BIMI International Medical (BIMI) 10-Q 13 Nov 15 2015 Q3 Quarterly report Financial data

Document And Entity Information

Document And Entity Information - shares	9 Months Ended
	Sep. 30, 2015	Oct. 31, 2015
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2015
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	Q3
Entity Registrant Name	NF Energy Saving Corp
Entity Central Index Key	1,213,660
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Trading Symbol	NFEC
Entity Common Stock, Shares Outstanding		6,553,289

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Current assets:
Cash and cash equivalents	$ 304,854	$ 1,304,130
Restricted cash	0	1,950,110
Accounts receivable, net	7,331,090	8,352,369
Retention receivable	790,412	743,006
Inventories	7,231,646	5,623,318
Prepayments and other receivables	654,950	864,317
Total current assets	16,312,952	18,837,250
Non-current assets:
Plant and equipment, net	13,309,271	14,042,426
Land use rights, net	2,874,172	3,018,029
Construction in progress	12,316,778	12,407,226
TOTAL ASSETS	44,813,173	48,304,931
Current liabilities:
Accounts payable, trade	5,303,092	5,805,720
Short-term bank borrowings	6,452,831	8,450,475
Note payable, related party	0	1,500,000
Amount due to a related party	431,682	431,682
Other payables and accrued liabilities	838,217	783,895
Total current liabilities	13,025,822	16,971,772
TOTAL LIABILITIES	$ 13,025,822	$ 16,971,772
Commitments and contingencies
Stockholders’ equity:
Common stock, $0.001 par value; 50,000,000 shares authorized; 6,553,289 and 5,719,147 shares issued and outstanding as of September 30, 2015 and December 31, 2014, respectively	$ 6,553	$ 5,719
Additional paid-in capital	11,605,145	9,887,646
Statutory reserve	2,227,634	2,227,634
Accumulated other comprehensive income	3,460,348	4,511,915
Retained earnings	14,487,671	14,700,245
Total stockholders’ equity	31,787,351	31,333,159
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$ 44,813,173	$ 48,304,931

CONDENSED CONSOLIDATED BALANCE3

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Sep. 30, 2015	Dec. 31, 2014
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	6,553,289	5,719,147
Common stock, shares outstanding	6,553,289	5,719,147

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
REVENUE, NET:
Product	$ 2,599,325	$ 2,907,301	$ 5,026,510	$ 6,076,053
Services	21,949	36,646	85,568	214,293
Total revenues, net	2,621,274	2,943,947	5,112,078	6,290,346
COST OF REVENUES:
Cost of products	2,231,389	2,035,094	4,061,616	4,732,807
Cost of services	16,758	22,819	44,157	160,670
Total cost of revenues	2,248,147	2,057,913	4,105,773	4,893,477
GROSS PROFIT	373,127	886,034	1,006,305	1,396,869
OPERATING EXPENSES:
Sales and marketing	51,850	15,476	69,013	45,399
General and administrative	239,824	389,391	861,008	1,167,085
Total operating expenses	291,674	404,867	930,021	1,212,484
INCOME FROM OPERATIONS	81,453	481,167	76,284	184,385
Other (expense) income:
Other income	16,749	6,386	18,025	6,520
Interest income	(16)	958	11,875	32,625
Interest expense	(104,616)	(106,106)	(318,385)	(315,475)
Total other expense	(87,883)	(98,762)	(288,485)	(276,330)
(LOSS) INCOME BEFORE INCOME TAXES	(6,430)	382,405	(212,201)	(91,945)
Income tax expense	(89)	(54,721)	(373)	(64,841)
NET (LOSS) INCOME	(6,519)	327,684	(212,574)	(156,786)
Other comprehensive income:
- Foreign currency translation (loss) gain	(1,407,073)	8,481	(1,051,567)	(232,656)
COMPREHENSIVE (LOSS) INCOME	$ (1,413,592)	$ 336,165	$ (1,264,141)	$ (389,442)
Net loss per share- Basic	$ 0	$ (0.06)	$ (0.04)	$ (0.03)
Net loss per share- Diluted	$ 0	$ (0.06)	$ (0.04)	$ (0.03)
Weighted average common shares outstanding- Basic	6,219,632	5,708,158	5,969,390	5,656,096
Weighted average common shares outstanding- Diluted	6,219,632	5,708,158	5,969,390	5,656,096

CONDENSED CONSOLIDATED STATEME5

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Cash flows from operating activities:
Net loss	$ (212,574)	$ (156,786)
Adjustments to reconcile net income to net cash used in operating activities
Depreciation and amortization	932,453	627,048
Stockbased compensation	0	190,250
Amortization of deferred compensation	0	94,052
Change in operating assets and liabilities:
Accounts and retention receivable	707,283	(1,947,472)
Inventories	(1,837,928)	(1,842,510)
Prepayments and other receivables	188,067	151,601
Accounts payable	(328,971)	2,020,968
Income tax payable	0	58,937
Other payables and accrued liabilities	296,244	148,760
Net cash used in operating activities	(255,426)	(655,152)
Cash flows from investing activities:
Purchase of plant and equipment	(892,817)	(77,061)
Payments on construction in progress	0	(221,866)
Net cash used in investing activities	(892,817)	(298,927)
Cash flows from financing activities:
Decrease in restricted cash	1,943,981
Proceeds from short-term bank borrowings	2,753,973	5,203,057
Repayment on short-term bank borrowings	(4,535,956)	(4,552,675)
Net cash provided by financing activities	161,998	650,382
Effect on exchange rate change on cash and cash equivalents	(13,031)	(6,285)
NET CHANGE IN CASH AND CASH EQUIVALENTS	(999,276)	(309,982)
BEGINNING OF PERIOD	1,304,130	1,020,760
END OF PERIOD	304,854	710,778
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for income taxes	299	5,797
Cash paid for interest	288,176	247,975
NON-CASH FINANCING AND INVESTING TRANSACTIONS:
Conversion of note and accrued interest into shares	$ 1,718,333	$ 0

CONDENSED CONSOLIDATED STATEME6

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY - 9 months ended Sep. 30, 2015 - USD ($)	Total	Common stock	Additional paid-in capital	Statutory reserve	Accumulated other comprehensive income	Retained earnings
Balance at Dec. 31, 2014	$ 31,333,159	$ 5,719	$ 9,887,646	$ 2,227,634	$ 4,511,915	$ 14,700,245
Balance (in shares) at Dec. 31, 2014		5,719,147
Shares issued for settlement of note payable and accrued interest	1,718,333	$ 834	1,717,499	0	0	0
Shares issued for settlement of note payable and accrued interest (in shares)		834,142
Foreign currency translation adjustment	(1,051,567)	$ 0	0	0	(1,051,567)	0
Net loss for the period	(212,574)	0	0	0	0	(212,574)
Balance at Sep. 30, 2015	$ 31,787,351	$ 6,553	$ 11,605,145	$ 2,227,634	$ 3,460,348	$ 14,487,671
Balance (in shares) at Sep. 30, 2015		6,553,289

BASIS OF PRESENTATION

BASIS OF PRESENTATION	9 Months Ended
	Sep. 30, 2015
Basis Of Presentation [Abstract]
BASIS OF PRESENTATION	NOTE–1 BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements have been prepared by management in accordance with both accounting principles generally accepted in the United States (“GAAP”), and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Certain information and note disclosures normally included in audited financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading. In the opinion of management, the consolidated balance sheet as of December 31, 2014 which has been derived from audited financial statements and these unaudited condensed consolidated financial statements reflect all normal and recurring adjustments considered necessary to state fairly the results for the periods presented. The results for the period ended September 30, 2015 are not necessarily indicative of the results to be expected for the entire fiscal year ending December 31, 2015 or for any future period. These unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the Management’s Discussion and the audited financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2014.

ORGANIZATION AND BUSINESS BACKG

ORGANIZATION AND BUSINESS BACKGROUND	9 Months Ended
	Sep. 30, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]
ORGANIZATION AND BUSINESS BACKGROUND	NOTE –; NF Energy Saving Corporation (the “Company” or “NFEC”) was incorporated in the State of Delaware in the name of Galli Process, Inc. on October 31, 2000. On February 7, 2002, the Company changed its name to “Global Broadcast Group, Inc.” On November 12, 2004, the Company changed its name to “Diagnostic Corporation of America.” On March 15, 2007, the Company changed its name to “NF Energy Saving Corporation of America.” On August 24, 2009, the Company further changed its name to “NF Energy Saving Corporation.” The Company, through its subsidiaries, mainly engages in the production of heavy industrial components and products such as valves and the provision of technical service and re-engineering projects in the energy saving related industry in the People’s Republic of China (the “PRC”). All the customers are located in the PRC. Name Place of incorporation and kind of legal entity Principal activities and place of operation Particulars of issued/ registered share capital Effective interest held Liaoning Nengfa Weiye Energy Technology Co. Ltd (“Nengfa Energy”) US$ 5,000,000 100 NFEC and its subsidiary are hereinafter referred to as (the “Company”).

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	9 Months Ended
	Sep. 30, 2015
Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	NOTE – The accompanying condensed consolidated financial statements reflect the application of certain significant accounting policies as described in this note and elsewhere in the accompanying condensed consolidated financial statements and notes. Use of estimates In preparing these condensed consolidated financial statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheet and revenues and expenses during the periods reported. Actual results may differ from these estimates. · Basis of consolidation The condensed consolidated financial statements include the financial statements of NFEC and its subsidiary. All significant inter-company balances and transactions within the Company have been eliminated upon consolidation. · Cash and cash equivalents Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments. · Accounts receivable Accounts receivable are recorded at the invoiced amount and do not bear interest, which are due within contractual payment terms, generally 30 90 90 Retention receivable Retention receivable is the amount withheld by a customer based upon 5 10 12 · Inventories Inventories are stated at the lower of cost or market value (net realizable value), cost being determined on a weighted average method. Costs include material, labor and manufacturing overhead costs. The Company quarterly reviews historical sales activity to determine excess, slow moving items and potentially obsolete items and also evaluates the impact of any anticipated changes in future demand. The Company provides inventory allowances based on excess and obsolete inventories determined principally by customer demand. As of September 30, 2015, the Company did not record an allowance for obsolete inventories, nor have there been any write-offs. · Construction in progress Construction in progress is stated at historical cost, which includes acquisition of land use rights, cost of construction, purchases of plant and equipment and other direct costs attributable to the construction of a new manufacturing facility in Yinzhou District Industrial Park, Tieling City, Liaoning Province, the PRC. Construction in progress is not depreciated until such time as the assets are completed and put into operational use. No capitalized interest is incurred during the period of construction. · Land use rights All land in the PRC is owned by the PRC government. The government in the PRC, according to the relevant PRC law, may sell the right to use the land for a specified period of time. Thus, the Company’s land purchase in the PRC is considered to be leasehold land and is stated at cost less accumulated amortization and any recognized impairment loss. Amortization is provided over the term of the land use right agreement on a straight-line basis, which is 50 2059 Amortization expense for the three months ended September 30, 2015 and 2014 was $ 16,385 16,742 Amortization expense for the nine months ended September 30, 2015 and 2014 was $ 50,142 50,327 Year ending September 30: 2016 $ 64,953 2017 64,953 2018 64,953 2019 64,953 2020 64,953 Thereafter 2,549,407 Total: $ 2,874,172 · Plant and equipment Plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Expected useful life Residual value Building 30 – 50 years 5% Plant and machinery 10 – 20 years 5% Furniture, fixture and equipment 5 – 8 years 5% Expenditure for repairs and maintenance is expensed as incurred. When assets have been retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations. Depreciation expense for the three months ended September 30, 2015 and 2014 was $ 322,780 192,385 Depreciation expense for the nine months ended September 30, 2015 and 2014 was $ 882,311 576,721 · Impairment of long-lived assets In accordance with the provisions of ASC Topic 360, “ Impairment or Disposal of Long-Lived Assets Revenue recognition The Company offers the following products and service to its customers: (a) Energy saving flow control equipment; and (b) Energy project management and sub-contracting service “Revenue Recognition” (a) Sale of products The Company derives a majority of its revenues from the sale of energy saving flow control equipment. Generally, these products are manufactured and configured to customer requirements. The Company typically produces and builds the energy saving flow control equipment for customers in a period from 1 6 The Company recognizes revenue from the sale of such finished products upon delivery to the customer, whereas the title and risk of loss are fully transferred to the customers. The Company records its revenues, net of value added taxes (“VAT”). The Company is subject to VAT which is levied on the majority of the products at the rate of 17 (b) Service revenue Service revenue is primarily derived from energy-saving technical services or project management or sub-contracting services that are not an element of an arrangement for the sale of products. These services are generally billed on a time-cost plus basis, for a period of service time from 2 3 (c) Interest income Interest income is recognized on a time apportionment basis, taking into account the principal amounts outstanding and the interest rates applicable. ⋅ Comprehensive income ASC Topic 220, “Comprehensive Income”, Income taxes Income taxes are determined in accordance with the provisions of ASC Topic 740, “Income Taxes ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50 For the three and nine months ended September 30, 2015 and 2014, the Company did not have any interest and penalties associated with tax positions. As of September 30, 2015, the Company did not have any significant unrecognized uncertain tax positions. The Company conducts the majority of its business in the PRC and is subject to tax in this jurisdiction. As a result of its business activities, the Company files tax returns that are subject to examination by the foreign tax authority. ⋅ Product warranty Under the terms of the contracts, the Company offers its customers with a free product warranty on a case-by-case basis, depending upon the type of customers, nature and size of the infrastructure projects. Under such arrangements, a portion of the project contract balance (usually 5% to 10% of contract value) is withheld by a customer from 12 24 ⋅ Net loss per share The Company calculates net income per share in accordance with ASC Topic 260, “Earnings per Share.” ⋅ Foreign currencies translation Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statement of operations. The reporting currency of the Company is the United States Dollar ("US$"). The Company's subsidiaries in the PRC maintain their books and records in their local currency, the Renminbi Yuan ("RMB"), which is the functional currency as being the primary currency of the economic environment in which these entities operate. In general, for consolidation purposes, assets and liabilities of its subsidiaries whose functional currency is not the US$ are translated into US$, in accordance with ASC Topic 830-30, “ Translation of Financial Statement September 30, 2015 September 30, 2014 Period-end RMB:US$1 exchange rate 6.3538 6.1560 Average period RMB:US$1 exchange rate 6.1729 6.1502 ⋅ Related parties Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operational decisions. Companies are also considered to be related if they are subject to common control or common significant influence. ⋅ Segment reporting ASC Topic 280, “ Segment Reporting ⋅ Fair value of financial instruments The carrying value of the Company’s financial instruments (excluding short-term bank borrowing and note payable): cash and cash equivalents, accounts and retention receivable, prepayments and other receivables, accounts payable, income tax payable, amount due to a related party, other payables and accrued liabilities approximate at their fair values because of the short-term nature of these financial instruments. Management believes, based on the current market prices or interest rates for similar debt instruments, the fair value of short-term bank borrowings and note payable approximate the carrying amount. The Company also follows the guidance of the ASC Topic 820-10, “ Fair Value Measurements and Disclosures • Level 1 : Inputs are based upon unadjusted quoted prices for identical instruments traded in active markets; • Level 2 : Inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques (e.g. Black-Scholes Option-Pricing model) for which all significant inputs are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Where applicable, these models project future cash flows and discount the future amounts to a present value using market-based observable inputs; and • Level 3 : Inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques, including option pricing models and discounted cash flow models. Fair value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates. ⋅ Recent accounting pronouncements The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and does not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.

ACCOUNTS AND RETENTION RECEIVAB

ACCOUNTS AND RETENTION RECEIVABLES	9 Months Ended
	Sep. 30, 2015
Accounts And Retention Receivable [Abstract]
ACCOUNTS AND RETENTION RECEIVABLE	NOTE – September 30, 2015 December 31, 2014 Accounts receivable, cost $ 7,676,152 $ 8,708,662 Retention receivable, cost 790,412 743,006 8,466,564 9,451,668 Less: allowance for doubtful accounts (345,062) (356,293) Accounts and retention receivable, net $ 8,121,502 $ 9,095,375 Up to November 2015, the Company has subsequently recovered from approximately 5.57

INVENTORY

INVENTORY	9 Months Ended
	Sep. 30, 2015
Inventory, Net [Abstract]
INVENTORY	NOTE – September 30, 2015 December 31, 2014 Raw materials $ 850,296 $ 1,313,987 Work-in-process 2,098,762 721,798 Finished goods 4,282,588 3,587,533 $ 7,231,646 $ 5,623,318 For the three and nine months ended September 30, 2015 and 2014, no allowance for obsolete inventories was recorded by the Company. Finished goods are expected to be delivered to the customer in the next twelve months.

CONSTRUCTION IN PROGRESS

CONSTRUCTION IN PROGRESS	9 Months Ended
	Sep. 30, 2015
Construction In Progress [Abstract]
CONSTRUCTION IN PROGRESS	NOTE – In 2008, the Company received approval from the local government to construct a new manufacturing facility for energy-saving products and equipment in Yinzhou District Industrial Park, Tieling City, Liaoning Province, the PRC. Total estimated construction cost of a new manufacturing facility is approximately $ 24 The first phase of construction project was completed and began its operations in December 2012 2013

SHORT-TERM BANK BORROWINGS

SHORT-TERM BANK BORROWINGS	9 Months Ended
	Sep. 30, 2015
Debt Disclosure [Abstract]
SHORT-TERM BANK BORROWINGS	NOTE – September 30, 2015 December 31, 2014 Payable to financial institutions in the PRC: Demand bank notes: Equivalent to RMB24,000,000 due in March 2015, which is collateralized by its restricted cash and guaranteed by its vendor and bears the handling fee equal to 0.05% of its face value. $ - $ 3,900,219 Equivalent to RMB1,000,000 due in January 24, 2016, which is collateralized by its restricted cash and guaranteed by its vendor and bears the handling fee equal to 0.05% of its face value. $ 157,386 $ - Short-term borrowings: Equivalent to RMB21,000,000 with interest rate at 1.2 times of the Bank of China Benchmark Lending Rate, monthly payable, due in March 2015, which is guaranteed by its vendors and secured by land use right - 3,412,692 Equivalent to RMB7,000,000 with interest rate at 1.2 times of the Bank of China Benchmark Lending Rate, monthly payable, due in March 2015, which is guaranteed by its vendor - 1,137,564 Equivalent to RMB28,000,000 with interest rate at 6.2% per annum, monthly payable, due March 19, 2016, which is guaranteed by its vendor and the director of the Company 4,406,812 - Equivalent to RMB12,000,000 with interest rate at 6.2% per annum, monthly payable, due March 19, 2016, which is guaranteed by its vendor and the director of the Company 1,888,633 - Total short-term bank borrowings $ 6,452,831 $ 8,450,475 The effective Bank of China Benchmark Lending rate is 6 6

AMOUNT DUE TO A RELATED PARTY

AMOUNT DUE TO A RELATED PARTY	9 Months Ended
	Sep. 30, 2015
Related Party Transactions [Abstract]
AMOUNT DUE TO A RELATED PARTY	NOTE – As of September 30, 2015, the amount due to a related party represented temporary advances made by the Company’s major stockholder, Pelaris International Ltd, which is controlled by Ms. Li Hua Wang (the Company’s CFO) and Mr. Gang Li (the Company’s CEO), which was unsecured, interest-free with no fixed repayment term. Imputed interest on this amount is considered insignificant.

OTHER PAYABLES AND ACCRUED LIAB

OTHER PAYABLES AND ACCRUED LIABILITIES	9 Months Ended
	Sep. 30, 2015
Payables and Accruals [Abstract]
OTHER PAYABLES AND ACCRUED LIABILITIES	NOTE – Other payables and accrued liabilities consisted of the following: September 30, 2015 December 31, 2014 (Unaudited) (Audited) Payable to equipment vendors $ 184,428 $ 153,298 Customer deposits 361,887 131,213 Value added tax payable 7,147 2,003 Accrued operating expenses 205,107 414,565 Accrued salary 791 13,387 Other payable 78,857 69,429 $ 838,217 $ 783,895

INCOME TAXES

INCOME TAXES	9 Months Ended
	Sep. 30, 2015
Income Tax Disclosure [Abstract]
INCOME TAXES	NOTE – NFEC is registered in the State of Delaware and is subject to the tax laws of United States of America. As of September 30, 2015, the operation in the United States of America incurred $ 3,195,884 2034 1,086,601 The Company’s subsidiaries operating in the PRC are subject to the Corporate Income Tax Law of the People’s Republic of China at a unified income tax rate of 25 Nine months ended September 30, 2015 2014 (Loss) income before income taxes from PRC operation $ (138,865) $ 314,555 Statutory income tax rate 25 % 25 % Income tax expense at statutory rate (34,716) 78,639 Effect from non-deductible items 35,089 (17,652) Tax adjustments - 3,854 Income tax expense $ 373 $ 64,841

STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY	9 Months Ended
	Sep. 30, 2015
Stockholders' Equity Note [Abstract]
STOCKHOLDERS' EQUITY	NOTE – On May 7, 2015, the Company entered into an Exchange Agreement with Cloverbay International Ltd. (“Cloverbay”), a company controlled by Gang Li, the Company’s Chairman and Chief Executive Officer, and Lihua Wang, the Company’s Chief Financial Officer, to convert an aggregate $ 1,718,333 834,142 2.06 As of September 30, 2015, the Company had a total of 6,553,289

SEGMENT INFORMATION

SEGMENT INFORMATION	9 Months Ended
	Sep. 30, 2015
Segment Reporting [Abstract]
SEGMENT INFORMATION	NOTE – The Company’s business units have been aggregated into two reportable segments, as defined by ASC Topic 280: · Heavy manufacturing business – production of valves components and the provision of valve improvement and engineering services; and · Energy-saving related business – production of wind-energy equipment, provision of energy-saving related re-engineering and technical services and long-term construction project. The Company operates these business segments in the PRC and all of the identifiable assets of the Company are located in the PRC during the periods presented. The accounting policies of the segments are the same as those described in the summary of significant accounting policies (see Note 3). The Company had no inter-segment sales for the three and nine months ended September 30, 2015 and 2014. The Company’s reportable segments are strategic business units that offer different products and services. They are managed separately because each business requires different technology and marketing strategies. Summarized financial information concerning the Company’s reportable segments is shown in the following table for the three and nine months ended September 30, 2015 and 2014: Three months ended September 30, 2015 Heavy Energy-saving manufacturing business related business Total Operating revenues, net: - Products $ 2,599,325 $ - $ 2,599,325 - Services 21,949 - 21,949 Total operating revenues 2,621,274 - 2,621,274 Cost of revenues 2,248,147 - 2,248,147 Gross profit 373,127 - 373,127 Depreciation and amortization 344,791 - 344,791 Total assets 44,813,173 - 44,813,173 Expenditure for long-lived assets $ 722,148 $ - $ 722,148 Nine months ended September 30, 2015 Heavy Energy-saving manufacturing business related business Total Operating revenues, net: - Products $ 5,026,510 $ - $ 5,026,510 - Services 85,568 - 85,568 Total operating revenues 5,112,078 - 5,112,078 Cost of revenues 4,105,773 - 4,105,773 Gross profit 1,006,305 - 1,006,305 Depreciation and amortization 932,453 - 932,453 Total assets 44,813,173 - 44,813,173 Expenditure for long-lived assets $ 892,817 $ - $ 892,817 Three months ended September 30, 2014 Heavy Energy-saving manufacturing business related business Total Operating revenues, net: - Products $ 2,465,375 $ 441,926 $ 2,907,301 - Services 36,646 - 36,646 Total operating revenues 2,502,021 441,926 2,943,947 Cost of revenues (1,641,001) (416,912) (2,057,913) Gross profit 747,203 25,014 886,034 Depreciation and amortization 209,127 - 209,127 Total assets 45,389,340 - 45,389,340 Expenditure for long-lived assets $ 298,927 $ - $ 298,927 Nine months ended September 30, 2014 Heavy Energy-saving manufacturing business related business Total Operating revenues, net: - Products $ 5,634,127 $ 441,926 $ 6,076,053 - Services 214,293 - 214,293 Total operating revenues 5,848,420 441,926 6,290,346 Cost of revenues (4,476,565) (416,912) (4,893,477) Gross profit 1,371,855 25,014 1,396,869 Depreciation and amortization 627,048 - 627,048 Total assets 45,389,340 - 45,389,340 Expenditure for long-lived assets $ 298,927 $ - $ 298,927 All long-lived assets are located in the PRC.

CONCENTRATIONS OF RISK

CONCENTRATIONS OF RISK	9 Months Ended
	Sep. 30, 2015
Risks and Uncertainties [Abstract]
CONCENTRATIONS OF RISK	NOTE – The Company is exposed to the following concentrations of risk: (a) Major customers Three months ended September 30, 2015 September 30, 2015 Percentage Accounts and retention Customers Revenues of revenues receivable Customer A $ 1,959,525 75 % $ 5,848,728 Nine months ended September 30, 2015 September 30, 2015 Percentage Accounts and retention Customers Revenues of revenues receivable Customer A $ 4,217,987 83 % $ 5,848,728 For the three and nine months ended September 30, 2014, the customers who accounted for 10% or more of the Company’s revenues and its outstanding receivable balances as at period-end dates, are presented as follows: Three months ended September 30, 2014 September 30, 2014 Percentage Accounts and retention Customers Revenues of revenues receivable Customer A $ 2,184,447 74 % $ 5,919,725 Customer D 441,926 15 % - Total: $ 2,626,373 89 % Total: $ 5,919,725 Nine months ended September 30, 2014 September 30, 2014 Percentage Accounts and retention Customers Revenues of revenues receivable Customer A $ 5,014,743 80 % $ 5,919,725 (b) Major vendors 10 Three months ended September 30, 2015 September 30, 2015 Percentage Accounts Vendors Purchases of purchases payable Vendor F $ 210,118 19 % $ 360,196 Vendor J 165,392 15 % 411,707 Total: $ 375,510 34 % Total: $ 771,903 Nine months ended September 30, 2015 September 30, 2015 Percentage Accounts Vendors Purchases of purchases payable Vendor F $ 689,239 17 % $ 360,196 Vendor J 462,314 12 % 411,707 Total: $ 1,151,553 29 % Total: $ 771,903 Three months ended September 30, 2014 September 30, 2014 Percentage Accounts Vendors Purchases of purchases payable Vendor H 423,769 14 % 375,916 Vendor I 416,912 14 % 20,143 Vendor J 306,158 10 % 241,805 Total: $ 1,146,839 38 % Total: $ 637,864 Nine months ended September 30, 2014 September 30, 2014 Percentage Accounts Vendors Purchases of purchases payable Vendor F $ 557,495 10 % Total: $ 241,249 All vendors are located in the PRC. (c) Credit risk Financial instruments that are potentially subject to credit risk consist principally of trade receivables. The Company believes the concentration of credit risk in its trade receivables is substantially mitigated by its ongoing credit evaluation process and relatively short collection terms. The Company does not generally require collateral from customers. The Company evaluates the need for an allowance for doubtful accounts based upon factors surrounding the credit risk of specific customers, historical trends and other information. (d) Interest rate risk As the Company has no significant interest-bearing assets, the Company’s income and operating cash flows are substantially independent of changes in market interest rates. The Company’s interest-rate risk arises from borrowing under notes and bank borrowings. The Company manages interest rate risk by varying the issuance and maturity dates variable rate debt, limiting the amount of variable rate debt, and continually monitoring the effects of market changes in interest rates. As of September 30, 2015, short-term bank borrowings were at variable rates. (e) Exchange rate risk The reporting currency of the Company is US$, to date the majority of the revenues and costs are denominated in RMB and a significant portion of the assets and liabilities are denominated in RMB. As a result, the Company is exposed to foreign exchange risk as its revenues and results of operations may be affected by fluctuations in the exchange rate between US$ and RMB. If RMB depreciates against US$, the value of RMB revenues and assets as expressed in US$ financial statements will decline. The Company does not hold any derivative or other financial instruments that expose to substantial market risk. (f) Economic and political risks The Company's operations are conducted in the PRC. Accordingly, the Company's business, financial condition and results of operations may be influenced by the political, economic and legal environment in the PRC, and by the general state of the PRC economy. The Company's operations in the PRC are subject to special considerations and significant risks not typically associated with companies in North America and Western Europe. These include risks associated with, among others, the political, economic and legal environment and foreign currency exchange. The Company's results may be adversely affected by changes in the political and social conditions in the PRC, and by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion, remittances abroad, and rates and methods of taxation.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	9 Months Ended
	Sep. 30, 2015
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	NOTE – As of September 30, 2015, there were no commitments and contingencies involved.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	9 Months Ended
	Sep. 30, 2015
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	NOTE – The Company evaluated subsequent events through the date the financial statements were issued and filed with this Form 10-Q. There were no subsequent events that required recognition or disclosure.

SUMMARY OF SIGNIFICANT ACCOUN22

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	9 Months Ended
	Sep. 30, 2015
Accounting Policies [Abstract]
Use of estimates	Use of estimates In preparing these condensed consolidated financial statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheet and revenues and expenses during the periods reported. Actual results may differ from these estimates.
Basis of consolidation	· Basis of consolidation The condensed consolidated financial statements include the financial statements of NFEC and its subsidiary. All significant inter-company balances and transactions within the Company have been eliminated upon consolidation.
Cash and cash equivalents	· Cash and cash equivalents Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments.
Accounts receivable	· Accounts receivable Accounts receivable are recorded at the invoiced amount and do not bear interest, which are due within contractual payment terms, generally 30 90 90
Retention receivable	Retention receivable Retention receivable is the amount withheld by a customer based upon 5 10 12
Inventories	· Inventories Inventories are stated at the lower of cost or market value (net realizable value), cost being determined on a weighted average method. Costs include material, labor and manufacturing overhead costs. The Company quarterly reviews historical sales activity to determine excess, slow moving items and potentially obsolete items and also evaluates the impact of any anticipated changes in future demand. The Company provides inventory allowances based on excess and obsolete inventories determined principally by customer demand. As of September 30, 2015, the Company did not record an allowance for obsolete inventories, nor have there been any write-offs.
Construction in progress	· Construction in progress Construction in progress is stated at historical cost, which includes acquisition of land use rights, cost of construction, purchases of plant and equipment and other direct costs attributable to the construction of a new manufacturing facility in Yinzhou District Industrial Park, Tieling City, Liaoning Province, the PRC. Construction in progress is not depreciated until such time as the assets are completed and put into operational use. No capitalized interest is incurred during the period of construction.
Land use rights	· Land use rights All land in the PRC is owned by the PRC government. The government in the PRC, according to the relevant PRC law, may sell the right to use the land for a specified period of time. Thus, the Company’s land purchase in the PRC is considered to be leasehold land and is stated at cost less accumulated amortization and any recognized impairment loss. Amortization is provided over the term of the land use right agreement on a straight-line basis, which is 50 2059 Amortization expense for the three months ended September 30, 2015 and 2014 was $ 16,385 16,742 Amortization expense for the nine months ended September 30, 2015 and 2014 was $ 50,142 50,327 Year ending September 30: 2016 $ 64,953 2017 64,953 2018 64,953 2019 64,953 2020 64,953 Thereafter 2,549,407 Total: $ 2,874,172
Plant and equipment	· Plant and equipment Plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Expected useful life Residual value Building 30 – 50 years 5% Plant and machinery 10 – 20 years 5% Furniture, fixture and equipment 5 – 8 years 5% Expenditure for repairs and maintenance is expensed as incurred. When assets have been retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations. Depreciation expense for the three months ended September 30, 2015 and 2014 was $ 322,780 192,385 Depreciation expense for the nine months ended September 30, 2015 and 2014 was $ 882,311 576,721
Impairment of long-lived assets	· Impairment of long-lived assets In accordance with the provisions of ASC Topic 360, “ Impairment or Disposal of Long-Lived Assets
Revenue recognition	Revenue recognition The Company offers the following products and service to its customers: (a) Energy saving flow control equipment; and (b) Energy project management and sub-contracting service In accordance with the ASC Topic 605, “Revenue Recognition” (a) Sale of products The Company derives a majority of its revenues from the sale of energy saving flow control equipment. Generally, these products are manufactured and configured to customer requirements. The Company typically produces and builds the energy saving flow control equipment for customers in a period from 1 6 The Company recognizes revenue from the sale of such finished products upon delivery to the customer, whereas the title and risk of loss are fully transferred to the customers. The Company records its revenues, net of value added taxes (“VAT”). The Company is subject to VAT which is levied on the majority of the products at the rate of 17 (b) Service revenue Service revenue is primarily derived from energy-saving technical services or project management or sub-contracting services that are not an element of an arrangement for the sale of products. These services are generally billed on a time-cost plus basis, for a period of service time from 2 3 (c) Interest income Interest income is recognized on a time apportionment basis, taking into account the principal amounts outstanding and the interest rates applicable.
Comprehensive income	⋅ Comprehensive income ASC Topic 220, “Comprehensive Income”,
Income taxes	Income taxes Income taxes are determined in accordance with the provisions of ASC Topic 740, “Income Taxes ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50 For the three and nine months ended September 30, 2015 and 2014, the Company did not have any interest and penalties associated with tax positions. As of September 30, 2015, the Company did not have any significant unrecognized uncertain tax positions. The Company conducts the majority of its business in the PRC and is subject to tax in this jurisdiction. As a result of its business activities, the Company files tax returns that are subject to examination by the foreign tax authority.
Product warranty	⋅ Product warranty Under the terms of the contracts, the Company offers its customers with a free product warranty on a case-by-case basis, depending upon the type of customers, nature and size of the infrastructure projects. Under such arrangements, a portion of the project contract balance (usually 5% to 10% of contract value) is withheld by a customer from 12 24
Net loss per share	⋅ Net loss per share The Company calculates net income per share in accordance with ASC Topic 260, “Earnings per Share.”
Foreign currencies translation	⋅ Foreign currencies translation Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statement of operations. The reporting currency of the Company is the United States Dollar ("US$"). The Company's subsidiaries in the PRC maintain their books and records in their local currency, the Renminbi Yuan ("RMB"), which is the functional currency as being the primary currency of the economic environment in which these entities operate. In general, for consolidation purposes, assets and liabilities of its subsidiaries whose functional currency is not the US$ are translated into US$, in accordance with ASC Topic 830-30, “ Translation of Financial Statement September 30, 2015 September 30, 2014 Period-end RMB:US$1 exchange rate 6.3538 6.1560 Average period RMB:US$1 exchange rate 6.1729 6.1502
Related parties	⋅ Related parties Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operational decisions. Companies are also considered to be related if they are subject to common control or common significant influence.
Segment reporting	⋅ Segment reporting ASC Topic 280, “ Segment Reporting
Fair value of financial instruments	⋅ Fair value of financial instruments The carrying value of the Company’s financial instruments (excluding short-term bank borrowing and note payable): cash and cash equivalents, accounts and retention receivable, prepayments and other receivables, accounts payable, income tax payable, amount due to a related party, other payables and accrued liabilities approximate at their fair values because of the short-term nature of these financial instruments. Management believes, based on the current market prices or interest rates for similar debt instruments, the fair value of short-term bank borrowings and note payable approximate the carrying amount. The Company also follows the guidance of the ASC Topic 820-10, “ Fair Value Measurements and Disclosures • Level 1 : Inputs are based upon unadjusted quoted prices for identical instruments traded in active markets; • Level 2 : Inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques (e.g. Black-Scholes Option-Pricing model) for which all significant inputs are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Where applicable, these models project future cash flows and discount the future amounts to a present value using market-based observable inputs; and • Level 3 : Inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques, including option pricing models and discounted cash flow models. Fair value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.
Recent accounting pronouncements	⋅ Recent accounting pronouncements The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and does not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.

ORGANIZATION AND BUSINESS BAC23

ORGANIZATION AND BUSINESS BACKGROUND (Tables)	9 Months Ended
	Sep. 30, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Description of Subsidiaries	Name Place of incorporation and kind of legal entity Principal activities and place of operation Particulars of issued/ registered share capital Effective interest held Liaoning Nengfa Weiye Energy Technology Co. Ltd (“Nengfa Energy”) US$ 5,000,000 100

SUMMARY OF SIGNIFICANT ACCOUN24

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)	9 Months Ended
	Sep. 30, 2015
Accounting Policies [Abstract]
Estimated Amortization Expense on Land Use Right	The estimated amortization expense on the land use right in the next five years and thereafter is as follows: Year ending September 30: 2016 $ 64,953 2017 64,953 2018 64,953 2019 64,953 2020 64,953 Thereafter 2,549,407 Total: $ 2,874,172
Expected Useful Lives	Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual values: Expected useful life Residual value Building 30 – 50 years 5% Plant and machinery 10 – 20 years 5% Furniture, fixture and equipment 5 – 8 years 5%
Exchange Rates	Translation of amounts from RMB into US$1 has been made at the following exchange rates for the respective period: September 30, 2015 September 30, 2014 Period-end RMB:US$1 exchange rate 6.3538 6.1560 Average period RMB:US$1 exchange rate 6.1729 6.1502

ACCOUNTS AND RETENTION RECEIV25

ACCOUNTS AND RETENTION RECEIVABLES (Tables)	9 Months Ended
	Sep. 30, 2015
Accounts And Retention Receivable [Abstract]
Accounts and Retention Receivable	September 30, 2015 December 31, 2014 Accounts receivable, cost $ 7,676,152 $ 8,708,662 Retention receivable, cost 790,412 743,006 8,466,564 9,451,668 Less: allowance for doubtful accounts (345,062) (356,293) Accounts and retention receivable, net $ 8,121,502 $ 9,095,375

INVENTORY (Tables)

INVENTORY (Tables)	9 Months Ended
	Sep. 30, 2015
Inventory, Net [Abstract]
Inventory	September 30, 2015 December 31, 2014 Raw materials $ 850,296 $ 1,313,987 Work-in-process 2,098,762 721,798 Finished goods 4,282,588 3,587,533 $ 7,231,646 $ 5,623,318

SHORT-TERM BANK BORROWINGS (Tab

SHORT-TERM BANK BORROWINGS (Tables)	9 Months Ended
	Sep. 30, 2015
Debt Disclosure [Abstract]
Short-Term Bank Borrowings	Short-term bank borrowings consist of the following: September 30, 2015 December 31, 2014 Payable to financial institutions in the PRC: Demand bank notes: Equivalent to RMB24,000,000 due in March 2015, which is collateralized by its restricted cash and guaranteed by its vendor and bears the handling fee equal to 0.05% of its face value. $ - $ 3,900,219 Equivalent to RMB1,000,000 due in January 24, 2016, which is collateralized by its restricted cash and guaranteed by its vendor and bears the handling fee equal to 0.05% of its face value. $ 157,386 $ - Short-term borrowings: Equivalent to RMB21,000,000 with interest rate at 1.2 times of the Bank of China Benchmark Lending Rate, monthly payable, due in March 2015, which is guaranteed by its vendors and secured by land use right - 3,412,692 Equivalent to RMB7,000,000 with interest rate at 1.2 times of the Bank of China Benchmark Lending Rate, monthly payable, due in March 2015, which is guaranteed by its vendor - 1,137,564 Equivalent to RMB28,000,000 with interest rate at 6.2% per annum, monthly payable, due March 19, 2016, which is guaranteed by its vendor and the director of the Company 4,406,812 - Equivalent to RMB12,000,000 with interest rate at 6.2% per annum, monthly payable, due March 19, 2016, which is guaranteed by its vendor and the director of the Company 1,888,633 - Total short-term bank borrowings $ 6,452,831 $ 8,450,475

OTHER PAYABLES AND ACCRUED LI28

OTHER PAYABLES AND ACCRUED LIABILITIES (Tables)	9 Months Ended
	Sep. 30, 2015
Payables and Accruals [Abstract]
Other Payables and Accrued Liabilities	Other payables and accrued liabilities consisted of the following: September 30, 2015 December 31, 2014 (Unaudited) (Audited) Payable to equipment vendors $ 184,428 $ 153,298 Customer deposits 361,887 131,213 Value added tax payable 7,147 2,003 Accrued operating expenses 205,107 414,565 Accrued salary 791 13,387 Other payable 78,857 69,429 $ 838,217 $ 783,895

INCOME TAXES (Tables)

INCOME TAXES (Tables)	9 Months Ended
	Sep. 30, 2015
Income Tax Disclosure [Abstract]
Reconciliation of Income Tax Rate to Effective Income Tax Rate	The reconciliation of income tax rate to the effective income tax rate for the nine months ended September 30, 2015 and 2014 is as follows: Nine months ended September 30, 2015 2014 (Loss) income before income taxes from PRC operation $ (138,865) $ 314,555 Statutory income tax rate 25 % 25 % Income tax expense at statutory rate (34,716) 78,639 Effect from non-deductible items 35,089 (17,652) Tax adjustments - 3,854 Income tax expense $ 373 $ 64,841

SEGMENT INFORMATION (Tables)

SEGMENT INFORMATION (Tables)	9 Months Ended
	Sep. 30, 2015
Segment Reporting [Abstract]
Summary of Financial Information Concerning Reportable Segments	Summarized financial information concerning the Company’s reportable segments is shown in the following table for the three and nine months ended September 30, 2015 and 2014: Three months ended September 30, 2015 Heavy Energy-saving manufacturing business related business Total Operating revenues, net: - Products $ 2,599,325 $ - $ 2,599,325 - Services 21,949 - 21,949 Total operating revenues 2,621,274 - 2,621,274 Cost of revenues 2,248,147 - 2,248,147 Gross profit 373,127 - 373,127 Depreciation and amortization 344,791 - 344,791 Total assets 44,813,173 - 44,813,173 Expenditure for long-lived assets $ 722,148 $ - $ 722,148 Nine months ended September 30, 2015 Heavy Energy-saving manufacturing business related business Total Operating revenues, net: - Products $ 5,026,510 $ - $ 5,026,510 - Services 85,568 - 85,568 Total operating revenues 5,112,078 - 5,112,078 Cost of revenues 4,105,773 - 4,105,773 Gross profit 1,006,305 - 1,006,305 Depreciation and amortization 932,453 - 932,453 Total assets 44,813,173 - 44,813,173 Expenditure for long-lived assets $ 892,817 $ - $ 892,817 Three months ended September 30, 2014 Heavy Energy-saving manufacturing business related business Total Operating revenues, net: - Products $ 2,465,375 $ 441,926 $ 2,907,301 - Services 36,646 - 36,646 Total operating revenues 2,502,021 441,926 2,943,947 Cost of revenues (1,641,001) (416,912) (2,057,913) Gross profit 747,203 25,014 886,034 Depreciation and amortization 209,127 - 209,127 Total assets 45,389,340 - 45,389,340 Expenditure for long-lived assets $ 298,927 $ - $ 298,927 Nine months ended September 30, 2014 Heavy Energy-saving manufacturing business related business Total Operating revenues, net: - Products $ 5,634,127 $ 441,926 $ 6,076,053 - Services 214,293 - 214,293 Total operating revenues 5,848,420 441,926 6,290,346 Cost of revenues (4,476,565) (416,912) (4,893,477) Gross profit 1,371,855 25,014 1,396,869 Depreciation and amortization 627,048 - 627,048 Total assets 45,389,340 - 45,389,340 Expenditure for long-lived assets $ 298,927 $ - $ 298,927

CONCENTRATIONS OF RISK (Tables)

CONCENTRATIONS OF RISK (Tables)	9 Months Ended
	Sep. 30, 2015
Risks and Uncertainties [Abstract]
Customers Account for Ten Percent or More of Revenues and its Outstanding Accounts Receivable	For the three and nine months ended September 30, 2015, only one customer accounted for 10% or more of the Company’s revenues and its outstanding receivable balances as at period-end dates, are presented as follows: Three months ended September 30, 2015 September 30, 2015 Percentage Accounts and retention Customers Revenues of revenues receivable Customer A $ 1,959,525 75 % $ 5,848,728 Nine months ended September 30, 2015 September 30, 2015 Percentage Accounts and retention Customers Revenues of revenues receivable Customer A $ 4,217,987 83 % $ 5,848,728 For the three and nine months ended September 30, 2014, the customers who accounted for 10% or more of the Company’s revenues and its outstanding receivable balances as at period-end dates, are presented as follows: Three months ended September 30, 2014 September 30, 2014 Percentage Accounts and retention Customers Revenues of revenues receivable Customer A $ 2,184,447 74 % $ 5,919,725 Customer D 441,926 15 % - Total: $ 2,626,373 89 % Total: $ 5,919,725 Nine months ended September 30, 2014 September 30, 2014 Percentage Accounts and retention Customers Revenues of revenues receivable Customer A $ 5,014,743 80 % $ 5,919,725
Concentrations Risk of Company's Purchases and Outstanding Accounts Payable Balances	For the three and nine months ended September 30, 2015 and 2014, the vendors who accounted for 10 Three months ended September 30, 2015 September 30, 2015 Percentage Accounts Vendors Purchases of purchases payable Vendor F $ 210,118 19 % $ 360,196 Vendor J 165,392 15 % 411,707 Total: $ 375,510 34 % Total: $ 771,903 Nine months ended September 30, 2015 September 30, 2015 Percentage Accounts Vendors Purchases of purchases payable Vendor F $ 689,239 17 % $ 360,196 Vendor J 462,314 12 % 411,707 Total: $ 1,151,553 29 % Total: $ 771,903 Three months ended September 30, 2014 September 30, 2014 Percentage Accounts Vendors Purchases of purchases payable Vendor H 423,769 14 % 375,916 Vendor I 416,912 14 % 20,143 Vendor J 306,158 10 % 241,805 Total: $ 1,146,839 38 % Total: $ 637,864 Nine months ended September 30, 2014 September 30, 2014 Percentage Accounts Vendors Purchases of purchases payable Vendor F $ 557,495 10 % Total: $ 241,249

Description of Subsidiaries (De

Description of Subsidiaries (Detail) - Liaoning Nengfa Weiye Energy Technology Co Ltd	9 Months Ended
	Sep. 30, 2015USD ($)
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Place of incorporation and kind of legal entity	The PRC, a limited liability company
Principal activities and place of operation	Production of a variety of industrial valve components which are widely used in water supply and sewage system, coal and gas fields, power generation stations, petroleum and chemical industries in the PRC
Particulars of issued/registered share capital	$ 5,000,000
Effective interest held	100.00%

Summary of Significant Accoun33

Summary of Significant Accounting Policies - Additional Information (Detail) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Summary Of Significant Accounting Policies [Line Items]
Value added tax rate levied on majority of products			17.00%
Minimum likelihood of tax benefits being realized upon settlement	50.00%		50.00%
Depreciation expense	$ 322,780	$ 192,385	$ 882,311	$ 576,721
Warrant Period			12 months
Accounts Receivable
Summary Of Significant Accounting Policies [Line Items]
Customers billing period			90 days
Use Rights
Summary Of Significant Accounting Policies [Line Items]
Finite lived intangible assets, useful Life			50 years
Finite lived intangible assets amortization period			2,059
Land Use Rights [Member]
Summary Of Significant Accounting Policies [Line Items]
Amortization expense	$ 16,385	$ 16,742	$ 50,142	$ 50,327
Minimum
Summary Of Significant Accounting Policies [Line Items]
Retention receivable percentage	5.00%		5.00%
Product Control Equipment Period			1 month
Billing Period			2 months
Portion Of Project Contract Balance Withheld Period			12 months
Minimum | Accounts Receivable
Summary Of Significant Accounting Policies [Line Items]
Customers billing period			30 days
Maximum
Summary Of Significant Accounting Policies [Line Items]
Retention receivable percentage	10.00%		10.00%
Product Control Equipment Period			6 months
Billing Period			3 months
Portion Of Project Contract Balance Withheld Period			24 months
Maximum | Accounts Receivable
Summary Of Significant Accounting Policies [Line Items]
Customers billing period			90 days

Estimated Amortization Expense

Estimated Amortization Expense on Land Use Right (Detail) - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Land Use Right [Line Items]
2,016	$ 64,953
2,017	64,953
2,018	64,953
2,019	64,953
2,020	64,953
Thereafter	2,549,407
Total:	$ 2,874,172	$ 3,018,029

Property, Plant and Equipment E

Property, Plant and Equipment Expected Useful Lives and Estimated Residual Values (Detail)	9 Months Ended
	Sep. 30, 2015
Building
Property, Plant and Equipment [Line Items]
Property plant and equipment, residual value	5.00%
Building | Minimum
Property, Plant and Equipment [Line Items]
Property plant and equipment, useful life	30 years
Building | Maximum
Property, Plant and Equipment [Line Items]
Property plant and equipment, useful life	50 years
Plant and machinery
Property, Plant and Equipment [Line Items]
Property plant and equipment, residual value	5.00%
Plant and machinery | Minimum
Property, Plant and Equipment [Line Items]
Property plant and equipment, useful life	10 years
Plant and machinery | Maximum
Property, Plant and Equipment [Line Items]
Property plant and equipment, useful life	20 years
Furniture, fixture and equipment
Property, Plant and Equipment [Line Items]
Property plant and equipment, residual value	5.00%
Furniture, fixture and equipment | Minimum
Property, Plant and Equipment [Line Items]
Property plant and equipment, useful life	5 years
Furniture, fixture and equipment | Maximum
Property, Plant and Equipment [Line Items]
Property plant and equipment, useful life	8 years

Exchange Rates (Detail)

Exchange Rates (Detail)	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Financial Statement Line Items with Differences in Reported Amount and Reporting Currency Denominated Amounts [Line Items]
Period-end RMB:US$1 exchange rate	6.3538	6.1560
Average period RMB:US$1 exchange rate	6.1729	6.1502

Accounts and Retention Receiv37

Accounts and Retention Receivables - Additional Information (Detail)	Sep. 30, 2015
Accounts, Notes, Loans and Financing Receivable [Line Items]
Percentage Of Accounts Receivable Recovered	5.57%

Accounts and Retention Receiv38

Accounts and Retention Receivables (Detail) - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Accounts, Notes, Loans and Financing Receivable [Line Items]
Accounts receivable, cost	$ 7,676,152	$ 8,708,662
Retention receivable, cost	790,412	743,006
Accounts And Retention Receivable Gross	8,466,564	9,451,668
Less: allowance for doubtful accounts	(345,062)	(356,293)
Accounts and retention receivable, net	$ 8,121,502	$ 9,095,375

Inventory (Detail)

Inventory (Detail) - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Inventory [Line Items]
Raw materials	$ 850,296	$ 1,313,987
Work-in-process	2,098,762	721,798
Finished goods	4,282,588	3,587,533
Accounts and retention receivable, net	$ 7,231,646	$ 5,623,318

Construction in Progress - Addi

Construction in Progress - Additional Information (Detail) - USD ($) $ in Millions	9 Months Ended	12 Months Ended
	Sep. 30, 2015	Dec. 31, 2008
Property, Plant and Equipment [Line Items]
Estimated construction cost of new manufacturing facility		$ 24
First Phase Of Construction Project
Property, Plant and Equipment [Line Items]
Construction project completion year	2,012
Second Phase Of Construction Project
Property, Plant and Equipment [Line Items]
Construction project completion year	2,013

Short-Term Bank Borrowings - Ad

Short-Term Bank Borrowings - Additional Information (Detail)	Sep. 30, 2015	Sep. 30, 2014
China Benchmark Lending Rate [Member]
Short-term Debt [Line Items]
Effective interest rate, per annum	6.00%	6.00%

Short-Term Bank Borrowings (Det

Short-Term Bank Borrowings (Detail)	Sep. 30, 2015USD ($)	Sep. 30, 2015CNY (¥)	Dec. 31, 2014USD ($)
Short-term Debt [Line Items]
Total short-term bank borrowings	$ 6,452,831		$ 8,450,475
Guarantee Type, Other | Short Term Loan One
Short-term Debt [Line Items]
Total short-term bank borrowings	0	¥ 21,000,000	3,412,692
Guarantee Type, Other | Short Term Loan Two
Short-term Debt [Line Items]
Total short-term bank borrowings	0	7,000,000	1,137,564
Guarantee Type, Other | Short Term Loan Three
Short-term Debt [Line Items]
Total short-term bank borrowings	4,406,812	28,000,000	0
Guarantee Type, Other | Short Term Loan Four
Short-term Debt [Line Items]
Total short-term bank borrowings	1,888,633	12,000,000	0
Vendor Guarantee One | Collateralized Loans
Short-term Debt [Line Items]
Total short-term bank borrowings	0	24,000,000	3,900,219
Vendor Guarantee Two | Collateralized Loans
Short-term Debt [Line Items]
Total short-term bank borrowings	$ 157,386	¥ 1,000,000	$ 0

Short-Term Bank Borrowings (Par

Short-Term Bank Borrowings (Parenthetical) (Detail)	9 Months Ended
	Sep. 30, 2015USD ($)	Sep. 30, 2015CNY (¥)	Dec. 31, 2014USD ($)
Short-term Debt [Line Items]
Short-term bank borrowings	$ 6,452,831		$ 8,450,475
Guarantee Type, Other | Short Term Loan One
Short-term Debt [Line Items]
Short-term bank borrowings	$ 0	¥ 21,000,000	3,412,692
Interest rate per bank of china benchmark lending rate	1.2	1.2
Maturity Period	March 2,015
Guarantee Type, Other | Short Term Loan Two
Short-term Debt [Line Items]
Short-term bank borrowings	$ 0	¥ 7,000,000	1,137,564
Interest rate per bank of china benchmark lending rate	1.2	1.2
Maturity Period	March 2,015
Guarantee Type, Other | Short Term Loan Three
Short-term Debt [Line Items]
Short-term bank borrowings	$ 4,406,812	¥ 28,000,000	0
Debt Instrument, Maturity Date	Mar. 19, 2016
Interest Rate Coverage Ratio	6.20%	6.20%
Guarantee Type, Other | Short Term Loan Four
Short-term Debt [Line Items]
Short-term bank borrowings	$ 1,888,633	¥ 12,000,000	0
Debt Instrument, Maturity Date	Mar. 19, 2016
Interest Rate Coverage Ratio	6.20%	6.20%
Vendor Guarantee One | Collateralized Loans
Short-term Debt [Line Items]
Short-term bank borrowings	$ 0	¥ 24,000,000	3,900,219
Maturity Period	March 2,015
Interest Rate Coverage Ratio	0.05%	0.05%
Vendor Guarantee Two | Collateralized Loans
Short-term Debt [Line Items]
Short-term bank borrowings	$ 157,386	¥ 1,000,000	$ 0
Debt Instrument, Maturity Date	Jan. 24, 2016
Interest Rate Coverage Ratio	0.05%	0.05%

Other Payables and Accrued Li44

Other Payables and Accrued Liabilities (Detail) - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Accounts Payable and Accrued Liabilities [Line Items]
Payable to equipment vendors	$ 184,428	$ 153,298
Customer deposits	361,887	131,213
Value added tax payable	7,147	2,003
Accrued operating expenses	205,107	414,565
Accrued salary	791	13,387
Other payable	78,857	69,429
Other payables and accrued liabilities	$ 838,217	$ 783,895

Income Taxes - Additional Infor

Income Taxes - Additional Information (Detail) - USD ($)	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Income Taxes [Line Items]
Unified income tax rate	25.00%	25.00%
United States of America
Income Taxes [Line Items]
Expiration date	2,034
Operating Loss Carryforwards	$ 3,195,884
Operating Loss Carryforwards, Valuation Allowance	$ 1,086,601

Reconciliation of Income Tax Ra

Reconciliation of Income Tax Rate to Effective Income Tax Rate (Detail) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Reconciliation of Effective Income Tax Rate [Line Items]
(Loss) income before income taxes from PRC operation			$ (138,865)	$ 314,555
Statutory income tax rate			25.00%	25.00%
Income tax expense at statutory rate			$ (34,716)	$ 78,639
Effect from non-deductible items			35,089	(17,652)
Tax adjustments			0	3,854
Income tax expense	$ 89	$ 54,721	$ 373	$ 64,841

Stockholder's Equity - Addition

Stockholder's Equity - Additional Information (Detail) - USD ($)	May. 07, 2015	Sep. 30, 2015	Sep. 30, 2014	Dec. 31, 2014
Schedule of Capitalization, Equity [Line Items]
Common stock, shares issued		6,553,289		5,719,147
Common stock, shares outstanding		6,553,289		5,719,147
Share price	$ 2.06
Debt Conversion, Converted Instrument, Amount	$ 1,718,333	$ 1,718,333	$ 0
Debt Conversion, Converted Instrument, Shares Issued	834,142

Summarized Financial Informatio

Summarized Financial Information of Reportable Segments (Detail) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014	Dec. 31, 2014
Operating revenues, net:
- Products	$ 2,599,325	$ 2,907,301	$ 5,026,510	$ 6,076,053
- Services	21,949	36,646	85,568	214,293
Total operating revenues	2,621,274	2,943,947	5,112,078	6,290,346
Cost of revenues	2,248,147	2,057,913	4,105,773	4,893,477
Gross profit	373,127	886,034	1,006,305	1,396,869
Depreciation and amortization	344,791	209,127	932,453	627,048
Total assets	44,813,173	45,389,340	44,813,173	45,389,340	$ 48,304,931
Expenditure for long-lived assets	722,148	298,927	892,817	298,927
Heavy Manufacturing Business
Operating revenues, net:
- Products	2,599,325	2,465,375	5,026,510	5,634,127
- Services	21,949	36,646	85,568	214,293
Total operating revenues	2,621,274	2,502,021	5,112,078	5,848,420
Cost of revenues	2,248,147	(1,641,001)	4,105,773	(4,476,565)
Gross profit	373,127	747,203	1,006,305	1,371,855
Depreciation and amortization	344,791	209,127	932,453	627,048
Total assets	44,813,173	45,389,340	44,813,173	45,389,340
Expenditure for long-lived assets	722,148	298,927	892,817	298,927
Energy Saving Related Business
Operating revenues, net:
- Products	0	441,926	0	441,926
- Services	0	0	0	0
Total operating revenues	0	441,926	0	441,926
Cost of revenues	0	(416,912)	0	(416,912)
Gross profit	0	25,014	0	25,014
Depreciation and amortization	0	0	0	0
Total assets	0	0	0	0
Expenditure for long-lived assets	$ 0	$ 0	$ 0	$ 0

Concentrations of Risk - Additi

Concentrations of Risk - Additional Information (Detail)	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Vendors | Purchases
Concentration Risk [Line Items]
Percentage of purchases	10.00%	10.00%	10.00%	10.00%
Customer A | Revenues and Accounts Receivable
Concentration Risk [Line Items]
Percentage of purchases	10.00%	10.00%	10.00%	10.00%

Customers Account for Ten Perce

Customers Account for Ten Percent or More of Revenues and its Outstanding Accounts Receivable Balances (Detail) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Concentration Risk [Line Items]
Revenues	$ 2,621,274	$ 2,943,947	$ 5,112,078	$ 6,290,346
Customer Concentration Risk
Concentration Risk [Line Items]
Revenues		$ 2,626,373
Percentage of revenues		89.00%
Accounts and retention receivable		$ 5,919,725		5,919,725
Customer Concentration Risk | Customer A
Concentration Risk [Line Items]
Revenues	$ 1,959,525	$ 2,184,447	$ 4,217,987	$ 5,014,743
Percentage of revenues	75.00%	74.00%	83.00%	80.00%
Accounts and retention receivable	$ 5,848,728	$ 5,919,725	$ 5,848,728	$ 5,919,725
Customer Concentration Risk | Customer D
Concentration Risk [Line Items]
Revenues		$ 441,926
Percentage of revenues		15.00%
Accounts and retention receivable		$ 0		$ 0

Concentrations Risk of Company'

Concentrations Risk of Company's Purchases and Outstanding Accounts Payable Balances (Detail) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Concentration Risk [Line Items]
Purchases	$ 2,231,389	$ 2,035,094	$ 4,061,616	$ 4,732,807
Major Supplier Concentration Risk | Accounts Payable
Concentration Risk [Line Items]
Accounts payable	771,903	637,864	771,903	637,864
Major Supplier Concentration Risk | Purchases
Concentration Risk [Line Items]
Purchases	$ 375,510	$ 1,146,839	$ 1,151,553
Percentage of purchases	34.00%	38.00%	29.00%
Major Supplier Concentration Risk | Vendor F | Accounts Payable
Concentration Risk [Line Items]
Accounts payable	$ 360,196	$ 241,249	$ 360,196	241,249
Major Supplier Concentration Risk | Vendor F | Purchases
Concentration Risk [Line Items]
Purchases	$ 210,118		$ 689,239	$ 557,495
Percentage of purchases	19.00%		17.00%	10.00%
Major Supplier Concentration Risk | Vendor H | Accounts Payable
Concentration Risk [Line Items]
Accounts payable		375,916		$ 375,916
Major Supplier Concentration Risk | Vendor H | Purchases
Concentration Risk [Line Items]
Purchases		$ 423,769
Percentage of purchases		14.00%
Major Supplier Concentration Risk | Vendor I | Accounts Payable
Concentration Risk [Line Items]
Accounts payable		$ 20,143		20,143
Major Supplier Concentration Risk | Vendor I | Purchases
Concentration Risk [Line Items]
Purchases		$ 416,912
Percentage of purchases		14.00%
Major Supplier Concentration Risk | Vendor J | Accounts Payable
Concentration Risk [Line Items]
Accounts payable	$ 411,707	$ 241,805	$ 411,707	$ 241,805
Major Supplier Concentration Risk | Vendor J | Purchases
Concentration Risk [Line Items]
Purchases	$ 165,392	$ 306,158	$ 462,314
Percentage of purchases	15.00%	10.00%	12.00%