| Significant Accounting Policies [Text Block] | Note 2 Summary of significant accounting policies The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The financial statements include the accounts of all directly, indirectly owned subsidiaries and the variable interest entity listed below. All material intercompany transactions and balances have been eliminated in consolidation. In the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation of the financial statements have been included. Interim results are not necessarily indicative of results to be expected for the full year. The information included in this Form 10-Q should be read in conjunction with information included in the 2014 annual report on Form 10-K filed on April 10, 2015. Basis of presentation Subsidiary Percentage General Steel Investment Co., Ltd. British Virgin Islands 100.0 % General Steel (China) Co., Ltd. (“General Steel (China)”) PRC 100.0 % Tianjin General Shengyuan IoT Technology Co., Ltd. (“General Shengyuan”) PRC 70.0 % Yangpu Shengtong Investment Co., Ltd. (“Yangpu Shengtong”) PRC 99.1 % Tianjin Qiu Steel Investment Co., Ltd. (“Qiu Steel”) PRC 98.7 % Longmen Joint Venture PRC VIE/60.0 % Maoming Hengda Steel Company, Ltd. (“Maoming Hengda”) PRC 99.0 % Baotou Steel Prior to December 31, 2014, the Company held an 80.0 0.7 4.0 General Shengyuan On February 13, 2015, the Company formed a joint venture entity, Tianjin General Shengyuan IoT Technology Co., Ltd, with a team of radio-frequency identification (“RFID”) experts (the “Expert Team”), to develop and commercialize RFID technology data solutions. Under the terms of the Agreement, the Company owned 70 1.6 10.0 (b) Principles of consolidation subsidiaries The accompanying consolidated financial statements include the financial statements of the Company, its subsidiaries, its variable interest entity (“VIE”) for which the Company is the ultimate primary beneficiary, and the VIE’s subsidiaries. Subsidiaries are those entities in which the Company, directly or indirectly, controls more than one half of the voting power; or has the power to govern the financial and operating policies, to appoint or remove the majority of the members of the board of directors, or to cast a majority of votes at the meeting of directors. A VIE is an entity in which the Company, or its subsidiary, through contractual arrangements, bears the risks of, and enjoys the rewards normally associated with ownership of the entity, and therefore the Company or its subsidiary is the primary beneficiary of the entity. All significant inter-company transactions and balances have been eliminated upon consolidation. ( Consolidation of VIE Prior to entering into the Unified Management Agreement on April 29, 2011, Longmen Joint Venture had been consolidated as the Company’s 60 Longmen Joint Venture’s equity at risk is considered insufficient to finance its activities and therefore Longmen Joint Venture is considered to be a VIE. The Company would be considered the primary beneficiary of the VIE if it has both of the following characteristics: a. The power to direct the activities of the VIE that most significantly impact the VIE’s economic performance; and b. The obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. A Supervisory Committee was formed during the negotiation of the Unified Management Agreement. Given there is both a Supervisory Committee and a Board of Directors with respect to Longmen Joint Venture , the powers (rights and roles) of both bodies were considered to determine which party has the power to direct the activities of Longmen Joint Venture, and by extension, whether the Company continues to have the power to direct Longmen Joint Venture’s activities after this Supervisory Committee was formed and the significant investment in plant and equipment by owners of the Longmen Joint Venture partner. The Supervisory Committee, in which the Company holds 2 out of 4 seats, requires a ¾ majority vote, while the Board of Directors, on which the Company holds 4 out of 7 seats, requires a simple majority vote. As the Supervisory Committee’s role is limited to supervising and monitoring management of Longmen Joint Venture and in the event there is any disagreement between the Board and the Supervisory Committee, the Board prevails, the Supervisory Committee is considered subordinate to the Board. Thus, the Board of Directors of Longmen Joint Venture continues to be the controlling decision-making body with respect to Longmen Joint Venture. The Company, which controls 60 In connection with the Unified Management Agreement, the Company, Shaanxi Coal and Shaanxi Steel may provide such support on a discretionary basis or as needed in the future. See Note 2(d) Liquidity and Going Concern. The Company has the obligation to absorb losses and the rights to receive benefits based on the profit allocation as stipulated by the Unified Management Agreement that are significant to the VIE. As both conditions are met, the Company is the primary beneficiary of Longmen Joint Venture and therefore, continues to consolidate Longmen Joint Venture as a VIE. The Company believes that the Unified Management Agreement between Longmen Joint Venture and Shaanxi Coal is in compliance with PRC law and is legally enforceable. However, PRC law and/or uncertainties in the PRC legal system could limit the Company’s ability to enforce the Unified Management Agreement, which in turn, may lead to reconsideration of the VIE assessment and the potential for a different conclusion. If the Unified Management Agreement cannot be enforced, the Company would not consolidate Longmen Joint Venture as a VIE. However, the current PRC legal system has not limited the Company’s ability to enforce the Unified Management Agreement nor does the Company believe it is likely to do so in the future. The Company makes an ongoing assessment to determine whether Longmen Joint Venture is a VIE. June 30, 2015 December 31, 2014 (in thousands) (in thousands) Current assets $ 641,541 $ 837,135 Plant and equipment, net 565,978 1,537,687 Other noncurrent assets 24,150 33,396 Total assets 1,231,669 2,408,218 Total liabilities (2,876,140) (2,946,126) Net liabilities $ (1,644,471) $ (537,908) June 30, 2015 December 31, 2014 (in thousands) (in thousands) Current liabilities: Short term notes payable $ 510,653 $ 638,829 Accounts payable 588,959 605,025 Accounts payable - related parties 206,777 205,914 Short term loans bank 113,352 216,940 Short term loans others 83,497 54,524 Short term loans - related parties 279,280 45,710 Other payables and accrued liabilities 54,028 47,121 Other payables - related parties 53,796 78,615 Customer deposits 83,519 87,372 Customer deposits - related parties 24,311 34,895 Deposit due to sales representatives 15,782 17,871 Deposit due to sales representatives related parties 2,872 2,509 Taxes payable 6,816 4,026 Deferred lease income 2,180 2,176 Capital lease obligations, current 9,942 8,508 Intercompany payable to be eliminated 14,269 20,155 Total current liabilities 2,050,033 2,070,190 Non-current liabilities: Long term loans - related parties 353,067 339,549 Deferred lease income - noncurrent 71,757 72,713 Capital lease obligations, noncurrent 401,283 393,252 Profit sharing liability - 70,422 Total non-current liabilities 826,107 875,936 Total liabilities of consolidated VIE $ 2,876,140 $ 2,946,126 Three months Three months (in thousands) (in thousands) Sales $ 528,778 $ 587,314 Gross (loss) profit $ (64,220) $ 28,229 (Loss) income from operations $ (1,005,820) $ 8,128 Net loss attributable to controlling interest $ (613,117) $ (8,077) Six months Six months (in thousands) (in thousands) Sales $ 856,936 $ 1,181,328 Gross (loss) profit $ (96,367) $ 6,010 Loss from operations $ (1,059,318) $ (31,166) Net loss attributable to controlling interest $ (655,522) $ (46,111) Longmen Joint Venture has two 100 50 Hualong Longmen Joint Venture, the single largest shareholder, holds a 36.0 34.67 29.33 Huatianyulong Longmen Joint Venture holds a 50.0 50.0 The Company has determined that it is appropriate for Longmen Joint Venture to consolidate Hualong and Huatianyulong with appropriate recognition in the Company’s financial statements of the non-controlling interests in each entity, beginning on the acquisition dates as these were also the effective dates of the agreements with other stockholders granting a majority voting rights in each entity, and thereby, the power of control, to Longmen Joint Venture. Liquidity and going concern The Company’s accounts have been prepared assuming that the company will continue as a going concern basis. The going concern basis assumes that assets are realized and liabilities are extinguished in the ordinary course of business at amounts disclosed in the financial statements. The Company’s ability to continue as a going concern depends upon aligning its sources of funding (debt and equity) with the expenditure requirements of the Company and repayment of the short-term debt facilities as and when they fall due. The steel business is capital intensive and as a normal industry practice in PRC, the Company is highly leveraged. Debt financing in the form of short term bank loans, loans from related parties, financing sales, bank acceptance notes, and capital leases have been utilized to finance the working capital requirements and the capital expenditures of the Company. As a result, the Company’s debt to equity ratio as of June 30, 2015 and December 31, 2014 were (1.8) (5.6) 1.5 Our steel business has faced very tough market conditions and challenging profitability over the last several years, and based on current trends, we think the near-term challenges for the steel sector will likely linger. In reaction to this challenging market, we are proactively reviewing our strategy and asset portfolio and seeking to restructure low-efficient, non-core assets, as well as idle land resources to unlock hidden fair value. The Company aims to transform into a leaner and fitter organization with better profitability. As such, the Company is strategically accelerating its business transformation to pursue opportunities that offer compelling benefits to the Company and shareholders, including: · First, strengthen the Company’s financials while providing the financial flexibility to pursue higher return, higher growth opportunities; · Second, reduce the complexity of the Company’s business structure, which is consistent with our objectives for internal simplification and operating efficiency; · Third, diversify operating risk in order to lower the Company’s high reliance on steel business, while at the same time leverage on the Company’s vast vertical resources in the steel industry; and · Fourth, pursue opportunities for additional value creation. Management has implemented the following plans that are intended to mitigate the conditions or events that raise substantial doubt about the Company’s ability to continue as a going concern. Longmen Joint Venture, as the most important entity of the Company, accounted for majority of total sales of the Company. As such, the majority of the Company’s working capital needs come from Longmen Joint Venture. The Company’s ability to continue as a going concern depends heavily on Longmen Joint Venture’s operations. Longmen Joint Venture has obtained different types of financial supports, which are listed below by category: Line of credit 150.2 Banks Amount of Repayment Date Bank of China 19.6 December 3, 2016 Bank of Beijing 81.6 October 14, 2016 Bank of Chongqing 49.0 December 26, 2016 Total $ 150.2 As of the date of this report, the Company utilized $nil of these lines of credit. Vendor financing 1,060.8 Company Financing Period Financing Amount Company A related party July 30, 2014 July 30, 2019 $ 244.8 Company B third party January 22, 2014 January 22, 2017 163.2 Company C third party October 1, 2013 September 30, 2017 652.8 Total $ 1,060.8 Company A, a related party company and Company B, a third party company, are both Longmen Joint Venture’s major coke suppliers. They have been doing business with Longmen Joint Venture for many years. On July 30, 2014, Company A signed a five-year agreement with Longmen Joint Venture to finance its coke purchases up to $ 244.8 163.2 41.7 55.0 Company C is a Fortune 500 Company. On June 28, 2013, Company C signed an agreement with Longmen Joint Venture to finance Longmen Joint Venture’s purchase of iron ore for an amount up to $ 489.3 0.05 Other financing Company Financing Period Financing Amount Company D related party April 22, 2014 April 22, 2017 $ 81.6 Company E related party April 23, 2014 April 23, 2017 86.5 Company F related party April 22, 2014 April 22, 2017 81.6 Company G related party April 30, 2015 April 30, 2018 81.6 Company H related party April 30, 2015 April 30, 2018 81.6 Total $ 412.9 As of the date of this report, our payables to Company D, Company E, Company F, Company G, and Company H are approximately $ 0.2 2.4 21.6 3.3 0.9 Amount due to sales representatives Longmen Joint Venture entered into agreements with various entities to act as the Company’s exclusive sales agents in specified geographic areas. These exclusive sales agents must meet certain criteria and are required to deposit a certain amount of money with the Company. In return, the sales agents receive exclusive sales rights in a specified area and discounted prices on products they order. These deposits bear no interest and are required to be returned to the sales agent once the agreement is terminated. As of June 30, 2015, Longmen Joint Venture has collected a total amount of $ 18.7 With the financial support from the banks and the companies above and management’s continued effort in obtaining additional financial supports from banks and other companies, management plans outlined above and summarized below are expected to provide sufficient funds to meet its future operations, working capital requirements and debt obligations until the end of June 30, 2016. However, these plans are based on the demand of the Company's products, economic conditions, the overcapacity issue in the steel industry and the Company's operating results not continuing to deteriorate and on our continued significant reliance on vendors and related parties being able to provide continued liquidity, as summarized below. Cash inflow (outflow) For the twelve months Current liabilities over current assets (excluding deferred lease income) as of June 30, 2015 (unaudited) $ (1,455.3) Projected cash financing and outflows: Cash provided by line of credit from banks 150.2 Cash provided by vendor financing 1,060.8 Cash provided by other financing 412.9 Cash provided by sales representatives 18.7 Cash projected to be used in operations in the twelve months ended June 30, 2016 (58.3) Cash projected to be used for financing cost in the twelve months ended June 30, 2016 (59.6) Net projected change in cash for the twelve months ended June 30, 2016 $ 69.4 (e) Use of estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the accompanying consolidated financial statements and footnotes. Significant accounting estimates reflected in the Company’s consolidated financial statements include the fair value of the profit sharing liability, the useful lives of and the weighted average calculation used in the impairment for property, plant and equipment, and potential losses on uncollectible receivables, allowance for inventory valuation, the interest rate used in the financing sales, the fair value of the assets recorded under capital lease and the present value of the net minimum lease payments of the capital lease. Actual results could differ from these estimates. Impairment One of the Company’s most significant estimates is the determination of fair value of the profit sharing liability see note 2(h). Since the liability is calculated and largely based on management’s expectations of product demand, pricing, raw materials cost and projected manufacturing efficiencies, it is susceptible to material changes when actual results deviate from those expectations. While management believes its current assumptions are reasonable and achievable, there is no assurance that those future expectations will be met or that significant adjustments won’t be required in the future. (f) Concentration of risks and uncertainties The Company’s operations are carried out 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’s economy. The Company’s operations in the PRC are subject to specific considerations and significant risks not typically associated with companies in North America and Western Europe. The Company’s results may be adversely affected by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation, among other things. Through the quarter ended June 30, 2015, the Company has incurred recurring losses from the Company’s operations from the last several years as the Company’s steel business has faced very tough market conditions and challenging profitability. Management has continued its effort to implementing cost savings on our manufacturing overhead costs and to reduce our unit production cost. The Company has forecasted its loss will be continued until year 2021 and expected to make a turning point and become profitable in year 2022 and beyond. The Company’s forecast is based on current market condition, if the future market condition is different from its forecast, the Company might continue to incur additional loss in 2022 and beyond and the Company’s assets pool of its long-lived assets may become further impaired see note 2(j). The Company has significant exposure to the price fluctuation of raw materials and energy prices as part of its normal operations. As of June 30, 2015 and December 31, 2014, the Company did not have any open commodity contracts to mitigate such risks. Cash includes demand deposits in accounts maintained with banks within the PRC, Hong Kong and the United States. Total cash (including restricted cash balances) in these banks on June 30, 2015 and December 31, 2014 amounted to $ 266.5 367.2 0.6 1.0 0.02 One of the Company’s customers individually accounted for 11.6 11.2 28.3 10.7 10 32.1 20.5 One of the company’s supplier individually accounted for 16.6 10.5 12.8 12.7 10 (g) Foreign currency translation and other comprehensive income The reporting currency of the Company is the U.S. dollar. The Company’s subsidiaries and VIE in China use the local currency, Renminbi (“RMB”), as their functional currency. Assets and liabilities are translated at the unified exchange rate as quoted by the People’s Bank of China at the end of the period. The statement of operations accounts are translated at the average translation rates and the equity accounts are translated at historical rates. Translation adjustments resulting from this process are included in accumulated other comprehensive income in the statement of equity. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred. Translation adjustments included in accumulated other comprehensive income amounted to $ (1.3) 0.6 6.13 6.14 6.12 6.16 6.14 6.14 The PRC government imposes significant exchange restrictions on fund transfers out of the PRC that are not related to business operations. These restrictions have not had a material impact on the Company because it has not engaged in any significant transactions that are subject to the restrictions. Financial instruments The accounting standard regarding fair value of financial instruments and related fair value measurements defines financial instruments and requires disclosure of the fair value of financial instruments held by the Company. The Company considers the carrying amount of cash, short term investments, accounts receivable, other receivables, accounts payable and accrued liabilities, to approximate their fair values because of the short period of time between the origination of such instruments and their expected realization. For short term loans and notes payable, the Company concluded the carrying values are a reasonable estimate of fair values because of the short period of time between the origination and repayment and as their stated interest rates approximate current rates available. The carrying value of the long term loans-related party approximates its fair value as of the reporting date as their stated interest rates approximate current market rates available. The accounting standards define fair value, establish a three-level valuation hierarchy for disclosures of fair value measurement and enhance disclosure requirements for fair value measures. The three levels are defined as follow: ⋅ Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. ⋅ Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments. ⋅ Level 3 inputs to the valuation methodology are unobservable and significant to the fair value. As described in Note 15 - Capital lease obligations, payments related to the capital lease of the Asset Pool consist of two components: (1) a fixed monthly payment of $ 2.3 14.6 40 liability charged or credited to operating income each period. The Company determines the fair value of the profit sharing liability using Level 3 inputs by considering the present value of Longmen Joint Venture’s projected profits/losses, discounted based on our average borrowing rate, which is currently 6.5%. The fair value of the profit sharing liability will change each period as a result of (a) any changes in our estimate of Longmen Joint Venture’s projected profits/losses over the remaining term of the Agreement, (b) any change in the discount rate used, based on changes in our current or expected borrowing rate, (c) the change in fair value related to the passage of time and change in the number of future periods over which the present value of future cash flows is estimated and (d) any difference between the previously estimated operating results for the current period and actual results. Each period, the Company considers whether the discount rate based on the Company’s average borrowing rate should be adjusted based upon the current and expected future financial condition of the Company. On November 22, 2014, the People’s Bank of China decreased standard bank borrowing rate across the board by 0.4%. Accordingly, the Company adjusted down the present value discount rate for profit sharing liability by 0.4% from 7.3% to 6.9%. On May 11, 2015, the People’s Bank of China decreased the standard bank borrowing rate again across the board by 0.25%. Accordingly, the Company adjusted down the present value discount rate for profit sharing liability by 0.25% from 6.9% to 6.7%. On June 27, 2015 the People’s Bank of China decreased the standard bank borrowing rate again across the board by 0.25%. Accordingly, the Company adjusted down the present value discount rate for profit sharing liability by 0.25% from 6.7% to 6.5%. The projected profits/losses in Longmen Joint Venture are based upon, but not limited to, the following assumptions: · projected selling units and growth in the steel market · projected unit selling price in the steel market · projected unit purchase cost in the coal and iron ore markets · selling and general and administrative expenses to be in line with the growth in the steel market · projected bank borrowings · interest rate index · gross national product index · industry index · government policy The above assumptions were reviewed by the Company at June 30, 2015 and December 31, 2014 and the assumptions related to the projected growth in the steel market and costs were revised, resulting in a further reduction of the estimated profit sharing liability. The major drivers of the change in our estimate were the continuing decrease in the selling price of our products as well as a continuing downtrend in the sluggish infrastructure investment and consumption growth for the next ten years or so. As such, as of December 31, 2014 financial statement issuance we had lowered our projected growth in the steel market for approximately ten years as compared to our previous estimates at December 31, 2013. The variables and the impact on our inputs to the 2014 valuation of profit sharing fair value, as compared to the 2013 valuation of the profit sharing fair value can be summarized as follows: - Volume Inputs: The most recent 5 year China GDP forecast and Shaanxi GDP forecast decreased on average by 0.4 1.4 - Steel Sales Price Inputs: The most recent China Steel Association price index, together with our actual result decreased, on average, by 5.6 - Raw Material Cost Inputs: The most recent China Steel Association price index, together with the our actual result decreased, on average, by 4.7 The above reduced our Gross Profit % over the next 5 years by, on average, 0.4 1.75 As a result of the changes in valuation inputs noted above for the year ended December 31, 2014, the Company recognized a gain on the change in the fair value of the profit sharing liability of $ 91.0 $0.1 million reduction resulting from the Asset Pool’s operating results for the year ended December 31, 2014 being slightly less favorable than previously estimated as of December 31, 2013, offset by a $8.1 million loss resulting from the 0.4% reduction of the present value discount rate and a $11.5 million loss from the present value discount For the three months ended March 31, 2015, the Company recognized a $ 12.9 0.25 The variables and the impact on the Company’s inputs to the first quarter of 2015 valuation of profit sharing fair value, as compared to the 2014 valuation of the profit sharing fair value can be summarized as follows: Volume Inputs: the Company reduced our projected sales volume in 2015 by 3 - Steel Sales Price Inputs: the Company reduced our projected selling price in 2015 by 12 7 For the three months ended June 30, 2015, the Company recognized a $57.5 million reduction in the fair value of profit sharing liability resulting from the change in estimates of future operating profits based on the actual operating results through June 2015 and the continued deterioration of steel market conditions in the second quarter of 2015, which deviated from our previously anticipated industry environment improvement, as well as the June 27, 2015 change to the Borrowing Rate by 0.25%. These further recent changes in market conditions resulted in a decrease in the expected liability of $54.8 million primarily from adjustments to the 2015 to 2031 expected cash flows as well as a $2.6 million loss from the reduction in the present value discount rate of 0.25%, a $1.2 million loss from the present value discount, and a $6.5 million gain resulting from the Asset Pool’s operating results for the three months ended June 30, 2015 being less favorable than previously estimated as of March 31, 2015. The estimated fair value of the profit sharing liability at June 30, 2015 was reduced to $0. At the same time, the reduction in the estimated future cash flows expected to be generated from Longmen Joint Venture’s operations caused the value of the Assets Pool to fall below the carrying value of Longmen Joint Venture’s long-lived assets, which triggered an impairment of $973.9 million (see Note 2(j)). The variables and the impact on the Company’s inputs to the second quarter of 2015 valuation of profit sharing fair value, as compared to the first quarter valuation of the profit sharing fair value can be summarized as follows: - Volume Inputs: the Company increased our projected sales volume between 2015 and 2031 in response to recent policy initiatives from the Chinese government to boost infrastructure investment and further steel industry consolidation. - Steel Sales Price Inputs: the Company reduced our projected selling price in 2015 by 19% versus the forecast used in the first quarter of 2015 and reduced our projected selling price between 2016 and 2031 proportionally based on the reduction for 2015. - Raw Material Cost Inputs: based on the actual results in the second quarter of 2015 and the latest market trends, the Company reduced cost of goods sold in 2015 by 12% versus the forecast used in the first quarter of 2015 and reduced our projected cost of goods sold between 2016 and 2031 proportionally based on the reduction for 2015. Changes in any of the assumptions used to estimate the fair value of the profit sharing liability and to determine whether and how much the carrying value of Longmen Joint Venture’s long-lived assets has been impaired will change the discounted cash flows of Longmen Joint Venture and the impairment value accordingly. If we were to reduce the projected bank borrowings rate used to discount the liability to a present value by 1.0% and other factors remained unchanged, our profit sharing liability as of June 30, 2015 would have been $0 and we would decrease the impairment expense by $95.7 million If we were to reduce the projected selling units and growth in the steel market rate by 1.0% and other factors remained unchanged, our profit sharing liability as of June 30, 2015 would have been $0 and we would increase the impairment expense by $54.6 million (in thousands) Carrying Value Fair Value Measurements at December 31, 2014 Level 1 Level 2 Level 3 Profit sharing liability $ 70,422 $ - $ - $ 70,422 June 30, 2015 December 31, 2014 (in thousands) (in thousands) Beginning balance $ 70,422 $ 162,295 Change in fair value of profit sharing liability: Change in preset value of estimate of future operating profits (71,395) (110,589) Change in discount rate 5,012 8,106 Interest expense - present value discount amortization 2,443 11,544 Difference between the previously estimated operating results for the current period and actual results (6,483) (79) Exchange rate effect 1 (855) Ending balance $ - $ 70,422 The Company did not identify any other assets or liabilities that are required to be presented on the balance sheet at fair value. (i) Notes receivable Notes receivable represents trade accounts receivable due from various customers where the customers’ banks have guaranteed the payment. The notes are non-interest bearing and normally paid within three to six months. The Company has the ability to submit request for payment to the customer’s bank earlier than the scheduled payment date, but will incur an interest charge and a processing fee. Restricted notes receivable represents notes receivable pledged as collateral for short-term loans and short-term notes payable issued by banks. Interest expenses for early submission request of payment amounted to $ 8.3 12.8 Interest expenses for early submission request of payment amounted to $ 16.3 26.9 (j) Plant and equipment, net Plant and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets with a 3 5 Buildings and Improvements 10 40 Machinery 10 30 Machinery and equipment under capital lease 10 20 Other equipment 5 Transportation Equipment 5 The Company assesses all significant leases for purposes of classification as either operating or capital. At lease inception, if the lease meets any of the four following criteria, the Company will classify it as a capital lease; otherwise it will be treated as an operating lease: a) transfer of ownership to lessee at the end of the lease term, b) bargain purchase option, c) lease term is equal to 75% or more of |
