Party Disclosures, for the identification of related parties and disclosure of related party transactions.

 

Foreign Currency and Foreign Currency Translation

 

The functional currency of the Company is the Chinese Yuan (“RMB”), as their functional currencies. An entity’s functional currency is the currency of the primary economic environment in which it operates, normally that is the currency of the environment in which the entity primarily generates and expends cash. Management’s judgment is essential to determine the functional currency by assessing various indicators, such as cash flows, sales price and market, expenses, financing and inter-company transactions and arrangements. 

 

Foreign currency transactions denominated in currencies other than the functional currency are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are re-measured at the applicable rates of exchange in effect at that date. Gains and losses resulting from foreign currency re-measurement are included in the statements of comprehensive loss. 

 

The consolidated financial statements are presented in U.S. dollars. Assets and liabilities are translated into U.S. dollars at the current exchange rate in effect at the balance sheet date, and revenues and expenses are translated at the average of the exchange rates in effect during the reporting period. Shareholders’ equity accounts are translated using the historical exchange rates at the date the entry to shareholders’ equity was recorded, except for the change in retained earnings during the period, which is translated using the historical exchange rates used to translate each period’s income statement. Differences resulting from translating functional currencies to the reporting currency are recorded in accumulated other comprehensive income in the consolidated balance sheets. 

 

13

 

 

Translation of amounts from RMB into U.S. dollars has been made at the following exchange rates:

 

Balance sheet items, except for equity accounts     
December 31, 2022   RMB6.8983 to $1 
June 30, 2022   RMB6.6991 to $1 
      
Income statement and cash flows items     
For the six months ended December 31, 2022   RMB6.9784 to $1 
For the six months ended December 31, 2021   RMB6.4305 to $1 

 

Segment reporting

 

The Company’s management reviews the consolidated results when making decisions about allocating resources and assessing performance of the Company as a whole and hence, the Company has only one reportable segment. The Company does not distinguish between markets or segments for the purpose of internal reporting. The Company’s long-lived assets are substantially all located in the PRC and substantially all of the Company’s revenues are derived from within the PRC. Therefore, no geographical segments are presented.

 

Commitments and Contingencies

 

In the normal course of business, the Company is subject to contingencies, including legal proceedings and claims arising out of the business that relate to a wide range of matters, such as government investigations and tax matters. The Company recognizes a liability for such contingency if it determines it is probable that a loss has occurred, and a reasonable estimate of the loss can be made. The Company may consider many factors in making these assessments including historical and the specific facts and circumstances of each matter.

 

Recent Accounting Pronouncements

 

The Company is an emerging growth company (“EGC”) as defined by the Jumpstart Our Business Startups Act (“JOBS Act”). The JOBS Act provides that an EGC can take advantage of extended transition periods for complying with new or revised accounting standards. This allows an EGC to delay adoption of certain accounting standards until those standards would otherwise apply to private companies. The Company elected to take advantage of the extended transition periods. However, this election will not apply should the Company cease to be classified as an EGC.

 

In June 2017, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): The amendments in this Update require a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The amendments broaden the information that an entity must consider in developing its expected credit loss estimate for assets measured either collectively or individually. The use of forecasted information incorporates more timely information in the estimate of expected credit loss, which will be more decision useful to users of the financial statements. In November 2019, the FASB issued ASU 2019-10 which defers the effective dates for the credit losses, derivatives and lease standards for certain companies. The deferred effective date for credit losses is January 1, 2023 for calendar-year end companies which are “smaller reporting companies”, non-SEC filers and all other companies including not-for-profit companies and employee benefit plans. The deferral for the derivatives and lease standards is only applicable to the companies which are not public business entities. The Company is still evaluating the impact of the accounting standard of credit losses on the Company’s consolidated financial statements and related disclosures. 

 

14

 

 

On December 18, 2019, the FASB issued ASU No. 2019-12, Income taxes (Topic 740), Simplifying the Accounting for Income Taxes. This guidance amends ASC Topic 740 and addresses several aspects including 1) evaluation of step-up tax basis of goodwill when there is not a business combination, 2) policy election to not allocate consolidated taxes on a separate entity basis to entities not subject to income tax, 3) accounting for tax law changes or rates during interim periods, 4) ownership changes from equity method investment to subsidiary or vice versa, 5) elimination of exception to intraperiod allocation when there is gain in discontinued operations and a loss from continuing operations, 6) treatment of franchise taxes that are partially based on income. The guidance is effective for calendar year-end public entities on January 1, 2021 and other entities on January 1, 2022. The Company adopted this guidance on July 1, 2021 and determined that the adoption of this guidance does not have material impacts on its consolidated financial statements and related disclosures.

 

In October 2020, the FASB issued ASU 2020-10, “Codification Improvements”. The amendments in this Update represent changes to clarify the Codification or correct unintended application of guidance that are not expected to have a significant effect on current accounting practice or create a significant administrative cost to most entities. The amendments in this Update affect a wide variety of Topics in the Codification and apply to all reporting entities within the scope of the affected accounting guidance. ASU 2020-10 is effective for the Company for fiscal years beginning after December 15, 2021 and interim periods within fiscal years beginning after December 15, 2022. The amendments in this Update should be applied retrospectively. The Company does not expect the adoption of this standard to have a material impact on its consolidated financial statements.

 

The Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the Company’s consolidated balance sheets, consolidated statements of income and consolidated statements of cash flows.

 

3. ACCOUNTS RECEIVABLE, NET

 

Accounts receivable consist of the following:

 

  

December 31,

2022

  

June 30,

2022

 
         
Accounts receivable   60,990    62,804 
Less: allowance for doubtful accounts   (60,990)   (62,804)
Accounts receivable, net   
-
    
-
 

 

The following table sets forth the movement of allowance for doubtful accounts:

 

  

December 31,

2022

  

June 30,

2022

 
         
Beginning  $62,804   $86,868 
Additions   
-
    
-
 
Write off   
-
    (21,685)
Exchange rate different   (1,814)   (2,379)
Balance  $60,990   $62,804 

 

4. PREPAYMENTS

 

Prepayments consist of the following:

 

  

December 31,

2022

  

June 30,

2022

 
Prepayments for inventory  $170,829   $105,216 
Prepayment  $170,829   $105,216 

 

15

 

 

5. OTHER RECEIVABLE

 

Other receivable consists of the following:

 

   December 31,
2022
  

June 30,

2022

 
Receivables from third party companies  $788,571   $149,262 
Loans receivable from employees   489,281    1,161,604 
Other receivable - current  $1,277,852   $1,310,866 

 

   December 31,
2022
   June 30,
2022
 
Other receivable - long term  $
    -
   $615,987 

 

Receivables from third party companies are interest free and due on demand. Loans receivable from employees are interest free and due on demand. $597,096 of loan receivable has been repaid to the Company during October 2022.

 

6. INVENTORY

 

Inventory consisted of the following:

 

  

December 31,

2022

  

June 30,

2022

 
Raw materials, parts, and components  $525,177   $87,478 
Finished goods   92,076    207,052 
Miscellaneous supplies   14,078    10,516 
Inventory  $631,331   $305,046 

 

7. PROPERTY, PLANT AND EQUIPMENT, NET

 

Property, plant and equipment consisted of the following:

 

  

December 31,

2022

  

June 30,

2022

 
         
Vehicle  $18,858   $19,419 
Office equipment   70,817    72,177 
Machinery, equipment, and tools   83,839    85,858 
Total   173,514    177,454 
Less: accumulated depreciation   (101,847)   (86,993)
Impairment on equipment   (2,788)   (2,871)
Property, plant and equipment, net  $68,879   $87,590 

 

Depreciation expenses charged to the consolidated statements of income and comprehensive income for the six months ended December 31, 2022 and 2021 were $17,167 and $54,403 respectively.

 

16

 

 

8. ADVANCE FROM CUSTOMERS

 

Changes in advance from customers as follows:

 

   December 31,   June 30, 
   2022   2022 
         
Advance from clients, beginning of the period  $6,668,713   $
-
 
Revenue deferred during the period   
-
    6,668,713 
Returned of revenue deferred in prior periods   (6,629,025)   
-
 
Advance from clients, end of the period  $39,688   $6,668,713 

 

9. OTHER PAYABLES

 

Other payables consist of the following:

 

  

December 31,

2022

  

June 30,

2022

 
         
Loans payable  $406,042   $4,376,863 
Other   
-
    80 
Other payables  $406,042   $4,376,943 

 

Loans payable are interest free and due on demand.

 

10. AMOUNTS DUE FROM AND DUE TO RELATED PARTIES

 

   Note  

December 31,

2022

  

June 30,

2022

 
Amounts due from related parties:            
Duolun Kangbaier Biotechnology Co. LTD   (a)   $1,160   $1,194 
Panjin Kangying Health Food Co., LTD   (a)    145    149 
Liaoning Baijiakang Health Technology Co. LTD   (a)    
-
    45 
Ms. Xiuzhi Sun   (b)    
-
    4,757,546 
Ms. Xiuhua Sun   (c)    233,777    1,087,722 
Mr. Yuewen Sun   (d)    
-
    970,281 
Mr. Zengwen Wang   (e)    
-
    746,370 
Mr. Mingkai Cao   (f)    4,349    4,479 
Total       $239,431   $7,567,786 
                
Amounts due to related parties:               
Jilin Kangbaier Biotechnology Co., LTD   (a)   $
-
   $298,548 
Panjin Double Eagle Green Health Food Co. LTD   (g)    133,773    114,180 
Panjin Double Eagle Weishi Green Health Food Co. LTD   (g)    139,269    107,897 
Liaoning Baijiakang Health Technology Co. LTD   (a)    115,875      
Mr. Zengwen Wang   (e)    
-
    620,846 
Ms. Xiuhua Sun   (c)    5,322    67,173 
Ms. Xiuzhi Sun   (b)    3,998,754    
-
 
Total       $4,392,993   $1,208,644 

 

(a) These companies are controlled by the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company, Ms. Xiuzhi Sun. The amount is due on demand, interest-free and unsecured.

 

(b)

Ms. Xiuzhi Sun is the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount due from Ms. Xiuzhi Sun was wholly settled by September 2022.

 

As of December 31, 2022, there is a amount of $3,998,754 due to Ms. Xiuzhi Sun that is interest free, unsecured, and due demand without an agreement. The Company used the funds borrowed from Ms. Xiuzhi Sun to fund its operations. 

 

17

 

 

(c) Ms. Xiuhua Sun is the sibling of Ms. Xiuzhi Sun, the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount is due on demand, interest-free and unsecured.

 

(d) Mr. Yuewen Sun is the sibling of Ms. Xiuzhi Sun, the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount due from Mr. Yuewen Sun was wholly settled by September 2022.

 

(e) Mr. Zengwen Wang is family member of Ms. Xiuzhi Sun, the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount due from and due to Mr. Yuewen Sun was wholly settled by September 2022.

 

(f) Mr. Mingkai Cao is family member of Ms. Xiuzhi Sun, the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount is due on demand, interest-free and unsecured.

 

(g) These companies are controlled by the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company, Ms. Xiuzhi Sun. Such balances are interest free, unsecured, and due demand without an agreement.

 

11. INCOME TAXES

 

The Company is subject to income taxes on an entity basis on income arising in or derived from the tax jurisdiction in which each entity is domiciled.

 

PRC

 

Under the Enterprise Income Tax (“EIT”) Law, which has been effective since January 1, 2008, domestic enterprises and foreign invested enterprises (the “FIEs”) are subject to a unified 25% enterprise income tax rate, except for certain entities that are entitled to tax holidays.  

 

For the six months ended December 31, 2022 and 2021, a reconciliation of the income tax expense determined at the statutory income tax rate to the Company’s income taxes is as follows:

 

   For the six months ended
December 31,
 
   2022   2021 
Loss before income taxes  $(234,714)  $(250,125)
PRC preferential income tax rate   25%   25%
Income tax credit computed at statutory corporate income tax rate   (58,678)   (62,531)
Reconciling items:          
Non-deductible expenses   1,431    2,941 
Change in valuation allowance   57,247    59,590 
Income tax expense  $
-
   $
-
 

 

The Company evaluates the level of authority for each uncertain tax position (including the potential application of interest and penalties) based on the technical merits, and measures the unrecognized benefits associated with the tax positions. for the six months ended December 31, 2022 and 2021, the Company had no unrecognized tax benefits.

 

18

 

 

12. CHINA CONTRIBUTION PLAN

 

The Company participates in a government-mandated multi-employer defined contribution plan pursuant to which certain retirement, medical and other welfare benefits are provided to employees. Chinese labor regulations require the Company to pay to the local labor bureau a monthly contribution at a stated contribution rate based on the monthly compensation of qualified employees. The relevant local labor bureau is responsible for meeting all retirement benefit obligations; the Company has no further commitments beyond their monthly contributions.

 

13. CONCENTRATIONS AND CREDIT RISK

 

(a) Concentrations

 

In the six months ended December 31, 2022, two customers accounted for over 77.85% of the Company’s revenues. In the six months ended December 31, 2021, two customers accounted for 83.07% of the Company’s revenues. No other customer accounts for more than 10% of the Company’s revenue in the six months ended December 31, 2022 and 2021.

 

As of December 31, 2022, one customer accounted for 100% of the Company’s accounts receivable. As of June 30, 2022, one customer accounted for 100% of the Company’s accounts receivable, respectively. No other customer accounts for more than 10% of the Company’s accounts receivable as of December 31, 2022 and June 30, 2022.

 

As of December 31, 2022, one suppliers each accounted for 15.05% of the Company’s accounts payable. As of June 30, 2022, four suppliers each accounted for 88.41% of the Company’s accounts payable. No other supplier accounts for over 10% of the Company’s accounts payable as of December 31, 2022 and June 30, 2022.

  

(b) Credit risk

 

Financial instruments that potentially subject the Company to a significant concentration of credit risk consist primarily of cash. As of December 31, 2022, and June 30, 2022, substantially all of the Company’s cash were held by major financial institutions located in the PRC, which management believes are of high credit quality.

  

For the credit risk related to trade accounts receivable, which are unsecured in nature, the Company performs ongoing credit evaluations of its customers and, if necessary, maintains reserves for potential credit losses. Historically, such losses have been within management’s expectations; however, there is the extremely remote chance that all trade receivables may be become uncollectible.

 

14. COMMITMENTS AND CONTINGENCIES

 

Contingencies 

 

In the ordinary course of business, the Company may be subject to certain legal proceedings, claims and disputes that arise from the business operations. Although the outcomes of these legal proceedings cannot be predicted, the Company does not believe these actions, in the aggregate, will have a material adverse impact on its financial position, results of operations or liquidity. As of December 31, 2022, the Company had no outstanding lawsuits or claims. 

 

15. SUBSEQUENT EVENT

 

The Company has assessed all events subsequent to December 31, 2022, and up to February 21, 2023, the date that these unaudited condensed consolidated financial statements were available to be issued. There are no material subsequent event to disclose in these unaudited condensed consolidated financial statements for which management is aware.

 

19

 

 

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

 

Overview

 

On December 30, 2022, we entered into a share exchange agreement (the “Share Exchange Agreement”) with (i) Cambell International Holding Limited (“Cambell International”), a limited liability company incorporated in the British Virgin Islands on September 23, 2020; and (ii) the shareholders of Cambell International (the “Cambell Shareholders”) to acquire all of the issued and outstanding capital stock of Cambell International in exchange for the issuance to the Cambell Shareholders of an aggregate of 1,000,000 shares (the “Shares”) of our common stock and the transfer by Ms. Xiaoyan Yuan, who was, at the time, our sole officer and director and the holder of 90% of the voting rights in our Company, to the Cambell Shareholders of 9,000,000 shares of our Series A Preferred Stock owned by her (the “Reverse Acquisition”). The Reverse Acquisition was closed on December 30, 2022. As a result of the Reverse Acquisition, Cambell International became our wholly-owned subsidiary.

 

Following the consummation of the Reverse Acquisition, we engage in the research and development of extraction processes of natural β -carotene, the planting and harvesting of raw materials and the production, distribution, marketing and sales of natural β -carotene health food products through our China-based VIE and its subsidiaries. Natural β -carotene is a safe source of vitamin A which is an essential nutrient important for vision, growth, cell division, reproduction and immunity as well as containing antioxidant properties which offer protection from diabetes, heart disease and cancer.

 

Through our 100% ownership of Cambell International, we hold the following entities:

 

Win&win Industrial Development Limited   A British Virgin Islands company   100%
(“Win&win”)   Principal activities: Investment holding    
           
BJK Holding Group Limited   A Hong Kong company   100%
(“BJK Holding”)   Principal activities: Investment holding    
           
Baijiakang (LiaoNing) Health Information Consulting Service Co., Ltd   A PRC limited liability company and deemed a wholly foreign-invested enterprise (“WFOE”)   100%
(“Baijiakang Consulting”)   Principal activities: Consultancy and information technology support    
           
LiaoNing KangBaiEr Biotechnology Development Co., Ltd.   A PRC limited liability company  

VIE by contractual

arrangements

(“Liaoning Kangbaier”)   Incorporated on September 22, 2015    
    Principal activities: research and development of extraction processes of natural β - carotene, the planting and harvesting of raw materials as well as the production, distribution, marketing and sales of natural β -carotene health food products    
           
Doron KangBaier Biotechnology Co. LTD  

 

A PRC limited liability company

 

Principal activities: research and support

  100% owned by LiaoNing KangBaiEr
           
LiaoNing BaiJiaKang Health Technology Co. LTD  

 

A PRC limited liability company

 

Principal activities: promotion and support

  100% owned by LiaoNing KangBaiEr

 

20

 

 

Pursuant to the Reverse Acquisition, Cambell International is deemed to be the acquirer. Consequently, the assets and liabilities and the historical operations that are reflected in the financial statements prior to the Reverse Acquisition are those of Cambell International and its consolidated subsidiaries and are recorded at the historical cost basis of Cambell International, and the consolidated financial statements after consummation of the Reverse Acquisition include the assets and liabilities of Cambell International and its subsidiaries and VIE, historical operations of Cambell International and its subsidiaries and VIE and operations of Bitmis Corp. from the closing date of the Reverse Acquisition.

 

Results of Operations

 

Six months ended December 31, 2022 compared to six months ended December 31, 2021

 

The following table sets forth key components of our results of operations during the six months ended December 31, 2022 and 2021, both in dollars and as a percentage of our revenue.

 

   Six Months ended December 31, 
   2022   2021 
   Amount   of Revenue   Amount   of Revenue 
Revenues   286,273    100.00%   590,798    100.00%
Cost of revenues   (232,648)   (81.27)%   (400,596)   (67.81)%
Gross profit   53,625    18.73%   190,202    32.19%
Operating expenses                    
Selling expenses   (1,231)   (0.43)%   (93,539)   (15.83)%
General and administrative expenses   (307,162)   (107.30)%   (349,313)   (59.13)%
Loss from operations   (254,768)   (89.00)%   (252,650)   (42.77)%
                     
Other Income (expense)                    
Other incomes   24,950    8.72%   2,821    0.48%
Other expenses   (4,896)   (1.71)%   (296)   (0.05)%
Net loss before taxes   (234,714)   (81.99)%   (250,125)   (42.34)%
Income tax expenses   -    -    -    - 
Net loss   (234,714)   (81.99)%   (250,125)   (42.34)%

 

21

 

 

Revenues. Our revenues were $286,273 for the six months ended December 31, 2022, representing a decrease of $304,525 or 52% from $590,798 for the six months ended December 31, 2021. There are two revenue streams within the Company’s operations: (1) normal product sales of carotene which constitutes the majority of the revenues, and (2) others. The decrease was mainly due to the explosion of COVID-19 during the six months ended December 31, 2022.

 

The following table summarizes our revenues by revenue streams for the six months ended December 31, 2022 and 2021:

 

   Six Months ended
December 31,
 
   2022   2021 
   Sales   Sales 
Normal product sales  $286,273   $590,798 
Others   -    - 
Total revenues  $286,273   $590,798 

 

Cost of revenues. Our cost of revenues was $232,647 for the six months ended December 31, 2022, compared to $400,596 for the same period last year. Cost of revenue refers to the cost of material and labor cost, direct material and overhead costs. The decrease was in line with the revenue.

 

Gross profit and gross margin. Our gross profit was $53,625 for the six months ended December 31, 2022, compared with a gross profit of $190,202 for the same period last year. The gross margin was decreased from 32.19% during 2021 to 18.73% during 2022. The decrease was in line with the business decline.

 

Selling expenses. As shown below, our selling expenses consist primarily of compensation and benefits to our selling department and other expenses incurred in connection with general operations. Our selling expenses decreased by $92,308 to $1,231 for the six months ended December 31, 2022, from $93,539 for the same period 2021. The decrease due to the advertising fee decreased by $93,175 for the six months ended December 31, 2022. The decreases were mainly in line with the decline of revenue.

 

   December 31,
2022
   December 31,
2021
   Fluctuation 
   Amount   Proportion   Amount   Proportion   Amount   Proportion 
Advertising fee   308    25.05%   93,483    99.94%   (93,175)   (99.67)%
Others   922    74.95%   56    0.06%   867    1,547.82%
Total selling expenses  $1,231    100.00%  $93,539    100.00%  $(92,308)   98.68%

 

22

 

 

General and administrative expenses. As shown below, our general and administrative expenses consist primarily of compensation and benefits to our general management, finance and administrative staff, professional fees and other expenses incurred in connection with general operations. Our general and administrative expenses decreased by $42,151 to $307,162 for the six months ended December 31, 2022, from $349,313 for the same period in 2021. Professional fee decreased by $931,125 or 90.58% from June 30, 2021 to June 30, 2022. The decrease was mainly due to the decline of office expense $84,202 for the six months ended December 31, 2022. The decrease was mainly in line with the decline of revenue.

 

   December 31,
2022
   December 31,
2021
   Fluctuation 
   Amount   Proportion   Amount   Proportion   Amount   Proportion 
Salary and Social Insurance  $120,169    39.12%  $117,731    33.70%  $2,438    2.07%
Business entertainment   6,448    2.10%   7,442    2.13%   (994)   (13.34)%
Depreciation and amortization   9,455    3.08%   44,651    12.78%   (35,196)   (78.82)%
Office expenses   10,989    3.58%   95,191    27.25%   (84,202)   (88.46)%
Professional fee   148,074    48.21%   72,373    20.72%   75,701    104.60%
Bad debt write-off             (21,770)   (6.23)%   21,770    (100.00)%
Travel fee   2,999    0.98%   7,461    2.14%   (4,462)   (59.80)%
Other   9,029    2.94%   26,235    7.51%   (17,206)   (65.58)%
Total general and administrative expenses  $307,162    100.00%  $349,313    100.00%  $(42,151)   (12.07)%

 

Income tax expense. Our Income tax expense was nil for the six months ended December 31,2022 and 2021.

 

Net loss. As a result of the cumulative effect of the factors described above, our net loss was $234,714 for the six months ended December 31, 2022 and net loss $250,125 for the six months ended December 31, 2021.

 

Liquidity and Capital Resources

 

The Company’s primary need for liquidity stems from its need to fund working capital requirements of the Company’s businesses, its capital expenditures and its general operations, including debt repayment. The Company has historically financed its operations through short-term and long-term commercial bank loans from Chinese banks, as well as its ongoing operating activities by using funds from loans from directors and shareholders, and other third party. The Company routinely monitors current and expected operational requirements and financial market conditions to evaluate the use of available financing sources. Considering the existing working capital position and the ability to access debt funding sources, the management believes that the Company’s operations and borrowing resources are sufficient to provide for its current and foreseeable capital requirements to support its ongoing operations for the next twelve months.

 

The following table set forth a summary of its cash flows for the periods indicated:

 

   For the Six Months Ended 
   December 31, 
   2022   2021 
Net cash (used in) provided by operating activities  $(10,201,408)  $1,689,376 
Net cash used in investing activities   (1,170)   (1,170)
Net cash provided by (used in) financing activities  $10,210,570   $(1,440,328)

 

23

 

 

Operating Activities

 

Net cash used in operating activities was $10,201,408 for the six months ended December 31, 2022, as compared to $1,689,376 net cash provided by operating activities for the six months ended December 31, 2021.

 

The net cash used in operating activities for the six months ended December 31, 2022 was mainly due to our net loss of $234,714, a decrease in advance from customers of $6,362,606 and a decrease in other payables of $3,800,399, partially offset by a decrease in other receivable of $631,451. The net cash provided by operating activities for the six months ended December 31, 2021 was mainly due to an increase in advance from customers of $2,193,576, partially offset by our net loss of $250,125, and increase in other receivable of $378,475.

 

Investing Activities

 

Net cash used in investing activities was $1,170 for the six months ended December 31, 2022, as compared to $93,539 net cash used in investing activities for the six months ended December 31, 2021. The net cash used in investing activities was mainly attributable to purchase of property and equipment for the six months ended December 31, 2022 and 2021.

 

Financing Activities

 

Net cash provided by financing activities was $10,210,570 for the six months ended December 31, 2022, as compared to $1,440,328 net cash used in financing activities for the six months ended December 31, 2021. The net cash provided by financing activities was mainly attributable to advances from related parties for the six months ended December 31, 2022. The net cash used in financing activities was mainly attributable to repayment to related parties for the six months ended December 31, 2021.

 

Contractual Obligations

 

The Company had no short-term and long-term bank loans as of December 31, 2022 and June 30, 2022.

 

Off-Balance Sheet Transactions

 

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources that is material to investors.

 

Critical Accounting Policies

 

We regularly evaluate the accounting policies and estimates that we use to make budgetary and financial statement assumptions. A complete summary of these policies is included in the notes to our financial statements. In general, management’s estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.

 

See Note 2 to the financial statements included herewith.

 

Recent Accounting Pronouncements

 

See Note 2 to the financial statements included herewith

 

Item 3. Quantitative and Qualitative Disclosures about Market Risk

 

As a smaller reporting company, we are not required to respond to this item.

 

24

 

 

Item 4. Controls and Procedures

 

Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”)) that is designed to ensure that information required to be disclosed by us 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 Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

 

An evaluation was conducted under the supervision and with the participation of our management of the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2022. Based on that evaluation, our management concluded that our disclosure controls and procedures were not effective as of such date to ensure that information 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 Securities and Exchange Commission’s rules and forms.

 

Changes in Internal Controls over Financial Reporting

 

There was no change in our internal control over financial reporting during the quarterly period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

JOBS Act

 

On April 5, 2012, the JOBS Act was signed into law. The JOBS Act contains provisions that, among other things, eases certain reporting requirements for qualifying public companies. We will qualify as an “emerging growth company” and under the JOBS Act will be allowed to comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. We are electing to delay the adoption of new or revised accounting standards, and as a result, we may not comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As a result, our financial statements may not be comparable to those of companies that comply with new or revised accounting pronouncements as of public company effective dates.

 

25

 

 

PART II. OTHER INFORMATION

 

Item 1. Legal Proceedings

 

We are not involved in any pending legal proceeding nor are we aware of any pending or threatened litigation against us.

 

Item 1a. Risk Factors

 

As a smaller reporting company, we are not required to respond to this item.

 

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

 

None

 

Item 3. Defaults Upon Senior Securities

 

None

 

Item 4. Mine Safety Disclosures.

 

Not applicable

 

ITEM 5. OTHER INFORMATION

 

None

 

Item 6. Exhibits

 

The following exhibits are included as part of this report:

 

31.1   Certification of Principal Executive Officer and Principal Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended*
32.1   Certification of Principal Executive Officer and Principal Financial Officer, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*
101.INS   Inline XBRL Instance Document.
101.SCH   Inline XBRL Taxonomy Extension Schema Document.
101.CAL   Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF   Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB   Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE   Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104   Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

 

*Filed herewith

 

26

 

 

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.

 

 

CAMBELL INTERNATIONAL HOLDING CORP., formerly known as

BITMIS CORP.
     
November 9, 2023   By: /s/ Sun Xiuzhi
Date     Sun Xiuzhi, Chief Executive Officer
    (Principal Executive Officer)
     

November 9, 2023

  By: /s/ Sun Xiuzhi
Date     Sun Xiuzhi, Chief Financial Officer
    (Principal Financial and Accounting Officer)

 

 

27

 

 

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Exhibit 31.1

 

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER AND PRINCIPAL FINANCIAL OFFICER
PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Xiuzhi Sun, certify that:

 

1.I have reviewed this Amendment No. 1 to Quarterly Report on Form 10-Q/A of Cambell International Holding Corp. (the “Report”); and

 

2.Based on my knowledge, this Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Report.

 

Dated: November 9, 2023 By: /s/ Xiuzhi Sun
    Xiuzhi Sun
    Chief Executive Officer and
Chief Financial Officer
    (Principal Executive Officer and
Principal Financial Officer)

 

Exhibit 32.1

 

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED
PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with this Amendment No. 1 to Quarterly Report of Cambell International Holding Corp. (the “Company”) on Form 10-Q/A for the quarter ended December 31, 2022, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Xiuzhi Sun, Chief Executive Officer and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

 

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

 

Dated: November 9, 2023 By: /s/ Xiuzhi Sun
    Xiuzhi Sun
    Chief Executive Officer and
Chief Financial Officer
    (Principal Executive Officer and
    Principal Financial Officer)

v3.23.3
Document And Entity Information - shares
6 Months Ended
Dec. 31, 2022
Feb. 21, 2023
Document Information Line Items    
Entity Registrant Name CAMBELL INTERNATIONAL HOLDING CORP.  
Trading Symbol N/A  
Document Type 10-Q/A  
Current Fiscal Year End Date --06-30  
Entity Common Stock, Shares Outstanding   7,250,750
Amendment Flag true  
Amendment Description EXPLANATORY NOTEThis Amendment No. 1 on Form 10-Q/A (this “Amendment”) amends the Quarterly Report on Form 10-Q for the quarter ended December 31, 2022 of Bitmis Corp. (now known as Cambell International Holding Corp.) (the “Company”), originally filed with the U.S. Securities and Exchange Commission (“SEC”) on February 21, 2023 (the “Original Report”). The purpose of this Amendment is to accurately reflect on the cover page of the Original Report that the Company is not required to file reports pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The fiscal year in which the Company’s registration statement was declared effective ended on June 30, 2017. No shares were sold pursuant to that registration statement. The Company’s reporting obligation under Section 15(d) of the Exchange Act was automatically suspended as of July 1, 2017 as it had fewer than 300 shareholders of record. The Company has been filing periodic reports on a voluntary basis, and continues to do so.This Amendment further reflects that the Company qualifies as an emerging growth company as it consistently has had total annual gross revenues of less than $1.235 billion and none of the events that would cause termination of its status as an emerging growth company has occurred.This Amendment does not amend, modify or otherwise update any other information in the Original Report. In addition, this Amendment does not reflect events that may have occurred subsequent to the date of the Original Report.  
Entity Central Index Key 0001678848  
Entity Current Reporting Status No  
Entity Filer Category Non-accelerated Filer  
Document Period End Date Dec. 31, 2022  
Document Fiscal Year Focus 2023  
Document Fiscal Period Focus Q2  
Entity Small Business true  
Entity Emerging Growth Company true  
Entity Shell Company false  
Entity Ex Transition Period false  
Document Quarterly Report true  
Document Transition Report false  
Entity File Number 333-214469  
Entity Incorporation, State or Country Code NV  
Entity Tax Identification Number 98-1310024  
Entity Address, Address Line One 1-17-1 Zhaojia Road  
Entity Address, Address Line Two Xinglongtai District  
Entity Address, City or Town Panjin City,  
Entity Address, State or Province CT  
City Area Code +86  
Local Phone Number 15842767931  
Title of 12(b) Security None  
Security Exchange Name NONE  
Entity Interactive Data Current Yes  
Entity Address, Postal Zip Code 00000  
v3.23.3
Condensed Consolidated Balance Sheets - USD ($)
Dec. 31, 2022
Jun. 30, 2022
CURRENT ASSETS    
Cash $ 398,023 $ 204,004
Accounts receivable, net of $60,990 and $62,804 allowance for doubtful accounts as of December 31, 2022 and June 30, 2022, respectively
Prepayments 170,829 105,216
Other receivables 1,277,852 1,310,866
Amounts due from related parties 239,431 7,567,786
Inventory 631,331 305,046
Total current assets 2,717,466 9,492,918
NON-CURRENT ASSETS    
Long-term other receivable 615,987
Property, plant and equipment, net 68,879 87,590
Total non-current assets 68,879 703,577
TOTAL ASSETS 2,786,345 10,196,495
CURRENT LIABILITIES    
Accounts payable 29,010 82,365
Advance from customers 39,688 6,668,713
Amounts due to related parties 4,392,993 1,208,644
Payroll payable 23,572 22,447
Tax payable 6,465 11,400
Other payables 406,042 4,376,943
Total current liabilities 4,897,770 12,370,512
TOTAL LIABILITIES 4,897,770 12,370,512
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ DEFICIT    
Preferred stock, par value $0.001, 10,000,000 shares authorized, 10,000,000 and 0 shares issued and outstanding as of December 31, 2022 and June 30, 2022, respectively 10,000
Common stock, par value $0.001; 75,000,000 shares authorized, 7,250,750 and 6,250,750 shares issued and outstanding as of December 31, 2022 and June 30, 2022, respectively 7,251 6,251
Additional paid-in capital (17,251) (6,251)
Accumulated deficit (2,434,863) (2,200,149)
Accumulated other comprehensive gain 323,438 26,132
Total Shareholders’ Deficit (2,111,425) (2,174,017)
TOTAL LIABILITIES AND SHAREHOLDERS’ DEFICIT $ 2,786,345 $ 10,196,495
v3.23.3
Condensed Consolidated Balance Sheets (Parentheticals) - USD ($)
Dec. 31, 2022
Jun. 30, 2022
Statement of Financial Position [Abstract]    
Accounts receivable, net allowance for doubtful accounts (in Dollars) $ 60,990 $ 62,804
Preferred stock, par value (in Dollars per share) $ 0.001 $ 0.001
Preferred stock, authorized shares 10,000,000 10,000,000
Preferred stock, issued shares 10,000,000 0
Preferred stock, outstanding shares 10,000,000 0
Common stock, par value (in Dollars per share) $ 0.001 $ 0.001
Common stock, authorized Shares 75,000,000 75,000,000
Common stock, issued shares 7,250,750 6,250,750
Common stock, outstanding Shares 7,250,750 6,250,750
v3.23.3
Condensed Consolidated Statements of Loss and Comprehensive Income (Loss) (Unaudited) - USD ($)
6 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Income Statement [Abstract]    
REVENUES $ 286,273 $ 590,798
COST OF REVENUES 232,648 400,596
GROSS PROFIT 53,625 190,202
OPERATING EXPENSES    
Selling expenses 1,231 93,539
General and administrative expenses 307,162 349,313
Total operating expenses 308,393 442,852
LOSS FROM OPERATIONS (254,768) (252,650)
OTHER INCOME (EXPENSE), NET    
Other incomes 24,950 2,821
Other expenses (4,896) (296)
Total other income net 20,054 2,525
NET LOSS BEFORE INCOME TAX (234,714) (250,125)
Income tax expense
NET LOSS (234,714) (250,125)
Other comprehensive income (loss):    
Foreign currency translation income (loss) 297,306 (26,877)
Total comprehensive income (loss) $ 62,592 $ (277,002)
Weighted average number of ordinary shares outstanding - basic and diluted (in Shares) 7,250,750 6,250,750
Net loss per share - basic and diluted (in Dollars per share) $ (0.03) $ (0.04)
v3.23.3
Condensed Consolidated Statements of Loss and Comprehensive Income (Loss) (Unaudited) (Parentheticals) - $ / shares
6 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Income Statement [Abstract]    
Weighted average number of ordinary shares outstanding - diluted 7,250,750 6,250,750
Net loss per share - diluted $ (0.03) $ (0.04)
v3.23.3
Condensed Consolidated Statements of Changes in Shareholders’ Deficit (Unaudited) - USD ($)
Ordinary shares
Subscription receivable
Accumulated deficit
Accumulated other comprehensive income
Additional paid-in capital
Total
Balance at Jun. 30, 2021 $ 6,251   $ (1,535,367) $ (56,041) $ (6,251) $ (1,591,408)
Balance (in Shares) at Jun. 30, 2021 6,250,750          
Net loss   (250,125) (250,125)
Foreign currency translation adjustment   (26,877) (26,877)
Balance at Dec. 31, 2021 $ 6,251   (1,785,492) (82,918) $ (6,251) (1,868,410)
Balance (in Shares) at Dec. 31, 2021 6,250,750          
Balance at Jun. 30, 2022 $ 6,251 $ (6,251) (2,200,149) 26,132   (2,174,017)
Balance (in Shares) at Jun. 30, 2022 6,250,750          
Reverse acquisition recapitalization $ 1,000 (1,000)  
Reverse acquisition recapitalization (in Shares) 1,000,000          
Net loss (234,714)   (234,714)
Foreign currency translation adjustment 297,306   297,306
Balance at Dec. 31, 2022 $ 7,251 $ (7,251) $ (2,434,863) $ 323,438   $ (2,111,425)
Balance (in Shares) at Dec. 31, 2022 7,250,750          
v3.23.3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)
6 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Statement of Cash Flows [Abstract]    
Net loss $ (234,714) $ (250,125)
Adjustments to reconcile net loss to net cash used in operating activities:    
Impairment on equipment   2,991
Depreciation and amortization 17,167 54,403
Changes in operating assets and liabilities:    
Accounts receivable, net 30,946
Other receivables 631,451 (378,475)
Prepayments (67,864) (117,356)
Inventory (331,250) 97,080
Accounts payable (50,391) 27,836
Advance from customers (6,362,606) 2,193,576
Payroll payable 1,753 (1,154)
Tax payable (4,555) (1,447)
Other payables (3,800,399) 31,101
Net cash (used in) provided by operating activities (10,201,408) 1,689,376
CASH FLOWS FROM INVESTING ACTIVITIES    
Purchase of property, plant and equipment (1,170) (93,539)
Cash used in investing activities (1,170) (93,539)
CASH FLOWS FROM FINANCIING ACTIVITIES    
Repayment to related parties (1,440,328)
Proceeds from advances from related parties 10,210,570
Cash provided by (used in) financing activities 10,210,570 (1,440,328)
EFFECT OF EXCHANGE RATE ON CASH 186,027 2,717
NET CHANGE IN CASH AND CASH EQUIVALENTS 194,019 158,226
CASH AT BEGINNING OF PERIOD 204,004 63,793
CASH AT END OF PERIOD 398,023 222,019
Cash paid during the period for:    
Income taxes
Interest
v3.23.3
Organization and Business
6 Months Ended
Dec. 31, 2022
Organization and Business [Abstract]  
ORGANIZATION AND BUSINESS

1. ORGANIZATION AND BUSINESS

  

Bitmis Corp., via the PRC affiliated entity Liaoning Kangbaier Biotechnology Development Co., Ltd. (“Liaoning Kangbaier”), engages in the research and development of extraction processes of natural β -carotene, the planting and harvesting of raw materials as well as the production, distribution marketing and sales of natural β -carotene health food products.

 

On December 30, 2022, the Company entered into a share exchange agreement (“Share Exchange Agreement”) with (i) Cambell International Holding Limited (“Cambell International”) which indirectly wholly owns Liaoning Kangbaier, a limited liability company incorporated in British Virgin Islands on September 23, 2020 and (ii) the shareholders of Cambell International (the “Cambell Shareholders”) to acquire all the issued and outstanding capital stock of Cambell International in exchange for the issuance to the Cambell Shareholders of an aggregate of 1,000,000 shares (the “Shares”) of the Company’s common stock and the transfer by Ms. Yuan Xiaoyan, the original controlling shareholder of the Company, to the Cambell Shareholders of 9,000,000 shares of our Series A Preferred Stock owned by her (“Reverse Acquisition”). The Reverse Acquisition was closed on December 30, 2022. 

 

Contractual Arrangements 

 

The Company, through its wholly-owned foreign subsidiary, WFOE in the PRC, Baijiakang (LiaoNing) Health Information Consulting Service Co., Ltd., entered into a series of contractual arrangements with Liaoning Kangbaier (collectively known as “the VIE”) and its respective shareholders that enable the Company to (1) have power to direct the activities that most significantly affects the economic performance of the VIE, and (2) receive the economic benefits of the VIE that could be significant to the VIE. As PRC laws and regulations prohibit and restrict foreign ownership of business in certain industries, while it has not been definitely determined by the Company that operates in an industry that is subject to such constraints over foreign ownership, the Company’s management has elected to operates its business, primarily through the VIE to mitigate the risk of being subject to such regulation. As such, Liaoning Kangbaier is controlled through contractual arrangements in lieu of direct equity ownership by the Company or any of its subsidiaries. The material terms of the VIE Agreements are summarized as follows:

 

Consulting Service Agreement

 

Pursuant to the terms of the Exclusive Consulting and Service Agreement dated November 27 2022, between Baijiakang Consulting and Kangbaier Liaoning (the “Consulting Service Agreement”), Baijiakang Consulting is the exclusive consulting and service provider to Kangbaier Liaoning to provide business-related software research and development services; design, installation, and testing services; network equipment support, upgrade, maintenance, monitor, and problem-solving services; employees training services; technology development and sublicensing services; public relations services; market investigation, research, and consultation services; short to medium term marketing plan-making services; compliance consultation services; marketing events and membership related activities planning and organizing services; intellectual property permits; equipment and rental services; and business-related management consulting services. Pursuant to the Consulting Service Agreement, the service fee is the remaining amount after Kangbaier Liaoning’s profit before tax in the corresponding year deducts Kangbaier Liaoning’s losses, if any, in the previous year, the necessary costs, expenses, taxes, and fees incurred in the corresponding year, and the withdraws of the statutory provident fund. Kangbaier Liaoning agreed not to transfer its rights and obligations under the Consulting Service Agreement to any third party without prior written consent from Baijiakang Consulting. In addition, Baijiakang Consulting may transfer its rights and obligations under the Consulting Service Agreement to Baijiakang Consulting’s affiliates without Kangbaier Liaoning’s consent, but Baijiakang Consulting shall notify Kangbaier Liaoning of such transfer. This Agreement is valid for a term of 10 years subject to any extension requested by Baijiakang Consulting unless terminated by Baijiakang Consulting unilaterally prior to the expiration.

 

The foregoing summary of the Consulting Service Agreement does not purport to be complete and is subject to, and qualified in its entirety by, the Consulting Service Agreement, which is filed as Exhibit 10.2 to this Form 8-K.

 

Business Operation Agreement

 

Pursuant to the terms of the Business Operation Agreement dated November 27, 2022, among Baijiakang Consulting, Kangbaier Liaoning and the shareholders of Kangbaier Liaoning (the “Business Operation Agreement”), Kangbaier Liaoning has agreed to subject the operations and management of its business to the control of Baijiakang Consulting. According to the Business Operation Agreement, Kangbaier Liaoning is not allowed to conduct any transactions that has substantial impact upon its operations, assets, rights, obligations and personnel without the Baijiakang Consulting’s written approval. The shareholders of Kangbaier Liaoning and Kangbaier Liaoning will take Baijiakang Consulting’s advice on appointment or dismissal of directors, employment of Kangbaier Liaoning’s employees, regular operation, and financial management of Kangbaier Liaoning. The shareholders of Kangbaier Liaoning have agreed to transfer any dividends, distributions or any other profits that they receive as the shareholders of Kangbaier Liaoning to Baijiakang Consulting without consideration. The Business Operation Agreement is valid for a term of 10 years or longer upon the request of Baijiakang Consulting prior to the expiration thereof. The Business Operation Agreement might be terminated earlier by Baijiakang Consulting with a 30-day written notice.

 

The foregoing summary of the Business Operation Agreement does not purport to be complete and is subject to, and qualified in its entirety by, the Business Operation Agreement, which is filed as Exhibit 10.3 to this Form 8-K.

 

Proxy Agreement

 

Pursuant to the terms of the Proxy Agreements dated November 27, 2022, among Baijiakang Consulting, and the shareholders of Kangbaier Liaoning (each, the “Proxy Agreement”, collectively, the “Proxy Agreements”), each shareholder of Kangbaier Liaoning has irrevocably entrusted his/her shareholder rights as Kangbaier Liaoning’s shareholder to Baijiakang Consulting , including but not limited to, proposing the shareholder meeting, accepting any notices with regard to the convening of shareholder meeting and any other procedures, conducting voting rights, and selling or transferring the shares held by such shareholder, for 10 years or earlier if the Business Operation Agreement was terminated for any reasons.

 

The foregoing summary of the Proxy Agreements does not purport to be complete and is subject to, and qualified in its entirety by, the Proxy Agreements, which are filed as Exhibit 10.4 to this Form 8-K.

 

Equity Disposal Agreement

 

Pursuant to the terms of the Equity Disposal Agreement dated November 27, 2022, among Baijiakang Consulting, Kangbaier Liaoning, and the shareholders of Kangbaier Liaoning (the “Equity Disposal Agreement”), the shareholders of Kangbaier Liaoning granted Baijiakang Consulting or its designees an irrevocable and exclusive purchase option (the “Option”) to purchase Kangbaier Liaoning’s all or partial equity interests and/or assets at the lowest purchase price permitted by PRC laws and regulations. The option is exercisable at any time at Baijiakang Consulting’s discretion in full or in part, to the extent permitted by PRC law. The shareholders of Kangbaier Liaoning agreed to give Kangbaier Liaoning the total amount of the exercise price as a gift, or in other methods upon Baijiakang Consulting’s written consent to transfer the exercise price to Kangbaier Liaoning. The Equity Disposal Agreement is valid for a term of 10 years or longer upon the request of Baijiakang Consulting.

 

The foregoing summary of the Equity Disposal Agreement does not purport to be complete and is subject to, and qualified in its entirety by, the Equity Disposal Agreement, which is filed as Exhibit 10.5 to this Form 8-K.

 

Equity Pledge Agreement

 

Pursuant to the terms of the Equity Pledge Agreement dated November 27, 2022, among Baijiakang Consulting and the shareholders of Kangbaier Liaoning (the “Pledge Agreement”), the shareholders of Kangbaier Liaoning pledged all of their equity interests in Kangbaier Liaoning to Baijiakang Consulting, including the proceeds thereof, to guarantee Kangbaier Liaoning’s performance of its obligations under the Business Operation Agreement, the Consulting Service Agreement and the Equity Disposal Agreement (each, a “Agreement”, collectively, the “Agreements”). If Kangbaier Liaoning or its shareholders breach its respective contractual obligations under any Agreements, or cause to occur one of the events regards as an event of default under any Agreements, Baijiakang Consulting, as pledgee, will be entitled to certain rights, including the right to dispose of the pledged equity interest in Kangbaier Liaoning. During the term of the Pledge Agreement, the pledged equity interests cannot be transferred without Baijiakang Consulting’s prior written consent. The Pledge Agreements is valid until all the obligations due under the Agreements have been fulfilled.

 

The foregoing summary of the Equity Pledge Agreement does not purport to be complete and is subject to, and qualified in its entirety by, the Equity Pledge Agreement, which is filed as Exhibit 10.6 to this Form 8-K.

 

Based on these contractual arrangements, the Company consolidates the VIE in accordance with SEC Regulation S-X Rule 3A-02 and Accounting Standards Codification (“ASC”) topic 810 (“ASC 810”), Consolidation.

 

The accompanying consolidated financial statements reflect the activities of each of the following entities of the Company:

 

Name   Background   Ownership
Cambell International     A British Virgin Islands company   100%
Holding Limited   Principal activities: Investment holding    
         
Win&win Industrial     A British Virgin Islands company   100%
Development Limited   Principal activities: Investment holding    
         
BJK Holding Group     A Hong Kong company   100%
Limited   Principal activities: Investment holding    
           
Baijiakang (LiaoNing) Health Information   A PRC limited liability company and deemed a wholly foreign-invested enterprise   100%
Consulting Service Co., Ltd   Principal activities: Consultancy and information technology support    
           
LiaoNing KangBaiEr   A PRC limited liability company   VIE by contractual
Biotechnology   Incorporated on September 22, 2015   arrangements
Development Co., Ltd.   Principal activities: research and development of extraction processes of natural β -carotene, the planting and harvesting of raw materials as well as the production, distribution marketing and sales of natural β -carotene health food products.    
           
Doron KangBaier   A PRC limited liability company   100% owned by
Biotechnology Co.LTD   Principal activities: research and support   LiaoNing KangBaiEr
           
LiaoNing BaiJiaKang   A PRC limited liability company   100% owned by
Health Technology Co.LTD   Principal activities: promotion and support   LiaoNing KangBaiEr
v3.23.3
Summary of Significant Accounting Policies
6 Months Ended
Dec. 31, 2022
Accounting Policies [Abstract]  
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

  

Basis of Presentation

 

The consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”).

 

The unaudited interim condensed consolidated financial statements do not include all the information and footnotes required by the U.S. GAAP for complete financial statements. Certain information and note disclosures normally included in the annual financial statements prepared in accordance with the U.S. GAAP have been condensed or omitted consistent with Article 10 of Regulation S-X. In the opinion of the Company’s management, the unaudited interim consolidated financial statements have been prepared on the same basis as the audited financial statements and include all adjustments, in normal recurring nature, as necessary for the fair statement of the Company’s financial position as of December 31, 2022, and results of operations and cash flows for the six-month periods ended December 31, 2022 and 2021. The unaudited interim condensed consolidated balance sheet as of June 30, 2022 has been derived from the audited financial statements at that date but does not include all the information and footnotes required by the U.S. GAAP. Interim results of operations are not necessarily indicative of the results expected for the full fiscal year or for any future period. These financial statements should be read in conjunction with the audited consolidated financial statements as of and for the years ended June 30, 2022 and 2021, and related notes included in the Company’s audited consolidated financial statements.

 

Principle of Consolidation

 

The consolidated financial statements include the accounts of the Company and its subsidiaries, and the VIE. All inter-company transactions and balances are eliminated upon consolidation.

 

Going Concern

 

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The realization of assets and the satisfaction of liabilities in the normal course of business are dependent on, among other things, the Company’s ability to operate profitably, to generate cash flows from operations, and to pursue financing arrangements to support its working capital requirements.

 

In assessing the Company’s liquidity, the Company monitors and analyzes its cash and cash equivalents and its operating and capital expenditure commitments. The Company’s liquidity needs are to meet its working capital requirements, operating expenses and capital expenditure obligations. As of December 31, 2022, the Company’s current liabilities exceeded the current assets by $2,180,304, its accumulated deficit was $2,434,863 and the Company has incurred losses during the six months ended December 31, 2022 and 2021. Accordingly, we may not be able to obtain additional financing. If we are unable to raise additional capital, we may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending the pursuit of our business plan, and reducing overhead expenses. We cannot provide any assurance that new financing will be available to us on commercially acceptable terms, if at all.

 

In evaluating if there is substantial doubt about the ability to continue as a going concern, the Company are trying to alleviate the going concern risk through (1) increasing cash generated from operations by controlling operating expenses, (2) financing from domestic banks and other financial institutions, and (3) equity or debt financing. The Company has certain plans to mitigate these adverse conditions and to increase the liquidity.

 

On an on-going basis, the Company will also receive financial support commitments from the Company’s related parties.

 

These conditions raise substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result should the Company be unable to continue as a going concern.

 

Liquidity

 

The Company had a working deficit of $2,180,304 as of December 31, 2022, an increase of $697,290 from a working deficit of $2,877,594 as of June 30, 2022. As of December 31, 2022 and June 30, 2022, the Company’s cash was $398,023 and $204,004, respectively.

 

The Company’s primary need for liquidity stems from its need to fund working capital requirements of the Company’s businesses, its capital expenditures and its general operations, including debt repayment. The Company has historically financed its operations through loans from directors and shareholders, and other third party. The Company routinely monitors current and expected operational requirements and financial market conditions to evaluate the use of available financing sources. In addition, the existing major shareholder committed not to request for repayment of the amount due to shareholders by December 31, 2022. Considering the existing working capital position and the ability to access debt funding sources, the management believes that the Company’s operations and borrowing resources are sufficient to provide for its current and foreseeable capital requirements to support its ongoing operations for the next twelve months. 

 

Use of Estimates

 

The preparation of these consolidated financial statements requires management of the Company to make estimates and judgments that affect the reported amounts of assets including application of discount on long-term other receivables with present value, liabilities, revenues, costs and expenses, and related disclosures. On an on-going basis, the Company evaluates its estimates based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Identified below are the accounting policies that reflect the Company’s most significant estimates and judgments, and those that the Company believes are the most critical to fully understanding and evaluating its consolidated financial statements.

 

In March 2020 the World Health Organization declared coronavirus COVID-19 a global pandemic. The COVID-19 pandemic has negatively impacted the global economy, workforces, customers, and created significant volatility and disruption of financial markets. The pandemic may impact Company’s future estimates including, but not limited to, our allowance for doubtful accounts, inventory valuations, fair value measurements, asset impairment charges. It is not possible for the Company to predict the duration or magnitude of the adverse results of the outbreak and its effects on its business or results of operations at this time.

  

Fair Value of Financial Instruments

 

U.S. GAAP establishes a three-tier hierarchy to prioritize the inputs used in the valuation methodologies in measuring the fair value of financial instruments. This hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three-tier fair value hierarchy is:

 

Level 1 - observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

 

Level 2 - include other inputs that are directly or indirectly observable in the market place.

 

Level 3 - unobservable inputs which are supported by little or no market activity.

 

The carrying value of the Company’s financial instruments, including cash, accounts receivable, other current assets, accounts payable, and accruals and other payable approximate their fair value due to their short maturities. 

 

In accordance with ASC 825, for investments in financial instruments with a variable interest rate indexed to performance of underlying assets, the Company elected the fair value method at the date of initial recognition and carried these investments at fair value. Changes in the fair value are reflected in the accompanying consolidated statements of operations and comprehensive loss as other income (expense). To estimate fair value, the Company refers to the quoted rate of return provided by banks at the end of each period using the discounted cash flow method. The Company classifies the valuation techniques that use these inputs as Level 2 of fair value measurements.

 

As of December 31, 2022 and June 30, 2022, the Company had no investments in financial instruments.

 

Cash

 

Cash consists of cash on hand and at banks and highly liquid investments, which are unrestricted from withdrawal or use, and which have original maturities of three months or less when purchased.

 

Cash denominated in RMB with a U.S. dollar equivalent of $398,023 and $204,004 at December 31, 2022 and June 30, 2022, respectively, were held in accounts at financial institutions located in the PRC‚ which is not freely convertible into foreign currencies. In addition, these balances are not covered by insurance. While management believes that these financial institutions are of high credit quality, it also continually monitors their credit worthiness. The Company, its subsidiaries and VIE have not experienced any losses in such accounts and do not believe the cash is exposed to any significant risk.

 

Accounts Receivable, Net and Allowance for Doubtful Accounts

 

Accounts receivable represents the revenue earned from the customers not yet collected. The carrying value of accounts receivable is reduced by an allowance that reflects the Company’s best estimate of the amounts that will not be collected. Account balances are charged off against the provision after all means of collection have been exhausted and the likelihood of collection is not probable. For the year ended June 30, 2022, the Company adopted ASU 2016- 13, “Financial Instruments - Credit Losses (Topic 326): Measurement on Credit Losses on Financial Instruments”, including certain subsequent amendments, transitional guidance and other interpretive guidance within ASU 2018-19, ASU 2019-04, ASU 2019-05, ASU 2019-11, ASU 2020-02 and ASU 2020-03 (collectively, including ASU 2016-13, “ASC 326”). ASC 326 introduces an approach based on expected losses to estimate the allowance for doubtful accounts, which replaces the previous incurred loss impairment model. The Company’s estimation of allowance for doubtful accounts considers factors such as historical credit loss experience, age of receivable balances, current market conditions, reasonable and supportable forecasts of future economic conditions, as well as an assessment of receivables due from specific identifiable counterparties to determine whether these receivables are considered at risk or uncollectible. The Company assesses collectibility by pooling receivables that have similar risk characteristics and evaluates receivables individually when specific receivables no longer share those risk characteristics. For receivables evaluated individually, when it is determined that foreclosure is probable or when the debtor is experiencing financial difficulty at the reporting date and repayment is expected to be provided substantially through the operation or sale of collateral, expected credit losses are based on the fair value of the collateral at the reporting date, adjusted for selling costs as appropriate. The balance of allowance of December 31, 2022 and June 30, 2022 were $60,990 and $62,804, respectively.

 

Inventory

 

Inventory primarily consists of 1) raw materials, primarily ingredients such as carrots, 2) finished goods, primarily β-carotene series products including carrot juice, carrot meal and carrot noodle, and 3) miscellaneous such as packages.

 

Inventories are stated at the lower of cost or net realizable value (market value). The cost of raw materials is determined on the basis of weighted average. The cost of finished goods is determined on the basis of weighted average and comprises direct materials, direct labor and an appropriate proportion of overhead.

 

Net realizable value is based on estimated selling prices less selling expenses and any further costs expected to be incurred for completion. Adjustments to reduce the cost of inventory to net realizable value are made, if required, for estimated excess, obsolescence, or impaired balances.

 

Property, Plant and Equipment

 

Property, plant and equipment, net is recorded at cost less accumulated depreciation and accumulated impairment. Depreciation is computed using the straight-line method over the estimated useful lives of the assets.

 

   Useful
Lives
Categories  (Years)
Furniture and equipment  3
Machinery  5
Motor vehicles  4

  

Expenditure for maintenance and repairs is expended as incurred.

 

The gain or loss on the disposal of equipment is the difference between the net sales proceeds and the lower of the carrying value or fair value less cost to sell the relevant assets and is recognized in general and administrative expenses in the consolidated statements of income and comprehensive income.

 

Impairment of Long-lived Assets

 

In accordance with ASC 360-10-35, the Company reviews the carrying values of long-lived assets, including property and equipment with finite lives and intangible assets subject to amortization, for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be recoverable. The Company assesses the recoverability of the assets based on the undiscounted future cash flows the assets are expected to generate and recognize an impairment loss when estimated undiscounted future cash flows expected to result from the use of the asset plus net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. If an impairment is identified, the Company would reduce the carrying amount of the asset to its estimated fair value based on a discounted cash flows approach or, when available and appropriate, to comparable market values. The estimation of future cash flows requires significant management judgment based on the Company’s historical results and anticipated results and is subject to many factors. The discount rate that is commensurate with the risk inherent in the Company’s business model is determined by its management. An impairment loss would be recorded if the Company determined that the carrying value of long-lived assets may not be recoverable. The impairment to be recognized is measured by the amount by which the carrying values of the assets exceed the fair value of the assets. Impairment of $2,788 and $2,871 has been recorded by the Company as of December 31, 2022 and June 30, 2022.

 

Revenue Recognition

 

Effective January 1, 2018, the Company adopted ASC Topic 606, Revenue from Contracts with Customers, which replaced ASC Topic 605, using the modified retrospective method of adoption.

 

 The Company recognizes revenues when its customer obtains control of promised goods, in an amount that reflects the consideration which the Company expects to receive in exchange for those goods. The Company recognizes revenues following the five-step model prescribed under ASU No. 2014-09: (i) identify contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenues when (or as) the Company satisfies the performance obligation. The application of the five-step model to the revenue streams compared to the prior guidance did not result in significant changes in the way the Company records its revenue. Upon adoption, the Company evaluated its revenue recognition policy for all revenue streams within the scope of the ASU under previous standards and using the five-step model under the new guidance and confirmed that there were no differences in the pattern of revenue recognition. Hence, the Company’s accounting for revenue remains substantially unchanged. There were no cumulative effect adjustments for service contracts in place prior to the adoption. The effect from the adoption of ASC Topic 606 was not material to the Company’s consolidated financial statements.

 

The Company applies judgment in determining the customer’s ability and intention to pay, which is based on a variety of factors including the customer’s historical payment experience.

 

Judgment is used in determining: (1) whether the financing component in the sales agreement is significant and, if so, (2) the discount rate used in calculating the significant financing component. The Company assesses the significance of the financing component based on the timing of payments agreed to by the parties to the contract that provides the customer with a significant benefit of financing. If determined to be significant, the Company adjusts the promised amount of consideration for the effects of the time value of money.

 

Judgment is also used in assessing whether the long-term accounts receivable results in variable consideration and, if so, the amount to be included in the transaction price. The Company applies the portfolio approach to estimating the amount of variable consideration in these arrangements using the most likely amount method that is based on the Company’s historical collection experience under similar arrangements.

 

Based on the above significant judgements, the financing component, arising from the long-term accounts receivable was recognized as financing revenue over the time of payment. There was no financing revenue for the six months ended December 31, 2022 and 2021, respectively.

 

The Company is in traditional production business operation and its performance obligation is delivery of the products to customers with agreed time and location. Customers sign on the delivery note as acceptance. The typical payment term is either advance payment or agreed-upon credit term after delivery of products. There is no warranty and return policy for the customers.

 

There are two revenue streams within the Company’s operations: (1) sales of health products which constitutes the majority of the revenues, and (2) others.

 

   For the Six Months Ended 
   2022   2021 
    Sales    Sales 
Health product sales  $286,273   $590,798 
Others   
-
    
-
 
Total revenues  $286,273    590,798 

 

There is no variable consideration and non-cash consideration agreed with the customers. The transaction price is fixed and allocated to the agreed product, the only performance obligation. The revenue is recognized at a point in time once the Company has determined that the customers have obtained control over the products. Control is typically deemed to have been transferred to the customers when the performance obligation is fulfilled, usually at the time of delivery, at the net sales price (transaction price).

 

There is no contract asset that the Company has right to consideration in exchange for the product sales that the Company has transferred to customers. Such right is not conditional on something other than the passage of time.

 

The standard warranty included in the price of the products is an assurance-type warranty for a period not to exceed one year from the point when the customers have obtained control over the products, and the nature of tasks under the warranty only remedying defective product. It is not considered as a distinct performance obligation.

 

Practical expedients and exemption

 

The Company elected a practical expedient that it does not adjust the promised amount of consideration for the effects of a significant financing component if the Company expects that, upon the inception of revenue contracts, the period between when the Company transfers its promised deliverables to its customers and when the customers pay for those deliverables will be more than one year.

 

Advertising and Promotional Expenses

 

Advertising costs are expensed as incurred and included in selling expenses. Advertising costs amounted to $308 and $93,483 for the six months ended December 31, 2022 and 2021, respectively.

 

Income Tax

 

The Company’s subsidiary in China are subject to the income tax laws of the relevant tax jurisdiction. No taxable income was generated outside the PRC for the six months ended December 31, 2022 and 2021. The Company accounts for income tax in accordance with U.S. GAAP.

 

Current income taxes are provided on the basis of net profit (loss) for financial reporting purposes, adjusted for income and expense items which are not assessable or deductible for income tax purposes, in accordance with the regulations of the relevant tax jurisdictions.

 

Deferred income taxes are recognized for temporary differences between the tax bases of assets and liabilities and their reported amounts in the consolidated financial statements, net operating loss carry forwards and credits. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Current income taxes are provided in accordance with the laws of the relevant taxing authorities. Deferred tax assets and liabilities are measured using enacted rates expected to apply to taxable income in which temporary differences are expected to be reversed or settled. The effect on deferred tax assets and liabilities of changes in tax rates is recognized in the statement of comprehensive loss in the period of the enactment of the change.

 

The Company considers positive and negative evidence when determining whether a portion or all of its deferred tax assets will more likely than not be realized. This assessment considers, among other matters, the nature, frequency and severity of current and cumulative losses, forecasts of future profitability, the duration of statutory carry-forward periods, its experience with tax attributes expiring unused, and its tax planning strategies. The ultimate realization of deferred tax assets is dependent upon its ability to generate sufficient future taxable income within the carry-forward periods provided for in the tax law and during the periods in which the temporary differences become deductible. When assessing the realization of deferred tax assets, the Company has considered possible sources of taxable income including (i) future reversals of existing taxable temporary differences, (ii) future taxable income exclusive of reversing temporary differences and carry-forwards, (iii) future taxable income arising from implementing tax planning strategies, and (iv) specific known trend of profits expected to be reflected within the industry.

 

An uncertain tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized upon examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the period incurred. PRC tax returns filed in 2022 and 2021 are subject to examination by any applicable tax authorities. The Company had no uncertain tax position for the six months ended December 31, 2022 and 2021.

 

Value Added Tax

 

The Company was subject to VAT at the rate of 13% and related surcharges on revenue generated from selling products for the six months ended December 31, 2022 and 2021. Entities that are VAT general taxpayers are allowed to offset qualified input VAT paid to suppliers against their output VAT liabilities. 

 

Earnings Per Share

 

The Company has adopted ASC Topic 260, “Earnings per Share,” (“EPS”) which requires presentation of basic EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation. In the accompanying consolidation financial statements, basic earnings per share is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period.

 

Diluted EPS includes the effect from potential issuance of ordinary shares. There was no potentially dilutive share to be issued during the six months ended December 31, 2022 and 2021.

 

Related Parties

 

The Company adopted ASC 850, Related Party Disclosures, for the identification of related parties and disclosure of related party transactions.

 

Foreign Currency and Foreign Currency Translation

 

The functional currency of the Company is the Chinese Yuan (“RMB”), as their functional currencies. An entity’s functional currency is the currency of the primary economic environment in which it operates, normally that is the currency of the environment in which the entity primarily generates and expends cash. Management’s judgment is essential to determine the functional currency by assessing various indicators, such as cash flows, sales price and market, expenses, financing and inter-company transactions and arrangements. 

 

Foreign currency transactions denominated in currencies other than the functional currency are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are re-measured at the applicable rates of exchange in effect at that date. Gains and losses resulting from foreign currency re-measurement are included in the statements of comprehensive loss. 

 

The consolidated financial statements are presented in U.S. dollars. Assets and liabilities are translated into U.S. dollars at the current exchange rate in effect at the balance sheet date, and revenues and expenses are translated at the average of the exchange rates in effect during the reporting period. Shareholders’ equity accounts are translated using the historical exchange rates at the date the entry to shareholders’ equity was recorded, except for the change in retained earnings during the period, which is translated using the historical exchange rates used to translate each period’s income statement. Differences resulting from translating functional currencies to the reporting currency are recorded in accumulated other comprehensive income in the consolidated balance sheets. 

 

Translation of amounts from RMB into U.S. dollars has been made at the following exchange rates:

 

Balance sheet items, except for equity accounts     
December 31, 2022   RMB6.8983 to $1 
June 30, 2022   RMB6.6991 to $1 
      
Income statement and cash flows items     
For the six months ended December 31, 2022   RMB6.9784 to $1 
For the six months ended December 31, 2021   RMB6.4305 to $1 

 

Segment reporting

 

The Company’s management reviews the consolidated results when making decisions about allocating resources and assessing performance of the Company as a whole and hence, the Company has only one reportable segment. The Company does not distinguish between markets or segments for the purpose of internal reporting. The Company’s long-lived assets are substantially all located in the PRC and substantially all of the Company’s revenues are derived from within the PRC. Therefore, no geographical segments are presented.

 

Commitments and Contingencies

 

In the normal course of business, the Company is subject to contingencies, including legal proceedings and claims arising out of the business that relate to a wide range of matters, such as government investigations and tax matters. The Company recognizes a liability for such contingency if it determines it is probable that a loss has occurred, and a reasonable estimate of the loss can be made. The Company may consider many factors in making these assessments including historical and the specific facts and circumstances of each matter.

 

Recent Accounting Pronouncements

 

The Company is an emerging growth company (“EGC”) as defined by the Jumpstart Our Business Startups Act (“JOBS Act”). The JOBS Act provides that an EGC can take advantage of extended transition periods for complying with new or revised accounting standards. This allows an EGC to delay adoption of certain accounting standards until those standards would otherwise apply to private companies. The Company elected to take advantage of the extended transition periods. However, this election will not apply should the Company cease to be classified as an EGC.

 

In June 2017, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): The amendments in this Update require a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The amendments broaden the information that an entity must consider in developing its expected credit loss estimate for assets measured either collectively or individually. The use of forecasted information incorporates more timely information in the estimate of expected credit loss, which will be more decision useful to users of the financial statements. In November 2019, the FASB issued ASU 2019-10 which defers the effective dates for the credit losses, derivatives and lease standards for certain companies. The deferred effective date for credit losses is January 1, 2023 for calendar-year end companies which are “smaller reporting companies”, non-SEC filers and all other companies including not-for-profit companies and employee benefit plans. The deferral for the derivatives and lease standards is only applicable to the companies which are not public business entities. The Company is still evaluating the impact of the accounting standard of credit losses on the Company’s consolidated financial statements and related disclosures. 

 

On December 18, 2019, the FASB issued ASU No. 2019-12, Income taxes (Topic 740), Simplifying the Accounting for Income Taxes. This guidance amends ASC Topic 740 and addresses several aspects including 1) evaluation of step-up tax basis of goodwill when there is not a business combination, 2) policy election to not allocate consolidated taxes on a separate entity basis to entities not subject to income tax, 3) accounting for tax law changes or rates during interim periods, 4) ownership changes from equity method investment to subsidiary or vice versa, 5) elimination of exception to intraperiod allocation when there is gain in discontinued operations and a loss from continuing operations, 6) treatment of franchise taxes that are partially based on income. The guidance is effective for calendar year-end public entities on January 1, 2021 and other entities on January 1, 2022. The Company adopted this guidance on July 1, 2021 and determined that the adoption of this guidance does not have material impacts on its consolidated financial statements and related disclosures.

 

In October 2020, the FASB issued ASU 2020-10, “Codification Improvements”. The amendments in this Update represent changes to clarify the Codification or correct unintended application of guidance that are not expected to have a significant effect on current accounting practice or create a significant administrative cost to most entities. The amendments in this Update affect a wide variety of Topics in the Codification and apply to all reporting entities within the scope of the affected accounting guidance. ASU 2020-10 is effective for the Company for fiscal years beginning after December 15, 2021 and interim periods within fiscal years beginning after December 15, 2022. The amendments in this Update should be applied retrospectively. The Company does not expect the adoption of this standard to have a material impact on its consolidated financial statements.

 

The Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the Company’s consolidated balance sheets, consolidated statements of income and consolidated statements of cash flows.

v3.23.3
Accounts Receivable, Net
6 Months Ended
Dec. 31, 2022
Accounts Receivable, Net [Abstract]  
ACCOUNTS RECEIVABLE, NET

3. ACCOUNTS RECEIVABLE, NET

 

Accounts receivable consist of the following:

 

  

December 31,

2022

  

June 30,

2022

 
         
Accounts receivable   60,990    62,804 
Less: allowance for doubtful accounts   (60,990)   (62,804)
Accounts receivable, net   
-
    
-
 

 

The following table sets forth the movement of allowance for doubtful accounts:

 

  

December 31,

2022

  

June 30,

2022

 
         
Beginning  $62,804   $86,868 
Additions   
-
    
-
 
Write off   
-
    (21,685)
Exchange rate different   (1,814)   (2,379)
Balance  $60,990   $62,804 
v3.23.3
Prepayments
6 Months Ended
Dec. 31, 2022
Prepayments [Abstract]  
PREPAYMENTS

4. PREPAYMENTS

 

Prepayments consist of the following:

 

  

December 31,

2022

  

June 30,

2022

 
Prepayments for inventory  $170,829   $105,216 
Prepayment  $170,829   $105,216 
v3.23.3
Other Receivable
6 Months Ended
Dec. 31, 2022
Other Receivable [Member]  
OTHER RECEIVABLE

5. OTHER RECEIVABLE

 

Other receivable consists of the following:

 

   December 31,
2022
  

June 30,

2022

 
Receivables from third party companies  $788,571   $149,262 
Loans receivable from employees   489,281    1,161,604 
Other receivable - current  $1,277,852   $1,310,866 

 

   December 31,
2022
   June 30,
2022
 
Other receivable - long term  $
    -
   $615,987 

 

Receivables from third party companies are interest free and due on demand. Loans receivable from employees are interest free and due on demand. $597,096 of loan receivable has been repaid to the Company during October 2022.

v3.23.3
Inventory
6 Months Ended
Dec. 31, 2022
Inventory [Abstract]  
INVENTORY

6. INVENTORY

 

Inventory consisted of the following:

 

  

December 31,

2022

  

June 30,

2022

 
Raw materials, parts, and components  $525,177   $87,478 
Finished goods   92,076    207,052 
Miscellaneous supplies   14,078    10,516 
Inventory  $631,331   $305,046 
v3.23.3
Property, Plant and Equipment, Net
6 Months Ended
Dec. 31, 2022
Property Plant and Equipment Net [Abstract]  
PROPERTY, PLANT AND EQUIPMENT, NET

7. PROPERTY, PLANT AND EQUIPMENT, NET

 

Property, plant and equipment consisted of the following:

 

  

December 31,

2022

  

June 30,

2022

 
         
Vehicle  $18,858   $19,419 
Office equipment   70,817    72,177 
Machinery, equipment, and tools   83,839    85,858 
Total   173,514    177,454 
Less: accumulated depreciation   (101,847)   (86,993)
Impairment on equipment   (2,788)   (2,871)
Property, plant and equipment, net  $68,879   $87,590 

 

Depreciation expenses charged to the consolidated statements of income and comprehensive income for the six months ended December 31, 2022 and 2021 were $17,167 and $54,403 respectively.

v3.23.3
Advance From Customers
6 Months Ended
Dec. 31, 2022
Advance From Customers [Abstract]  
ADVANCE FROM CUSTOMERS

8. ADVANCE FROM CUSTOMERS

 

Changes in advance from customers as follows:

 

   December 31,   June 30, 
   2022   2022 
         
Advance from clients, beginning of the period  $6,668,713   $
-
 
Revenue deferred during the period   
-
    6,668,713 
Returned of revenue deferred in prior periods   (6,629,025)   
-
 
Advance from clients, end of the period  $39,688   $6,668,713 
v3.23.3
Other Payables
6 Months Ended
Dec. 31, 2022
Other Payables [Abstract]  
OTHER PAYABLES

9. OTHER PAYABLES

 

Other payables consist of the following:

 

  

December 31,

2022

  

June 30,

2022

 
         
Loans payable  $406,042   $4,376,863 
Other   
-
    80 
Other payables  $406,042   $4,376,943 

 

Loans payable are interest free and due on demand.

v3.23.3
Amounts Due From and Due to Related Parties
6 Months Ended
Dec. 31, 2022
Amounts Due From and Due to Related Parties [Abstract]  
AMOUNTS DUE FROM AND DUE TO RELATED PARTIES

10. AMOUNTS DUE FROM AND DUE TO RELATED PARTIES

 

   Note  

December 31,

2022

  

June 30,

2022

 
Amounts due from related parties:            
Duolun Kangbaier Biotechnology Co. LTD   (a)   $1,160   $1,194 
Panjin Kangying Health Food Co., LTD   (a)    145    149 
Liaoning Baijiakang Health Technology Co. LTD   (a)    
-
    45 
Ms. Xiuzhi Sun   (b)    
-
    4,757,546 
Ms. Xiuhua Sun   (c)    233,777    1,087,722 
Mr. Yuewen Sun   (d)    
-
    970,281 
Mr. Zengwen Wang   (e)    
-
    746,370 
Mr. Mingkai Cao   (f)    4,349    4,479 
Total       $239,431   $7,567,786 
                
Amounts due to related parties:               
Jilin Kangbaier Biotechnology Co., LTD   (a)   $
-
   $298,548 
Panjin Double Eagle Green Health Food Co. LTD   (g)    133,773    114,180 
Panjin Double Eagle Weishi Green Health Food Co. LTD   (g)    139,269    107,897 
Liaoning Baijiakang Health Technology Co. LTD   (a)    115,875      
Mr. Zengwen Wang   (e)    
-
    620,846 
Ms. Xiuhua Sun   (c)    5,322    67,173 
Ms. Xiuzhi Sun   (b)    3,998,754    
-
 
Total       $4,392,993   $1,208,644 

 

(a) These companies are controlled by the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company, Ms. Xiuzhi Sun. The amount is due on demand, interest-free and unsecured.

 

(b)

Ms. Xiuzhi Sun is the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount due from Ms. Xiuzhi Sun was wholly settled by September 2022.

 

As of December 31, 2022, there is a amount of $3,998,754 due to Ms. Xiuzhi Sun that is interest free, unsecured, and due demand without an agreement. The Company used the funds borrowed from Ms. Xiuzhi Sun to fund its operations. 

 

(c) Ms. Xiuhua Sun is the sibling of Ms. Xiuzhi Sun, the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount is due on demand, interest-free and unsecured.

 

(d) Mr. Yuewen Sun is the sibling of Ms. Xiuzhi Sun, the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount due from Mr. Yuewen Sun was wholly settled by September 2022.

 

(e) Mr. Zengwen Wang is family member of Ms. Xiuzhi Sun, the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount due from and due to Mr. Yuewen Sun was wholly settled by September 2022.

 

(f) Mr. Mingkai Cao is family member of Ms. Xiuzhi Sun, the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount is due on demand, interest-free and unsecured.

 

(g) These companies are controlled by the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company, Ms. Xiuzhi Sun. Such balances are interest free, unsecured, and due demand without an agreement.
v3.23.3
Income Taxes
6 Months Ended
Dec. 31, 2022
Income Taxes [Abstract]  
INCOME TAXES

11. INCOME TAXES

 

The Company is subject to income taxes on an entity basis on income arising in or derived from the tax jurisdiction in which each entity is domiciled.

 

PRC

 

Under the Enterprise Income Tax (“EIT”) Law, which has been effective since January 1, 2008, domestic enterprises and foreign invested enterprises (the “FIEs”) are subject to a unified 25% enterprise income tax rate, except for certain entities that are entitled to tax holidays.  

 

For the six months ended December 31, 2022 and 2021, a reconciliation of the income tax expense determined at the statutory income tax rate to the Company’s income taxes is as follows:

 

   For the six months ended
December 31,
 
   2022   2021 
Loss before income taxes  $(234,714)  $(250,125)
PRC preferential income tax rate   25%   25%
Income tax credit computed at statutory corporate income tax rate   (58,678)   (62,531)
Reconciling items:          
Non-deductible expenses   1,431    2,941 
Change in valuation allowance   57,247    59,590 
Income tax expense  $
-
   $
-
 

 

The Company evaluates the level of authority for each uncertain tax position (including the potential application of interest and penalties) based on the technical merits, and measures the unrecognized benefits associated with the tax positions. for the six months ended December 31, 2022 and 2021, the Company had no unrecognized tax benefits.

v3.23.3
China Contribution Plan
6 Months Ended
Dec. 31, 2022
China Contribution Plan [Abstract]  
CHINA CONTRIBUTION PLAN

12. CHINA CONTRIBUTION PLAN

 

The Company participates in a government-mandated multi-employer defined contribution plan pursuant to which certain retirement, medical and other welfare benefits are provided to employees. Chinese labor regulations require the Company to pay to the local labor bureau a monthly contribution at a stated contribution rate based on the monthly compensation of qualified employees. The relevant local labor bureau is responsible for meeting all retirement benefit obligations; the Company has no further commitments beyond their monthly contributions.

v3.23.3
Concentrations and Credit Risk
6 Months Ended
Dec. 31, 2022
Concentrations and Credit Risk [Abstract]  
CONCENTRATIONS AND CREDIT RISK

13. CONCENTRATIONS AND CREDIT RISK

 

(a) Concentrations

 

In the six months ended December 31, 2022, two customers accounted for over 77.85% of the Company’s revenues. In the six months ended December 31, 2021, two customers accounted for 83.07% of the Company’s revenues. No other customer accounts for more than 10% of the Company’s revenue in the six months ended December 31, 2022 and 2021.

 

As of December 31, 2022, one customer accounted for 100% of the Company’s accounts receivable. As of June 30, 2022, one customer accounted for 100% of the Company’s accounts receivable, respectively. No other customer accounts for more than 10% of the Company’s accounts receivable as of December 31, 2022 and June 30, 2022.

 

As of December 31, 2022, one suppliers each accounted for 15.05% of the Company’s accounts payable. As of June 30, 2022, four suppliers each accounted for 88.41% of the Company’s accounts payable. No other supplier accounts for over 10% of the Company’s accounts payable as of December 31, 2022 and June 30, 2022.

  

(b) Credit risk

 

Financial instruments that potentially subject the Company to a significant concentration of credit risk consist primarily of cash. As of December 31, 2022, and June 30, 2022, substantially all of the Company’s cash were held by major financial institutions located in the PRC, which management believes are of high credit quality.

  

For the credit risk related to trade accounts receivable, which are unsecured in nature, the Company performs ongoing credit evaluations of its customers and, if necessary, maintains reserves for potential credit losses. Historically, such losses have been within management’s expectations; however, there is the extremely remote chance that all trade receivables may be become uncollectible.

v3.23.3
Commitments and Contingencies
6 Months Ended
Dec. 31, 2022
Commitments and Contingencies [Abstract]  
COMMITMENTS AND CONTINGENCIES

14. COMMITMENTS AND CONTINGENCIES

 

Contingencies 

 

In the ordinary course of business, the Company may be subject to certain legal proceedings, claims and disputes that arise from the business operations. Although the outcomes of these legal proceedings cannot be predicted, the Company does not believe these actions, in the aggregate, will have a material adverse impact on its financial position, results of operations or liquidity. As of December 31, 2022, the Company had no outstanding lawsuits or claims. 

v3.23.3
Subsequent Event
6 Months Ended
Dec. 31, 2022
Subsequent Event [Abstract]  
SUBSEQUENT EVENT

15. SUBSEQUENT EVENT

 

The Company has assessed all events subsequent to December 31, 2022, and up to February 21, 2023, the date that these unaudited condensed consolidated financial statements were available to be issued. There are no material subsequent event to disclose in these unaudited condensed consolidated financial statements for which management is aware.

v3.23.3
Accounting Policies, by Policy (Policies)
6 Months Ended
Dec. 31, 2022
Accounting Policies [Abstract]  
Basis of Presentation

Basis of Presentation

The consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”).

The unaudited interim condensed consolidated financial statements do not include all the information and footnotes required by the U.S. GAAP for complete financial statements. Certain information and note disclosures normally included in the annual financial statements prepared in accordance with the U.S. GAAP have been condensed or omitted consistent with Article 10 of Regulation S-X. In the opinion of the Company’s management, the unaudited interim consolidated financial statements have been prepared on the same basis as the audited financial statements and include all adjustments, in normal recurring nature, as necessary for the fair statement of the Company’s financial position as of December 31, 2022, and results of operations and cash flows for the six-month periods ended December 31, 2022 and 2021. The unaudited interim condensed consolidated balance sheet as of June 30, 2022 has been derived from the audited financial statements at that date but does not include all the information and footnotes required by the U.S. GAAP. Interim results of operations are not necessarily indicative of the results expected for the full fiscal year or for any future period. These financial statements should be read in conjunction with the audited consolidated financial statements as of and for the years ended June 30, 2022 and 2021, and related notes included in the Company’s audited consolidated financial statements.

Principle of Consolidation

Principle of Consolidation

The consolidated financial statements include the accounts of the Company and its subsidiaries, and the VIE. All inter-company transactions and balances are eliminated upon consolidation.

 

Going Concern

Going Concern

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The realization of assets and the satisfaction of liabilities in the normal course of business are dependent on, among other things, the Company’s ability to operate profitably, to generate cash flows from operations, and to pursue financing arrangements to support its working capital requirements.

In assessing the Company’s liquidity, the Company monitors and analyzes its cash and cash equivalents and its operating and capital expenditure commitments. The Company’s liquidity needs are to meet its working capital requirements, operating expenses and capital expenditure obligations. As of December 31, 2022, the Company’s current liabilities exceeded the current assets by $2,180,304, its accumulated deficit was $2,434,863 and the Company has incurred losses during the six months ended December 31, 2022 and 2021. Accordingly, we may not be able to obtain additional financing. If we are unable to raise additional capital, we may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending the pursuit of our business plan, and reducing overhead expenses. We cannot provide any assurance that new financing will be available to us on commercially acceptable terms, if at all.

In evaluating if there is substantial doubt about the ability to continue as a going concern, the Company are trying to alleviate the going concern risk through (1) increasing cash generated from operations by controlling operating expenses, (2) financing from domestic banks and other financial institutions, and (3) equity or debt financing. The Company has certain plans to mitigate these adverse conditions and to increase the liquidity.

On an on-going basis, the Company will also receive financial support commitments from the Company’s related parties.

These conditions raise substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result should the Company be unable to continue as a going concern.

Liquidity

Liquidity

The Company had a working deficit of $2,180,304 as of December 31, 2022, an increase of $697,290 from a working deficit of $2,877,594 as of June 30, 2022. As of December 31, 2022 and June 30, 2022, the Company’s cash was $398,023 and $204,004, respectively.

The Company’s primary need for liquidity stems from its need to fund working capital requirements of the Company’s businesses, its capital expenditures and its general operations, including debt repayment. The Company has historically financed its operations through loans from directors and shareholders, and other third party. The Company routinely monitors current and expected operational requirements and financial market conditions to evaluate the use of available financing sources. In addition, the existing major shareholder committed not to request for repayment of the amount due to shareholders by December 31, 2022. Considering the existing working capital position and the ability to access debt funding sources, the management believes that the Company’s operations and borrowing resources are sufficient to provide for its current and foreseeable capital requirements to support its ongoing operations for the next twelve months. 

Use of Estimates

Use of Estimates

The preparation of these consolidated financial statements requires management of the Company to make estimates and judgments that affect the reported amounts of assets including application of discount on long-term other receivables with present value, liabilities, revenues, costs and expenses, and related disclosures. On an on-going basis, the Company evaluates its estimates based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Identified below are the accounting policies that reflect the Company’s most significant estimates and judgments, and those that the Company believes are the most critical to fully understanding and evaluating its consolidated financial statements.

 

In March 2020 the World Health Organization declared coronavirus COVID-19 a global pandemic. The COVID-19 pandemic has negatively impacted the global economy, workforces, customers, and created significant volatility and disruption of financial markets. The pandemic may impact Company’s future estimates including, but not limited to, our allowance for doubtful accounts, inventory valuations, fair value measurements, asset impairment charges. It is not possible for the Company to predict the duration or magnitude of the adverse results of the outbreak and its effects on its business or results of operations at this time.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

U.S. GAAP establishes a three-tier hierarchy to prioritize the inputs used in the valuation methodologies in measuring the fair value of financial instruments. This hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three-tier fair value hierarchy is:

Level 1 - observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2 - include other inputs that are directly or indirectly observable in the market place.

Level 3 - unobservable inputs which are supported by little or no market activity.

The carrying value of the Company’s financial instruments, including cash, accounts receivable, other current assets, accounts payable, and accruals and other payable approximate their fair value due to their short maturities. 

In accordance with ASC 825, for investments in financial instruments with a variable interest rate indexed to performance of underlying assets, the Company elected the fair value method at the date of initial recognition and carried these investments at fair value. Changes in the fair value are reflected in the accompanying consolidated statements of operations and comprehensive loss as other income (expense). To estimate fair value, the Company refers to the quoted rate of return provided by banks at the end of each period using the discounted cash flow method. The Company classifies the valuation techniques that use these inputs as Level 2 of fair value measurements.

As of December 31, 2022 and June 30, 2022, the Company had no investments in financial instruments.

Cash

Cash

Cash consists of cash on hand and at banks and highly liquid investments, which are unrestricted from withdrawal or use, and which have original maturities of three months or less when purchased.

Cash denominated in RMB with a U.S. dollar equivalent of $398,023 and $204,004 at December 31, 2022 and June 30, 2022, respectively, were held in accounts at financial institutions located in the PRC‚ which is not freely convertible into foreign currencies. In addition, these balances are not covered by insurance. While management believes that these financial institutions are of high credit quality, it also continually monitors their credit worthiness. The Company, its subsidiaries and VIE have not experienced any losses in such accounts and do not believe the cash is exposed to any significant risk.

Accounts Receivable, Net and Allowance for Doubtful Accounts

Accounts Receivable, Net and Allowance for Doubtful Accounts

Accounts receivable represents the revenue earned from the customers not yet collected. The carrying value of accounts receivable is reduced by an allowance that reflects the Company’s best estimate of the amounts that will not be collected. Account balances are charged off against the provision after all means of collection have been exhausted and the likelihood of collection is not probable. For the year ended June 30, 2022, the Company adopted ASU 2016- 13, “Financial Instruments - Credit Losses (Topic 326): Measurement on Credit Losses on Financial Instruments”, including certain subsequent amendments, transitional guidance and other interpretive guidance within ASU 2018-19, ASU 2019-04, ASU 2019-05, ASU 2019-11, ASU 2020-02 and ASU 2020-03 (collectively, including ASU 2016-13, “ASC 326”). ASC 326 introduces an approach based on expected losses to estimate the allowance for doubtful accounts, which replaces the previous incurred loss impairment model. The Company’s estimation of allowance for doubtful accounts considers factors such as historical credit loss experience, age of receivable balances, current market conditions, reasonable and supportable forecasts of future economic conditions, as well as an assessment of receivables due from specific identifiable counterparties to determine whether these receivables are considered at risk or uncollectible. The Company assesses collectibility by pooling receivables that have similar risk characteristics and evaluates receivables individually when specific receivables no longer share those risk characteristics. For receivables evaluated individually, when it is determined that foreclosure is probable or when the debtor is experiencing financial difficulty at the reporting date and repayment is expected to be provided substantially through the operation or sale of collateral, expected credit losses are based on the fair value of the collateral at the reporting date, adjusted for selling costs as appropriate. The balance of allowance of December 31, 2022 and June 30, 2022 were $60,990 and $62,804, respectively.

 

Inventory

Inventory

Inventory primarily consists of 1) raw materials, primarily ingredients such as carrots, 2) finished goods, primarily β-carotene series products including carrot juice, carrot meal and carrot noodle, and 3) miscellaneous such as packages.

Inventories are stated at the lower of cost or net realizable value (market value). The cost of raw materials is determined on the basis of weighted average. The cost of finished goods is determined on the basis of weighted average and comprises direct materials, direct labor and an appropriate proportion of overhead.

Net realizable value is based on estimated selling prices less selling expenses and any further costs expected to be incurred for completion. Adjustments to reduce the cost of inventory to net realizable value are made, if required, for estimated excess, obsolescence, or impaired balances.

Property, Plant and Equipment

Property, Plant and Equipment

Property, plant and equipment, net is recorded at cost less accumulated depreciation and accumulated impairment. Depreciation is computed using the straight-line method over the estimated useful lives of the assets.

   Useful
Lives
Categories  (Years)
Furniture and equipment  3
Machinery  5
Motor vehicles  4

Expenditure for maintenance and repairs is expended as incurred.

The gain or loss on the disposal of equipment is the difference between the net sales proceeds and the lower of the carrying value or fair value less cost to sell the relevant assets and is recognized in general and administrative expenses in the consolidated statements of income and comprehensive income.

Impairment of Long-lived Assets

Impairment of Long-lived Assets

In accordance with ASC 360-10-35, the Company reviews the carrying values of long-lived assets, including property and equipment with finite lives and intangible assets subject to amortization, for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be recoverable. The Company assesses the recoverability of the assets based on the undiscounted future cash flows the assets are expected to generate and recognize an impairment loss when estimated undiscounted future cash flows expected to result from the use of the asset plus net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. If an impairment is identified, the Company would reduce the carrying amount of the asset to its estimated fair value based on a discounted cash flows approach or, when available and appropriate, to comparable market values. The estimation of future cash flows requires significant management judgment based on the Company’s historical results and anticipated results and is subject to many factors. The discount rate that is commensurate with the risk inherent in the Company’s business model is determined by its management. An impairment loss would be recorded if the Company determined that the carrying value of long-lived assets may not be recoverable. The impairment to be recognized is measured by the amount by which the carrying values of the assets exceed the fair value of the assets. Impairment of $2,788 and $2,871 has been recorded by the Company as of December 31, 2022 and June 30, 2022.

 

Revenue Recognition

Revenue Recognition

Effective January 1, 2018, the Company adopted ASC Topic 606, Revenue from Contracts with Customers, which replaced ASC Topic 605, using the modified retrospective method of adoption.

 The Company recognizes revenues when its customer obtains control of promised goods, in an amount that reflects the consideration which the Company expects to receive in exchange for those goods. The Company recognizes revenues following the five-step model prescribed under ASU No. 2014-09: (i) identify contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenues when (or as) the Company satisfies the performance obligation. The application of the five-step model to the revenue streams compared to the prior guidance did not result in significant changes in the way the Company records its revenue. Upon adoption, the Company evaluated its revenue recognition policy for all revenue streams within the scope of the ASU under previous standards and using the five-step model under the new guidance and confirmed that there were no differences in the pattern of revenue recognition. Hence, the Company’s accounting for revenue remains substantially unchanged. There were no cumulative effect adjustments for service contracts in place prior to the adoption. The effect from the adoption of ASC Topic 606 was not material to the Company’s consolidated financial statements.

The Company applies judgment in determining the customer’s ability and intention to pay, which is based on a variety of factors including the customer’s historical payment experience.

Judgment is used in determining: (1) whether the financing component in the sales agreement is significant and, if so, (2) the discount rate used in calculating the significant financing component. The Company assesses the significance of the financing component based on the timing of payments agreed to by the parties to the contract that provides the customer with a significant benefit of financing. If determined to be significant, the Company adjusts the promised amount of consideration for the effects of the time value of money.

Judgment is also used in assessing whether the long-term accounts receivable results in variable consideration and, if so, the amount to be included in the transaction price. The Company applies the portfolio approach to estimating the amount of variable consideration in these arrangements using the most likely amount method that is based on the Company’s historical collection experience under similar arrangements.

Based on the above significant judgements, the financing component, arising from the long-term accounts receivable was recognized as financing revenue over the time of payment. There was no financing revenue for the six months ended December 31, 2022 and 2021, respectively.

The Company is in traditional production business operation and its performance obligation is delivery of the products to customers with agreed time and location. Customers sign on the delivery note as acceptance. The typical payment term is either advance payment or agreed-upon credit term after delivery of products. There is no warranty and return policy for the customers.

There are two revenue streams within the Company’s operations: (1) sales of health products which constitutes the majority of the revenues, and (2) others.

   For the Six Months Ended 
   2022   2021 
    Sales    Sales 
Health product sales  $286,273   $590,798 
Others   
-
    
-
 
Total revenues  $286,273    590,798 

 

There is no variable consideration and non-cash consideration agreed with the customers. The transaction price is fixed and allocated to the agreed product, the only performance obligation. The revenue is recognized at a point in time once the Company has determined that the customers have obtained control over the products. Control is typically deemed to have been transferred to the customers when the performance obligation is fulfilled, usually at the time of delivery, at the net sales price (transaction price).

There is no contract asset that the Company has right to consideration in exchange for the product sales that the Company has transferred to customers. Such right is not conditional on something other than the passage of time.

The standard warranty included in the price of the products is an assurance-type warranty for a period not to exceed one year from the point when the customers have obtained control over the products, and the nature of tasks under the warranty only remedying defective product. It is not considered as a distinct performance obligation.

Practical expedients and exemption

The Company elected a practical expedient that it does not adjust the promised amount of consideration for the effects of a significant financing component if the Company expects that, upon the inception of revenue contracts, the period between when the Company transfers its promised deliverables to its customers and when the customers pay for those deliverables will be more than one year.

Advertising and Promotional Expenses

Advertising and Promotional Expenses

Advertising costs are expensed as incurred and included in selling expenses. Advertising costs amounted to $308 and $93,483 for the six months ended December 31, 2022 and 2021, respectively.

Income Tax

Income Tax

The Company’s subsidiary in China are subject to the income tax laws of the relevant tax jurisdiction. No taxable income was generated outside the PRC for the six months ended December 31, 2022 and 2021. The Company accounts for income tax in accordance with U.S. GAAP.

Current income taxes are provided on the basis of net profit (loss) for financial reporting purposes, adjusted for income and expense items which are not assessable or deductible for income tax purposes, in accordance with the regulations of the relevant tax jurisdictions.

Deferred income taxes are recognized for temporary differences between the tax bases of assets and liabilities and their reported amounts in the consolidated financial statements, net operating loss carry forwards and credits. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Current income taxes are provided in accordance with the laws of the relevant taxing authorities. Deferred tax assets and liabilities are measured using enacted rates expected to apply to taxable income in which temporary differences are expected to be reversed or settled. The effect on deferred tax assets and liabilities of changes in tax rates is recognized in the statement of comprehensive loss in the period of the enactment of the change.

The Company considers positive and negative evidence when determining whether a portion or all of its deferred tax assets will more likely than not be realized. This assessment considers, among other matters, the nature, frequency and severity of current and cumulative losses, forecasts of future profitability, the duration of statutory carry-forward periods, its experience with tax attributes expiring unused, and its tax planning strategies. The ultimate realization of deferred tax assets is dependent upon its ability to generate sufficient future taxable income within the carry-forward periods provided for in the tax law and during the periods in which the temporary differences become deductible. When assessing the realization of deferred tax assets, the Company has considered possible sources of taxable income including (i) future reversals of existing taxable temporary differences, (ii) future taxable income exclusive of reversing temporary differences and carry-forwards, (iii) future taxable income arising from implementing tax planning strategies, and (iv) specific known trend of profits expected to be reflected within the industry.

 

An uncertain tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized upon examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the period incurred. PRC tax returns filed in 2022 and 2021 are subject to examination by any applicable tax authorities. The Company had no uncertain tax position for the six months ended December 31, 2022 and 2021.

Value Added Tax

Value Added Tax

The Company was subject to VAT at the rate of 13% and related surcharges on revenue generated from selling products for the six months ended December 31, 2022 and 2021. Entities that are VAT general taxpayers are allowed to offset qualified input VAT paid to suppliers against their output VAT liabilities. 

Earnings Per Share

Earnings Per Share

The Company has adopted ASC Topic 260, “Earnings per Share,” (“EPS”) which requires presentation of basic EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation. In the accompanying consolidation financial statements, basic earnings per share is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period.

Diluted EPS includes the effect from potential issuance of ordinary shares. There was no potentially dilutive share to be issued during the six months ended December 31, 2022 and 2021.

Related Parties

Related Parties

The Company adopted ASC 850, Related Party Disclosures, for the identification of related parties and disclosure of related party transactions.

Foreign Currency and Foreign Currency Translation

Foreign Currency and Foreign Currency Translation

The functional currency of the Company is the Chinese Yuan (“RMB”), as their functional currencies. An entity’s functional currency is the currency of the primary economic environment in which it operates, normally that is the currency of the environment in which the entity primarily generates and expends cash. Management’s judgment is essential to determine the functional currency by assessing various indicators, such as cash flows, sales price and market, expenses, financing and inter-company transactions and arrangements. 

Foreign currency transactions denominated in currencies other than the functional currency are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are re-measured at the applicable rates of exchange in effect at that date. Gains and losses resulting from foreign currency re-measurement are included in the statements of comprehensive loss. 

The consolidated financial statements are presented in U.S. dollars. Assets and liabilities are translated into U.S. dollars at the current exchange rate in effect at the balance sheet date, and revenues and expenses are translated at the average of the exchange rates in effect during the reporting period. Shareholders’ equity accounts are translated using the historical exchange rates at the date the entry to shareholders’ equity was recorded, except for the change in retained earnings during the period, which is translated using the historical exchange rates used to translate each period’s income statement. Differences resulting from translating functional currencies to the reporting currency are recorded in accumulated other comprehensive income in the consolidated balance sheets. 

 

Translation of amounts from RMB into U.S. dollars has been made at the following exchange rates:

Balance sheet items, except for equity accounts     
December 31, 2022   RMB6.8983 to $1 
June 30, 2022   RMB6.6991 to $1 
      
Income statement and cash flows items     
For the six months ended December 31, 2022   RMB6.9784 to $1 
For the six months ended December 31, 2021   RMB6.4305 to $1 
Segment reporting

Segment reporting

The Company’s management reviews the consolidated results when making decisions about allocating resources and assessing performance of the Company as a whole and hence, the Company has only one reportable segment. The Company does not distinguish between markets or segments for the purpose of internal reporting. The Company’s long-lived assets are substantially all located in the PRC and substantially all of the Company’s revenues are derived from within the PRC. Therefore, no geographical segments are presented.

Commitments and Contingencies

Commitments and Contingencies

In the normal course of business, the Company is subject to contingencies, including legal proceedings and claims arising out of the business that relate to a wide range of matters, such as government investigations and tax matters. The Company recognizes a liability for such contingency if it determines it is probable that a loss has occurred, and a reasonable estimate of the loss can be made. The Company may consider many factors in making these assessments including historical and the specific facts and circumstances of each matter.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

The Company is an emerging growth company (“EGC”) as defined by the Jumpstart Our Business Startups Act (“JOBS Act”). The JOBS Act provides that an EGC can take advantage of extended transition periods for complying with new or revised accounting standards. This allows an EGC to delay adoption of certain accounting standards until those standards would otherwise apply to private companies. The Company elected to take advantage of the extended transition periods. However, this election will not apply should the Company cease to be classified as an EGC.

In June 2017, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): The amendments in this Update require a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The amendments broaden the information that an entity must consider in developing its expected credit loss estimate for assets measured either collectively or individually. The use of forecasted information incorporates more timely information in the estimate of expected credit loss, which will be more decision useful to users of the financial statements. In November 2019, the FASB issued ASU 2019-10 which defers the effective dates for the credit losses, derivatives and lease standards for certain companies. The deferred effective date for credit losses is January 1, 2023 for calendar-year end companies which are “smaller reporting companies”, non-SEC filers and all other companies including not-for-profit companies and employee benefit plans. The deferral for the derivatives and lease standards is only applicable to the companies which are not public business entities. The Company is still evaluating the impact of the accounting standard of credit losses on the Company’s consolidated financial statements and related disclosures. 

 

On December 18, 2019, the FASB issued ASU No. 2019-12, Income taxes (Topic 740), Simplifying the Accounting for Income Taxes. This guidance amends ASC Topic 740 and addresses several aspects including 1) evaluation of step-up tax basis of goodwill when there is not a business combination, 2) policy election to not allocate consolidated taxes on a separate entity basis to entities not subject to income tax, 3) accounting for tax law changes or rates during interim periods, 4) ownership changes from equity method investment to subsidiary or vice versa, 5) elimination of exception to intraperiod allocation when there is gain in discontinued operations and a loss from continuing operations, 6) treatment of franchise taxes that are partially based on income. The guidance is effective for calendar year-end public entities on January 1, 2021 and other entities on January 1, 2022. The Company adopted this guidance on July 1, 2021 and determined that the adoption of this guidance does not have material impacts on its consolidated financial statements and related disclosures.

In October 2020, the FASB issued ASU 2020-10, “Codification Improvements”. The amendments in this Update represent changes to clarify the Codification or correct unintended application of guidance that are not expected to have a significant effect on current accounting practice or create a significant administrative cost to most entities. The amendments in this Update affect a wide variety of Topics in the Codification and apply to all reporting entities within the scope of the affected accounting guidance. ASU 2020-10 is effective for the Company for fiscal years beginning after December 15, 2021 and interim periods within fiscal years beginning after December 15, 2022. The amendments in this Update should be applied retrospectively. The Company does not expect the adoption of this standard to have a material impact on its consolidated financial statements.

The Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the Company’s consolidated balance sheets, consolidated statements of income and consolidated statements of cash flows.

v3.23.3
Organization and Business (Tables)
6 Months Ended
Dec. 31, 2022
Organization and Business [Abstract]  
Schedule of Consolidated Financial Statements The accompanying consolidated financial statements reflect the activities of each of the following entities of the Company:
Name   Background   Ownership
Cambell International     A British Virgin Islands company   100%
Holding Limited   Principal activities: Investment holding    
         
Win&win Industrial     A British Virgin Islands company   100%
Development Limited   Principal activities: Investment holding    
         
BJK Holding Group     A Hong Kong company   100%
Limited   Principal activities: Investment holding    
           
Baijiakang (LiaoNing) Health Information   A PRC limited liability company and deemed a wholly foreign-invested enterprise   100%
Consulting Service Co., Ltd   Principal activities: Consultancy and information technology support    
           
LiaoNing KangBaiEr   A PRC limited liability company   VIE by contractual
Biotechnology   Incorporated on September 22, 2015   arrangements
Development Co., Ltd.   Principal activities: research and development of extraction processes of natural β -carotene, the planting and harvesting of raw materials as well as the production, distribution marketing and sales of natural β -carotene health food products.    
           
Doron KangBaier   A PRC limited liability company   100% owned by
Biotechnology Co.LTD   Principal activities: research and support   LiaoNing KangBaiEr
           
LiaoNing BaiJiaKang   A PRC limited liability company   100% owned by
Health Technology Co.LTD   Principal activities: promotion and support   LiaoNing KangBaiEr
v3.23.3
Summary of Significant Accounting Policies (Tables)
6 Months Ended
Dec. 31, 2022
Accounting Policies [Abstract]  
Schedule of Depreciation Is Computed Using the Straight-Line Method over the Estimated Useful Lives of the Assets Property, plant and equipment, net is recorded at cost less accumulated depreciation and accumulated impairment. Depreciation is computed using the straight-line method over the estimated useful lives of the assets.
   Useful
Lives
Categories  (Years)
Furniture and equipment  3
Machinery  5
Motor vehicles  4
Schedule of Revenue Streams within the Company’s Operations There are two revenue streams within the Company’s operations: (1) sales of health products which constitutes the majority of the revenues, and (2) others.
   For the Six Months Ended 
   2022   2021 
    Sales    Sales 
Health product sales  $286,273   $590,798 
Others   
-
    
-
 
Total revenues  $286,273    590,798 

 

Schedule of Exchange Rates Translation of amounts from RMB into U.S. dollars has been made at the following exchange rates:
Balance sheet items, except for equity accounts     
December 31, 2022   RMB6.8983 to $1 
June 30, 2022   RMB6.6991 to $1 
      
Income statement and cash flows items     
For the six months ended December 31, 2022   RMB6.9784 to $1 
For the six months ended December 31, 2021   RMB6.4305 to $1 
v3.23.3
Accounts Receivable, Net (Tables)
6 Months Ended
Dec. 31, 2022
Accounts Receivable, Net [Abstract]  
Schedule of Accounts Receivable Accounts receivable consist of the following:
  

December 31,

2022

  

June 30,

2022

 
         
Accounts receivable   60,990    62,804 
Less: allowance for doubtful accounts   (60,990)   (62,804)
Accounts receivable, net   
-
    
-
 
Schedule of Sets Forth the Movement of Allowance for Doubtful Accounts The following table sets forth the movement of allowance for doubtful accounts:
  

December 31,

2022

  

June 30,

2022

 
         
Beginning  $62,804   $86,868 
Additions   
-
    
-
 
Write off   
-
    (21,685)
Exchange rate different   (1,814)   (2,379)
Balance  $60,990   $62,804 
v3.23.3
Prepayments (Tables)
6 Months Ended
Dec. 31, 2022
Prepayments [Abstract]  
Schedule of Prepayments Prepayments consist of the following:
  

December 31,

2022

  

June 30,

2022

 
Prepayments for inventory  $170,829   $105,216 
Prepayment  $170,829   $105,216 
v3.23.3
Other Receivable (Tables)
6 Months Ended
Dec. 31, 2022
Other Receivable [Abstract]  
Schedule of Other Receivable Other receivable consists of the following:
   December 31,
2022
  

June 30,

2022

 
Receivables from third party companies  $788,571   $149,262 
Loans receivable from employees   489,281    1,161,604 
Other receivable - current  $1,277,852   $1,310,866 
   December 31,
2022
   June 30,
2022
 
Other receivable - long term  $
    -
   $615,987 
v3.23.3
Inventory (Tables)
6 Months Ended
Dec. 31, 2022
Inventory [Abstract]  
Schedule of Inventory Inventory consisted of the following:
  

December 31,

2022

  

June 30,

2022

 
Raw materials, parts, and components  $525,177   $87,478 
Finished goods   92,076    207,052 
Miscellaneous supplies   14,078    10,516 
Inventory  $631,331   $305,046 
v3.23.3
Property, Plant and Equipment, Net (Tables)
6 Months Ended
Dec. 31, 2022
Property Plant and Equipment Net [Abstract]  
Schedule of Property, Plant and Equipment Property, plant and equipment consisted of the following:
  

December 31,

2022

  

June 30,

2022

 
         
Vehicle  $18,858   $19,419 
Office equipment   70,817    72,177 
Machinery, equipment, and tools   83,839    85,858 
Total   173,514    177,454 
Less: accumulated depreciation   (101,847)   (86,993)
Impairment on equipment   (2,788)   (2,871)
Property, plant and equipment, net  $68,879   $87,590 
v3.23.3
Advance From Customers (Tables)
6 Months Ended
Dec. 31, 2022
Advance From Customers [Abstract]  
Schedule of Advance from Customers Changes in advance from customers as follows:
   December 31,   June 30, 
   2022   2022 
         
Advance from clients, beginning of the period  $6,668,713   $
-
 
Revenue deferred during the period   
-
    6,668,713 
Returned of revenue deferred in prior periods   (6,629,025)   
-
 
Advance from clients, end of the period  $39,688   $6,668,713 
v3.23.3
Other Payables (Tables)
6 Months Ended
Dec. 31, 2022
Other Payables [Abstract]  
Schedule of Other Payables Other payables consist of the following:
  

December 31,

2022

  

June 30,

2022

 
         
Loans payable  $406,042   $4,376,863 
Other   
-
    80 
Other payables  $406,042   $4,376,943 
v3.23.3
Amounts Due From and Due to Related Parties (Tables)
6 Months Ended
Dec. 31, 2022
Amounts Due From and Due to Related Parties [Abstract]  
Schedule of Amounts Due From and Due to Related Parties
   Note  

December 31,

2022

  

June 30,

2022

 
Amounts due from related parties:            
Duolun Kangbaier Biotechnology Co. LTD   (a)   $1,160   $1,194 
Panjin Kangying Health Food Co., LTD   (a)    145    149 
Liaoning Baijiakang Health Technology Co. LTD   (a)    
-
    45 
Ms. Xiuzhi Sun   (b)    
-
    4,757,546 
Ms. Xiuhua Sun   (c)    233,777    1,087,722 
Mr. Yuewen Sun   (d)    
-
    970,281 
Mr. Zengwen Wang   (e)    
-
    746,370 
Mr. Mingkai Cao   (f)    4,349    4,479 
Total       $239,431   $7,567,786 
                
Amounts due to related parties:               
Jilin Kangbaier Biotechnology Co., LTD   (a)   $
-
   $298,548 
Panjin Double Eagle Green Health Food Co. LTD   (g)    133,773    114,180 
Panjin Double Eagle Weishi Green Health Food Co. LTD   (g)    139,269    107,897 
Liaoning Baijiakang Health Technology Co. LTD   (a)    115,875      
Mr. Zengwen Wang   (e)    
-
    620,846 
Ms. Xiuhua Sun   (c)    5,322    67,173 
Ms. Xiuzhi Sun   (b)    3,998,754    
-
 
Total       $4,392,993   $1,208,644 
(a) These companies are controlled by the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company, Ms. Xiuzhi Sun. The amount is due on demand, interest-free and unsecured.
(b)

Ms. Xiuzhi Sun is the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount due from Ms. Xiuzhi Sun was wholly settled by September 2022.

 

As of December 31, 2022, there is a amount of $3,998,754 due to Ms. Xiuzhi Sun that is interest free, unsecured, and due demand without an agreement. The Company used the funds borrowed from Ms. Xiuzhi Sun to fund its operations. 

 

(c) Ms. Xiuhua Sun is the sibling of Ms. Xiuzhi Sun, the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount is due on demand, interest-free and unsecured.
(d) Mr. Yuewen Sun is the sibling of Ms. Xiuzhi Sun, the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount due from Mr. Yuewen Sun was wholly settled by September 2022.
(e) Mr. Zengwen Wang is family member of Ms. Xiuzhi Sun, the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount due from and due to Mr. Yuewen Sun was wholly settled by September 2022.
(f) Mr. Mingkai Cao is family member of Ms. Xiuzhi Sun, the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount is due on demand, interest-free and unsecured.
(g) These companies are controlled by the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company, Ms. Xiuzhi Sun. Such balances are interest free, unsecured, and due demand without an agreement.
v3.23.3
Income Taxes (Tables)
6 Months Ended
Dec. 31, 2022
Income Taxes [Abstract]  
Schedule of Reconciliation of Income Tax Expense For the six months ended December 31, 2022 and 2021, a reconciliation of the income tax expense determined at the statutory income tax rate to the Company’s income taxes is as follows:
   For the six months ended
December 31,
 
   2022   2021 
Loss before income taxes  $(234,714)  $(250,125)
PRC preferential income tax rate   25%   25%
Income tax credit computed at statutory corporate income tax rate   (58,678)   (62,531)
Reconciling items:          
Non-deductible expenses   1,431    2,941 
Change in valuation allowance   57,247    59,590 
Income tax expense  $
-
   $
-
 
v3.23.3
Organization and Business (Details) - shares
1 Months Ended
Nov. 27, 2022
Sep. 23, 2020
Organization and Business (Details) [Line Items]    
Aggregate shares (in Shares)   1,000,000
Consulting Service Agreement [Member]    
Organization and Business (Details) [Line Items]    
Agreement term 10 years  
Business Operation Agreement [Member]    
Organization and Business (Details) [Line Items]    
Agreement term 10 years  
Proxy Agreement [Member]    
Organization and Business (Details) [Line Items]    
Agreement term 10 years  
Equity Disposal Agreement [Member]    
Organization and Business (Details) [Line Items]    
Agreement term 10 years  
Reverse Acquisition [Member]    
Organization and Business (Details) [Line Items]    
Aggregate shares (in Shares)   9,000,000
v3.23.3
Organization and Business (Details) - Schedule of Consolidated Financial Statements
6 Months Ended
Dec. 31, 2022
Cambell International [Member]  
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]  
Name Cambell International
Background A British Virgin Islands company
Ownership 100%
Holding Limited [Member]  
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]  
Name Holding Limited
Background Principal activities: Investment holding
Win&win Industrial [Member]  
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]  
Name Win&win Industrial
Background A British Virgin Islands company
Ownership 100%
Development Limited [Member]  
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]  
Name Development Limited
Background Principal activities: Investment holding
BJK Holding Group [Member]  
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]  
Name BJK Holding Group
Background A Hong Kong company
Ownership 100%
Limited [Member]  
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]  
Name Limited
Background Principal activities: Investment holding
Baijiakang (LiaoNing) Health Information [Member]  
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]  
Name Baijiakang (LiaoNing) Health Information
Background A PRC limited liability company and deemed a wholly foreign-invested enterprise
Ownership 100%
Consulting Service Co., Ltd [Member]  
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]  
Name Consulting Service Co., Ltd
Background Principal activities: Consultancy and information technology support
LiaoNing KangBaiEr [Member]  
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]  
Name LiaoNing KangBaiEr
Background A PRC limited liability company
Ownership VIE by contractual
Biotechnology [Member]  
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]  
Name Biotechnology
Background Incorporated on September 22, 2015
Ownership arrangements
Development Co., Ltd. [Member]  
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]  
Name Development Co., Ltd.
Background Principal activities: research and development of extraction processes of natural β -carotene, the planting and harvesting of raw materials as well as the production, distribution marketing and sales of natural β -carotene health food products.
Doron KangBaier [Member]  
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]  
Name Doron KangBaier
Background A PRC limited liability company
Ownership 100% owned by
Biotechnology Co.LTD [Member]  
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]  
Name Biotechnology Co.LTD
Background Principal activities: research and support
Ownership LiaoNing KangBaiEr
LiaoNing BaiJiaKang [Member]  
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]  
Name LiaoNing BaiJiaKang
Background A PRC limited liability company
Ownership 100% owned by
Health Technology Co.LTD [Member]  
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]  
Name Health Technology Co.LTD
Background Principal activities: promotion and support
Ownership LiaoNing KangBaiEr
v3.23.3
Summary of Significant Accounting Policies (Details) - USD ($)
6 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Jun. 30, 2022
Accounting Policies [Abstract]      
Current assets $ 2,180,304    
Accumulated deficit 2,434,863    
Working deficit 2,180,304   $ 2,877,594
Working deficit increase 697,290    
Cash 398,023   204,004
Cash denominated 398,023   204,004
Allowance 60,990   62,804
Impairment 2,788   $ 2,871
Advertising costs $ 308 $ 93,483  
Tax benefit rate 50.00%    
Value added tax percentage 13.00% 13.00%  
Reportable segment 1    
v3.23.3
Summary of Significant Accounting Policies (Details) - Schedule of Depreciation Is Computed Using the Straight-Line Method over the Estimated Useful Lives of the Assets
6 Months Ended
Dec. 31, 2022
Furniture and equipment [Member]  
Public Utility, Property, Plant and Equipment [Line Items]  
Useful Lives (Years) 3 years
Machinery [Member]  
Public Utility, Property, Plant and Equipment [Line Items]  
Useful Lives (Years) 5 years
Motor vehicles [Member]  
Public Utility, Property, Plant and Equipment [Line Items]  
Useful Lives (Years) 4 years
v3.23.3
Summary of Significant Accounting Policies (Details) - Schedule of Revenue Streams within the Company’s Operations - USD ($)
6 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Schedule of Revenue Streams within the Company Operations [Abstract]    
Health product sales $ 286,273 $ 590,798
Others
Total revenues $ 286,273 $ 590,798
v3.23.3
Summary of Significant Accounting Policies (Details) - Schedule of Exchange Rates
6 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Jun. 30, 2022
Schedule of Exchange Rates [Abstract]      
Balance sheet items, except for equity accounts RMB6.8983 to $1   RMB6.6991 to $1
Income statement and cash flows items RMB6.9784 to $1 RMB6.4305 to $1  
v3.23.3
Accounts Receivable, Net (Details) - Schedule of Accounts Receivable - USD ($)
Dec. 31, 2022
Jun. 30, 2022
Schedule of Accounts Receivable [Abstract]    
Accounts receivable $ 60,990 $ 62,804
Less: allowance for doubtful accounts (60,990) (62,804)
Accounts receivable, net
v3.23.3
Accounts Receivable, Net (Details) - Schedule of Sets Forth the Movement of Allowance for Doubtful Accounts - USD ($)
6 Months Ended 12 Months Ended
Dec. 31, 2022
Jun. 30, 2022
Schedule of Sets Forth the Movement of Allowance for Doubtful Accounts [Abstract]    
Beginning $ 62,804 $ 86,868
Additions
Write off (21,685)
Exchange rate different (1,814) (2,379)
Balance $ 60,990 $ 62,804
v3.23.3
Prepayments (Details) - Schedule of Prepayments - USD ($)
Dec. 31, 2022
Jun. 30, 2022
Schedule of Prepayments [Abstract]    
Prepayments for inventory $ 170,829 $ 105,216
Prepayment $ 170,829 $ 105,216
v3.23.3
Other Receivable (Details)
Dec. 31, 2022
USD ($)
Other Receivable [Abstract]  
Loan receivable $ 597,096
v3.23.3
Other Receivable (Details) - Schedule of Other Receivable - USD ($)
Dec. 31, 2022
Jun. 30, 2022
Schedule of Other Receivable [Abstract]    
Receivables from third party companies $ 788,571 $ 149,262
Loans receivable from employees 489,281 1,161,604
Other receivable - current 1,277,852 1,310,866
Other receivable – long term $ 615,987
v3.23.3
Inventory (Details) - Schedule of Inventory - USD ($)
Dec. 31, 2022
Jun. 30, 2022
Schedule of Inventory [Abstract]    
Raw materials, parts, and components $ 525,177 $ 87,478
Finished goods 92,076 207,052
Miscellaneous supplies 14,078 10,516
Inventory $ 631,331 $ 305,046
v3.23.3
Property, Plant and Equipment, Net (Details) - USD ($)
6 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Property Plant and Equipment Net [Abstract]    
Depreciation expenses $ 17,167 $ 54,403
v3.23.3
Property, Plant and Equipment, Net (Details) - Schedule of Property, Plant and Equipment - USD ($)
6 Months Ended 12 Months Ended
Dec. 31, 2022
Jun. 30, 2022
Property, Plant and Equipment [Line Items]    
Property, plant and equipment, gross $ 173,514 $ 177,454
Less: accumulated depreciation (101,847) (86,993)
Impairment on equipment (2,788) (2,871)
Property, plant and equipment, net 68,879 87,590
Vehicle [Member]    
Property, Plant and Equipment [Line Items]    
Property, plant and equipment, gross 18,858 19,419
Office equipment [Member]    
Property, Plant and Equipment [Line Items]    
Property, plant and equipment, gross 70,817 72,177
Machinery, equipment, and tools [Member]    
Property, Plant and Equipment [Line Items]    
Property, plant and equipment, gross $ 83,839 $ 85,858
v3.23.3
Advance From Customers (Details) - Schedule of Advance from Customers - USD ($)
6 Months Ended 12 Months Ended
Dec. 31, 2022
Jun. 30, 2022
Schedule of Advance from Customers [Abstract]    
Advance from clients, beginning of the period $ 6,668,713
Revenue deferred during the period 6,668,713
Returned of revenue deferred in prior periods (6,629,025)
Advance from clients, end of the period $ 39,688 $ 6,668,713
v3.23.3
Other Payables (Details) - Schedule of Other Payables - USD ($)
Dec. 31, 2022
Jun. 30, 2022
Schedule of Other Payables [Abstract]    
Loans payable $ 406,042 $ 4,376,863
Other 80
Other payables $ 406,042 $ 4,376,943
v3.23.3
Amounts Due From and Due to Related Parties (Details)
Dec. 31, 2022
USD ($)
Ms. Xiuzhi Sun [Member]  
Amounts Due From and Due to Related Parties (Details) [Line Items]  
Due amount $ 3,998,754
v3.23.3
Amounts Due From and Due to Related Parties (Details) - Schedule of Amounts Due From and Due to Related Parties - USD ($)
Dec. 31, 2022
Jun. 30, 2022
Related Party Transaction [Line Items]    
Amounts due from related parties $ 239,431 $ 7,567,786
Amounts due to related parties 4,392,993 1,208,644
Duolun Kangbaier Biotechnology Co. LTD [Member]    
Related Party Transaction [Line Items]    
Amounts due from related parties [1] 1,160 1,194
Panjin Kangying Health Food Co., LTD [Member]    
Related Party Transaction [Line Items]    
Amounts due from related parties [1] 145 149
Liaoning Baijiakang Health Technology Co. LTD [Member]    
Related Party Transaction [Line Items]    
Amounts due from related parties [1] 45
Amounts due to related parties [1] 115,875  
Ms. Xiuzhi Sun [Member]    
Related Party Transaction [Line Items]    
Amounts due from related parties [2] 4,757,546
Amounts due to related parties [2] 3,998,754
Ms. Xiuhua Sun [Member]    
Related Party Transaction [Line Items]    
Amounts due from related parties [3] 233,777 1,087,722
Amounts due to related parties [3] 5,322 67,173
Mr. Yuewen Sun [Member]    
Related Party Transaction [Line Items]    
Amounts due from related parties [4] 970,281
Mr. Zengwen Wang [Member]    
Related Party Transaction [Line Items]    
Amounts due from related parties [5] 746,370
Amounts due to related parties [5] 620,846
Mr. Mingkai Cao [Member]    
Related Party Transaction [Line Items]    
Amounts due from related parties [6] 4,349 4,479
Jilin Kangbaier Biotechnology Co., LTD [Member]    
Related Party Transaction [Line Items]    
Amounts due to related parties [1] 298,548
Panjin Double Eagle Green Health Food Co. LTD [Member]    
Related Party Transaction [Line Items]    
Amounts due to related parties [7] 133,773 114,180
Panjin Double Eagle Weishi Green Health Food Co. LTD [Member]    
Related Party Transaction [Line Items]    
Amounts due to related parties [7] $ 139,269 $ 107,897
[1] These companies are controlled by the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company, Ms. Xiuzhi Sun. The amount is due on demand, interest-free and unsecured.
[2]

Ms. Xiuzhi Sun is the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount due from Ms. Xiuzhi Sun was wholly settled by September 2022.

 

As of December 31, 2022, there is a amount of $3,998,754 due to Ms. Xiuzhi Sun that is interest free, unsecured, and due demand without an agreement. The Company used the funds borrowed from Ms. Xiuzhi Sun to fund its operations.
[3] Ms. Xiuhua Sun is the sibling of Ms. Xiuzhi Sun, the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount is due on demand, interest-free and unsecured.
[4] Mr. Yuewen Sun is the sibling of Ms. Xiuzhi Sun, the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount due from Mr. Yuewen Sun was wholly settled by September 2022.
[5] Mr. Zengwen Wang is family member of Ms. Xiuzhi Sun, the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount due from and due to Mr. Yuewen Sun was wholly settled by September 2022.
[6] Mr. Mingkai Cao is family member of Ms. Xiuzhi Sun, the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company. The amount is due on demand, interest-free and unsecured.
[7] These companies are controlled by the Chief Executive Officer and Chief Financial Officer, as well as the shareholder of the Company, Ms. Xiuzhi Sun. Such balances are interest free, unsecured, and due demand without an agreement.
v3.23.3
Income Taxes (Details)
6 Months Ended
Dec. 31, 2022
Income Taxes [Abstract]  
Income tax rate percentage 25.00%
v3.23.3
Income Taxes (Details) - Schedule of Reconciliation of Income Tax Expense - USD ($)
6 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Schedule of Reconciliation of Income Tax Expense [Abstract]    
Loss before income taxes $ (234,714) $ (250,125)
PRC preferential income tax rate 25.00% 25.00%
Income tax credit computed at statutory corporate income tax rate $ (58,678) $ (62,531)
Non-deductible expenses 1,431 2,941
Change in valuation allowance 57,247 59,590
Income tax expense
v3.23.3
Concentrations and Credit Risk (Details)
6 Months Ended 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Jun. 30, 2022
One Suppliers [Member]      
Concentrations and Credit Risk (Details) [Line Items]      
Revenue percentage 10.00%   10.00%
Number of suppliers 1   4
Revenues percentage 15.05%   88.41%
Two Customer [Member]      
Concentrations and Credit Risk (Details) [Line Items]      
Number of customer 2 2  
Revenues percentage 77.85% 83.07%  
Revenue percentage 10.00% 10.00%  
One Customer [Member]      
Concentrations and Credit Risk (Details) [Line Items]      
Number of customer 1   1
Revenues percentage 100.00%   100.00%
Revenue percentage 10.00%   10.00%

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