Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Dec. 31, 2016 | Feb. 10, 2017 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Dec. 31, 2016 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q2 | |
Entity Registrant Name | SHINECO, INC. | |
Entity Central Index Key | 1,300,734 | |
Current Fiscal Year End Date | --06-30 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 21,034,072 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2016 | Jun. 30, 2016 |
CURRENT ASSETS: | ||
Cash | $ 23,743,694 | $ 22,009,374 |
Accounts receivable, net - third parties | 9,671,841 | 4,464,098 |
- unconsolidated entity | 1,616,794 | 1,088,144 |
Due from related parties | 965,109 | 1,671,435 |
Inventories | 1,914,342 | 4,608,179 |
Advances to suppliers, net | 325,035 | 53,024 |
Loans to third parties, net | 1,410,424 | 560,234 |
Other receivables, net | 646,839 | 463,361 |
Short-term deposit | 153,895 | 100,270 |
Prepaid leases - current, net | 455,920 | 478,565 |
Prepaid expenses | 122,091 | 33,117 |
TOTAL CURRENT ASSETS | 41,025,984 | 35,529,801 |
Property and equipment at cost, net of accumulated depreciation and amortization | 10,313,280 | 11,035,199 |
Land use right, net of accumulated amortization | 1,332,994 | 1,408,765 |
Investments | 5,150,347 | 4,766,847 |
Deposit for business acquisition | 2,015,594 | 0 |
Long-term deposit and other noncurrent assets | 112,619 | 120,357 |
Prepaid leases-non current, net | 3,465,424 | 3,860,327 |
Deferred tax assets | 355,473 | 327,492 |
TOTAL ASSETS | 63,771,715 | 57,048,788 |
CURRENT LIABILITIES: | ||
Short-term loans-banks | 2,902,095 | 2,745,945 |
Accounts payable | 253,815 | 259,803 |
Advances from customers | 86,844 | 9,597 |
Due to related parties | 341,062 | 244,915 |
Other payables and accrued expenses | 1,150,753 | 1,999,622 |
Taxes payable | 1,369,388 | 1,278,142 |
TOTAL LIABILITIES | 6,103,957 | 6,538,024 |
Commitments and contingencies | ||
EQUITY: | ||
Common stock; par value $0.001, 100,000,000 shares authorized; 21,034,072 and 19,320,882 shares issued and outstanding at December 31, 2016 and June 30, 2016 | 21,034 | 19,321 |
Additional paid-in capital | 22,737,302 | 17,344,466 |
Statutory reserve | 3,363,914 | 3,242,139 |
Retained earnings | 34,912,067 | 30,837,399 |
Accumulated other comprehensive loss | (4,358,368) | (1,887,929) |
Total Stockholders' equity of Shineco, Inc. | 56,675,949 | 49,555,396 |
Non-controlling interest | 991,809 | 955,368 |
TOTAL EQUITY | 57,667,758 | 50,510,764 |
TOTAL LIABILITIES AND EQUITY | $ 63,771,715 | $ 57,048,788 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2016 | Jun. 30, 2016 |
Common stock; par value (in dollars per shares) | $ 0.001 | $ 0.001 |
Common Stock, Shares Authorized | 100,000,000 | 100,000,000 |
Common Stock, Shares, Issued | 21,034,072 | 19,320,882 |
Common Stock, Shares, Outstanding | 21,034,072 | 19,320,882 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
REVENUE | $ 11,223,066 | $ 12,124,998 | $ 17,589,730 | $ 19,410,917 |
COST OF REVENUE | ||||
Cost of product and services | 7,251,134 | 7,783,236 | 11,687,306 | 12,640,114 |
Business and sales related tax | 18,419 | 21,972 | 33,964 | 38,566 |
GROSS PROFIT | 3,953,513 | 4,319,790 | 5,868,460 | 6,732,237 |
OPERATING EXPENSES | ||||
General and administrative expenses | 924,577 | 419,267 | 1,398,341 | 934,421 |
Selling expenses | 502,036 | 514,065 | 882,354 | 1,001,947 |
Total operating expense | 1,426,613 | 933,332 | 2,280,695 | 1,936,368 |
INCOME FROM OPERATIONS | 2,526,900 | 3,386,458 | 3,587,765 | 4,795,869 |
OTHER INCOME | ||||
Income from equity method investments | 593,224 | 596,311 | 994,396 | 936,360 |
Other income | 73,407 | 72,880 | 159,308 | 53,236 |
Interest income (expense), net | 7,785 | (107,181) | 40,538 | (71,913) |
Total other income | 674,416 | 562,010 | 1,194,242 | 917,683 |
INCOME BEFORE INCOME TAX PROVISION | 3,201,316 | 3,948,468 | 4,782,007 | 5,713,552 |
PROVISIONS FOR INCOME TAXES | 303,751 | 325,938 | 505,387 | 626,887 |
NET INCOME | 2,897,565 | 3,622,530 | 4,276,620 | 5,086,665 |
Less: net income attributable to non-controlling interest | 49,829 | 48,938 | 80,177 | 90,949 |
NET INCOME ATTRIBUTABLE TO SHINECO, INC. | 2,847,736 | 3,573,592 | 4,196,443 | 4,995,716 |
COMPREHENSIVE INCOME | ||||
Net income | 2,897,565 | 3,622,530 | 4,276,620 | 5,086,665 |
Other comprehensive loss: foreign currency translation loss | (2,317,494) | (961,315) | (2,514,175) | (2,835,447) |
Total comprehensive income | 580,071 | 2,661,215 | 1,762,445 | 2,251,218 |
Comprehensive income attributable to non-controlling interest | 9,815 | 31,082 | 36,441 | 64,227 |
COMPREHENSIVE INCOME ATTRIBUTABLE TO SHINECO, INC. | $ 589,886 | $ 2,630,133 | $ 1,726,004 | $ 2,186,991 |
Weighted average number of shares basic and diluted | 21,034,072 | 19,320,882 | 20,205,409 | 19,320,882 |
Basic and diluted earnings per common share | $ 0.14 | $ 0.18 | $ 0.21 | $ 0.26 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 6 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 4,276,620 | $ 5,086,665 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 299,553 | 402,764 |
Provision for doubtful accounts | 298,297 | 181,847 |
Increase in inventory reserve | 35,930 | 109,863 |
Deferred tax benefit | (43,424) | (73,755) |
Income from equity method investments | (994,396) | (936,360) |
Interest income from loans to related parties | (87,220) | 0 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (5,556,300) | 618,330 |
Advances to suppliers | (282,288) | 577,814 |
Inventories | 2,530,386 | 901,707 |
Other receivables | (399,914) | (97,874) |
Prepaid expense and other assets | (152,508) | 134,549 |
Due from related parties | 240,601 | 879,756 |
Prepaid leases | 235,872 | 251,543 |
Accounts payable | 5,444 | 699,494 |
Advances from customers | 79,921 | 56,909 |
Other payables | (785,057) | 436,013 |
Taxes payable | 151,820 | 225,457 |
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | (146,663) | 9,454,722 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Acquisitions of property and equipment | (31,952) | (14,805) |
Loan advances to third parties | (979,465) | (125,940) |
Collections on loans to related parties | 501,119 | 222,616 |
Deposit for business acquisition | (2,074,198) | 0 |
Payments made on investment in unconsolidated entites | (200,000) | 0 |
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES | (2,784,496) | 81,871 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from short-term bank loans | 2,697,939 | 2,844,000 |
Proceeds from other short-term loans | 0 | 72,522 |
Repayment of short-term bank loans | (2,414,589) | (3,267,141) |
Proceeds from initial public offering, net of offering costs of $2,314,806 | 5,394,549 | 0 |
Proceeds from advances from related parties | 109,882 | 127,092 |
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES | 5,787,781 | (223,527) |
EFFECT OF EXCHANGE RATE CHANGE ON CASH | (1,122,302) | (585,031) |
NET INCREASE IN CASH | 1,734,320 | 8,728,035 |
CASH-Beginning of the Period | 22,009,374 | 6,056,105 |
CASH-End of the Period | 23,743,694 | 14,784,140 |
SUPPLEMENTAL CASH FLOW DISCLOSURES: | ||
Cash paid for income tax | 219,682 | 551,257 |
Cash paid for interest | $ 71,586 | $ 216,755 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) | 6 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
IPO [Member] | ||
Payments of Stock Issuance Costs | $ 2,314,806 | $ 2,314,806 |
ORGANIZATION AND NATURE OF OPER
ORGANIZATION AND NATURE OF OPERATIONS | 6 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | NOTE 1 - ORGANIZATION AND NATURE OF OPERATIONS Shineco, Inc. (“Shineco” or the “Company”) was incorporated in the State of Delaware on August 20, 1997. The Company is a holding company whose primary purpose is to develop business opportunities in the People’s Republic of China (“PRC” or “China”). On December 30, 2004, the Company acquired all of the issued and outstanding shares of Beijing Tenet-Jove Technological Development Corp., Ltd. (“Tenet-Jove”), a PRC company, in exchange for restricted shares of the Company’s common stock, and the sole operating business of the Company became that of its subsidiary, Tenet-Jove. Tenet-Jove was incorporated on December 15, 2003 under the laws of China. Consequently, Tenet-Jove became a 100 90 On December 31, 2008, June 11, 2011 and May 24, 2012, respectively, Tenet-Jove entered into a series of contractual agreements with the owners of Ankang Longevity Pharmaceutical (Group) Co., Ltd. (“Ankang Longevity Group”), each of Yantai Zhisheng International Freight Forwarding Co., Ltd (“Zhisheng Freight”), Yantai Zhisheng International Trade Co., Ltd (“Zhisheng Trade”), Yantai Mouping District Zhisheng Agricultural Produce Cooperative (“Zhisheng Agricultural”) and Qingdao Zhihesheng Agricultural Produce Services., Ltd (“Qingdao Zhihesheng”). On February 24, 2014, Tenet-Jove also subsequently entered into the same series of contractual agreements with ShinecoZhisheng (Beijing) Bio-Technology Co., Ltd (“Zhisheng Bio-Tech”), which is a new company incorporated in 2014. Zhisheng Bio-Tech, Zhisheng Freight, Zhisheng Trade, Zhisheng Agricultural, and Qingdao Zhihesheng are collectively referred to herein as “Zhisheng Group”. These agreements include an Executive Business Cooperation Agreement; Timely Reporting Agreements; Equity Interest Pledge Agreement and Executive Option Agreement. Pursuant to the above agreements, Tenet-Jove has the exclusive right to provide to Zhisheng Group and Ankang Longevity Group consulting services related to business operations and management. All the above contractual agreements obligate Tenet-Jove to absorb a majority of the risk of loss from Zhisheng Group and Ankang Longevity Group’s activities and entitle Tenet-Jove to receive a majority of their residual returns. In essence, Tenet-Jove has gained effective control over Zhisheng Group and Ankang Longevity Group. Therefore, the Company believes that Zhisheng Group and Ankang Longevity Group should be considered as Variable Interest Entities (“VIEs”) under the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 810 “Consolidation”. Accordingly, the accounts of these entities are consolidated with those of Tenet-Jove. Since Shineco is effectively controlled by the majority shareholders of Zhisheng Group and Ankang Longevity Group. Shineco owns 100% equity interest of Tenet-Jove. Accordingly, Shineco, Tenet-Jove, and its VIEs, Zhisheng Group and Ankang Longevity Group are effectively controlled by the same majority shareholders. Therefore, Shineco, Tenet-Jove and its VIEs are considered under common control. The consolidation of Tenet-Jove and its VIEs into Shineco has been accounted for at historical cost and prepared on the basis as if the aforementioned exclusive contractual agreements between Tenet-Jove and its VIEs had become effective as of the beginning of the first period presented in the accompanying consolidated financial statements. The Company, its subsidiaries, its VIEs and its VIEs’ subsidiaries (collectively the “Group”) operate three main business segments: 1) Tenet-Jove is engaged in planting, manufacturing and selling of Bluish Dogbane and related products, also known in Chinese as “Luobuma”, including therapeutic clothing and textile products made from Luobuma; 2) Zhisheng Group is engaged in the business of planting, processing and distributing of green agricultural produce as well as providing domestic and international logistic services for agricultural products (“Agricultural Products”); 3) Ankang Longevity Group develops and manufactures traditional Chinese medicinal herbal products as well as other retail pharmaceutical products. These different business activities and products can potentially be integrated and benefit from one and other. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial information pursuant to the rules of the SEC and have been consistently applied. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Interim results are not necessarily indicative of results of a full year. These financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Form 10-K for the fiscal year ended June 30, 2016, which was filed on September 28, 2016. The unaudited condensed consolidated financial statements of the Company reflect the principal activities of the Company, its subsidiaries, its VIEs and its VIEs’ subsidiaries. The non-controlling interest represents the minority shareholders’ interest in the Company’s majority owned subsidiaries. All intercompany transactions have been eliminated . Consolidation of Variable Interest Entities VIEs are generally entities that lack sufficient equity to finance their activities without additional financial support from other parties or whose equity holders lack adequate decision making ability. All VIEs with which the Company is involved must be evaluated to determine the primary beneficiary of the risks and rewards of the VIE. The primary beneficiary is required to consolidate the VIE for financial reporting purposes. The carrying amount of the VIEs and their subsidiaries’ consolidated assets and liabilities are as follows: December 31, 2016 June 30, 2016 Current assets $ 35,740,212 $ 30,560,208 Plant and equipment, net 8,965,391 9,595,357 Other noncurrent assets 9,807,252 10,136,632 Total assets 54,512,855 50,292,197 Total liabilities (4,709,592) (4,398,424) Net assets $ 49,803,263 $ 45,893,773 Non-controlling Interests US GAAP requires that non-controlling interests in subsidiaries and affiliates be reported in the equity section of a company’s balance sheet. In addition, the amounts attributable to the net income (loss) of those subsidiaries are reported separately in the unaudited condensed consolidated statements of income and comprehensive income. Risks and Uncertainties The operations of the Company are located in the PRC. Accordingly, the Company’s business, financial condition, and results of operations may be influenced by the political, economic, and legal environments in the PRC, as well as 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 other factors, the political, economic and legal environment and foreign currency exchange. The Company’s results may be adversely affected by changes in the political, regulatory and social conditions in the PRC, and by changes in governmental policies or interpretations with respect to laws and regulations, anti-inflationary measures, currency conversion, remittances abroad, and rates and methods of taxation, among other things. Although the Company has not experienced losses from these situations and believes that it is in compliance with existing laws and regulations, this may not be indicative of future results. Members of the current management team own controlling interests in the Company and are also the owners of the VIEs in the PRC. The Company only controls the VIEs through contractual arrangements which obligate it to absorb the risk of loss and to receive the residual expected returns. As such, the controlling shareholders of the Company and the VIEs could cancel these agreements or permit them to expire at the end of the agreement terms, as a result of which the Company would not retain control of the VIEs. Use of Estimates The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements as well as the reported amounts of revenue and expenses during the reporting period. Significant estimates required to be made by management include, but are not limited to, useful lives of property, plant, and equipment, and intangible assets, the recoverability of long-lived assets and the valuation of accounts receivable, accrued expenses, taxes payable and inventory reserve. Actual results could differ from those estimates. Revenue Recognition The Company recognizes revenue from sales of bluish dogbane products, Chinese medicinal herbal products and agricultural products, as well as providing logistic service and other processing service to external customers. The Company recognizes revenue when all of the following have occurred: (i) there is persuasive evidence of an arrangement with a customer; (ii) delivery has occurred or services have been rendered; (iii) the sales price is fixed or determinable; and (iv) the Company’s collection of such fees is reasonable assured. These criteria, as related to the Company’s revenue, are considered to have been met as follows: Sales of products : The Company recognizes revenue on sale of products when the goods are delivered and title to the goods passes to the customer provided that there are no uncertainties regarding customer acceptance; persuasive evidence of an arrangement exists; the sales price is fixed or determinable; and collectability is deemed probable. Revenue from the rendering of services: Revenue from international freight forwarding, domestic air and overland freight forwarding services are recognized upon the completion of the performance of services as stipulated in the underlying contract or when commodities are being released from the customer’s warehouse; the service price is fixed or determinable; and collectability is deemed probable. Cash and Cash Equivalents Cash and cash equivalents consist of cash on hand, cash on deposits and other highly liquid investments which are unrestricted as to withdrawal or use, and which have maturities of three months or less when purchased. The Company maintains cash and cash equivalents with various financial institutions mainly in the PRC. Balances in banks in the PRC are uninsured. As of December 31, 2016 and June 30, 2016, the Company had no cash equivalents. Accounts Receivable Accounts receivable are recorded at net realizable value consisting of carrying amount less an allowance for uncollectible accounts, as necessary. The Company reviews the accounts receivable on a periodic basis and makes general and specific allowance when there is doubt as to the collectability of individual balances. In evaluating the collectability of individual receivable balances, the Company considers many factors, including the age of the balance, customers’ historical payment history, their current credit-worthiness and current economic trends. As of December 31, 2016 and June 30, 2016, the allowances for doubtful accounts were $ 97,251 103,968 Accounts receivable-unconsolidated entity represents the amount due from Shaanxi Pharmaceutical Group Pai’ang Medicine Co. Ltd. (“Shaanxi Pharmaceutical Group”). The joint-venture company established by Shaanxi Pharmaceutical and the Company are required to exclusively purchase certain raw materials and drug products from Shaanxi Pharmaceutical Group. In return, Shaanxi Pharmaceutical Group has agreed to compensate Ankang Longevity Group with a preferred distribution that equals to 7% of the total purchases made from Shaanxi Pharmaceutical Group. The accounts receivable mainly represents the preferred distribution due from Shaanxi Pharmaceutical Group. Inventories Inventories, which are stated at the lower of cost or current market value, consisting of raw materials, work-in-progress, finished goods related to the Company’s products. Cost is determined using the first in first out (FIFO) method. Market is the lower of replacement cost or net realizable value. Agricultural products that the Company farms are recorded at cost, which includes direct costs such as seed selection, fertilizer, labor cost and contract fee that are spent in growing agricultural products on the leased farmland, and indirect costs which include amortization of prepayment of farmland lease fee and farmland development costs. All the costs are accumulated until the time of harvest and then allocated to harvested crops costs when they are sold. The Company periodically evaluates its inventory and records inventory reserve for certain inventories that may not be saleable. Advances to suppliers consist of balance paid to suppliers for materials that have not been received. Advances to suppliers are reviewed periodically to determine whether their carrying value has become impaired. As of December 31, 2016 and June 30, 2016, the Company had an allowance for uncollectible advances to suppliers in the amount of $ 9,679 10,118 Loans to third parties consist of various cash advances to unrelated companies and individuals, with whom the Company has business relationships. The loans are due within one year with no interest rate. Loans to third parties are reviewed periodically as to whether their carrying values remain realizable. Property and equipment are stated at cost, less accumulated depreciation and amortization. Expenditures for additions, major renewal and betterments are capitalized, and expenditures for maintenance and repairs are charged to expense as incurred. Depreciation is provided on a straight-line basis, less estimated residual value, over an asset’s estimated useful life, Farmland leasehold improvements are amortized over the shorter of lease term or estimated useful lives of the underlying assets. Estimated useful lives Buildings 20 50 Machinery equipment 5 10 Motor vehicles 5 10 Office equipment 5 10 Farmland leasehold improvements 12 18 Under PRC law, all land in the PRC is owned by the government and cannot be sold to an individual or company. The government grants individuals and companies the rights to use parcels of land for a specified period of time. Land use rights are stated at cost less accumulated amortization. Amortization is provided over the respective useful lives, using the straight-line method. Estimated useful life is 50 Finite-lived assets and intangibles are reviewed for impairment testing when circumstances require. For purposes of evaluating the recoverability of long-lived assets, when undiscounted future cash flows will not be sufficient to recover an asset’s carrying amount, the asset is written down to its fair value. The long-lived assets of the Company that are subject to evaluation consist primarily of property, plant and equipment, land use rights, investments and long-term prepaid lease. For the six and three months ended December 31, 2016 and 2015, the Company did not recognize any impairment of its long-lived assets. The Company adopted the provisions of ASC 820, “Fair Value Measurements and Disclosures.” ASC 820 clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows: Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. The carrying value of current assets and liabilities approximate their fair values because of the short-term nature of these instruments. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the unaudited condensed consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The provisions of ASC 740-10-25, “Accounting for Uncertainty in Income Taxes,” prescribe a more-likely-than-not threshold for consolidated financial statement recognition and measurement of a tax position taken (or expected to be taken) in a tax return. This ASC also provides guidance on the recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, and related disclosures. The Company does not have any uncertain tax positions at December 31, 2016 and June 30, 2016. The statute of limitations for the Company’s U.S. federal income tax returns and certain state income tax returns remains open for tax years 2013 and after. As of December 31, 2016, the tax years ended June 30, 2007 through June 30, 2016 for the Company’s People’s Republic of China (“PRC”) subsidiaries remain open for statutory examination by PRC tax authorities. Sales revenue represents the invoiced value of goods, net of a Value-Added Tax (“VAT”). All of the Company’s products that are sold in the PRC are subject to a Chinese value-added tax at a rate of 17 The Company uses the United States dollar (“U.S. dollars” or “USD”) for financial reporting purposes. The Company’s subsidiaries and VIEs maintain their books and records in their functional currency of Renminbi (“RMB”), the currency of the PRC. In general, for consolidation purposes, the Company translates the assets and liabilities of its subsidiaries and VIEs into U.S. dollars using the applicable exchange rates prevailing at the balance sheet date, and the statements of income and cash flows are translated at average exchange rates during the reporting period. As a result, amounts related to assets and liabilities reported on the statement of cash flows will not necessarily agree with changes in the corresponding balances on the balance sheet. Equity accounts are translated at historical rates. Adjustments resulting from the translation of the financial statements of the subsidiaries and VIEs are recorded as accumulated other comprehensive loss. The balance sheet amounts, with the exception of equity, at December 31, 2016 and June 30, 2016 were translated at 1 RMB to $ 0.1440 0.1505 0.1482 0.1580 0.1463 0.1565 Comprehensive income consists of two components, net income and other comprehensive loss. The foreign currency translation gain or loss resulting from translation of the financial statements expressed in RMB to US$ is reported in other comprehensive loss in the unaudited condensed consolidated statements of income and comprehensive income. An investment in which the Company has the ability to exercise significant influence, but does not have a controlling interest, is accounted for using the equity method. Significant influence is generally considered to exist when the Company has an ownership interest in the voting stock between 20 50 The Company computes earnings per share (“EPS”) in accordance with ASC 260, “Earnings per Share” (“ASC 260”). ASC 260 requires companies with complex capital structures to present basic and diluted EPS. Basic EPS is measured as net income divided by the weighted average common shares outstanding for the period. Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of potential common shares (e.g., convertible securities, options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential common shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. There is no anti-dilutive effect for the six months and three months ended December 31, 2016 and 2015. In May 2014, the Financial Accounting Standards Board (“FASB”) issued an update ("ASU 2014-09") establishing Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers Deferral of the Effective Date Principal versus Agent Considerations (Reporting Revenue Gross versus Net), , Identifying Performance Obligations and Licensing, Narrow-Scope Improvements and Practical Expedients, In August 2016, the Financial Accounting Standards Board (the “FASB”) has issued Accounting Standards Update (ASU) No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, to address diversity in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The amendments provide guidance on the following eight specific cash flow issues: (1) Debt Prepayment or Debt Extinguishment Costs; (2) Settlement of Zero-Coupon Debt Instruments or Other Debt Instruments with Coupon Interest Rates That Are Insignificant in Relation to the Effective Interest Rate of the Borrowing; (3) Contingent Consideration Payments Made after a Business Combination; (4)Proceeds from the Settlement of Insurance Claims; (5) Proceeds from the Settlement of Corporate-Owned Life Insurance Policies, including Bank-Owned; (6) Life Insurance Policies; (7) Distributions Received from Equity Method Investees; (8) Beneficial Interests in Securitization Transactions; and Separately Identifiable Cash Flows and Application of the Predominance Principle. The amendments are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019. Early adoption is permitted, including adoption in an interim period. The amendments should be applied using a retrospective transition method to each period presented. If it is impracticable to apply the amendments retrospectively for some of the issues, the amendments for those issues would be applied prospectively as of the earliest date practicable. The Company expects that the adoption of this ASU would not have a material impact on the Company’s unaudited condensed consolidated financial statements. In October 2016, the FASB has issued ASU No. 2016-17, Consolidation (Topic 810): Interest Held through Related Parties That Are under Common Control, to provide guidance on the evaluation of whether a reporting entity is the primary beneficiary of a VIE by amending how a reporting entity, that is a single decision maker of a VIE, treats indirect interests in that entity held through related parties that are under common control. The amendments are effective for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2016, and interim periods within fiscal years beginning after December 15, 2017. Early adoption is permitted, including adoption in an interim period. The Company expects that the adoption of this ASU would not have any impact on the Company’s unaudited condensed consolidated financial statements as there are no interests held through related parties that are under common control. In January 2017, the FASB issued ASU 2017-01, which clarifies the definition of a business to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The standard will be effective for us in the first quarter of our fiscal 2019. The Company expects that the adoption of this ASU would not have a material impact on the Company’s unaudited condensed consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-03, Accounting Changes and Error Corrections (Topic 250) and InvestmentsEquity Method and Joint Ventures (Topic 323). The amendments amended Accounting Changes and Error Corrections (Topic 250) to state that registrants should consider additional qualitative disclosures if the impact of an issued but not yet adopted ASU is unknown or cannot be reasonably estimated and to include a description of the effect of the accounting policies that the registrant expects to apply, if determined. Transition guidance included in certain issued but not yet adopted ASUs was also updated to reflect this amendment. The Company does not expect that the adoption of this guidance will have a material impact on its consolidated financial statements. |
INVENTORIES
INVENTORIES | 6 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Inventory Disclosure [Text Block] | NOTE 3- INVENTORIES The inventories consist of the following: December 31, 2016 June 30, 2016 Raw materials $ 818,441 $ 825,028 Work-in-process 181,394 3,230,729 Finished goods 1,714,811 1,354,176 Packing materials 18,333 17,531 Less: inventory reserve (818,637) (819,285) Total $ 1,914,342 $ 4,608,179 Work-in-process includes direct costs such as seed selection, fertilizer, labor cost and subcontractor fee that are spent in growing agricultural products on the leased farmland, and indirect costs which include amortization of prepayment of farmland lease fee and farmland development cost. All the costs are accumulated until the time of harvest and then allocated to harvested crops costs when they are sold. |
DEPOSIT FOR BUSINESS ACQUISITIO
DEPOSIT FOR BUSINESS ACQUISITION | 6 Months Ended |
Dec. 31, 2016 | |
Business Combinations [Abstract] | |
Business Combination Disclosure [Text Block] | NOTE 4- DEPOSIT FOR BUSINESS ACQUISITION On December 12, 2016, the Company entered into a merger and acquisition agreement with Tianjin Tajite E-Commerce Co., Ltd. (“Tianjin Tajite”), a professional e-commerce company distributing Luobuma fabric commodities and Japanese elderly products based in Tianjin, China, to acquire 51% equity interest of Tianjin Tajite. Pursuant to the agreement, the Company made a payment of RMB 14,000,000 (approximately $2,016,000 as of December 31, 2016) for the planned business acquisition. |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 6 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment Disclosure [Text Block] | NOTE 5- PROPERTY AND EQUIPMENT, NET Property and equipment consist of the following: December 31, 2016 June 30, 2016 Buildings $ 10,261,246 $ 10,726,872 Building improvement 50,541 52,834 Machinery equipment 455,628 443,846 Motor vehicles 221,388 231,434 Construction in progress 431,913 451,512 Office equipment 198,993 208,022 Farmland leasehold improvement 3,027,561 3,164,943 14,647,270 15,279,463 Less: accumulated depreciation and amortization (4,333,990) (4,244,264) Property, plant and equipment, net $ 10,313,280 $ 11,035,199 Depreciation and amortization expense charged to operations were $ 281,924 382,403 Farmland leasehold improvements consist of following: December 31, 2016 June 30, 2016 Blueberry farmland leasehold reconstruction $ 2,325,907 $ 2,431,450 Yew tree planting base reconstruction 260,588 272,412 Greenhouse renovation 441,066 461,081 Total farmland leasehold improvement $ 3,027,561 $ 3,164,943 |
LAND USE RIGHTS, NET
LAND USE RIGHTS, NET | 6 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets Disclosure [Text Block] | NOTE 6- LAND USE RIGHTS, NET The Company states land use right at cost less accumulated amortization. All land in the People’s Republic of China is government owned and cannot be sold to any individual or company. However, the government grants the user a “land use right” (the “Right”) to use the land. The Company has the Right to use the land for 50 years and amortizes the Right on a straight-line basis over the period of 50 years. December 31, 2016 June 30, 2016 Land use rights $ 1,601,387 $ 1,674,053 Less: accumulated amortization (268,393) (265,288) Land use rights, net $ 1,332,994 $ 1,408,765 For the six months ended December 31, 2016 and 2015, the Company incurred amortization expense of $ 15,045 17,574 The estimated future amortization expenses are as follows: Twelve months ending December 31: 2017 $ 32,028 2018 32,028 2019 32,028 2020 32,028 2021 32,028 Thereafter 1,172,854 Total $ 1,332,994 |
INVESTMENTS
INVESTMENTS | 6 Months Ended |
Dec. 31, 2016 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investments and Joint Ventures Disclosure [Text Block] | NOTE 7- INVESTMENTS Ankang Longevity Group entered into two equity investment agreements with a third party, Shaanxi Pharmaceutical Group Pai’ang Medicine Co. Ltd., a Chinese state-owned pharmaceutical enterprise to invest a total of RMB 6.8 1.0 49 401,768 359,665 239,886 211,065 Ankang Longevity Group entered into a supplemental agreement with Shaanxi Pharmaceutical Group Pai’ang Medicine Co. Ltd. (“Shaanxi Pharmaceutical Group”). According to the supplemental agreement, the new joint-venture companies established by Shaanxi Pharmaceutical and Ankang Longevity Group are required to exclusively purchase certain raw materials and drug products from Shaanxi Pharmaceutical Group. In return, Shaanxi Pharmaceutical Group has agreed to compensate Ankang Longevity Group with a preferred distribution equal to 7 592,628 576,700 49 352,638 385,251 On October 21, 2013, the Company, through its controlled subsidiaries, Zhisheng Freight and Zhisheng Agricultural, entered into an agreement with an unrelated third party, Zhejiang Zhen’Ai Network Warehousing Services Co., Ltd. (“Zhen’Ai Network”), and invested RMB 14.5 2.2 29 30 10 30 On November 21, 2016, the Company (the “Investor”) entered into an agreement with Original Lab Inc., a California corporation (the “Investee”), that the investor makes a payment of $ 200,000 December 31, 2016 June 30, 2016 Shaanxi Pharmacy Holding Group Longevity Pharmacy Co., Ltd ( Ankang Longevity Pharmacy ) $ 2,332,111 $ 2,091,531 Shaanxi Pharmacy Sunsimiao Drugstores Ankang Chain Co., Ltd 530,656 493,008 Zhejiang Zhen’Ai Network Warehousing Services Co., Ltd. 2,087,580 2,182,308 Original Lab Inc. 200,000 - Total $ 5,150,347 $ 4,766,847 December 31, 2016 June 30, 2016 Current assets $ 27,091,152 $ 28,450,106 Noncurrent assets 287,674 386,764 Current liabilities 21,551,268 23,577,799 For the six months ended December 31, 2016 2015 Net sales $ 14,651,055 $ 12,692,508 Gross profit 1,947,737 1,873,301 Income from operations 815,437 738,058 Net income 819,935 734,009 |
PREPAID LEASES
PREPAID LEASES | 6 Months Ended |
Dec. 31, 2016 | |
PREPAID LEASES [Abstract] | |
Prepaid Leases [Text Block] | NOTE 8 - PREPAID LEASES One of the Company’s controlled subsidiaries, Zhisheng Group entered into several farmland lease contracts with farmer cooperatives to lease farmland in order to plant and grow organic vegetable, fruit and Chinese yew trees. The lease term varies from 5 24 36.8 5.3 These leases are accounted for as operating leases and will be amortized each year on a straight-line basis over the lease terms. The amortization expense is initially recorded as work in process under inventory account during the growing period and then transferred to harvested crops costs at the time of harvest and then allocated to cost of sales when they are sold. December 31, 2016 June 30, 2016 Current $ 455,920 $ 478,565 Non-current 3,465,424 3,860,327 Total $ 3,921,344 $ 4,338,892 Twelve months ending December 31: 2017 $ 455,920 2018 454,673 2019 454,673 2020 310,222 2021 207,043 Thereafter 2,038,813 Total $ 3,921,344 |
SHORT-TERM LOANS
SHORT-TERM LOANS | 6 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Debt Disclosure [Text Block] | NOTE 9 - SHORT-TERM LOANS December 31, Maturity Int. Lender 2016 Date Rate/Year Wanxiang Trust Co., Ltd-a $ 22,675 2017-9-9 13.48 % Agricultural Bank of China-b 287,942 2017-10-12 5.22 % Agricultural Bank of China-c 719,855 2017-8-18 5.71 % Agricultural Bank of China-d 1,151,768 2017-11-27 5.22 % Agricultural Bank of China-d 287,942 2017-4-7 5.22 % Agricultural Bank of China-e 431,913 2017-11-15 5.22 % Total $ 2,902,095 Maturity Int. Lender June 30, 2016 Date Rate/Year Chongqing Alibaba Micro-Credit Company-a $ 36,873 2016-9-9 * 15.21 % Agricultural Bank of China-b 301,008 2016-9-24 * 5.52 % Agricultural Bank of China-d 451,512 2016-8-9 * 5.82 % Agricultural Bank of China-d 451,512 2016-10-27 * 5.27 % Agricultural Bank of China-d 1,204,032 2016-11-18 * 5.22 % Agricultural Bank of China-d 301,008 2017-4-7 5.22 % Total $ 2,745,945 The loans outstanding were guaranteed by the following properties, entities or individuals: a. Not collateralized or guaranteed. b. Collateralized by the building owned by Xiaoyan Chen and Jing Chen, who are both the related parties of the company. Xiaoyan Chen is one of the shareholders of Ankang Longevity Pharmaceutical (Group) Co., Ltd. Jing Chen is the sister of the Xiaoyan Chen but not a shareholder of Ankang Longevity Group. c. Guaranteed by commercial credit guaranty companies unrelated to the Company. d. Guaranteed by a commercial credit guaranty company, unrelated to the Company and also by Jiping Chen, a shareholder of the Company. e. Guaranteed by a third-party company and also by Jiping Chen, a shareholder of the Company. * The Company repaid the loans in full on maturity date. The Company recorded interest expense of $ 71,586 73,248 5.46 6.44 The Company recorded interest expense of $ 32,283 31,148 5.43 5.92 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions Disclosure [Text Block] | NOTE 10 - RELATED PARTY TRANSACTIONS DUE FROM RELATED PARTIES The Company had previously made temporary advances to certain shareholders of the Company as well as several other entities that are either owned by directors or family members of those directors. Those advances are due on demand, non-interest bearing, except for the advance to Xinyang Yifangyuan Garden Technology Co., Ltd., which bears fixed monthly interest rate of 4.17 December 31, 2016 June 30, 2016 Shaanxi Pharmaceutical Group Pai’ang Medicine Co., Ltd $ 497,197 $ 820,728 Yang Bin 143,971 150,504 Chang Song 141,484 85,035 Zhang Xin 89,262 93,312 TianjinTajite E-Commerce Co., Ltd 79,076 - Wang Qi Wei 7,919 8,279 Huiyin Ansheng 6,200 - Xinyang Yifangyuan Garden Technology Co., Ltd - 500,784 Tian Shuangpeng - 11,288 Qi Qiuchi - 1,505 $ 965,109 $ 1,671,435 For the six months ended December 31, 2016 and 2015, interest income of $ 87,220 156,217 For the three months ended December 31, 2016 and 2015, interest income of $ 30,972 96,322 DUE TO RELATED PARTIES As of December 31, 2016 and June 30, 2016, the Company has related party payables of $ 341,062 244,915 December 31, 2016 June 30, 2016 Wu Yang $ 106,611 $ 96,398 Xiong Kun 81,632 - Wang Sai 141,609 120,854 Zhang Yuying 11,210 26,769 $ 341,062 $ 244,915 SALES TO AND PURCHASES FROM RELATED PARTIES For the six and three months ended December 31, 2016, the Company recorded sales to Shaanxi Pharmaceutical Group Pai’ang Medicine Co., Ltd, a related party, of $ 1,682,604 882,405 For the six and three months ended December 31, 2015, the Company recorded sales to Shaanxi Pharmaceutical Group Pai’ang Medicine Co., Ltd, a related party, of $ 1,509,728 763,253 |
TAXES
TAXES | 6 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure [Text Block] | NOTE 11 - TAXES (a) Corporate Income Taxes The Company is subject to income taxes on an entity basis on income arising in or derived from the location in which each entity is domiciled. Shineco is incorporated in the United States and has no operating activities. Tenet-Jove and its VIEs entities are governed by the Income Tax Laws of the PRC, and are currently subject to tax at a statutory rate of 25 i) The components of the income tax expense are as follows: For the six months ended For the three months ended December 31, December 31, 2016 2015 2016 2015 Current income tax provision $ 548,811 $ 685,388 $ 343,292 $ 393,454 Deferred income tax benefit (43,424) (58,501) (39,541) (67,516) Total $ 505,387 $ 626,887 $ 303,751 $ 325,938 ii) The following table summarizes deferred tax assets resulting from differences between the financial reporting basis and tax basis of assets and liabilities: December 31, 2016 June 30, 2016 Allowance for doubtful accounts $ 151,704 $ 123,818 Inventory reserve 203,769 203,674 Net operating loss carry-forwards 109,169 114,122 Total 464,642 441,614 Valuation allowance (109,169) (114,122) Deferred tax assets, net $ 355,473 $ 327,492 December 31, 2016 June 30, 2016 Beginning balance $ 114,122 $ 108,932 Current year addition - 13,971 Exchange difference (4,953) (8,781) Ending balance $ 109,169 $ 114,122 (b) Value Added Tax The Company is subject to a value added tax (“VAT”) for selling merchandise. The applicable VAT rate is 17 In the event that the PRC tax authorities dispute the date on which revenue is recognized for tax purposes, the PRC tax office has the right to assess a penalty based on the amount of the taxes which are determined to be late or deficient, and will be expensed in the period if and when a determination is made by the tax authorities. (c) Taxes Payable December 31, 2016 June 30, 2016 Income tax payable $ 1,308,221 $ 1,201,641 Value added tax payable 54,864 69,955 Business tax and other taxes payable 6,303 6,546 $ 1,369,388 $ 1,278,142 |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 6 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Stockholders' Equity Note Disclosure [Text Block] | NOTE 12 SHAREHOLDERS’ EQUITY Initial Public Offering On September 28, 2016, the Company completed its initial public offering of 1,713,190 4.50 7.7 5.4 Stock Incentive Plan On September 23, 2016, the Board of Directors of the Company approved a stock incentive plan (“Plan”). Pursuant to the Plan, the Company plans to file a registration statement on Form S-8, as soon as practicable, to register up to 2,103,407 Statutory Reserve The Company is required to make appropriations to reserve funds, comprising the statutory surplus reserve and discretionary surplus reserve, based on after-tax net income determined in accordance with generally accepted accounting principles of the PRC (“PRC GAAP”). Appropriations to the statutory surplus reserve is required to be at least 10 50 3,363,914 3,242,139 |
CONCENTRATION AND RISKS
CONCENTRATION AND RISKS | 6 Months Ended |
Dec. 31, 2016 | |
Risks and Uncertainties [Abstract] | |
Concentration Risk Disclosure [Text Block] | NOTE 13- CONCENTRATION AND RISKS The Company maintains certain bank accounts in the PRC which are not protected by Federal Deposit Insurance Corporation (“FDIC”) insurance or other insurance. The cash balance held in the PRC bank accounts was $ 23,666,340 21,986,817 During the six months ended December 31, 2016 and 2015, almost 100 100 For the six months ended December 31, 2016, one customer accounted for approximately 16 38 For the three months ended December 31, 2016, three customers accounted for approximately 13 12 11 38 For the six months ended December 31, 2016, three vendors accounted for approximately 17 15 13 29 16 11 For the three months ended December 31, 2016, four vendors accounted for approximately 25 20 13 10 36 25 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | NOTE 14 - COMMITMENTS AND CONTINGENCIES Lease Commitments The Company leases eight main office spaces under non-cancelable operating lease agreements through February 28, 2019. The Company also leases farmland under a non-cancelable operating lease agreement through April 26, 2041. Most of those operating lease payments are scheduled on a quarterly basis. The future minimum rental payments are as follows: 2017 $ 610,109 2018 315,499 2019 213,962 2020 213,346 2021 213,346 Thereafter 4,124,691 Total $ 5,690,953 Rent expense totaled $ 324,173 126,590 Rent expense totaled $ 159,271 66,297 In addition, the Company sublets the above-mentioned farmland to a third party under a non-cancelable operating lease agreement through May 31, 2020 2017 $ 213,346 2018 213,346 2019 213,346 2020 88,895 Total $ 728,933 Sublease rental income totaled $ 106,673 113,760 Sublease rental income totaled $ 53,337 56,880 Legal Contingencies From time to time, the Company is a party to various legal actions arising in the ordinary course of business. The Company accrues costs associated with these matters when they become probable and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies are expensed as incurred. The Company's management does not expect any liability from the disposition of such claims and litigation individually or in the aggregate would have a material adverse impact on the Company's consolidated financial position, results of operations and cash flows. |
SEGMENT REPORTING
SEGMENT REPORTING | 6 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Segment Reporting Disclosure [Text Block] | NOTE 15 - SEGMENT REPORTING ASC 280, “Segment Reporting”, establishes standards for reporting information about operating segments on a basis consistent with the Group's internal organizational structure as well as information about geographical areas, business segments and major customers in financial statements for details on the Group's business segments. The Company's chief operating decision maker has been identified as the Chief Executive Officer who reviews the financial information of separate operating segments when making decisions about allocating resources and assessing performance of the Group. Based on management's assessment, the Company has determined that it has three operating segments according to the major products and locations as follows: Ø Developing, manufacturing and distributing of specialized fabrics, textile products and other by-products derived from an indigenous Chinese plant called Apocynum Venetum, commonly known as “Bluish Dogbane” or known in Chinese as “Luobuma” (referred to herein as Luobuma): The operating companies of this segment, namely Tenet-Jove and Tenet Huatai, specialize in Luobuma developing and manufacturing of relevant products. With rich experience and broad channels in domestic market, the Group is leading in Luobuma textile production and other by-products. This segment’s operations are focused in the north region of Mainland China, mostly carried out in Beijing and Tianjin City. Ø Planting, processing and distributing of traditional Chinese medicinal herbal products as well as other pharmaceutical products (“Herbal products”): The operating companies of this segment, namely AnKang Longevity Group and its subsidiaries, plant and process more than 600 kinds of Chinese medicinal herbal products with an established domestic sales and distribution network. Ankang Longevity Group is also engaged in retail pharmacy business and the operating revenue is also included in this segment due to immaterial amount. Ankang Longevity Group also started a joint-venture pharmacy retail and wholesale distribution business in the second quarter of 2013 with a large Chinese pharmaceutical company, Shaanxi Pharmaceutical Holdings Group, aiming to expand its pharmacy retail and wholesale business. The operations of this segment are mainly located in the Mid-western region of Mainland China. Ø Planting, processing and distributing of green and organic agricultural produce as well as growing and cultivating of Chinese Yew trees (“Agricultural products”): The operating companies of this segment, the Zhisheng Group, engage in the business of growing and distributing green and organic vegetables and fruits as well as providing logistics services for distributing agricultural products. This segment has been focusing its efforts on the growing and cultivating of Chinese yew tree (formally known as “taxus media”), a small evergreen tree whose branches can be used for the production of anti-cancer medication and tree itself can be used for ornamental indoor bonsai tree, which are known to have the effect of purifying air quality. The operations of this segment are located in the East and North regions of Mainland China, mostly carried out in Shandong Province and in Beijing where the Zhisheng Group has newly developed over 100 acres of modern greenhouses for cultivating yew trees and other plants. The following table presents summarized information by segment for the six months ended December 31, 2016: For the six months ended December 31, 2016 Bluish Herbal Agricultural dogbane products products Total Segment revenue $ 1,647,959 $ 6,676,290 $ 9,265,481 $ 17,589,730 Cost of goods 808,338 4,915,064 5,963,904 11,687,306 Business and sales related tax 8,472 25,492 - 33,964 Gross profit 831,149 1,735,734 3,301,577 5,868,460 Gross profit contribution % 14.1 % 29.6 % 56.3 % 100.0 % The following table presents summarized information by segment for six months ended December 31, 2015: For the six months ended December 31, 2015 Bluish Herbal Agricultural dogbane products products Total Segment revenue $ 2,446,684 $ 7,264,849 $ 9,699,384 $ 19,410,917 Cost of goods 1,146,076 5,483,293 6,010,745 12,640,114 Business and sales related tax 11,428 27,138 - 38,566 Gross profit 1,289,180 1,754,418 3,688,639 6,732,237 Gross profit contribution % 19.1 % 26.1 % 54.8 % 100.0 % The following table presents summarized information by segment for the three months ended December 31, 2016: For the three months ended December 31, 2016 Bluish Herbal Agricultural dogbane products products Total Segment revenue $ 910,498 $ 3,495,919 $ 6,816,649 $ 11,223,066 Cost of goods 441,118 2,477,351 4,332,665 7,251,134 Business and sales related tax 4,868 13,551 - 18,419 Gross profit 464,512 1,005,017 2,483,984 3,953,513 Gross profit contribution % 11.7 % 25.4 % 62.9 % 100.0 % The following table presents summarized information by segment for three months ended December 31, 2015: For the three months ended December 31, 2015 Bluish Herbal Agricultural dogbane products products Total Segment revenue $ 1,351,139 $ 3,784,670 $ 6,989,189 $ 12,124,998 Cost of goods 745,858 2,789,035 4,248,343 7,783,236 Business and sales related tax 7,153 14,819 - 21,972 Gross profit 598,128 980,816 2,740,846 4,319,790 Gross profit contribution % 13.9 % 22.7 % 63.4 % 100.0 % Total Assets as of December 31, 2016 June 30, 2016 Bluish Dogbane or “Luobuma” $ 6,871,687 $ 6,963,093 Herbal products 33,030,072 28,088,515 Agricultural products 23,869,956 21,997,180 $ 63,771,715 $ 57,048,788 |
SUMMARY OF SIGNIFICANT ACCOUN22
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation [Policy Text Block] | Basis of Presentation and Principles of Consolidation The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial information pursuant to the rules of the SEC and have been consistently applied. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Interim results are not necessarily indicative of results of a full year. These financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Form 10-K for the fiscal year ended June 30, 2016, which was filed on September 28, 2016. The unaudited condensed consolidated financial statements of the Company reflect the principal activities of the Company, its subsidiaries, its VIEs and its VIEs’ subsidiaries. The non-controlling interest represents the minority shareholders’ interest in the Company’s majority owned subsidiaries. All intercompany transactions have been eliminated . |
Consolidation, Variable Interest Entity, Policy [Policy Text Block] | Consolidation of Variable Interest Entities VIEs are generally entities that lack sufficient equity to finance their activities without additional financial support from other parties or whose equity holders lack adequate decision making ability. All VIEs with which the Company is involved must be evaluated to determine the primary beneficiary of the risks and rewards of the VIE. The primary beneficiary is required to consolidate the VIE for financial reporting purposes. The carrying amount of the VIEs and their subsidiaries’ consolidated assets and liabilities are as follows: December 31, 2016 June 30, 2016 Current assets $ 35,740,212 $ 30,560,208 Plant and equipment, net 8,965,391 9,595,357 Other noncurrent assets 9,807,252 10,136,632 Total assets 54,512,855 50,292,197 Total liabilities (4,709,592) (4,398,424) Net assets $ 49,803,263 $ 45,893,773 |
Consolidation, Subsidiaries or Other Investments, Consolidated Entities, Policy [Policy Text Block] | Non-controlling Interests US GAAP requires that non-controlling interests in subsidiaries and affiliates be reported in the equity section of a company’s balance sheet. In addition, the amounts attributable to the net income (loss) of those subsidiaries are reported separately in the unaudited condensed consolidated statements of income and comprehensive income. |
Risks and Uncertainties [Policy Text Block] | Risks and Uncertainties The operations of the Company are located in the PRC. Accordingly, the Company’s business, financial condition, and results of operations may be influenced by the political, economic, and legal environments in the PRC, as well as 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 other factors, the political, economic and legal environment and foreign currency exchange. The Company’s results may be adversely affected by changes in the political, regulatory and social conditions in the PRC, and by changes in governmental policies or interpretations with respect to laws and regulations, anti-inflationary measures, currency conversion, remittances abroad, and rates and methods of taxation, among other things. Although the Company has not experienced losses from these situations and believes that it is in compliance with existing laws and regulations, this may not be indicative of future results. Members of the current management team own controlling interests in the Company and are also the owners of the VIEs in the PRC. The Company only controls the VIEs through contractual arrangements which obligate it to absorb the risk of loss and to receive the residual expected returns. As such, the controlling shareholders of the Company and the VIEs could cancel these agreements or permit them to expire at the end of the agreement terms, as a result of which the Company would not retain control of the VIEs. |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements as well as the reported amounts of revenue and expenses during the reporting period. Significant estimates required to be made by management include, but are not limited to, useful lives of property, plant, and equipment, and intangible assets, the recoverability of long-lived assets and the valuation of accounts receivable, accrued expenses, taxes payable and inventory reserve. Actual results could differ from those estimates. |
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition The Company recognizes revenue from sales of bluish dogbane products, Chinese medicinal herbal products and agricultural products, as well as providing logistic service and other processing service to external customers. The Company recognizes revenue when all of the following have occurred: (i) there is persuasive evidence of an arrangement with a customer; (ii) delivery has occurred or services have been rendered; (iii) the sales price is fixed or determinable; and (iv) the Company’s collection of such fees is reasonable assured. These criteria, as related to the Company’s revenue, are considered to have been met as follows: Sales of products : The Company recognizes revenue on sale of products when the goods are delivered and title to the goods passes to the customer provided that there are no uncertainties regarding customer acceptance; persuasive evidence of an arrangement exists; the sales price is fixed or determinable; and collectability is deemed probable. Revenue from the rendering of services: Revenue from international freight forwarding, domestic air and overland freight forwarding services are recognized upon the completion of the performance of services as stipulated in the underlying contract or when commodities are being released from the customer’s warehouse; the service price is fixed or determinable; and collectability is deemed probable. |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and Cash Equivalents Cash and cash equivalents consist of cash on hand, cash on deposits and other highly liquid investments which are unrestricted as to withdrawal or use, and which have maturities of three months or less when purchased. The Company maintains cash and cash equivalents with various financial institutions mainly in the PRC. Balances in banks in the PRC are uninsured. As of December 31, 2016 and June 30, 2016, the Company had no cash equivalents. |
Receivables, Policy [Policy Text Block] | Accounts Receivable Accounts receivable are recorded at net realizable value consisting of carrying amount less an allowance for uncollectible accounts, as necessary. The Company reviews the accounts receivable on a periodic basis and makes general and specific allowance when there is doubt as to the collectability of individual balances. In evaluating the collectability of individual receivable balances, the Company considers many factors, including the age of the balance, customers’ historical payment history, their current credit-worthiness and current economic trends. As of December 31, 2016 and June 30, 2016, the allowances for doubtful accounts were $ 97,251 103,968 Accounts receivable-unconsolidated entity represents the amount due from Shaanxi Pharmaceutical Group Pai’ang Medicine Co. Ltd. (“Shaanxi Pharmaceutical Group”). The joint-venture company established by Shaanxi Pharmaceutical and the Company are required to exclusively purchase certain raw materials and drug products from Shaanxi Pharmaceutical Group. In return, Shaanxi Pharmaceutical Group has agreed to compensate Ankang Longevity Group with a preferred distribution that equals to 7% of the total purchases made from Shaanxi Pharmaceutical Group. The accounts receivable mainly represents the preferred distribution due from Shaanxi Pharmaceutical Group. |
Inventory, Policy [Policy Text Block] | Inventories Inventories, which are stated at the lower of cost or current market value, consisting of raw materials, work-in-progress, finished goods related to the Company’s products. Cost is determined using the first in first out (FIFO) method. Market is the lower of replacement cost or net realizable value. Agricultural products that the Company farms are recorded at cost, which includes direct costs such as seed selection, fertilizer, labor cost and contract fee that are spent in growing agricultural products on the leased farmland, and indirect costs which include amortization of prepayment of farmland lease fee and farmland development costs. All the costs are accumulated until the time of harvest and then allocated to harvested crops costs when they are sold. The Company periodically evaluates its inventory and records inventory reserve for certain inventories that may not be saleable. |
Advances to Suppliers [Policy Text Block] | Advances to Suppliers Advances to suppliers consist of balance paid to suppliers for materials that have not been received. Advances to suppliers are reviewed periodically to determine whether their carrying value has become impaired. As of December 31, 2016 and June 30, 2016, the Company had an allowance for uncollectible advances to suppliers in the amount of $ 9,679 10,118 |
Finance, Loans and Leases Receivable, Policy [Policy Text Block] | Loans to Third Parties Loans to third parties consist of various cash advances to unrelated companies and individuals, with whom the Company has business relationships. The loans are due within one year with no interest rate. Loans to third parties are reviewed periodically as to whether their carrying values remain realizable. |
Property, Plant and Equipment, Policy [Policy Text Block] | Property and Equipment Property and equipment are stated at cost, less accumulated depreciation and amortization. Expenditures for additions, major renewal and betterments are capitalized, and expenditures for maintenance and repairs are charged to expense as incurred. Depreciation is provided on a straight-line basis, less estimated residual value, over an asset’s estimated useful life, Farmland leasehold improvements are amortized over the shorter of lease term or estimated useful lives of the underlying assets. Estimated useful lives Buildings 20 50 Machinery equipment 5 10 Motor vehicles 5 10 Office equipment 5 10 Farmland leasehold improvements 12 18 |
Goodwill and Intangible Assets, Intangible Assets, Policy [Policy Text Block] | Land Use Right Under PRC law, all land in the PRC is owned by the government and cannot be sold to an individual or company. The government grants individuals and companies the rights to use parcels of land for a specified period of time. Land use rights are stated at cost less accumulated amortization. Amortization is provided over the respective useful lives, using the straight-line method. Estimated useful life is 50 |
Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block] | Long-lived Assets Finite-lived assets and intangibles are reviewed for impairment testing when circumstances require. For purposes of evaluating the recoverability of long-lived assets, when undiscounted future cash flows will not be sufficient to recover an asset’s carrying amount, the asset is written down to its fair value. The long-lived assets of the Company that are subject to evaluation consist primarily of property, plant and equipment, land use rights, investments and long-term prepaid lease. For the six and three months ended December 31, 2016 and 2015, the Company did not recognize any impairment of its long-lived assets. |
Fair Value of Financial Instruments, Policy [Policy Text Block] | Fair Value of Financial Instruments The Company adopted the provisions of ASC 820, “Fair Value Measurements and Disclosures.” ASC 820 clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows: Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. The carrying value of current assets and liabilities approximate their fair values because of the short-term nature of these instruments. |
Income Tax, Policy [Policy Text Block] | Income Taxes Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the unaudited condensed consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The provisions of ASC 740-10-25, “Accounting for Uncertainty in Income Taxes,” prescribe a more-likely-than-not threshold for consolidated financial statement recognition and measurement of a tax position taken (or expected to be taken) in a tax return. This ASC also provides guidance on the recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, and related disclosures. The Company does not have any uncertain tax positions at December 31, 2016 and June 30, 2016. The statute of limitations for the Company’s U.S. federal income tax returns and certain state income tax returns remains open for tax years 2013 and after. As of December 31, 2016, the tax years ended June 30, 2007 through June 30, 2016 for the Company’s People’s Republic of China (“PRC”) subsidiaries remain open for statutory examination by PRC tax authorities. |
Value Added Tax [Policy Text Block] | Value Added Tax Sales revenue represents the invoiced value of goods, net of a Value-Added Tax (“VAT”). All of the Company’s products that are sold in the PRC are subject to a Chinese value-added tax at a rate of 17 |
Foreign Currency Transactions and Translations Policy [Policy Text Block] | Foreign Currency Translation The Company uses the United States dollar (“U.S. dollars” or “USD”) for financial reporting purposes. The Company’s subsidiaries and VIEs maintain their books and records in their functional currency of Renminbi (“RMB”), the currency of the PRC. In general, for consolidation purposes, the Company translates the assets and liabilities of its subsidiaries and VIEs into U.S. dollars using the applicable exchange rates prevailing at the balance sheet date, and the statements of income and cash flows are translated at average exchange rates during the reporting period. As a result, amounts related to assets and liabilities reported on the statement of cash flows will not necessarily agree with changes in the corresponding balances on the balance sheet. Equity accounts are translated at historical rates. Adjustments resulting from the translation of the financial statements of the subsidiaries and VIEs are recorded as accumulated other comprehensive loss. The balance sheet amounts, with the exception of equity, at December 31, 2016 and June 30, 2016 were translated at 1 RMB to $ 0.1440 0.1505 0.1482 0.1580 0.1463 0.1565 |
Comprehensive Income, Policy [Policy Text Block] | Comprehensive Income Comprehensive income consists of two components, net income and other comprehensive loss. The foreign currency translation gain or loss resulting from translation of the financial statements expressed in RMB to US$ is reported in other comprehensive loss in the unaudited condensed consolidated statements of income and comprehensive income. |
Equity Method Investments, Policy [Policy Text Block] | Equity Investment An investment in which the Company has the ability to exercise significant influence, but does not have a controlling interest, is accounted for using the equity method. Significant influence is generally considered to exist when the Company has an ownership interest in the voting stock between 20 50 |
Earnings Per Share, Policy [Policy Text Block] | Earnings per Share The Company computes earnings per share (“EPS”) in accordance with ASC 260, “Earnings per Share” (“ASC 260”). ASC 260 requires companies with complex capital structures to present basic and diluted EPS. Basic EPS is measured as net income divided by the weighted average common shares outstanding for the period. Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of potential common shares (e.g., convertible securities, options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential common shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. There is no anti-dilutive effect for the six months and three months ended December 31, 2016 and 2015. |
New Accounting Pronouncements, Policy [Policy Text Block] | New Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued an update ("ASU 2014-09") establishing Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers Deferral of the Effective Date Principal versus Agent Considerations (Reporting Revenue Gross versus Net), , Identifying Performance Obligations and Licensing, Narrow-Scope Improvements and Practical Expedients, In August 2016, the Financial Accounting Standards Board (the “FASB”) has issued Accounting Standards Update (ASU) No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, to address diversity in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The amendments provide guidance on the following eight specific cash flow issues: (1) Debt Prepayment or Debt Extinguishment Costs; (2) Settlement of Zero-Coupon Debt Instruments or Other Debt Instruments with Coupon Interest Rates That Are Insignificant in Relation to the Effective Interest Rate of the Borrowing; (3) Contingent Consideration Payments Made after a Business Combination; (4)Proceeds from the Settlement of Insurance Claims; (5) Proceeds from the Settlement of Corporate-Owned Life Insurance Policies, including Bank-Owned; (6) Life Insurance Policies; (7) Distributions Received from Equity Method Investees; (8) Beneficial Interests in Securitization Transactions; and Separately Identifiable Cash Flows and Application of the Predominance Principle. The amendments are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019. Early adoption is permitted, including adoption in an interim period. The amendments should be applied using a retrospective transition method to each period presented. If it is impracticable to apply the amendments retrospectively for some of the issues, the amendments for those issues would be applied prospectively as of the earliest date practicable. The Company expects that the adoption of this ASU would not have a material impact on the Company’s unaudited condensed consolidated financial statements. In October 2016, the FASB has issued ASU No. 2016-17, Consolidation (Topic 810): Interest Held through Related Parties That Are under Common Control, to provide guidance on the evaluation of whether a reporting entity is the primary beneficiary of a VIE by amending how a reporting entity, that is a single decision maker of a VIE, treats indirect interests in that entity held through related parties that are under common control. The amendments are effective for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2016, and interim periods within fiscal years beginning after December 15, 2017. Early adoption is permitted, including adoption in an interim period. The Company expects that the adoption of this ASU would not have any impact on the Company’s unaudited condensed consolidated financial statements as there are no interests held through related parties that are under common control. In January 2017, the FASB issued ASU 2017-01, which clarifies the definition of a business to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The standard will be effective for us in the first quarter of our fiscal 2019. The Company expects that the adoption of this ASU would not have a material impact on the Company’s unaudited condensed consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-03, Accounting Changes and Error Corrections (Topic 250) and InvestmentsEquity Method and Joint Ventures (Topic 323). The amendments amended Accounting Changes and Error Corrections (Topic 250) to state that registrants should consider additional qualitative disclosures if the impact of an issued but not yet adopted ASU is unknown or cannot be reasonably estimated and to include a description of the effect of the accounting policies that the registrant expects to apply, if determined. Transition guidance included in certain issued but not yet adopted ASUs was also updated to reflect this amendment. The Company does not expect that the adoption of this guidance will have a material impact on its consolidated financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN23
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Schedule of Variable Interest Entities [Table Text Block] | The carrying amount of the VIEs and their subsidiaries’ consolidated assets and liabilities are as follows: December 31, 2016 June 30, 2016 Current assets $ 35,740,212 $ 30,560,208 Plant and equipment, net 8,965,391 9,595,357 Other noncurrent assets 9,807,252 10,136,632 Total assets 54,512,855 50,292,197 Total liabilities (4,709,592) (4,398,424) Net assets $ 49,803,263 $ 45,893,773 |
Summary of Estimated useful lives of Property and Equipment [Table Text Block] | Following are the estimated useful lives of the Company’s property and equipment: Estimated useful lives Buildings 20 50 Machinery equipment 5 10 Motor vehicles 5 10 Office equipment 5 10 Farmland leasehold improvements 12 18 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 6 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Current [Table Text Block] | The inventories consist of the following: December 31, 2016 June 30, 2016 Raw materials $ 818,441 $ 825,028 Work-in-process 181,394 3,230,729 Finished goods 1,714,811 1,354,176 Packing materials 18,333 17,531 Less: inventory reserve (818,637) (819,285) Total $ 1,914,342 $ 4,608,179 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 6 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment [Table Text Block] | Property and equipment consist of the following: December 31, 2016 June 30, 2016 Buildings $ 10,261,246 $ 10,726,872 Building improvement 50,541 52,834 Machinery equipment 455,628 443,846 Motor vehicles 221,388 231,434 Construction in progress 431,913 451,512 Office equipment 198,993 208,022 Farmland leasehold improvement 3,027,561 3,164,943 14,647,270 15,279,463 Less: accumulated depreciation and amortization (4,333,990) (4,244,264) Property, plant and equipment, net $ 10,313,280 $ 11,035,199 |
Schedule of Leasehold Improvements [Table Text Block] | Farmland leasehold improvements consist of following: December 31, 2016 June 30, 2016 Blueberry farmland leasehold reconstruction $ 2,325,907 $ 2,431,450 Yew tree planting base reconstruction 260,588 272,412 Greenhouse renovation 441,066 461,081 Total farmland leasehold improvement $ 3,027,561 $ 3,164,943 |
LAND USE RIGHTS, NET (Tables)
LAND USE RIGHTS, NET (Tables) | 6 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets [Table Text Block] | The Company has the Right to use the land for 50 years and amortizes the Right on a straight-line basis over the period of 50 years. December 31, 2016 June 30, 2016 Land use rights $ 1,601,387 $ 1,674,053 Less: accumulated amortization (268,393) (265,288) Land use rights, net $ 1,332,994 $ 1,408,765 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block] | The estimated future amortization expenses are as follows: Twelve months ending December 31: 2017 $ 32,028 2018 32,028 2019 32,028 2020 32,028 2021 32,028 Thereafter 1,172,854 Total $ 1,332,994 |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 6 Months Ended |
Dec. 31, 2016 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investments [Table Text Block] | The Company’s investments in unconsolidated entities consist of the following: December 31, 2016 June 30, 2016 Shaanxi Pharmacy Holding Group Longevity Pharmacy Co., Ltd ( Ankang Longevity Pharmacy ) $ 2,332,111 $ 2,091,531 Shaanxi Pharmacy Sunsimiao Drugstores Ankang Chain Co., Ltd 530,656 493,008 Zhejiang Zhen’Ai Network Warehousing Services Co., Ltd. 2,087,580 2,182,308 Original Lab Inc. 200,000 - Total $ 5,150,347 $ 4,766,847 |
Equity Method Investments Summarized Financial Information [Table Text Block] | Summarized financial information of unconsolidated entities is as follows: December 31, 2016 June 30, 2016 Current assets $ 27,091,152 $ 28,450,106 Noncurrent assets 287,674 386,764 Current liabilities 21,551,268 23,577,799 For the six months ended December 31, 2016 2015 Net sales $ 14,651,055 $ 12,692,508 Gross profit 1,947,737 1,873,301 Income from operations 815,437 738,058 Net income 819,935 734,009 |
PREPAID LEASES (Tables)
PREPAID LEASES (Tables) | 6 Months Ended |
Dec. 31, 2016 | |
PREPAID LEASES [Abstract] | |
Schedule of Long Term Prepaid Expenses [Table Text Block] | The prepaid leases consist of the following: December 31, 2016 June 30, 2016 Current $ 455,920 $ 478,565 Non-current 3,465,424 3,860,327 Total $ 3,921,344 $ 4,338,892 |
Schedule of Operating Lease Further Amortization Expense [Table Text Block] | Further amortization expense is as follows: Twelve months ending December 31: 2017 $ 455,920 2018 454,673 2019 454,673 2020 310,222 2021 207,043 Thereafter 2,038,813 Total $ 3,921,344 |
SHORT-TERM LOANS (Tables)
SHORT-TERM LOANS (Tables) | 6 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of Short-term Debt [Table Text Block] | Short-term loans consist of the following: December 31, Maturity Int. Lender 2016 Date Rate/Year Wanxiang Trust Co., Ltd-a $ 22,675 2017-9-9 13.48 % Agricultural Bank of China-b 287,942 2017-10-12 5.22 % Agricultural Bank of China-c 719,855 2017-8-18 5.71 % Agricultural Bank of China-d 1,151,768 2017-11-27 5.22 % Agricultural Bank of China-d 287,942 2017-4-7 5.22 % Agricultural Bank of China-e 431,913 2017-11-15 5.22 % Total $ 2,902,095 Maturity Int. Lender June 30, 2016 Date Rate/Year Chongqing Alibaba Micro-Credit Company-a $ 36,873 2016-9-9 * 15.21 % Agricultural Bank of China-b 301,008 2016-9-24 * 5.52 % Agricultural Bank of China-d 451,512 2016-8-9 * 5.82 % Agricultural Bank of China-d 451,512 2016-10-27 * 5.27 % Agricultural Bank of China-d 1,204,032 2016-11-18 * 5.22 % Agricultural Bank of China-d 301,008 2017-4-7 5.22 % Total $ 2,745,945 The loans outstanding were guaranteed by the following properties, entities or individuals: a. Not collateralized or guaranteed. b. Collateralized by the building owned by Xiaoyan Chen and Jing Chen, who are both the related parties of the company. Xiaoyan Chen is one of the shareholders of Ankang Longevity Pharmaceutical (Group) Co., Ltd. Jing Chen is the sister of the Xiaoyan Chen but not a shareholder of Ankang Longevity Group. c. Guaranteed by commercial credit guaranty companies unrelated to the Company. d. Guaranteed by a commercial credit guaranty company, unrelated to the Company and also by Jiping Chen, a shareholder of the Company. e. Guaranteed by a third-party company and also by Jiping Chen, a shareholder of the Company. * The Company repaid the loans in full on maturity date. |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 6 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Schedule Of Amounts Due From Related Parties [Table Text Block] | As of December 31, 2016 and June 30, 2016, the outstanding amounts due from related parties consist of the following: December 31, 2016 June 30, 2016 Shaanxi Pharmaceutical Group Pai’ang Medicine Co., Ltd $ 497,197 $ 820,728 Yang Bin 143,971 150,504 Chang Song 141,484 85,035 Zhang Xin 89,262 93,312 TianjinTajite E-Commerce Co., Ltd 79,076 - Wang Qi Wei 7,919 8,279 Huiyin Ansheng 6,200 - Xinyang Yifangyuan Garden Technology Co., Ltd - 500,784 Tian Shuangpeng - 11,288 Qi Qiuchi - 1,505 $ 965,109 $ 1,671,435 |
Schedule Of Amounts Due To Related Parties [Table Text Block] | The payables are unsecured, non-interest bearing and due on demand. December 31, 2016 June 30, 2016 Wu Yang $ 106,611 $ 96,398 Xiong Kun 81,632 - Wang Sai 141,609 120,854 Zhang Yuying 11,210 26,769 $ 341,062 $ 244,915 |
TAXES (Tables)
TAXES (Tables) | 6 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) [Table Text Block] | For the six months ended For the three months ended December 31, December 31, 2016 2015 2016 2015 Current income tax provision $ 548,811 $ 685,388 $ 343,292 $ 393,454 Deferred income tax benefit (43,424) (58,501) (39,541) (67,516) Total $ 505,387 $ 626,887 $ 303,751 $ 325,938 |
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | December 31, 2016 June 30, 2016 Allowance for doubtful accounts $ 151,704 $ 123,818 Inventory reserve 203,769 203,674 Net operating loss carry-forwards 109,169 114,122 Total 464,642 441,614 Valuation allowance (109,169) (114,122) Deferred tax assets, net $ 355,473 $ 327,492 |
Summary of Valuation Allowance [Table Text Block] | December 31, 2016 June 30, 2016 Beginning balance $ 114,122 $ 108,932 Current year addition - 13,971 Exchange difference (4,953) (8,781) Ending balance $ 109,169 $ 114,122 |
Schedule of Taxes Payable [Table Text Block] | Taxes payable consists of the following: December 31, 2016 June 30, 2016 Income tax payable $ 1,308,221 $ 1,201,641 Value added tax payable 54,864 69,955 Business tax and other taxes payable 6,303 6,546 $ 1,369,388 $ 1,278,142 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block] | Twelve months ending December 31: 2017 $ 610,109 2018 315,499 2019 213,962 2020 213,346 2021 213,346 Thereafter 4,124,691 Total $ 5,690,953 |
Schedule of Future Minimum Rental Receivables for Operating Leases [Table Text Block] | Twelve months ending December 31: 2017 $ 213,346 2018 213,346 2019 213,346 2020 88,895 Total $ 728,933 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 6 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment [Table Text Block] | The following table presents summarized information by segment for the six months ended December 31, 2016: For the six months ended December 31, 2016 Bluish Herbal Agricultural dogbane products products Total Segment revenue $ 1,647,959 $ 6,676,290 $ 9,265,481 $ 17,589,730 Cost of goods 808,338 4,915,064 5,963,904 11,687,306 Business and sales related tax 8,472 25,492 - 33,964 Gross profit 831,149 1,735,734 3,301,577 5,868,460 Gross profit contribution % 14.1 % 29.6 % 56.3 % 100.0 % The following table presents summarized information by segment for six months ended December 31, 2015: For the six months ended December 31, 2015 Bluish Herbal Agricultural dogbane products products Total Segment revenue $ 2,446,684 $ 7,264,849 $ 9,699,384 $ 19,410,917 Cost of goods 1,146,076 5,483,293 6,010,745 12,640,114 Business and sales related tax 11,428 27,138 - 38,566 Gross profit 1,289,180 1,754,418 3,688,639 6,732,237 Gross profit contribution % 19.1 % 26.1 % 54.8 % 100.0 % The following table presents summarized information by segment for the three months ended December 31, 2016: For the three months ended December 31, 2016 Bluish Herbal Agricultural dogbane products products Total Segment revenue $ 910,498 $ 3,495,919 $ 6,816,649 $ 11,223,066 Cost of goods 441,118 2,477,351 4,332,665 7,251,134 Business and sales related tax 4,868 13,551 - 18,419 Gross profit 464,512 1,005,017 2,483,984 3,953,513 Gross profit contribution % 11.7 % 25.4 % 62.9 % 100.0 % The following table presents summarized information by segment for three months ended December 31, 2015: For the three months ended December 31, 2015 Bluish Herbal Agricultural dogbane products products Total Segment revenue $ 1,351,139 $ 3,784,670 $ 6,989,189 $ 12,124,998 Cost of goods 745,858 2,789,035 4,248,343 7,783,236 Business and sales related tax 7,153 14,819 - 21,972 Gross profit 598,128 980,816 2,740,846 4,319,790 Gross profit contribution % 13.9 % 22.7 % 63.4 % 100.0 % Total Assets as of December 31, 2016 June 30, 2016 Bluish Dogbane or “Luobuma” $ 6,871,687 $ 6,963,093 Herbal products 33,030,072 28,088,515 Agricultural products 23,869,956 21,997,180 $ 63,771,715 $ 57,048,788 |
ORGANIZATION AND NATURE OF OP34
ORGANIZATION AND NATURE OF OPERATIONS (Details Textual) | Dec. 31, 2016 |
Tenet-Jove Technological Development Corp., Ltd [Member] | |
Organization And Nature Of Operations [Line Items] | |
Minority Interest Ownership Percentage By Parent | 100.00% |
Tenet Huatai Technological Development Co., Ltd [Member] | |
Organization And Nature Of Operations [Line Items] | |
Equity Method Investment, Ownership Percentage | 90.00% |
SUMMARY OF SIGNIFICANT ACCOUN35
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | Dec. 31, 2016 | Jun. 30, 2016 |
Variable Interest Entity [Line Items] | ||
Total assets | $ 54,512,855 | $ 50,292,197 |
Total liabilities | (4,709,592) | (4,398,424) |
Net assets | 49,803,263 | 45,893,773 |
Property, Plant and Equipment [Member] | ||
Variable Interest Entity [Line Items] | ||
Total assets | 8,965,391 | 9,595,357 |
Current Assets [Member] | ||
Variable Interest Entity [Line Items] | ||
Total assets | 35,740,212 | 30,560,208 |
Other Noncurrent Assets [Member] | ||
Variable Interest Entity [Line Items] | ||
Total assets | $ 9,807,252 | $ 10,136,632 |
SUMMARY OF SIGNIFICANT ACCOUN36
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) | 6 Months Ended |
Dec. 31, 2016 | |
Minimum [Member] | Buildings [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 20 years |
Minimum [Member] | Machinery equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Minimum [Member] | Motor vehicles [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Minimum [Member] | Office equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Minimum [Member] | Farmland leasehold improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 12 years |
Maximum [Member] | Buildings [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 50 years |
Maximum [Member] | Machinery equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 10 years |
Maximum [Member] | Motor vehicles [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 10 years |
Maximum [Member] | Office equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 10 years |
Maximum [Member] | Farmland leasehold improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 18 years |
SUMMARY OF SIGNIFICANT ACCOUN37
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Textual) | 3 Months Ended | 6 Months Ended | |||
Dec. 31, 2016USD ($) | Dec. 31, 2015 | Dec. 31, 2016USD ($) | Dec. 31, 2015 | Jun. 30, 2016USD ($) | |
Significant Accounting Policies [Line Items] | |||||
Allowance for Doubtful Accounts Receivable | $ 97,251 | $ 97,251 | $ 103,968 | ||
Advances To Suppliers | $ 9,679 | $ 9,679 | $ 10,118 | ||
Finite-Lived Intangible Asset, Useful Life | 50 years | ||||
Foreign Currency Exchange Rate, Translation | 0.1440 | 0.1440 | 0.1505 | ||
Foreign Currency Transactions Weighted Average Exchange Rate | 0.1463 | 0.1565 | 0.1482 | 0.1580 | |
Value added Tax Rate | 17.00% | 17.00% | |||
Minimum [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Noncontrolling Interest, Ownership Percentage by Parent | 20.00% | 20.00% | |||
Maximum [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Noncontrolling Interest, Ownership Percentage by Parent | 50.00% | 50.00% | |||
Land Use Rights [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Finite-Lived Intangible Asset, Useful Life | 50 years |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) | Dec. 31, 2016 | Jun. 30, 2016 |
Inventory [Line Items] | ||
Raw materials | $ 818,441 | $ 825,028 |
Work-in-process | 181,394 | 3,230,729 |
Finished goods | 1,714,811 | 1,354,176 |
Packing materials | 18,333 | 17,531 |
Less: inventory reserve | (818,637) | (819,285) |
Total | $ 1,914,342 | $ 4,608,179 |
DEPOSIT FOR BUSINESS ACQUISIT39
DEPOSIT FOR BUSINESS ACQUISITION (Details Textual) | Dec. 31, 2016USD ($) | Dec. 31, 2016CNY (¥) | Dec. 12, 2016 | Jun. 30, 2016USD ($) |
Deposits For Business Acquisition | $ 2,015,594 | $ 0 | ||
Tianjin Tajite E-Commerce Co [Member] | ||||
Deposits For Business Acquisition | $ 2,016,000 | ¥ 14,000,000 | ||
Business Acquisition, Percentage of Voting Interests Acquired | 51.00% |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details) - USD ($) | Dec. 31, 2016 | Jun. 30, 2016 |
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 14,647,270 | $ 15,279,463 |
Less: accumulated depreciation and amortization | (4,333,990) | (4,244,264) |
Property, plant and equipment, net | 10,313,280 | 11,035,199 |
Buildings [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 10,261,246 | 10,726,872 |
Building improvement [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 50,541 | 52,834 |
Machinery equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 455,628 | 443,846 |
Motor vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 221,388 | 231,434 |
Construction in Progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 431,913 | 451,512 |
Office equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 198,993 | 208,022 |
Farmland leasehold improvement [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 3,027,561 | $ 3,164,943 |
PROPERTY AND EQUIPMENT, NET (41
PROPERTY AND EQUIPMENT, NET (Details 1) - USD ($) | Dec. 31, 2016 | Jun. 30, 2016 |
Property, Plant and Equipment [Line Items] | ||
Total farmland leasehold improvement | $ 3,027,561 | $ 3,164,943 |
Blueberry farmland leasehold reconstruction [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total farmland leasehold improvement | 2,325,907 | 2,431,450 |
Yew tree planting base reconstruction [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total farmland leasehold improvement | 260,588 | 272,412 |
Greenhouse renovation [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total farmland leasehold improvement | $ 441,066 | $ 461,081 |
PROPERTY AND EQUIPMENT, NET (42
PROPERTY AND EQUIPMENT, NET (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Line Items] | ||||
Depreciation, Depletion and Amortization, Nonproduction, Total | $ 134,557 | $ 121,148 | $ 281,924 | $ 382,403 |
LAND USE RIGHTS, NET (Details)
LAND USE RIGHTS, NET (Details) - USD ($) | Dec. 31, 2016 | Jun. 30, 2016 |
Goodwill [Line Items] | ||
Land use rights | $ 1,601,387 | $ 1,674,053 |
Less: accumulated amortization | (268,393) | (265,288) |
Land use rights, net | $ 1,332,994 | $ 1,408,765 |
LAND USE RIGHTS, NET (Details 1
LAND USE RIGHTS, NET (Details 1) - USD ($) | Dec. 31, 2016 | Jun. 30, 2016 |
Twelve months ending December 31: | ||
2,017 | $ 32,028 | |
2,018 | 32,028 | |
2,019 | 32,028 | |
2,020 | 32,028 | |
2,021 | 32,028 | |
Thereafter | 1,172,854 | |
Total | $ 1,332,994 | $ 1,408,765 |
LAND USE RIGHTS, NET (Details T
LAND USE RIGHTS, NET (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
Finite-Lived Intangible Assets [Line Items] | ||||
Finite-Lived Intangible Asset, Useful Life | 50 years | |||
Amortization | $ 6,703 | $ 8,701 | $ 15,045 | $ 17,574 |
INVESTMENTS (Details)
INVESTMENTS (Details) - USD ($) | Dec. 31, 2016 | Jun. 30, 2016 |
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investments | $ 5,150,347 | $ 4,766,847 |
Shaanxi Pharmacy Holding Group Longevity Pharmacy Co., Ltd ( Ankang Longevity Pharmacy ) [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investments | 2,332,111 | 2,091,531 |
Shaanxi Pharmacy Sunsimiao Drugstores Ankang Chain Co., Ltd [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investments | 530,656 | 493,008 |
Zhejiang Zhen’Ai Network Warehousing Services Co., Ltd. [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investments | 2,087,580 | 2,182,308 |
Original Lab Inc. [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investments | $ 200,000 | $ 0 |
INVESTMENTS (Details 1)
INVESTMENTS (Details 1) - USD ($) | Dec. 31, 2016 | Jun. 30, 2016 |
Schedule of Equity Method Investments [Line Items] | ||
Current assets | $ 27,091,152 | $ 28,450,106 |
Noncurrent assets | 287,674 | 386,764 |
Current liabilities | $ 21,551,268 | $ 23,577,799 |
INVESTMENTS (Details 2)
INVESTMENTS (Details 2) - USD ($) | 6 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Schedule of Equity Method Investments [Line Items] | ||
Net sales | $ 14,651,055 | $ 12,692,508 |
Gross profit | 1,947,737 | 1,873,301 |
Income from operations | 815,437 | 738,058 |
Net income | $ 819,935 | $ 734,009 |
INVESTMENTS (Details Textual)
INVESTMENTS (Details Textual) ¥ in Millions | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||
Oct. 21, 2013 | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2016CNY (¥) | Jun. 30, 2016USD ($) | |
Schedule of Equity Method Investments [Line Items] | |||||||
Equity Method Investments | $ 5,150,347 | $ 5,150,347 | $ 4,766,847 | ||||
Payments to Acquire Businesses and Interest in Affiliates | 200,000 | $ 0 | |||||
Tiancang Systematic Warehousing Project [Member] | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Equity Method Investments | 2,200,000 | 2,200,000 | ¥ 14.5 | ||||
Equity Method Investments Percentage of Share on Net Income Loss | 29.00% | ||||||
Equity Method Investments Percentage of Statutory Reserve Deductible | 30.00% | ||||||
Equity Method Investments, Percentage of Employee Welfare Fund Contributions Deductible | 10.00% | ||||||
Equity Method Investments Percentage of Statutory Reserve Threshold | 30.00% | ||||||
Original Lab Inc. [Member] | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Equity Method Investments | 200,000 | 200,000 | $ 0 | ||||
Payments to Acquire Businesses and Interest in Affiliates | 200,000 | ||||||
Ankang Longevity Group [Member] | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Equity Method Investments | 1,000,000 | 1,000,000 | ¥ 6.8 | ||||
Income (Loss) from Equity Method Investments | $ 239,886 | $ 211,065 | $ 401,768 | 359,665 | |||
Ankang Longevity Group [Member] | Sunsimiao Drugstores [Member] | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Equity Method Investment, Ownership Percentage | 49.00% | 49.00% | 49.00% | ||||
Ankang Longevity Group [Member] | Shaanxi Pharmaceutical Group [Member] | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Equity Method Investment, Ownership Percentage | 49.00% | 49.00% | 49.00% | ||||
Percentage of Preferred Distribution | 7.00% | ||||||
Proceeds from Equity Method Investment, Dividends or Distributions, Return of Capital | $ 352,638 | $ 385,251 | $ 592,628 | $ 576,700 |
PREPAID LEASES (Details)
PREPAID LEASES (Details) - USD ($) | Dec. 31, 2016 | Jun. 30, 2016 |
Current | $ 455,920 | $ 478,565 |
Non-current | 3,465,424 | 3,860,327 |
Total | $ 3,921,344 | $ 4,338,892 |
PREPAID LEASES (Details 1)
PREPAID LEASES (Details 1) | 6 Months Ended |
Dec. 31, 2016USD ($) | |
Twelve months ending December 31: | |
2,017 | $ 455,920 |
2,018 | 454,673 |
2,019 | 454,673 |
2,020 | 310,222 |
2,021 | 207,043 |
Thereafter | 2,038,813 |
Total | $ 3,921,344 |
PREPAID LEASES (Details Textual
PREPAID LEASES (Details Textual) ¥ in Millions, $ in Millions | 6 Months Ended | |
Dec. 31, 2016USD ($) | Dec. 31, 2016CNY (¥) | |
Operating Leases, Rent Expense | $ 5.3 | ¥ 36.8 |
Maximum [Member] | ||
Operating Lease, Lease Term | 24 years | 24 years |
Minimum [Member] | ||
Operating Lease, Lease Term | 5 years | 5 years |
SHORT-TERM LOANS (Details)
SHORT-TERM LOANS (Details) - USD ($) | 6 Months Ended | 12 Months Ended | |||
Dec. 31, 2016 | Jun. 30, 2016 | ||||
Short-term Debt | $ 2,902,095 | $ 2,745,945 | |||
Wanxiang Trust Co., Ltd [Member] | |||||
Short-term Debt | [1] | $ 22,675 | |||
Debt Instrument, Maturity Date | [1] | Sep. 9, 2017 | |||
Short-term Debt, Weighted Average Interest Rate | [1] | 13.48% | |||
Chongqing Alibaba Micro-Credit Company [Member] | |||||
Short-term Debt | [1] | $ 36,873 | |||
Debt Instrument, Maturity Date | [1],[2] | Sep. 9, 2016 | |||
Short-term Debt, Weighted Average Interest Rate | [1] | 15.21% | |||
Agricultural Bank of China One [Member] | |||||
Short-term Debt | [3] | $ 287,942 | $ 301,008 | ||
Debt Instrument, Maturity Date | [3] | Oct. 12, 2017 | Sep. 24, 2016 | [2] | |
Short-term Debt, Weighted Average Interest Rate | [3] | 5.22% | 5.52% | ||
Agricultural Bank of China Two [Member] | |||||
Short-term Debt | [4] | $ 719,855 | $ 451,512 | ||
Debt Instrument, Maturity Date | Aug. 18, 2017 | [5] | Aug. 9, 2016 | [2],[4] | |
Short-term Debt, Weighted Average Interest Rate | [4] | 5.71% | 5.82% | ||
Agricultural Bank of China Three [Member] | |||||
Short-term Debt | [4] | $ 1,151,768 | $ 451,512 | ||
Debt Instrument, Maturity Date | [4] | Nov. 27, 2017 | Oct. 27, 2016 | [2] | |
Short-term Debt, Weighted Average Interest Rate | [4] | 5.22% | 5.27% | ||
Agricultural Bank of China Four [Member] | |||||
Short-term Debt | [4] | $ 287,942 | $ 1,204,032 | ||
Debt Instrument, Maturity Date | [4] | Apr. 7, 2017 | Nov. 18, 2016 | [2] | |
Short-term Debt, Weighted Average Interest Rate | [4] | 5.22% | 5.22% | ||
Agricultural Bank of China Five [Member] | |||||
Short-term Debt | $ 431,913 | [6] | $ 301,008 | [4] | |
Debt Instrument, Maturity Date | Nov. 15, 2017 | [6] | Apr. 7, 2017 | [2],[4] | |
Short-term Debt, Weighted Average Interest Rate | 5.22% | [6] | 5.22% | [4] | |
[1] | Not collateralized or guaranteed. | ||||
[2] | The Company repaid the loans in full on maturity date. | ||||
[3] | Collateralized by the building owned by Xiaoyan Chen and Jing Chen, who are both the related parties of the company. Xiaoyan Chen is one of the shareholders of Ankang Longevity Pharmaceutical (Group) Co., Ltd. Jing Chen is the sister of the Xiaoyan Chen but not a shareholder of Ankang Longevity Group. | ||||
[4] | Guaranteed by a commercial credit guaranty company, unrelated to the Company and also by Jiping Chen, a shareholder of the Company. | ||||
[5] | Guaranteed by commercial credit guaranty companies unrelated to the Company. | ||||
[6] | Guaranteed by a third-party company and also by Jiping Chen, a shareholder of the Company. |
SHORT-TERM LOANS (Details Textu
SHORT-TERM LOANS (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
Interest Expense, Debt | $ 32,283 | $ 31,148 | $ 71,586 | $ 73,248 |
Short-term Debt, Interest Rate Increase | 5.43% | 5.92% | 5.46% | 6.44% |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | Dec. 31, 2016 | Jun. 30, 2016 |
Related Party Transaction [Line Items] | ||
Due from Related Parties, Current | $ 965,109 | $ 1,671,435 |
Shaanxi Pharmaceutical Group Pai'ang Medicine Co. Ltd [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties, Current | 497,197 | 820,728 |
Yang Bin [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties, Current | 143,971 | 150,504 |
Chang Song [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties, Current | 141,484 | 85,035 |
Zhang Xin [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties, Current | 89,262 | 93,312 |
TianjinTajite E-Commerce Co., Ltd [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties, Current | 79,076 | 0 |
Wang Qi Wei [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties, Current | 7,919 | 8,279 |
Huiyin Ansheng [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties, Current | 6,200 | 0 |
Xinyang Yifangyuan Garden Technology Co., Ltd [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties, Current | 0 | 500,784 |
Tian Shuangpeng [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties, Current | 0 | 11,288 |
Qi Qiuchi [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties, Current | $ 0 | $ 1,505 |
RELATED PARTY TRANSACTIONS (D56
RELATED PARTY TRANSACTIONS (Details 1) - USD ($) | Dec. 31, 2016 | Jun. 30, 2016 |
Related Party Transaction [Line Items] | ||
Due to Related Parties, Current | $ 341,062 | $ 244,915 |
Wu Yang [Member] | ||
Related Party Transaction [Line Items] | ||
Due to Related Parties, Current | 106,611 | 96,398 |
Xiong Kun [Member] | ||
Related Party Transaction [Line Items] | ||
Due to Related Parties, Current | 81,632 | 0 |
Wang Sai [Member] | ||
Related Party Transaction [Line Items] | ||
Due to Related Parties, Current | 141,609 | 120,854 |
Zhang Yuying [Member] | ||
Related Party Transaction [Line Items] | ||
Due to Related Parties, Current | $ 11,210 | $ 26,769 |
RELATED PARTY TRANSACTIONS (D57
RELATED PARTY TRANSACTIONS (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Jun. 30, 2016 | |
Related Party Transaction [Line Items] | |||||
Interest Income, Related Party | $ 30,972 | $ 96,322 | $ 87,220 | $ 0 | |
Due to Related Parties, Current | 341,062 | 341,062 | $ 244,915 | ||
Revenue from Related Parties | $ 882,405 | $ 763,253 | $ 1,682,604 | $ 1,509,728 | |
Xinyang Yifangyuan Garden Technology Co., Ltd [Member] | |||||
Related Party Transaction [Line Items] | |||||
Loans Receivable With Monthly Fixed Rates Of Interest | 4.17% | 4.17% |
TAXES (Details)
TAXES (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax [Line Items] | ||||
Current income tax provision | $ 343,292 | $ 393,454 | $ 548,811 | $ 685,388 |
Deferred income tax benefit | (39,541) | (67,516) | (43,424) | (73,755) |
Total | $ 303,751 | $ 325,938 | $ 505,387 | $ 626,887 |
TAXES (Details 1)
TAXES (Details 1) - USD ($) | Dec. 31, 2016 | Jun. 30, 2016 | Jun. 30, 2015 |
Income Tax [Line Items] | |||
Allowance for doubtful accounts | $ 151,704 | $ 123,818 | |
Inventory reserve | 203,769 | 203,674 | |
Net operating loss carry-forwards | 109,169 | 114,122 | |
Total | 464,642 | 441,614 | |
Valuation allowance | (109,169) | (114,122) | $ (108,932) |
Deferred tax assets, net | $ 355,473 | $ 327,492 |
TAXES (Details 2)
TAXES (Details 2) - USD ($) | 6 Months Ended | 12 Months Ended |
Dec. 31, 2016 | Jun. 30, 2016 | |
Income Tax [Line Items] | ||
Beginning balance | $ 114,122 | $ 108,932 |
Current year addition | 0 | 13,971 |
Exchange difference | (4,953) | (8,781) |
Ending balance | $ 109,169 | $ 114,122 |
TAXES (Details 3)
TAXES (Details 3) - USD ($) | Dec. 31, 2016 | Jun. 30, 2016 |
Income Tax [Line Items] | ||
Income tax payable | $ 1,308,221 | $ 1,201,641 |
Value added tax payable | 54,864 | 69,955 |
Business tax and other taxes payable | 6,303 | 6,546 |
Taxes Payable, Current, Total | $ 1,369,388 | $ 1,278,142 |
TAXES (Details Textual)
TAXES (Details Textual) | 6 Months Ended |
Dec. 31, 2016 | |
Income Tax [Line Items] | |
Value Added Tax Rate Percentage | 17.00% |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 25.00% |
SHAREHOLDERS' EQUITY (Details T
SHAREHOLDERS' EQUITY (Details Textual) - USD ($) | 1 Months Ended | 6 Months Ended | |||
Sep. 28, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Sep. 23, 2016 | Jun. 30, 2016 | |
Statutory Reserve Disclosure [Line Items] | |||||
Statutory Surplus Reserve Percentage | 10.00% | ||||
Statutory Reserve Percentage On Registered Capital | 50.00% | ||||
Statutory Accounting Practices, Statutory Capital and Surplus Required | $ 3,363,914 | $ 3,242,139 | |||
Proceeds from Issuance Initial Public Offering | $ 5,394,549 | $ 0 | |||
Stock Compensation Plan [Member] | |||||
Statutory Reserve Disclosure [Line Items] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 2,103,407 | ||||
IPO [Member] | |||||
Statutory Reserve Disclosure [Line Items] | |||||
Stock Issued During Period, Shares, New Issues | 1,713,190 | ||||
Share Price | $ 4.50 | ||||
Proceeds from Issuance Initial Public Offering | $ 5,400,000 | ||||
Stock Issued During Period, Value, New Issues | $ 7,700,000 |
CONCENTRATION AND RISKS (Detail
CONCENTRATION AND RISKS (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Concentration Risk [Line Items] | ||||||
Cash and Cash Equivalents, at Carrying Value, Beginning Balance | $ 23,743,694 | $ 14,784,140 | $ 23,743,694 | $ 14,784,140 | $ 22,009,374 | $ 6,056,105 |
Sales Revenue, Net [Member] | Customer One Concentration Risk [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration Risk, Percentage | 13.00% | 38.00% | 16.00% | 38.00% | ||
Sales Revenue, Net [Member] | Customer Two Concentration Risk [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration Risk, Percentage | 12.00% | |||||
Sales Revenue, Net [Member] | Customer Three Concentration Risk [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration Risk, Percentage | 11.00% | |||||
Purchases [Member] | Supplier One Concentration Risk [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration Risk, Percentage | 25.00% | 36.00% | 17.00% | 29.00% | ||
Purchases [Member] | Supplier Two Concentration Risk [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration Risk, Percentage | 20.00% | 25.00% | 15.00% | 16.00% | ||
Purchases [Member] | Supplier Three Concentration Risk [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration Risk, Percentage | 13.00% | 13.00% | 11.00% | |||
Purchases [Member] | Supplier Four Concentration Risk [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration Risk, Percentage | 10.00% | |||||
CHINA | ||||||
Concentration Risk [Line Items] | ||||||
Cash and Cash Equivalents, at Carrying Value, Beginning Balance | $ 23,666,340 | $ 23,666,340 | $ 21,986,817 | |||
CHINA | Assets, Total [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration Risk, Percentage | 100.00% | |||||
CHINA | Sales Revenue, Segment [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration Risk, Percentage | 100.00% |
COMMITMENTS AND CONTINGENCIES65
COMMITMENTS AND CONTINGENCIES (Details) | Dec. 31, 2016USD ($) |
Schedule Of Future Minimum Rental Payments For Operating Leases [Line Items] | |
2,017 | $ 610,109 |
2,018 | 315,499 |
2,019 | 213,962 |
2,020 | 213,346 |
2,021 | 213,346 |
Thereafter | 4,124,691 |
Total | $ 5,690,953 |
COMMITMENTS AND CONTINGENCIES66
COMMITMENTS AND CONTINGENCIES (Details 1) | Dec. 31, 2016USD ($) |
Future Minimum Payments Receivable for Operating Leases [Line Items] | |
2,017 | $ 213,346 |
2,018 | 213,346 |
2,019 | 213,346 |
2,020 | 88,895 |
Total | $ 728,933 |
COMMITMENTS AND CONTINGENCIES67
COMMITMENTS AND CONTINGENCIES (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
Commitments And Contingencies [Line Items] | ||||
Operating Leases, Rent Expense, Net | $ 159,271 | $ 66,297 | $ 324,173 | $ 126,590 |
Lease Expiration Date | May 31, 2020 | |||
Operating Leases, Income Statement, Sublease Revenue | $ 53,337 | $ 56,880 | $ 106,673 | $ 113,760 |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Jun. 30, 2016 | |
Segment Reporting Information [Line Items] | |||||
Segment revenue | $ 11,223,066 | $ 12,124,998 | $ 17,589,730 | $ 19,410,917 | |
Cost of goods | 7,251,134 | 7,783,236 | 11,687,306 | 12,640,114 | |
Business and sales related tax | 18,419 | 21,972 | 33,964 | 38,566 | |
Gross profit | $ 3,953,513 | $ 4,319,790 | $ 5,868,460 | $ 6,732,237 | |
Gross profit contribution % | 100.00% | 100.00% | 100.00% | 100.00% | |
Assets | $ 63,771,715 | $ 63,771,715 | $ 57,048,788 | ||
Bluish Dogbane [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Segment revenue | 910,498 | $ 1,351,139 | 1,647,959 | $ 2,446,684 | |
Cost of goods | 441,118 | 745,858 | 808,338 | 1,146,076 | |
Business and sales related tax | 4,868 | 7,153 | 8,472 | 11,428 | |
Gross profit | $ 464,512 | $ 598,128 | $ 831,149 | $ 1,289,180 | |
Gross profit contribution % | 11.70% | 13.90% | 14.10% | 19.10% | |
Assets | $ 6,871,687 | $ 6,871,687 | 6,963,093 | ||
Herbal Products [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Segment revenue | 3,495,919 | $ 3,784,670 | 6,676,290 | $ 7,264,849 | |
Cost of goods | 2,477,351 | 2,789,035 | 4,915,064 | 5,483,293 | |
Business and sales related tax | 13,551 | 14,819 | 25,492 | 27,138 | |
Gross profit | $ 1,005,017 | $ 980,816 | $ 1,735,734 | $ 1,754,418 | |
Gross profit contribution % | 25.40% | 22.70% | 29.60% | 26.10% | |
Assets | $ 33,030,072 | $ 33,030,072 | 28,088,515 | ||
Agricultural Products [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Segment revenue | 6,816,649 | $ 6,989,189 | 9,265,481 | $ 9,699,384 | |
Cost of goods | 4,332,665 | 4,248,343 | 5,963,904 | 6,010,745 | |
Business and sales related tax | 0 | 0 | 0 | 0 | |
Gross profit | $ 2,483,984 | $ 2,740,846 | $ 3,301,577 | $ 3,688,639 | |
Gross profit contribution % | 62.90% | 63.40% | 56.30% | 54.80% | |
Assets | $ 23,869,956 | $ 23,869,956 | $ 21,997,180 |