Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Mar. 30, 2014 | |
Document And Entity Information | ||
Entity Registrant Name | Yasheng Group | |
Entity Central Index Key | 1123312 | |
Document Type | 10-K | |
Document Period End Date | 31-Dec-14 | |
Amendment Flag | FALSE | |
Current Fiscal Year End Date | -19 | |
Is Entity a Well-known Seasoned Issuer? | No | |
Is Entity a Voluntary Filer? | No | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Public Float | $0 | |
Entity Common Stock, Shares Outstanding | 155,097,355 | |
Document Fiscal Period Focus | FY | |
Document Fiscal Year Focus | 2014 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
ASSETS | |||
Cash and cash equivalents | $11,907,242 | $11,337,958 | $10,980,384 |
Accounts receivable, net | 112,094,824 | 103,061,683 | 91,880,065 |
Inventories | 341,756,253 | 318,980,143 | 227,294,252 |
Prepaid and other current assets | 4,070,937 | 4,400,112 | 3,962,855 |
Total current assets | 469,829,255 | 437,779,896 | 334,117,556 |
Equity and other investments | 209,941 | 210,702 | 204,380 |
Property, plant and equipment, net | 905,268,722 | 848,678,908 | 785,135,358 |
Construction in progress | 6,960,289 | 7,083,472 | 7,488,107 |
Intangible assets, net | 1,097,762,161 | 1,057,082,947 | 1,033,037,846 |
Total assets | 2,480,030,368 | 2,350,835,926 | 2,159,983,247 |
LIABILITIES AND STOCKHOLDERS' EQUITY | |||
Accounts payable and accrued expenses | 27,402,889 | 31,495,004 | 25,058,592 |
Short term loans | 4,902,762 | 6,560,711 | 9,545,780 |
VAT tax payable | 701,760 | 789,243 | 828,517 |
Current portion of long term debt | 3,560,394 | 4,431,287 | 4,930,826 |
Other current liabilities | 607,853 | 685,982 | 726,773 |
Total current liabilities | 37,175,659 | 43,962,227 | 41,090,488 |
Long term debt | 0 | 0 | 0 |
Long term payable | 21,073,928 | 24,573,824 | 28,124,436 |
Total liabilities | 58,249,587 | 68,536,050 | 69,214,924 |
Stockholders' equity: | |||
Common stock, US $1.00 par value 800,000,000 shares authorized 155,097,355 shares issued and outstanding | 155,097,355 | 155,097,355 | 155,097,355 |
Accumulated other comprehensive income | 443,988,809 | 443,442,989 | 388,404,930 |
Retained earnings | 1,822,694,617 | 1,683,759,531 | 1,547,266,038 |
Total stockholders' equity | 2,421,780,781 | 2,282,299,875 | 2,090,768,323 |
Total liabilities & stockholders' equity | $2,480,030,368 | $2,350,835,926 | $2,159,983,247 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Stockholders' equity: | |||
Common stock par value | $1 | $1 | $1 |
Common stock shares authorized | 800,000,000 | 800,000,000 | 800,000,000 |
Common stock shares issued | 155,097,355 | 155,097,355 | 155,097,355 |
Common stock shares Outstanding | 155,097,355 | 155,097,355 | 155,097,355 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Income Statement [Abstract] | |||
Net sales | $1,012,135,672 | $1,011,323,630 | $993,102,745 |
Cost of goods sold | 868,280,442 | 867,845,745 | 859,918,076 |
Gross profit | 143,855,230 | 143,477,886 | 133,184,669 |
Operating expenses: | |||
Sales and marketing | 1,792,470 | 2,009,990 | 1,944,354 |
General and administrative | 4,147,497 | 4,725,345 | 4,598,557 |
Total operating expenses | 5,939,968 | 6,735,335 | 6,542,911 |
Operating profit | 137,915,263 | 136,742,550 | 126,641,758 |
Interest expense | 666,613 | 937,163 | 1,110,340 |
Other income (expense) | 1,686,436 | 688,106 | 885,804 |
Income before income tax expense | 138,935,086 | 136,493,493 | 126,417,222 |
Net income | $138,935,086 | $136,493,493 | $126,417,222 |
Basic earnings per share | $0.90 | $0.88 | $0.82 |
Weighted average number of shares | 155,097,355 | 155,097,355 | 155,097,355 |
CONSOLIDATED_STATEMENTS_OF_STO
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (USD $) | Common Stock | Retained Earnings | Accumulated Other Comprehensive Income / Loss | Total |
Beginning Balance, Amount at Dec. 31, 2011 | $155,097,355 | $1,420,848,816 | $383,117,150 | $1,959,063,321 |
Net income | 126,417,222 | 126,417,222 | 126,417,222 | |
Foreign currency translation | 5,287,780 | 5,287,780 | 5,287,780 | |
Ending Balance, Amount at Dec. 31, 2012 | 155,097,355 | 1,547,266,038 | 388,404,930 | 2,090,768,323 |
Net income | 136,494,493 | 136,493,493 | ||
Foreign currency translation | 55,038,059 | 55,038,059 | ||
Ending Balance, Amount at Dec. 31, 2013 | 155,097,355 | 1,683,759,531 | 443,442,989 | 2,282,299,875 |
Net income | 138,935,086 | 138,935,086 | ||
Foreign currency translation | 545,820 | 545,820 | ||
Ending Balance, Amount at Dec. 31, 2014 | $1,822,694,617 | $443,988,809 | $2,421,780,781 | $2,421,780,781 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Operating activities: | |||
Net income | $138,935,086 | $136,493,493 | $126,417,222 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 12,939,730 | 13,069,959 | 10,928,610 |
Allowance for doubtful accounts | 930,389 | 437,993 | 590,704 |
Changes in assets and liabilities: | |||
Accounts receivable | -9,963,530 | -8,777,416 | -11,837,759 |
Inventories | -22,776,108 | -84,654,827 | -86,456,869 |
Prepaid and other current assets | 329,175 | -314,671 | 324,380 |
Accounts payable | -4,092,115 | -5,024,141 | -16,060,984 |
Tax payables | -87,483 | -64,903 | -135,845 |
Accrued expenses and other current liabilities | -78,129 | -72,237 | -66,416 |
Net cash provided by operating activities | 116,137,014 | 51,093,250 | 23,703,043 |
Investing activities: | |||
Purchase of assets | -110,084,814 | -43,779,419 | -11,121,978 |
Investments | 0 | 0 | 0 |
Net cash used in investing activities | -110,084,814 | -43,779,419 | -11,121,978 |
Cash flows from financing activities: | |||
Payment on land lease | -3,411,143 | -4,420,607 | -5,928,885 |
Increase (decrease) in debt | -2,617,595 | -3,932,423 | -7,274,734 |
Net cash provided by financing activities | -6,028,738 | -8,353,030 | -13,203,619 |
Effect of exchange rate change on cash and cash equivalents | 545,820 | 1,396,772 | 888,547 |
Net increase (decrease) in cash and cash equivalents | 569,283 | 357,574 | 265,993 |
Cash and cash equivalents at beginning of period | 11,337,958 | 10,980,384 | 10,714,391 |
Cash and cash equivalents at end of period | 11,907,242 | 11,337,958 | 10,980,384 |
Supplemental Disclosures: | |||
Cash paid for interest | $666,613 | $937,163 | $1,110,340 |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Consolidated Statements Of Comprehensive Income | |||
Net income | $138,935,086 | $136,493,493 | $126,417,222 |
Foreign currency translation adjustment | 545,820 | 55,038,059 | 5,287,780 |
Total other comprehensive income | 545,820 | 55,038,059 | 5,287,780 |
Total comprehensive income | $139,480,906 | $191,531,552 | $131,705,002 |
1_Organization_and_nature_of_o
1. Organization and nature of operations | 12 Months Ended |
Dec. 31, 2014 | |
Notes to Financial Statements | |
1. Organization and nature of operations | Yasheng Group (“The Company”) is a California corporation with primary operations in China. The Company designs, develops, manufactures and markets high-quality farming and sideline products; chemical materials and products; textiles; construction materials; and livestock and poultry. It also designs, develops and markets new technologies related to agriculture and genetic biology. |
2_Summary_of_Significant_Accou
2. Summary of Significant Accounting Policies | 12 Months Ended | |
Dec. 31, 2014 | ||
Notes to Financial Statements | ||
2. Summary of Significant Accounting Policies | ||
(a) | Accounting standards | |
The consolidated financial statements have been prepared on a historical cost basis to reflect the financial position and results of operations of the Company in accordance with accounting principles generally accepted in the United States of America. | ||
(b) | Fiscal year | |
The Company’s fiscal year ends on the 31st of December of each calendar year. | ||
(c) | Consolidation | |
The consolidated financial statements include the accounts of the Company and its subsidiaries. All material intercompany balances and transactions have been eliminated. | ||
(d) | Use of estimates | |
The Company’s discussion and analysis of its financial condition and results of operations are based upon its consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. 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. | ||
(e) | Revenue recognition | |
We mainly sell food products. We recognize revenue when title and risk of loss are transferred to our customers. This generally happens upon delivery of our product. | ||
(f) | Shipping and handling costs | |
The Company records outward freight, purchasing and receiving costs in selling expenses; inspection costs and warehousing costs are recorded as general and administrative expenses. | ||
(g) | Cash and cash equivalents | |
Cash and cash equivalents include cash on hand, demand deposits held by banks, and securities with maturities of three months or less. The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. Cash equivalents are composed primarily of investments in money market accounts stated at cost, which approximates fair value. | ||
(h) | Inventories | |
Inventories are recorded using the weighted average method and are valued at the lower of cost or market. | ||
(i) | Accounts receivable, net | |
The carrying amount of accounts receivable is reduced by a valuation allowance that reflects the Company’s best estimate of the amounts that will not be collected. In addition to reviewing delinquent accounts receivable, the Company considers many factors in estimating its general allowance, including aging analysis, historical bad debt records, customer credit analysis and any specific known troubled accounts. | ||
(j) | Property, plant and equipment | |
Property, plant and equipment are carried at cost less accumulated depreciation and amortization. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the assets. Amortization of leasehold improvements isalculated on a straight-line basis over the life of the asset or the term of the lease, whichever is shorter. Major renewals and betterments are capitalized and depreciated; maintenance and repairs that do not extend the life of the respective assets are charged to expense as incurred. Upon disposal of assets, the cost and related accumulated depreciation are removed from the accounts and any gain or loss is included in income. Depreciation related to property and equipment used in production is reported in cost of sales. Property and equipment are depreciated over their estimated useful lives as follows: | ||
Buildings and improvements | 20 - 40 years | |
Farming facilities | 10 years | |
Machinery and equipment | 7 years | |
Transportation and other facilities | 3 - 15 years | |
Long-term assets of the Company are reviewed annually to assess whether the carrying value has become impaired, according to the guidelines established in Statement of Accounting Standards (SFAS) No. 144, "Accounting for the Impairment of Disposal of Long-Lived Assets." The Company also evaluates the periods of amortization to determine whether subsequent events and circumstances warrant revised estimates of useful lives. No impairment of assets was recorded in the periods reported. | ||
(k) | Intangible assets | |
Intangible assets consist of land use rights and are recorded at cost. Under PRC’s current property rights regime, use rights for specified periods (e.g., 40 to 70 years) can be obtained from the state through the up-front payment of land use fees. The fees are determined by the location, type and density of the proposed development. This separation of land ownership and use rights allows the trading of land use rights while maintaining state ownership of land. The Company has over 300,000 acres of farming land that are utilized for grazing, cultivation, and reclamation, of which 65,000 acres are under cultivation using the latest scientific technologies to produce a wide variety of agricultural products. | ||
Land use rights are amortized over 70 years using the straight-line method. | ||
(l) | Impairment of long-lived assets | |
The carrying amounts of long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is evaluated by a comparison of the carrying amount of assets to future undiscounted net cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less cost to sell. | ||
(m) | Investments | |
Investments consist primarily of less than 20% equity positions in non-marketable securities and are recorded at lower of cost or market. | ||
(n) | Foreign currency translation | |
The accompanying financial statements are presented in United States (US) dollars. The functional currency is the Renminbi (RMB). The financial statements are translated into US dollars from RMB at year-end exchange rates for assets and liabilities, and weighted average exchange rates for revenues and expenses. Capital accounts are translated at their historical exchange rates when the capital transactions occurred. | ||
Gains and losses resulting from foreign currency translation are recorded in a separate component of shareholders’ equity. Foreign currency translation adjustments are included in accumulated other comprehensive income in the consolidated statements of shareholders’ equity for the years presented. | ||
RMB is not freely convertible into the currency of other nations. All such exchange transactions must take place through authorized institutions. There is no guarantee the RMB amounts could have been, or could be, converted into US dollars at rates used in translation. | ||
(o) | Income taxes | |
As a state-owned agricultural enterprise, the Company and all of its agricultural subsidiaries are exempted from enterprise income taxes with approval from the Gansu Provincial Bureau of Local Taxation. The only non-agricultural subsidiary, Baiyin Cement Plant, has suffered net loss for the three years shown and therefore has no applicable taxable income. Because of the uncertainty of future profits, no deferred tax assets have been set up at this time. | ||
(p) | Earnings per share | |
Basic earnings per share are computed using the weighted average number of common shares outstanding during the year. Diluted earnings per share are computed using the weighted average number of common and, if dilutive, potential common shares outstanding during the year. The Company has no potentially dilutive shares for the periods shown. | ||
(q) | Economic and Political Risks | |
The Company faces a number of risks and challenges as a result of having primary operations and markets in the PRC. Changing political climates in the PRC could have a significant effect on the Company's business. | ||
(r) | Advertising expense | |
The Company expenses advertising as incurred. Advertising expenses amounted to $766,924, $754,294, $731,962, for year 2014, 2013, and 2012, respectively. | ||
(s) | Comprehensive income | |
Comprehensive income is defined as the change in equity of a company during a period from transactions and other events and circumstances excluding transactions resulting from investments from owners and distributions to owners. Accumulated other comprehensive income, as presented on the accompanying consolidated balance sheets, consists of mainly the cumulative foreign currency translation adjustment. | ||
(t) | Value added tax (VAT) | |
Value added tax is a consumption tax levied on value added. While the standard VAT rate in PRC is 17%, the Company's agricultural subsidiaries enjoy a reduced VAT rate of 4%. | ||
(u) | Recently Issued Accounting Standards | |
Recently Adopted Accounting Pronouncements | ||
In December 2011, the Financial Accounting Standards Board (“FASB”) issued guidance enhancing disclosure requirements about the nature of an entity’s right to offset and related arrangements associated with its financial instruments. The new guidance requires the disclosure of the gross amounts subject to rights of set-off, amounts offset in accordance with the accounting standards followed, and the related net exposure. In January 2013, the FASB clarified that the scope of this guidance applies to derivatives, repurchase agreements, and securities lending arrangements that are either offset or subject to an enforceable master netting arrangement, or similar agreements. We have adopted this new guidance. | ||
In February 2013, the FASB issued guidance on disclosure requirements for items reclassified out of accumulated other comprehensive income (“AOCI”). This new guidance requires entities to present (either on the face of the income statement or in the notes to financial statements) the effects on the line items of the income statement for amounts reclassified out of AOCI. We have adopted this new guidance. | ||
In September 2011, the Financial Accounting Standards Board (“FASB”) issued guidance on testing goodwill for impairment. The new guidance provides an entity the option to first perform a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If an entity determines that this is the case, it is required to perform the two-step goodwill impairment test to identify potential goodwill impairment and measure the amount of goodwill impairment loss to be recognized for that reporting unit (if any). If an entity determines that the fair value of a reporting unit is greater than its carrying amount, the two-step goodwill impairment test is not required. We adopted this new guidance. | ||
Recent accounting guidance not yet adopted | ||
In March 2013, the FASB issued guidance on a parent’s accounting for the cumulative translation adjustment upon de-recognition of a subsidiary or group of assets within a foreign entity. This new guidance requires that the parent release any related cumulative translation adjustment into net income only if the sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided. The new guidance will be effective for us beginning December 31, 2014.. We do not anticipate material impacts on our financial statements upon adoption. | ||
(v) | Fair Value of Financial Instruments | |
The carrying amounts of accounts receivable, accounts payable, other liabilities, and short-term borrowings approximate their fair value due to the short-term maturity of these instruments. Long term debt approximates fair value as its interest rates approximates market interest rates | ||
3_Accounts_receivable
3. Accounts receivable | 12 Months Ended | |||||||||||||
Dec. 31, 2014 | ||||||||||||||
Receivables [Abstract] | ||||||||||||||
3. Accounts receivable | Accounts receivable are recognized and carried at original invoice amount outstanding less an allowance for doubtful accounts. The activity in the Accounts Receivable was as follows: | |||||||||||||
December 31st | Gross Balance | Allowance | Net Balance | |||||||||||
at end of year | for doubtful accounts | at end of year | ||||||||||||
2012 | 96,715,857 | 4,835,793 | 91,880,065 | |||||||||||
2013 | 108,335,469 | 5,273,786 | 103,061,683 | |||||||||||
2014 | 118,298,998 | 6,204,175 | 112,092,824 | |||||||||||
The allowance for doubtful accounts reflects our best estimate of probable losses inherent in the accounts receivable balances. We determine the allowance based on known troubled accounts, historical experience, and other currently available evidence. Activity in the allowance for doubtful accounts was as follows: | ||||||||||||||
Year Ended December 31st | Beginning Balance | Charged to costs and expenses | Write offs and other | Ending Balance | ||||||||||
2012 | 4,224,559 | 590,704 | 4,835,793 | |||||||||||
2013 | 4,835,793 | 437,993 | 5,273,786 | |||||||||||
2014 | 5,273,786 | 930,389 | 6,204,175 | |||||||||||
4_Inventories
4. Inventories | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Notes to Financial Statements | |||||||||||||
4. Inventories | The major classes of inventory: raw materials, packaging materials, products in process, finished goods, stocks, low-value consumable goods, materials in transit as well as others. | ||||||||||||
The following is a breakdown of the major categories of inventories. | |||||||||||||
Breakdown of Inventories | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Raw material | 69,104,388 | 64,583,540 | 46,131,100 | ||||||||||
Finished Goods | 179,605,652 | 167,437,526 | 119,049,524 | ||||||||||
Low-value consumable goods | 46,327,219 | 43,296,466 | 30,926,047 | ||||||||||
Packaging material | 30,722,573 | 28,712,685 | 20,509,061 | ||||||||||
Maintenance material | 15,996,422 | 14,949,927 | 10,678,519 | ||||||||||
Total for the year | 341,756,253 | 318,980,143 | 227,294,252 |
5_Property_plant_and_equipment
5. Property, plant and equipment & depreciation | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||
5. Property, plant and equipment & depreciation | The major classes of property, plant and equipment include building and improvements, machinery and equipment, transportation facilities, agricultural facilities, etc. They are carried at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The following is a breakdown of fixed assets and accumulated depreciation by fiscal year. | ||||||||||||
Property, plant and equipment | 2014 | 2013 | 2012 | ||||||||||
Buildings and improvements | 123,603,446 | 115,517,239 | 103,140,392 | ||||||||||
Farming facilities | 113,064,212 | 105,667,488 | 94,345,971 | ||||||||||
Machinery and equipment | 14,873,613 | 13,900,573 | 12,411,226 | ||||||||||
Transportation and other facilities | 359,434,553 | 335,920,143 | 299,928,699 | ||||||||||
Windbreak and Sand-break Trees | 404,432,178 | 381,277,766 | 365,843,411 | ||||||||||
Total | 1,015,408,002 | 952,283,209 | 875,669,700 | ||||||||||
Accumulated Depreciation | 110,139,280 | 103,604,301 | 90,534,342 | ||||||||||
Total | 905,268,722 | 848,678,908 | 785,135,358 | ||||||||||
The Company invests every year in windbreaks and sand-breaks to provide shelterbelts for many of the farms located near the Gobi Desert. These investments are recorded under property, plant and equipment above. The following is a more detailed breakdown of the windbreaks and sand breaks and accumulated depreciation by fiscal year. | |||||||||||||
Windbreak and Sand-break Trees | 2014 | 2013 | 2012 | ||||||||||
Wind breaks and sand breaks capitalized (trees) | 322,950,473 | 304,670,258 | 294,353,892 | ||||||||||
Additional Long Term Costs Capitalized | 86,982,781 | 81,673,973 | 71,489,719 | ||||||||||
Total | 409,933,255 | 386,344,231 | 365,843,611 | ||||||||||
Accumulated Depreciation | (5,501,077 | ) | (5,066,465 | ) | (4,685,791 | ) | |||||||
Net Wind Breaks and Sand Breaks | 404,432,178 | 381,277,766 | 361,157,820 | ||||||||||
Depreciation for year | 434,612 | 380,674 | 350,164 | ||||||||||
6_China_contribution_plan
6. China contribution plan | 12 Months Ended |
Dec. 31, 2014 | |
Notes to Financial Statements | |
6. China contribution plan | The Company’s subsidiaries in China participate 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’s subsidiaries to pay to the local labor bureau a monthly contribution at a stated contribution rate based on the monthly basic compensation of qualified employees. The relevant local labor bureau is responsible for meeting all retirement benefit obligations; the Company has no further commitments beyond its monthly contribution. |
7_Profit_appropriation
7. Profit appropriation | 12 Months Ended |
Dec. 31, 2014 | |
Notes to Financial Statements | |
7. Profit appropriation | Pursuant to the laws applicable to China’s Foreign Investment Enterprises, each of the Company’s subsidiaries in China must make appropriations from its after-tax profit to non-distributable reserve funds as determined by the Board of Directors. These reserve funds include a (i) general reserve, (ii) enterprise expansion fund and (iii) staff bonus and welfare fund. The general reserve fund requires annual appropriations of 10% of after-tax profit (as determined under PRC GAAP) until these reserves equal 50% of the amount of paid-in capital; the other fund appropriations are at the Company’s discretion. |
8_Concentration_of_risks
8. Concentration of risks | 12 Months Ended |
Dec. 31, 2014 | |
Notes to Financial Statements | |
8. Concentration of risks | |
The operations of the Company are substantially located in the PRC and accordingly, investing in the shares of the Company is subject to among others, the PRC’s political, economic and legal risks. | |
9_Income_taxes
9. Income taxes | 12 Months Ended |
Dec. 31, 2014 | |
Notes to Financial Statements | |
9. Income taxes | The Company and all of its agricultural subsidiaries are exempt from income taxes in the PRC. |
10_Debt
10. Debt | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Notes to Financial Statements | |||||||||||||||||
10. Debt | The Company obtains secured lending from the banks using the following two types of arrangements, collateral and guarantee. Collateral is loans secured against the assets of the Yasheng Group, while guarantee is loans provided with the guarantee from a third party. | ||||||||||||||||
(a) Long term debt | |||||||||||||||||
Collateral | Guarantee | Total | Maturity | ||||||||||||||
2012 | 0 | 0 | 0 | N/A | |||||||||||||
2013 | 0 | 0 | 0 | N/A | |||||||||||||
2014 | 0 | 0 | 0 | N/A | |||||||||||||
(b) Current portion of long term debt | |||||||||||||||||
Collateral | Guarantee | Total | Interest rate | ||||||||||||||
2012 | 3,451,600 | 1,479,226 | 4,930,826 | 7.25 | % | ||||||||||||
2013 | 3,051,600 | 1,379,687 | 4,431,287 | 7.25 | % | ||||||||||||
2014 | 2,051,600 | 1,508,794 | 3,560,394 | 7.25 | % | ||||||||||||
11_Employee_benefit_plans
11. Employee benefit plans | 12 Months Ended |
Dec. 31, 2014 | |
Notes to Financial Statements | |
11. Employee benefit plans | The Company provides the following benefits for all employees: |
A. Employee Welfare Fund: An amount equal to 14% of payroll is set aside by the Company for standard employee benefits. This fund is managed and controlled by the Company. All required payments current. | |
B. Open Policy Pension: The Company pays to national and community insurance agents an amount equal to 20% of payroll. This insurance continues to cover the employee subsequent to retirement. | |
C. Unemployment Insurance: The Company pays to the national employment administrative entities an amount equal to 1% of payroll. Any dismissed employee thereby receives a specified amount of family-support funds for a designated period. | |
D. Housing Surplus Reserve: The Company pays to the national housing fund administrative entities an amount equal to 10% of payroll for deposit into the employees' future housing allowance accounts. | |
The aforesaid items are for employee's benefits and should be accounted for as the Company's expenses. | |
E. China contribution plan. | |
The Company’s subsidiaries in China participate 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’s subsidiaries to pay to the local labor bureau a monthly contribution at a stated contribution rate based on the monthly basic compensation of qualified employees. The relevant local labor bureau is responsible for meeting all retirement benefit obligations; the Company has no further commitments beyond its monthly contribution. |
12_Stockholders_Equity
12. Stockholders' Equity | 12 Months Ended |
Dec. 31, 2014 | |
Equity [Abstract] | |
12. Stockholders' Equity | The Company issued no new shares during the years 2014 and 2013. |
13_Restated_Financial_Statemen
13. Restated Financial Statements, (2011 and 2010) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||
13. Restated Financial Statements, (2011 and 2010) | The original financial statements for the year ended 12-31-2011 and 2010 capitalized all of the wind break tree costs (originally stated as Other Long Term Assets ) and amortized them over 70 years. The restated financial statements have expensed the maintenance portion of the costs in the year occurred and only capitalized the long term portion. The balance sheet has also moved the long term assets (wind break trees) into the property plant and equipment. The chart below shows the changes made to the financial statements in total assets, net income and earnings per share. | ||||||||
Net Sales | 2011 | 2010 | |||||||
Construction material | 6,121,835 | 5,434,519 | |||||||
Farming | 943,009,599 | 844,019,745 | |||||||
Total | 949,131,434 | 849,454,265 | |||||||
15_Segments
15. Segments | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Notes to Financial Statements | |||||||||||||||||
14. Segments | In its operation of the business, management, including upper management and the board of director’s, reviews certain information as it relates to the Company as a whole. The information most used and useful is the profitability by subsidiary. Accordingly, these are the segments which are presented in the tables below. | ||||||||||||||||
Entity level segment | |||||||||||||||||
2014 Sales Breakdown by Subsidiary Unit: Dollar | |||||||||||||||||
Subsidiaries | Net Sales | Cost of Sales | Gross Profit | ||||||||||||||
Gansu Jinta Hengsheng Agricultural Development Co., Ltd. | 148,737,663 | 118,994,758 | 29,742,905 | ||||||||||||||
Gansu Hongtai Agricultural Technology Co., Ltd. | 299,935,038 | 175,574,191 | 25,360,847 | ||||||||||||||
Gansu Jinta Xingsheng Industrial Co., Ltd. | 154,035,388 | 133,419,328 | 20,616,060 | ||||||||||||||
Gansu Jinta Yongsheng Agricultural Development Company. | 153,402,638 | 131,260,081 | 22,142,557 | ||||||||||||||
Gansu Jinta Yuantai Commercial Trading Co., Ltd. | 1,851,287 | 1,423,539 | 427,748 | ||||||||||||||
Gansu Tiaoshan Agricultural-Industrial-Commercial Group Co., Ltd | 320,413,447 | 287,392,964 | 43,020,483 | ||||||||||||||
Gansu Xiaheqing Industrial Co., Ltd. | 23,760,211 | 21,215,581 | 2,544,630 | ||||||||||||||
Total | 1,012,135,672 | 868,280,442 | 143,855,230 | ||||||||||||||
2013 Sales Breakdown by Subsidiary Unit: Dollar | |||||||||||||||||
Subsidiaries | Net Sales | Cost of Sales | Gross Profit | ||||||||||||||
Gansu Jinta Hengsheng Agricultural Development Co., Ltd. | 146,961,967 | 119,955,514 | 27,566,449 | ||||||||||||||
Gansu Hongtai Agricultural Technology Co., Ltd. | 199,538,728 | 173,622,607 | 25,963,203 | ||||||||||||||
Gansu Jinta Xingsheng Industrial Co., Ltd. | 151,820,821 | 129,222,545 | 22,825,132 | ||||||||||||||
Gansu Jinta Yongsheng Agricultural Development Company. | 149,208,966 | 128,082,675 | 21,277,389 | ||||||||||||||
Gansu Jinta Yuantai Commercial Trading Co., Ltd. | 1,935,801 | 1,399,743 | 555,397 | ||||||||||||||
Gansu Tiaoshan Agricultural-Industrial-Commercial Group Co., Ltd | 333,325,391 | 295,685,000 | 36,301,016 | ||||||||||||||
Gansu Xiaheqing Industrial Co., Ltd. | 28,531,956 | 19,877,661 | 8,989,299 | ||||||||||||||
Total | 1,011,323,630 | 867,845,745 | 143,477,886 | ||||||||||||||
2012 Sales Breakdown by Subsidiary Unit: Dollar | |||||||||||||||||
Subsidiaries | Net Sales | Cost of Sales | Gross Profit | ||||||||||||||
Gansu Jinta Hengsheng Agricultural Development Co., Ltd. | 144,363,425 | 118,767,836 | 25,595,589 | ||||||||||||||
Gansu Hongtai Agricultural Technology Co., Ltd. | 196,010,538 | 171,903,571 | 24,106,967 | ||||||||||||||
Gansu Jinta Xingsheng Industrial Co., Ltd. | 149,136,366 | 127,943,114 | 21,193,252 | ||||||||||||||
Gansu Jinta Yongsheng Agricultural Development Company. | 146,570,694 | 126,814,530 | 19,756,164 | ||||||||||||||
Gansu Jinta Yuantai Commercial Trading Co., Ltd. | 1,901,573 | 1,385,884 | 515,689 | ||||||||||||||
Gansu Tiaoshan Agricultural-Industrial-Commercial Group Co., Ltd | 327,092,687 | 293,422,289 | 33,670,398 | ||||||||||||||
Gansu Xiaheqing Industrial Co., Ltd. | 28,027,462 | 19,680,852 | 8,346,610 | ||||||||||||||
Total | 993,102,745 | 859,918,076 | 133,184,669 | ||||||||||||||
Other segments that are considered are agriculture, livestock and biotechnology/industrial. Below is an explanation of the three segments and Schedules that details each of these three segments. | |||||||||||||||||
Agriculture | |||||||||||||||||
Agriculture is our largest segment accounting for 99.11% of our sales. This is spread over several of our entities. This segment includes over 30 agriculture products under the following six areas: | |||||||||||||||||
Field crops: Cotton, Corn, Barley, Wheat, Flaxseed, Alfalfa | |||||||||||||||||
Vegetables: Onion, Potato, Beet, Pea | |||||||||||||||||
Fruit: Apple, Pear, Apricot Specialty Crops: Hops, Wolfberry, Cumin, Liquorices | |||||||||||||||||
Specialty Crops: Hops, Wolfberry, Cumin, Hemp, Liquorices Root Seeds: Black Melon Seeds, sunflower Seeds, Corn Seed, Flax Seed, Hemp seeds | |||||||||||||||||
These also include processing the products and getting them to market. | |||||||||||||||||
Livestock | |||||||||||||||||
Our livestock segment, although small is growing, increasing 1% per year. Livestock includes animal husbandry, animal food products. This includes chickens and eggs. Chicken operations include breeding and raising chickens, as well as processing live chickens into fresh, frozen and value-added chicken products and logistics operations to move products through the supply chain. | |||||||||||||||||
Biotech/industrial | |||||||||||||||||
This segment includes construction materials. It increased 1.9% from 2013 to 2014. We have a concrete plant in Baiyin which produces the majority of our sales currently in construction materials. | |||||||||||||||||
Below is a three year comparison chart on these segments | |||||||||||||||||
Year 2014 | Sales | Cost of | |||||||||||||||
Sales % | Profit | Profit | Gross | Gross % | |||||||||||||
Agriculture | 1,003,148,453 | 860,094,655 | 143,053,798 | 14.2 | |||||||||||||
Livestock | 2,700,930 | 2,321,561 | 379,369 | 14 | |||||||||||||
Biotech/Industrial | 6,286,289 | 5,864,226 | 422,063 | 6.7 | |||||||||||||
Total | 1,012,135,672 | 868,280,442 | 143,855,230 | 14.1 | |||||||||||||
Year 2013 | |||||||||||||||||
Sales % | |||||||||||||||||
Agriculture | 1,002,407,738 | 859,673,849 | 142,733,889 | 14.24 | |||||||||||||
Livestock | 2,679,494 | 2,317,621 | 361,873 | 13.5 | |||||||||||||
Biotech/Industrial | 6,236,398 | 5,854,274 | 382,124 | 6.12 | |||||||||||||
Total | 1,011,323,630 | 867,845,745 | 143,477,886 | 14.19 | |||||||||||||
Year 2012 | |||||||||||||||||
Sales % | |||||||||||||||||
Agriculture | 985,234,394 | 852,673,583 | 132,560,811 | 13.45 | |||||||||||||
Livestock | 2,155,983 | 1,834,557 | 321,426 | 14.91 | |||||||||||||
Biotech/Industrial | 5,712,368 | 5,409,936 | 302,432 | 5.29 | |||||||||||||
Total | 993,102,745 | 859,918,076 | 133,184,699 | 13.41 |
16_Operating_leases
16. Operating leases | 12 Months Ended |
Dec. 31, 2014 | |
Notes to Financial Statements | |
16. Operating leases | The Company has no operating leases for the periods shown. |
17_Earnings_per_share
17. Earnings per share | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Earnings Per Share [Abstract] | |||||||||||||
17. Earnings per share | The components of basic earnings per share are as follows: | ||||||||||||
Years Ended December 31st, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Net income available | |||||||||||||
For common shareholders | 138,935,086 | 136,493,493 | 126,417,222 | ||||||||||
Weighted average shares | |||||||||||||
of common stock | 155,097,355 | 155,097,355 | 155,097,355 | ||||||||||
Basic earnings per share | 0.9 | 0.88 | 0.82 | ||||||||||
18_Subsequent_Events_and_new_S
18. Subsequent Events and new Subsidiaries | 12 Months Ended |
Dec. 31, 2014 | |
Subsequent Events [Abstract] | |
18. Subsequent Events and new Subsidiaries | Angel Star Nutrition LLC |
Dec 31, 2013 Angel Star Nutrition LLC -- a Delaware-based Limited Liability Company. | |
Yasheng Group and IBC will be co-owners of Angel Star Nutrition LLC, with each party holding a 50% stake in the venture. Mei P. Wu (President of Yasheng Group) will serve as CEO, while Steven P. White (President of Intermountain Brands Corporation) will serve as President. The purpose of the new venture is to produce powdered infant formula and other nutrition products for distribution worldwide. | |
Registration Authority: State of Delaware, entity number: 140012521 | |
Legal Domicile: 2282 South President Drive., Suite F, West Valley, Utah 84120 | |
The Company is actively seeking joint ventures to further its plan for growth. Below are three joint ventures currently in the due diligence phase. | |
Rouge Mountain Mining Group Corp (AZ) | |
On November 21, 2012 the Company formed Rouge Mountain Mining Group Corp. in Arizona. This subsidiary is an exploration stage company formed to develop the Company’s mining claims in La Paz County, Arizona and to facilitate future joints ventures with other mining companies in the United States. This new subsidiary has no operations yet. | |
Lemco Yasheng LLC | |
The Company entered into a Letter of Intent dated November 1, 2012 with LEMCO Investments Limited, (the BVI and the UK), whereby both parties expressed an interest in forming a joint venture to exploring opportunities of mutual interest for the development of land-use and forestry conservation projects, including industrial agriculture, carbon emissions reductions and other forms of payments for environmental services. | |
On January 25, 2013 the Company formed Lemco Yasheng LLC to facilitate the joint venture once executed. The Company is still in its due diligence phase of the endeavor. | |
Yasheng Greenphil LLC | |
The Company entered into an agreement in September 2012 with Greenphil Agua-Culture & Hydroponics Holding, Inc (Manila, Philippines) and Greenphil Aqua-Culture & Hydroponics, LLC (California), where all parties expressed an interest in forming a joint venture to conduct business development in the Republic of the Philippines. This business will include agua-culture and hyrdopononics, farming, mining and other projects. | |
On February 8, 2013 the Company formed Yasheng Greenphil LLC to facilitate the joint venture once executed. The Company is still in its due diligence phase of the endeavor. | |
Angel Star Nutrition LLC | |
Dec 31, 2013 Angel Star Nutrition LLC -- a Delaware-based Limited Liability Company. | |
Yasheng Group and IBC will be co-owners of Angel Star Nutrition LLC, with each party holding a 50% stake in the venture. Mei P. Wu (President of Yasheng Group) will serve as CEO, while Steven P. White (President of Intermountain Brands Corporation) will serve as President. The purpose of the new venture is to produce powdered infant formula and other nutrition products for distribution worldwide. | |
Registration Authority: State of Delaware, entity number: 140012521 | |
Legal Domicile: 2282 South President Drive., Suite F, West Valley, Utah 84120 |
2_Summary_of_Significant_Accou1
2. Summary of Significant Accounting Policies (Policies) | 12 Months Ended | |
Dec. 31, 2014 | ||
Notes to Financial Statements | ||
Accounting standards | The consolidated financial statements have been prepared on a historical cost basis to reflect the financial position and results of operations of the Company in accordance with accounting principles generally accepted in the United States of America. | |
Fiscal year | The Company’s fiscal year ends on the 31st of December of each calendar year. | |
Consolidation | The consolidated financial statements include the accounts of the Company and its subsidiaries. All material intercompany balances and transactions have been eliminated. | |
Use of estimates | The Company’s discussion and analysis of its financial condition and results of operations are based upon its consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. 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. | |
Revenue recognition | We mainly sell food products. We recognize revenue when title and risk of loss are transferred to our customers. This generally happens upon delivery of our product. | |
Shipping and handling costs | The Company records outward freight, purchasing and receiving costs in selling expenses; inspection costs and warehousing costs are recorded as general and administrative expenses. | |
Cash and cash equivalents | Cash and cash equivalents include cash on hand, demand deposits held by banks, and securities with maturities of three months or less. The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. Cash equivalents are composed primarily of investments in money market accounts stated at cost, which approximates fair value. | |
Inventories | Inventories are recorded using the weighted average method and are valued at the lower of cost or market. | |
Accounts receivable, net | The carrying amount of accounts receivable is reduced by a valuation allowance that reflects the Company’s best estimate of the amounts that will not be collected. In addition to reviewing delinquent accounts receivable, the Company considers many factors in estimating its general allowance, including aging analysis, historical bad debt records, customer credit analysis and any specific known troubled accounts. | |
Property, plant and equipment | Property, plant and equipment are carried at cost less accumulated depreciation and amortization. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the assets. Amortization of leasehold improvements isalculated on a straight-line basis over the life of the asset or the term of the lease, whichever is shorter. Major renewals and betterments are capitalized and depreciated; maintenance and repairs that do not extend the life of the respective assets are charged to expense as incurred. Upon disposal of assets, the cost and related accumulated depreciation are removed from the accounts and any gain or loss is included in income. Depreciation related to property and equipment used in production is reported in cost of sales. Property and equipment are depreciated over their estimated useful lives as follows: | |
Buildings and improvements | 20 - 40 years | |
Farming facilities | 10 years | |
Machinery and equipment | 7 years | |
Transportation and other facilities | 3 - 15 years | |
Long-term assets of the Company are reviewed annually to assess whether the carrying value has become impaired, according to the guidelines established in Statement of Accounting Standards (SFAS) No. 144, "Accounting for the Impairment of Disposal of Long-Lived Assets." The Company also evaluates the periods of amortization to determine whether subsequent events and circumstances warrant revised estimates of useful lives. No impairment of assets was recorded in the periods reported. | ||
Intangible assets | Intangible assets consist of land use rights and are recorded at cost. Under PRC’s current property rights regime, use rights for specified periods (e.g., 40 to 70 years) can be obtained from the state through the up-front payment of land use fees. The fees are determined by the location, type and density of the proposed development. This separation of land ownership and use rights allows the trading of land use rights while maintaining state ownership of land. The Company has over 300,000 acres of farming land that are utilized for grazing, cultivation, and reclamation, of which 65,000 acres are under cultivation using the latest scientific technologies to produce a wide variety of agricultural products. | |
Land use rights are amortized over 70 years using the straight-line method. | ||
Impairment of long-lived assets | The carrying amounts of long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is evaluated by a comparison of the carrying amount of assets to future undiscounted net cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less cost to sell. | |
Investments | Investments consist primarily of less than 20% equity positions in non-marketable securities and are recorded at lower of cost or market. | |
Foreign currency translation | The accompanying financial statements are presented in United States (US) dollars. The functional currency is the Renminbi (RMB). The financial statements are translated into US dollars from RMB at year-end exchange rates for assets and liabilities, and weighted average exchange rates for revenues and expenses. Capital accounts are translated at their historical exchange rates when the capital transactions occurred. | |
Gains and losses resulting from foreign currency translation are recorded in a separate component of shareholders’ equity. Foreign currency translation adjustments are included in accumulated other comprehensive income in the consolidated statements of shareholders’ equity for the years presented. | ||
RMB is not freely convertible into the currency of other nations. All such exchange transactions must take place through authorized institutions. There is no guarantee the RMB amounts could have been, or could be, converted into US dollars at rates used in translation. | ||
Income taxes | As a state-owned agricultural enterprise, the Company and all of its agricultural subsidiaries are exempted from enterprise income taxes with approval from the Gansu Provincial Bureau of Local Taxation. The only non-agricultural subsidiary, Baiyin Cement Plant, has suffered net loss for the three years shown and therefore has no applicable taxable income. Because of the uncertainty of future profits, no deferred tax assets have been set up at this time. | |
Earnings per share | Basic earnings per share are computed using the weighted average number of common shares outstanding during the year. Diluted earnings per share are computed using the weighted average number of common and, if dilutive, potential common shares outstanding during the year. The Company has no potentially dilutive shares for the periods shown. | |
Economic and Political Risks | The Company faces a number of risks and challenges as a result of having primary operations and markets in the PRC. Changing political climates in the PRC could have a significant effect on the Company's business. | |
Advertising expense | The Company expenses advertising as incurred. Advertising expenses amounted to $766,924, $754,294, $731,962, for year 2014, 2013, and 2012, respectively. | |
Comprehensive income | Comprehensive income is defined as the change in equity of a company during a period from transactions and other events and circumstances excluding transactions resulting from investments from owners and distributions to owners. Accumulated other comprehensive income, as presented on the accompanying consolidated balance sheets, consists of mainly the cumulative foreign currency translation adjustment. | |
Value added tax (VAT) | Value added tax is a consumption tax levied on value added. While the standard VAT rate in PRC is 17%, the Company's agricultural subsidiaries enjoy a reduced VAT rate of 4%. | |
Recently Issued Accounting Standards | Recently Adopted Accounting Pronouncements | |
In December 2011, the Financial Accounting Standards Board (“FASB”) issued guidance enhancing disclosure requirements about the nature of an entity’s right to offset and related arrangements associated with its financial instruments. The new guidance requires the disclosure of the gross amounts subject to rights of set-off, amounts offset in accordance with the accounting standards followed, and the related net exposure. In January 2013, the FASB clarified that the scope of this guidance applies to derivatives, repurchase agreements, and securities lending arrangements that are either offset or subject to an enforceable master netting arrangement, or similar agreements. We have adopted this new guidance. | ||
In February 2013, the FASB issued guidance on disclosure requirements for items reclassified out of accumulated other comprehensive income (“AOCI”). This new guidance requires entities to present (either on the face of the income statement or in the notes to financial statements) the effects on the line items of the income statement for amounts reclassified out of AOCI. We have adopted this new guidance. | ||
In September 2011, the Financial Accounting Standards Board (“FASB”) issued guidance on testing goodwill for impairment. The new guidance provides an entity the option to first perform a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If an entity determines that this is the case, it is required to perform the two-step goodwill impairment test to identify potential goodwill impairment and measure the amount of goodwill impairment loss to be recognized for that reporting unit (if any). If an entity determines that the fair value of a reporting unit is greater than its carrying amount, the two-step goodwill impairment test is not required. We adopted this new guidance. | ||
Recent accounting guidance not yet adopted | ||
In March 2013, the FASB issued guidance on a parent’s accounting for the cumulative translation adjustment upon de-recognition of a subsidiary or group of assets within a foreign entity. This new guidance requires that the parent release any related cumulative translation adjustment into net income only if the sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided. The new guidance will be effective for us beginning December 31, 2014.. We do not anticipate material impacts on our financial statements upon adoption. | ||
Fair Value of Financial Instruments | The carrying amounts of accounts receivable, accounts payable, other liabilities, and short-term borrowings approximate their fair value due to the short-term maturity of these instruments. Long term debt approximates fair value as its interest rates approximates market interest rates | |
2_Summary_of_Significant_Accou2
2. Summary of Significant Accounting Policies (Tables) | 12 Months Ended | |
Dec. 31, 2014 | ||
Notes to Financial Statements | ||
Estimated useful lives as follows | Buildings and improvements | 20 - 40 years |
Farming facilities | 10 years | |
Machinery and equipment | 7 years | |
Transportation and other facilities | 3 - 15 years |
3_Accounts_receivable_Tables
3. Accounts receivable (Tables) | 12 Months Ended | |||||||||||||
Dec. 31, 2014 | ||||||||||||||
Receivables [Abstract] | ||||||||||||||
Accounts receivable | December 31st | Gross Balance | Allowance | Net Balance | ||||||||||
at end of year | for doubtful accounts | at end of year | ||||||||||||
2012 | 96,715,857 | 4,835,793 | 91,880,065 | |||||||||||
2013 | 108,335,469 | 5,273,786 | 103,061,683 | |||||||||||
2014 | 118,298,998 | 6,204,175 | 112,092,824 | |||||||||||
Allowance for doubtful accounts | Year Ended December 31st | Beginning Balance | Charged to costs and expenses | Write offs and other | Ending Balance | |||||||||
2012 | 4,224,559 | 590,704 | 4,835,793 | |||||||||||
2013 | 4,835,793 | 437,993 | 5,273,786 | |||||||||||
2014 | 5,273,786 | 930,389 | 6,204,175 |
4_Inventories_Tables
4. Inventories (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Notes to Financial Statements | |||||||||||||
Inventory Breakdown | Breakdown of Inventories | ||||||||||||
2014 | 2013 | 2012 | |||||||||||
Raw material | 69,104,388 | 64,583,540 | 46,131,100 | ||||||||||
Finished Goods | 179,605,652 | 167,437,526 | 119,049,524 | ||||||||||
Low-value consumable goods | 46,327,219 | 43,296,466 | 30,926,047 | ||||||||||
Packaging material | 30,722,573 | 28,712,685 | 20,509,061 | ||||||||||
Maintenance material | 15,996,422 | 14,949,927 | 10,678,519 | ||||||||||
Total for the year | 341,756,253 | 318,980,143 | 227,294,252 |
5_Property_plant_and_equipment1
5. Property, plant and equipment & depreciation (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||
Fixed assets and accumulated depreciation | |||||||||||||
Property, plant and equipment | 2014 | 2013 | 2012 | ||||||||||
Buildings and improvements | 123,603,446 | 115,517,239 | 103,140,392 | ||||||||||
Farming facilities | 113,064,212 | 105,667,488 | 94,345,971 | ||||||||||
Machinery and equipment | 14,873,613 | 13,900,573 | 12,411,226 | ||||||||||
Transportation and other facilities | 359,434,553 | 335,920,143 | 299,928,699 | ||||||||||
Windbreak and Sand-break Trees | 404,432,178 | 381,277,766 | 365,843,411 | ||||||||||
Total | 1,015,408,002 | 952,283,209 | 875,669,700 | ||||||||||
Accumulated Depreciation | 110,139,280 | 103,604,301 | 90,534,342 | ||||||||||
Total | 905,268,722 | 848,678,908 | 785,135,358 | ||||||||||
Windbreaks and sand breaks and accumulated depreciation | Windbreak and Sand-break Trees | 2014 | 2013 | 2012 | |||||||||
Wind breaks and sand breaks capitalized (trees) | 322,950,473 | 304,670,258 | 294,353,892 | ||||||||||
Additional Long Term Costs Capitalized | 86,982,781 | 81,673,973 | 71,489,719 | ||||||||||
Total | 409,933,255 | 386,344,231 | 365,843,611 | ||||||||||
Accumulated Depreciation | (5,501,077 | ) | (5,066,465 | ) | (4,685,791 | ) | |||||||
Net Wind Breaks and Sand Breaks | 404,432,178 | 381,277,766 | 361,157,820 | ||||||||||
Depreciation for year | 434,612 | 380,674 | 350,164 |
10_Debt_Tables
10. Debt (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Debt Tables | |||||||||||||||||
Debt | (a) Long term debt | ||||||||||||||||
Collateral | Guarantee | Total | Maturity | ||||||||||||||
2012 | 0 | 0 | 0 | N/A | |||||||||||||
2013 | 0 | 0 | 0 | N/A | |||||||||||||
2014 | 0 | 0 | 0 | N/A | |||||||||||||
(b) Current portion of long term debt | |||||||||||||||||
Collateral | Guarantee | Total | Interest rate | ||||||||||||||
2012 | 3,451,600 | 1,479,226 | 4,930,826 | 7.25 | % | ||||||||||||
2013 | 3,051,600 | 1,379,687 | 4,431,287 | 7.25 | % | ||||||||||||
2014 | 2,051,600 | 1,508,794 | 3,560,394 | 7.25 | % |
13_Restated_Financial_Statemen1
13. Restated Financial Statements, (2011 and 2010) (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||
Changes made to the financial statements | Net Sales | 2011 | 2010 | ||||||
Construction material | 6,121,835 | 5,434,519 | |||||||
Farming | 943,009,599 | 844,019,745 | |||||||
Total | 949,131,434 | 849,454,265 |
15_Segments_Tables
15. Segments (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Segments Tables | |||||||||||||||||
Other segments | Entity level segment | ||||||||||||||||
2014 Sales Breakdown by Subsidiary Unit: Dollar | |||||||||||||||||
Subsidiaries | Net Sales | Cost of Sales | Gross Profit | ||||||||||||||
Gansu Jinta Hengsheng Agricultural Development Co., Ltd. | 148,737,663 | 118,994,758 | 29,742,905 | ||||||||||||||
Gansu Hongtai Agricultural Technology Co., Ltd. | 299,935,038 | 175,574,191 | 25,360,847 | ||||||||||||||
Gansu Jinta Xingsheng Industrial Co., Ltd. | 154,035,388 | 133,419,328 | 20,616,060 | ||||||||||||||
Gansu Jinta Yongsheng Agricultural Development Company. | 153,402,638 | 131,260,081 | 22,142,557 | ||||||||||||||
Gansu Jinta Yuantai Commercial Trading Co., Ltd. | 1,851,287 | 1,423,539 | 427,748 | ||||||||||||||
Gansu Tiaoshan Agricultural-Industrial-Commercial Group Co., Ltd | 320,413,447 | 287,392,964 | 43,020,483 | ||||||||||||||
Gansu Xiaheqing Industrial Co., Ltd. | 23,760,211 | 21,215,581 | 2,544,630 | ||||||||||||||
Total | 1,012,135,672 | 868,280,442 | 143,855,230 | ||||||||||||||
2013 Sales Breakdown by Subsidiary Unit: Dollar | |||||||||||||||||
Subsidiaries | Net Sales | Cost of Sales | Gross Profit | ||||||||||||||
Gansu Jinta Hengsheng Agricultural Development Co., Ltd. | 146,961,967 | 119,955,514 | 27,566,449 | ||||||||||||||
Gansu Hongtai Agricultural Technology Co., Ltd. | 199,538,728 | 173,622,607 | 25,963,203 | ||||||||||||||
Gansu Jinta Xingsheng Industrial Co., Ltd. | 151,820,821 | 129,222,545 | 22,825,132 | ||||||||||||||
Gansu Jinta Yongsheng Agricultural Development Company. | 149,208,966 | 128,082,675 | 21,277,389 | ||||||||||||||
Gansu Jinta Yuantai Commercial Trading Co., Ltd. | 1,935,801 | 1,399,743 | 555,397 | ||||||||||||||
Gansu Tiaoshan Agricultural-Industrial-Commercial Group Co., Ltd | 333,325,391 | 295,685,000 | 36,301,016 | ||||||||||||||
Gansu Xiaheqing Industrial Co., Ltd. | 28,531,956 | 19,877,661 | 8,989,299 | ||||||||||||||
Total | 1,011,323,630 | 867,845,745 | 143,477,886 | ||||||||||||||
2012 Sales Breakdown by Subsidiary Unit: Dollar | |||||||||||||||||
Subsidiaries | Net Sales | Cost of Sales | Gross Profit | ||||||||||||||
Gansu Jinta Hengsheng Agricultural Development Co., Ltd. | 144,363,425 | 118,767,836 | 25,595,589 | ||||||||||||||
Gansu Hongtai Agricultural Technology Co., Ltd. | 196,010,538 | 171,903,571 | 24,106,967 | ||||||||||||||
Gansu Jinta Xingsheng Industrial Co., Ltd. | 149,136,366 | 127,943,114 | 21,193,252 | ||||||||||||||
Gansu Jinta Yongsheng Agricultural Development Company. | 146,570,694 | 126,814,530 | 19,756,164 | ||||||||||||||
Gansu Jinta Yuantai Commercial Trading Co., Ltd. | 1,901,573 | 1,385,884 | 515,689 | ||||||||||||||
Gansu Tiaoshan Agricultural-Industrial-Commercial Group Co., Ltd | 327,092,687 | 293,422,289 | 33,670,398 | ||||||||||||||
Gansu Xiaheqing Industrial Co., Ltd. | 28,027,462 | 19,680,852 | 8,346,610 | ||||||||||||||
Total | 993,102,745 | 859,918,076 | 133,184,669 | ||||||||||||||
Below is a three year comparison chart on these segments | |||||||||||||||||
Year 2014 | Sales | Cost of | |||||||||||||||
Sales % | Profit | Profit | Gross | Gross % | |||||||||||||
Agriculture | 1,003,148,453 | 860,094,655 | 143,053,798 | 14.2 | |||||||||||||
Livestock | 2,700,930 | 2,321,561 | 379,369 | 14 | |||||||||||||
Biotech/Industrial | 6,286,289 | 5,864,226 | 422,063 | 6.7 | |||||||||||||
Total | 1,012,135,672 | 868,280,442 | 143,855,230 | 14.1 | |||||||||||||
Year 2013 | |||||||||||||||||
Sales % | |||||||||||||||||
Agriculture | 1,002,407,738 | 859,673,849 | 142,733,889 | 14.24 | |||||||||||||
Livestock | 2,679,494 | 2,317,621 | 361,873 | 13.5 | |||||||||||||
Biotech/Industrial | 6,236,398 | 5,854,274 | 382,124 | 6.12 | |||||||||||||
Total | 1,011,323,630 | 867,845,745 | 143,477,886 | 14.19 | |||||||||||||
Year 2012 | |||||||||||||||||
Sales % | |||||||||||||||||
Agriculture | 985,234,394 | 852,673,583 | 132,560,811 | 13.45 | |||||||||||||
Livestock | 2,155,983 | 1,834,557 | 321,426 | 14.91 | |||||||||||||
Biotech/Industrial | 5,712,368 | 5,409,936 | 302,432 | 5.29 | |||||||||||||
17_Earnings_per_share_Tables
17. Earnings per share (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Earnings Per Share [Abstract] | |||||||||||||
Earnings per share | Years Ended December 31st, | ||||||||||||
2014 | 2013 | 2012 | |||||||||||
Net income available | |||||||||||||
For common shareholders | 138,935,086 | 136,493,493 | 126,417,222 | ||||||||||
Weighted average shares | |||||||||||||
of common stock | 155,097,355 | 155,097,355 | 155,097,355 | ||||||||||
Basic earnings per share | 0.9 | 0.88 | 0.82 |
2_Summary_of_Significant_Accou3
2. Summary of Significant Accounting Policies (Details) | 12 Months Ended |
Dec. 31, 2014 | |
BuildingAndBuildingImprovements [Member] | MinimumMember | |
Property, Plant and Equipment [Line Items] | |
Estimated useful live | P20Y |
BuildingAndBuildingImprovements [Member] | MaximumMember | |
Property, Plant and Equipment [Line Items] | |
Estimated useful live | P40Y |
Farming Facilities [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful live | P10Y |
Machinery and Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful live | P7Y |
Transportation Equipment [Member] | MinimumMember | |
Property, Plant and Equipment [Line Items] | |
Estimated useful live | P3Y |
Transportation Equipment [Member] | MaximumMember | |
Property, Plant and Equipment [Line Items] | |
Estimated useful live | P15Y |
2_Summary_of_Significant_Accou4
2. Summary of Significant Accounting Policies (Details Narrative) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Summary Of Significant Accounting Policies Details Narrative | |||
Advertising expenses | $766,924 | $754,294 | $731,962 |
3_Accounts_receivable_Details
3. Accounts receivable (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Accounts Receivable Details | |||
Gross Balance at end of year | $96,715,857 | $4,835,793 | $91,880,065 |
Allowance for doubtful accounts | 108,335,469 | 5,273,786 | 103,061,683 |
Net Balance at end of year | $112,094,824 | $103,061,683 | $91,880,065 |
3_Accounts_receivable_Details_
3. Accounts receivable (Details 1) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Accounts Receivable Details 1 | |||
Beginning Balance | $5,273,786 | $4,835,793 | $4,224,559 |
Charged to costs and expenses | 930,389 | 437,993 | 590,704 |
Ending Balance | $6,204,175 | $5,273,786 | $4,835,793 |
4_Inventories_Details
4. Inventories (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Notes to Financial Statements | |||
Raw material | $69,104,388 | $64,583,540 | $46,131,100 |
Finished goods | 179,605,652 | 167,437,526 | 119,049,524 |
Low value consumable goods | 46,327,219 | 43,296,466 | 30,926,047 |
Packaging material | 30,722,573 | 28,712,685 | 20,509,061 |
Maintenance material | 15,996,422 | 14,949,927 | 10,678,519 |
Total | $341,756,253 | $318,980,143 | $227,294,252 |
5_Property_plant_and_equipment2
5. Property, plant and equipment & depreciation (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Property Plant And Equipment Depreciation Details | |||
Buildings and improvements | $123,603,446 | $115,517,239 | $103,140,392 |
Farming facilities | 113,064,212 | 105,667,488 | 94,345,971 |
Machinery and equipment | 14,873,613 | 13,900,573 | 12,411,226 |
Transportation and other facilities | 359,434,553 | 335,920,143 | 299,928,699 |
Windbreak and Sand-break Trees | 404,432,178 | 381,277,766 | 365,843,411 |
Total | 1,015,408,002 | 952,283,209 | 875,669,700 |
Accumulated Depreciation | 110,139,280 | 103,604,301 | 90,534,342 |
Total | $905,268,722 | $848,678,908 | $785,135,358 |
5_Property_plant_and_equipment3
5. Property, plant and equipment & depreciation (Details 1) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Property Plant And Equipment Depreciation Details 1 | |||
Wind breaks and sand breaks capitalized (trees) | $322,950,473 | $304,670,258 | $294,353,892 |
Additional Long Term Costs Capitalized | 86,982,781 | 81,673,973 | 71,489,719 |
Total | 409,933,255 | 386,344,231 | 365,843,611 |
Accumulated Depreciation | -5,501,077 | -5,066,465 | -4,685,791 |
Net Wind Breaks and Sand Breaks | 404,432,178 | 381,277,766 | 361,157,820 |
Depreciation for year | $434,612 | $380,674 | $350,164 |
10_Debt_Details
10. Debt (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Long term debt | $0 | $0 | $0 |
Current portion of long term debt | 3,560,394 | 4,431,287 | 4,930,826 |
Current portion of long term debt interest rate | 7.25% | 7.25% | 7.25% |
Collateral | |||
Long term debt | 0 | 0 | 0 |
Current portion of long term debt | 2,051,600 | 3,051,600 | 3,451,600 |
Guarantee | |||
Long term debt | 0 | 0 | 0 |
Current portion of long term debt | $1,508,794 | $1,379,687 | $1,479,226 |
11_Employee_benefit_plans_Deta
11. Employee benefit plans (Details Narrative) | 12 Months Ended |
Dec. 31, 2014 | |
Employee Benefit Plans Details Narrative | |
Percentage of Payroll set for employee benefits | 14.00% |
Percentage of Payroll paid to insurance agents | 20.00% |
Percentage of Payroll for unemployment insurance | 1.00% |
Percentage of Payroll paid for housing allowance accounts | 10.00% |
13_Restated_Financial_Statemen2
13. Restated Financial Statements, (2011 and 2010) (Details) (USD $) | 12 Months Ended | ||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | |
Net sales | $1,012,135,672 | $1,011,323,630 | $993,102,745 | $949,131,434 | $849,454,265 |
Construction material | |||||
Net sales | 6,121,835 | 5,434,519 | |||
Farming | |||||
Net sales | $943,009,599 | $844,019,745 |
14_Segments_Details
14. Segments (Details) (USD $) | 12 Months Ended | ||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | |
Related Party Transaction [Line Items] | |||||
Net Sales | $1,012,135,672 | $1,011,323,630 | $993,102,745 | $949,131,434 | $849,454,265 |
Cost of Sales | 868,280,442 | 867,845,745 | 859,918,076 | ||
Gross Profit | 143,855,230 | 143,477,886 | 133,184,669 | ||
Gansu Jinta Hengsheng Agricultural Development Company Limited [Member] | |||||
Related Party Transaction [Line Items] | |||||
Net Sales | 148,737,663 | 146,961,967 | 144,363,425 | ||
Cost of Sales | 118,994,758 | 119,955,514 | 118,767,836 | ||
Gross Profit | 29,742,905 | 27,566,449 | 25,595,589 | ||
Gansu Hongtai Agricultural Technology Company Limited [Member] | |||||
Related Party Transaction [Line Items] | |||||
Net Sales | 299,935,038 | 199,538,728 | 196,010,538 | ||
Cost of Sales | 175,574,191 | 173,622,607 | 171,903,571 | ||
Gross Profit | 25,360,847 | 25,963,203 | 24,106,967 | ||
Gansu Jinta Xingsheng Industrial Company Limited [Member] | |||||
Related Party Transaction [Line Items] | |||||
Net Sales | 154,035,388 | 151,820,821 | 149,136,366 | ||
Cost of Sales | 133,419,328 | 129,222,545 | 127,943,114 | ||
Gross Profit | 20,616,060 | 22,825,132 | 21,193,252 | ||
Gansu Jinta Yongsheng Agricultural Development Company [Member] | |||||
Related Party Transaction [Line Items] | |||||
Net Sales | 153,402,638 | 149,208,966 | 146,570,694 | ||
Cost of Sales | 131,260,081 | 128,082,675 | 126,814,530 | ||
Gross Profit | 22,142,557 | 21,277,389 | 19,756,164 | ||
Gansu Jinta Yuantai Commercial Trading Company Limited [Member] | |||||
Related Party Transaction [Line Items] | |||||
Net Sales | 1,851,287 | 1,935,801 | 1,901,573 | ||
Cost of Sales | 1,423,539 | 1,399,743 | 1,385,884 | ||
Gross Profit | 427,748 | 555,397 | 515,689 | ||
Gansu Tiaoshan Agricultural Industrial Commercial Group Company Limited [Member] | |||||
Related Party Transaction [Line Items] | |||||
Net Sales | 320,413,447 | 333,325,391 | 327,092,687 | ||
Cost of Sales | 287,392,964 | 295,685,000 | 293,422,289 | ||
Gross Profit | 43,020,483 | 36,301,016 | 33,670,398 | ||
Gansu Xiaheqing Industrial Company Limited [Member] | |||||
Related Party Transaction [Line Items] | |||||
Net Sales | 23,760,211 | 28,531,956 | 28,027,462 | ||
Cost of Sales | 21,215,581 | 19,877,661 | 19,680,852 | ||
Gross Profit | $2,544,630 | $8,989,299 | $8,346,610 |
14_Segments_Details_1
14. Segments (Details 1) (USD $) | 12 Months Ended | ||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | |
Segment Reporting Information [Line Items] | |||||
Net Sales | $1,012,135,672 | $1,011,323,630 | $993,102,745 | $949,131,434 | $849,454,265 |
Cost of Sales | 868,280,442 | 867,845,745 | 859,918,076 | ||
Gross Profit | 143,855,230 | 143,477,886 | 133,184,669 | ||
Gross Profit % | 14.10% | 14.19% | 13.41% | ||
Agriculture [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | 1,003,148,453 | 1,002,407,738 | 985,234,394 | ||
Cost of Sales | 860,094,655 | 859,673,849 | 852,673,583 | ||
Gross Profit | 143,053,798 | 142,733,889 | 132,560,811 | ||
Gross Profit % | 14.20% | 14.24% | 13.45% | ||
Livestock [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | 2,700,930 | 2,679,494 | 2,155,983 | ||
Cost of Sales | 2,321,561 | 2,317,621 | 1,834,557 | ||
Gross Profit | 379,369 | 361,873 | 321,426 | ||
Gross Profit % | 14.00% | 13.50% | 14.91% | ||
Biotechnology [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | 6,286,289 | 6,236,398 | 5,712,368 | ||
Cost of Sales | 5,864,226 | 5,854,274 | 5,409,936 | ||
Gross Profit | $422,063 | $382,124 | $302,432 | ||
Gross Profit % | 6.70% | 6.12% | 5.29% |
17_Earnings_per_share_Details
17. Earnings per share (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Earnings Per Share Details | |||
Net income available For common shareholders | $138,935,086 | $136,493,493 | $126,417,222 |
Weighted average shares of common stock | 155,097,355 | 155,097,355 | 155,097,355 |
Basic earnings per share | $0.90 | $0.88 | $0.82 |