| SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE－3 SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES The accompanying condensed consolidated financial statements reflect
the application of certain significant accounting policies as described in this note and elsewhere in the accompanying condensed consolidated
financial statements and notes.
· Basis of presentation These accompanying condensed consolidated financial
statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”).
· Use of estimates and assumptions In preparing these condensed consolidated financial
statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheet
and revenues and expenses during the periods reported. Actual results may differ from these estimates.
· Basis of consolidation The unaudited condensed consolidated financial
statements include the accounts of ENMI and its subsidiaries. All significant inter-company balances and transactions within the Company
have been eliminated upon consolidation.
· Cash and cash equivalents Cash and cash equivalents are carried at cost
and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an
original maturity of three months or less as of the purchase date of such investments.
· Revenue recognition ASC 606, Revenue from Contracts with Customers The Company applies the following five steps in
order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements:
· identify the contract with a customer;
· identify the performance obligations in the contract;
· determine the transaction price;
· allocate the transaction price to performance obligations in the contract; and
· recognize revenue as the performance obligation is satisfied. The Company also follows
the guidance provided in ASC 606, Revenue from Contracts with Customers The Company derives its
revenue from the sale of the rapid tester kits and from commissions earned in its role as an agent. Where the Company acts
as a principal, it sells its products directly to healthcare providers, retailers and individual consumers through its retail channels.
The Company considers customer order confirmations to be a contract with the customer. Customer confirmations are executed at the time
an order is placed. Revenue is recognized when control of the product is transferred to the customer (i.e., when the Company’s
performance obligation is satisfied), which typically occurs at shipment date. As a result, the Company has a present and unconditional
right to payment and record the amount due from the customer in accounts receivable. For each contract, the Company considers the promise
to transfer products to be the only identified performance obligation. In determining the transaction price, the Company evaluates whether
the price is subject to refund or adjustment to determine the net consideration to which the Company expects to be entitled. Where the Company acts as an agent, the Company
recognizes revenue on a net basis, as the Company is not responsible for the fulfillment, nor controls the delivery of the promised goods,
and has no discretion in establishing prices and therefore is agent in the arrangement. For each contract the Company considers the promise
to facilitate the arrangement between the parties as the identified performance obligation. The transaction price is determined to be
the contracted price to which the Company is entitled to upon completion of its performance obligation. The Company’s revenues for the three months
ended June 30, 2023 and 2022 are recognized at a point in time, for both its roles as principal and as agent.
· Cost of revenue Cost of revenue consists primarily of the cost
of goods sold, which are directly attributable to the sales of products.
· Income taxes The Company adopted the ASC 740 Income tax The estimated future tax effects of temporary
differences between the tax basis of assets and liabilities are reported in the accompanying balance sheets, as well as tax credit carry-backs
and carry-forwards. The Company periodically reviews the recoverability of deferred tax assets recorded on its balance sheets and provides
valuation allowances as management deems necessary.
· Uncertain tax positions The Company did no
· Foreign currencies translation Transactions denominated in currencies other than
the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction.
Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency
using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the condensed consolidated
statement of operations. The reporting currency of the Company is United
States Dollar ("US$") and the accompanying condensed consolidated financial statements have been expressed in US$. In addition,
the Company is operating in Hong Kong and maintain its books and record in its local currency, Hong Kong Dollars (“HKD”),
which is a functional currency as being the primary currency of the economic environment in which their operations are conducted. In general,
for consolidation purposes, assets and liabilities of its subsidiary whose functional currency is not US$ are translated into US$, in
accordance with ASC Topic 830-30, “ Translation of Financial Statement Translation of amounts from HKD into US$ has been
made at the following exchange rates for the three months ended June 30, 2023 and 2022:
Schedule of translation rates
June 30, 2023 June 30, 2022
Period-end HKD:US$ exchange rate 0.1276 0.1274
Average HKD:US$ exchange rate 0.1276 0.1274
· Comprehensive income ASC Topic 220, “ Comprehensive Income
· Net loss per share The Company calculates net loss per share in
accordance with ASC 260, Earnings per Share
· Stock based compensation Pursuant to ASU 2018-07, the Company follows
ASC 718, Compensation—Stock Compensation (“ASC 718”), which requires the measurement and recognition of
compensation expense for all share-based payment awards (employee or non-employee), are measured at grant-date fair value of the
equity instruments that an entity is obligated to issue. Restricted stock units are valued using the market price of the
Company’s common shares on the date of grant. The Company uses a Black-Scholes option model to estimate the fair value of
employee stock options at the date of grant. As of June 30, 2023, those shares issued and stock options granted for service
compensations were immediately vested, and therefore these amounts are thus recognized as expense in the operation.
· Related parties The Company follows the ASC 850-10, “ Related
Party” Pursuant to section 850-10-20 the related parties
include a) affiliates of the Company; b) entities for which investments in their equity securities would be required, absent the
election of the fair value option under the Fair Value Option Subsection of section 825–10–15, to be accounted for by the
equity method by the investing entity; c) trusts for the benefit of employees, such as pension and Income-sharing trusts that are managed
by or under the trusteeship of management; d) principal owners of the Company; e) management of the Company; f) other parties with which
the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent
that one of the transacting parties might be prevented from fully pursuing its own separate interests; and g) other parties that
can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one
of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be
prevented from fully pursuing its own separate interests. The unaudited condensed consolidated
financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense
allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in
the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include:
a) the nature of the relationship(s) involved; b) a description of the transactions, including transactions to which no amounts
or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information
deemed necessary to an understanding of the effects of the transactions on the financial statements; c) the dollar amounts of
transactions for each of the periods for which income statements are presented and the effects of any change in the method of
establishing the terms from that used in the preceding period; and d) amount due from or to related parties as of the date of
each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.
· Commitments and contingencies The Company follows the ASC 450-20, Commitments If the assessment of a contingency indicates that
it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would
be accrued in the Company’s condensed consolidated financial statements. If the assessment indicates that a potentially material
loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent
liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally
not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Management does not believe, based upon
information available at this time that these matters will have a material adverse effect on the Company’s financial position, results
of operations or cash flows. However, there is no assurance that such matters will not materially and adversely affect the Company’s
business, financial position, and results of operations or cash flows.
· Fair value of financial instruments The Company follows paragraph 825-10-50-10 of
the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and has adopted paragraph 820-10-35-37
of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments.
Paragraph 820-10-35-37 of the FASB Accounting Standards Codification establishes a framework for measuring fair value in generally accepted
accounting principles (GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair
value measurements and related disclosures, paragraph 820-10-35-37 of the FASB Accounting Standards Codification establishes a fair value
hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value
hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest
priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by paragraph 820-10-35-37 of the FASB Accounting
Standards Codification are described below:
Level 1 Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.
Level 2 Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.
Level 3 Pricing inputs that are generally observable inputs and not corroborated by market data. Financial assets are considered Level 3 when their
fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant
model assumption or input is unobservable. The fair value hierarchy gives the highest priority
to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If
the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is
based on the lowest level input that is significant to the fair value measurement of the instrument. The carrying amounts of the Company’s financial
assets and liabilities, such as cash and cash equivalents, approximate their fair values because of the short maturity of these instruments.
· Recent accounting pronouncements From time to time, new accounting pronouncements
are issued by the Financial Accounting Standard Board (“FASB”) or other standard setting bodies and adopted by the Company
as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that
are not yet effective will not have a material impact on its financial position or results of operations upon adoption. The Company has reviewed all recently issued,
but not yet effective, accounting pronouncements and believe the future adoption of any such pronouncements may not be expected to cause
a material impact on its financial condition or the results of its operations. |
