| Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
| Mar. 31, 2019 |
| Accounting Policies [Abstract] | |
| Basis of presentation and consolidation | Basis of presentation and consolidation The accompanying consolidated financial
statements are prepared in accordance with accounting principles generally accepted in the United States of America ("US
GAAP"). The consolidated financial statements include the financial statements of the Company, its wholly-owned subsidiaries
and VIEs. All significant inter-company transactions and balances between the Company, its subsidiaries and VIEs are eliminated
upon consolidation. |
| Consolidation of variable interest entities | Consolidation of variable interest entities In accordance with accounting standards
regarding 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 Company has concluded, based on the
contractual arrangements, that Jiuzhou Pharmacy (including its subsidiaries and controlled entities), Jiuzhou Clinic and Jiuzhou
Service are each a VIE and that the Company’s wholly-owned subsidiary, Jiuxin Management, absorbs a majority of the risk
of loss from the activities of these companies, thereby enabling the Company, through Jiuxin Management, to receive a majority
of their respective expected residual returns. Control and common control are defined
under the accounting standards as “an individual, enterprise, or immediate family members who hold more than 50 percent of
the voting ownership interest of each entity.” Because the Owners collectively own 100% of Jiuzhou Pharmacy, Jiuzhou Clinic
and Jiuzhou Service, and have agreed to vote their interests in concert since the establishment of each of these three companies
as memorialized in the voting rights agreement, the Company believes that the Owners collectively have control and common control
of the three companies. Accordingly, the Company believes that Jiuzhou Pharmacy, Jiuzhou Clinic and Jiuzhou Service were constructively
held under common control by Jiuxin Management as of the time the Contractual Agreements were entered into, establishing Jiuxin
Management as their primary beneficiary. Jiuxin Management, in turn, is owned by Renovation, which is owned by the Company. |
| Risks and Uncertainties | 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 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 others, 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. Although the Company has not experienced losses from these situations and believes that it is in compliance with existing
laws and regulations including its organization and structure disclosed in Note 1, this may not be indicative of future results. The Company has significant cash deposits
with suppliers in order to obtain and maintain inventory. The Company's ability to obtain products and maintain inventory
at existing and new locations is dependent upon its ability to post and maintain significant cash deposits with its suppliers.
In the PRC, many vendors are unwilling to extend credit terms for product sales that require cash deposits to be made. The Company
does not generally receive interest on any of its supplier deposits, and such deposits are subject to loss as a result of the creditworthiness
or bankruptcy of the party who holds such funds, as well as the risk from illegal acts such as conversion, fraud, theft or dishonesty
associated with the third party. If these circumstances were to arise, the Company would find it difficult or impossible, due to
the unpredictability of legal proceedings in China, to recover all or a portion of the amount on deposit with its suppliers. 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 | Use of estimates The preparation of unaudited condensed
consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements,
and the reported amounts of revenues and expenses during the reporting period. The significant estimates made in the preparation
of the accompanying unaudited condensed consolidated financial statements relate to the assessment of the carrying values of accounts
receivable, advances to suppliers and related allowance for doubtful accounts, useful lives of property and equipment, inventory
reserve and fair value of its purchase option derivative liability. Because of the use of estimates inherent in the financial reporting
process, actual results could materially differ from those estimates. |
| Fair value measurements | Fair value measurements The Company establishes a three-level
valuation hierarchy of valuation techniques based on observable and unobservable inputs, which may be used to measure fair
value and include the following: Level 1 – Quoted prices in active markets for identical
assets or liabilities. Level 2 – Inputs other than Level
1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in
markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially
the full term of the assets or liabilities. Level 3 – Unobservable inputs that
are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Classification within the hierarchy is
determined based on the lowest level of input that is significant to the fair value measurement. The Company’s financial assets
and liabilities, which include financial instruments as defined by FASB ASC 820, include cash and cash equivalents,
restricted cash, accounts receivable, accounts payable, long-term debt and derivatives. The carrying amounts of cash and cash
equivalents, financial assets available for sales, accounts receivable, notes receivables, and accounts payable are a
reasonable approximation of fair value due to the short maturities of these instruments (Level 1). The carrying amount of
notes payable approximates fair value based on borrowing rates of similar bank loan currently available to the Company (Level
2) (See Note 13). The carrying amount of the Company’s derivative instruments is recorded at fair value and is
determined based on observable inputs that are corroborated by market data (Level 2). The carrying amount of the Financial
assets available for sale is recorded at fair value and is determined based on unobservable inputs (Level 3)(SeeNote 3). As
of March 31 2019, the fair values of our derivative instruments were carried at fair value (See Note 17). As of March 31
2019, the fair values of our Financial liability were carried at fair value (See Note 18)
Active Market Observable Unobservable Total
Cash and restricted cash $ 24,745,202 - - 24,745,202
Financial assets available for sale - - 180,928 180,928
Notes payable - 25,951,673 - 25,951,673
Financial liability 81,935 81,935
Warrants liability - 465,248 - 465,248
Total $ 24,745,202 26,416,921 262,863 51,424,986 |
| Revenue recognition | Revenue recognition Revenue from sales of prescription medicine at
drugstores is recognized when the prescription is filled and the customer picks up and pays for the prescription. Revenue from sales of other merchandise
at drugstores is recognized at the point of sale, which is when a customer pays for and receives the merchandise. Usually the majority
of our merchandise, such as prescription and OTC drugs, are not allowed to be returned after the customers leave the counter. Return
of other products, such as sundry products, are minimal. Sales of drugs reimbursed by the local government medical insurance agency
and receivables from the agency are recognized when a customer pays for the drugs at a store. Based on historical experience, a
reserve for potential loss from denial of reimbursement on certain unqualified drugs is made to the receivables from the government
agency. Retail sales price adjustments after sales are rare. Revenue from medical services is recognized
after the service has been rendered to a customer. Revenue from online pharmacy sales is recognized
when merchandise is shipped to customers. While most deliveries take one day, certain deliveries may take longer depending on a
customer’s location. Any loss caused in a shipment will be reimbursed by the Company’s courier company. Our sales policy
allows for the return of certain merchandises without reason within seven days after customer’s receipt of the applicable
merchandise. A proper sales reserve is made to account for the potential loss from returns from customers. Historically, sales
returns seven days after merchandise receipts have been minimal. Revenue from sales of merchandise to
non-retail customers is recognized when the following conditions are met: (1) persuasive evidence of an arrangement exists
(sales agreements and customer purchase orders are used to determine the existence of an arrangement); (2) control of the merchandise
is transferred to customers, The Company’s revenue is net of value
added tax (“VAT”) collected on behalf of PRC tax authorities in respect to the sales of merchandise. VAT collected
from customers, net of VAT paid for purchases, is recorded as a liability in the accompanying consolidated balance sheets until
it is paid to the relevant PRC tax authorities. C ertain contract liabilities
primarily represent the Company’s obligation to transfer additional goods or services to a customer for which the Company
has received consideration, for example, membership points. The consideration received remains a contract liability until goods
or services have been provided to the retail customer. The estimated amount based on accrued membership points was deducted from
sales revenue. |
| Restricted cash | Restricted cash The Company's restricted cash consists
of cash and long-term deposits in a bank as security for its notes payable. The Company has notes payable outstanding with the
bank and is required to keep certain amounts on deposit that are subject to withdrawal restrictions. The notes payable are generally
short term in nature due to their short maturity period of six to nine months; thus, restricted cash is classified as a current
asset. |
| Accounts receivable | Accounts receivable Accounts receivable represents the following:
(1) amounts due from banks relating to retail sales that are paid or settled by the customers' debit or credit cards, (2)
amounts due from government social security bureaus and commercial health insurance programs relating to retail sales of drugs,
prescription medicine, and medical services that are paid or settled by the customers' medical insurance cards, (3) amounts
due from non-bank third party payment instruments such as Alipay and certain e-commerce platforms and (4) amounts due from non-retail
customers for sales of merchandise. Accounts receivable are recorded at net
realizable value consisting of the carrying amount less an allowance for uncollectible accounts, as necessary. In the Company's
retail business, accounts receivable mainly consist of reimbursements due from the government insurance bureaus and commercial
health insurance programs and are usually collected within two or three months. The Company directly writes off delinquent account
balances, which it determines to be uncollectible after confirming with the appropriate bureau or program each month. Additionally,
the Company also makes estimated reserves on related outstanding accounts receivable based on historical trends. In the Company's online pharmacy
business, accounts receivable primarily consist of amounts due from non-bank third party payment instruments such as Alipay and
certain e-commerce platforms. To purchase pharmaceutical products from an e-commerce platforms such as Tmall, customers are required
to submit payment to certain non-bank third party payment instruments, such as Alipay, which, in turn, reimburse the Company within
seven days to a month. Except for customer returns of sold products, the receivables from these payments instruments are rarely
uncollectible. In its wholesale business, the Company
uses the aging method to estimate the allowance for anticipated uncollectible receivable balances. Under the aging method, bad
debt percentages are determined by management, based on historical experience and the current economic climate, are applied
to customers' balances categorized by the number of months the underlying invoices have remained outstanding. At each reporting
period, the allowance balance is adjusted to reflect the amount computed as a result of the aging method. When facts subsequently
become available to indicate that the allowance provided requires an adjustment, a corresponding adjustment is made to the allowance
account as a change in estimate. |
| Advances to suppliers | Advances to suppliers Advances to suppliers consist of prepayments
to our vendors, such as pharmaceutical manufacturers and other distributors. Since the acquisition of Jiuxin Medicine, we have
transferred almost all logistics services of our retail drugstores to Jiuxin Medicine. Jiuzhou Pharmacy only directly purchases
certain non-medical products, such as certain nutritional supplements. As a result, almost all advances to suppliers are made by
Jiuxin Medicine. Advances to suppliers for our drug wholesale
business consist of prepayments to our vendors, such as pharmaceutical manufacturers and other distributors. We typically
receive products from vendors within three to nine months after making prepayments. We continuously monitor delivery from,
and payments to, our vendors while maintaining a provision for estimated credit losses based upon historical experience and any
specific supplier issues, such as discontinuing of inventory supply, that have been identified. If we have difficulty receiving
products from a vendor, we take the following steps: cease purchasing products from such vendor, ask for return of our prepayment
promptly, and if necessary, take legal action. If all of these steps are unsuccessful, management then determines whether
the prepayments should be reserved or written off. |
| Inventories | Inventories Inventories are stated at the lower of
cost or market value. Cost is determined using the first in first out (FIFO) method. Market value is the lower of replacement cost
or net realizable value. The Company carries out physical inventory counts on a monthly basis at each store and warehouse location.
Herbs that the Company farms are recorded at their cost, which includes direct costs such as seed selection, fertilizer, labor
costs that are spent in growing herbs on the leased farmland, and indirect costs such as amortization of farmland development cost.
All costs are accumulated until the time of harvest and then allocated to harvested herbs costs when the herbs are sold. The Company
periodically reviews its inventory and records write-downs to inventories for shrinkage losses and damaged merchandise that are
identified. The Company provides a reserve for estimated inventory obsolescence or excess quantities on hand equal to the difference,
if any, between the cost of the inventory and its estimated realizable value. |
| Farmland assets | Farmland assets Herbs that the Company farms are recorded
at their cost, which includes direct costs such as seed selection, fertilizer, and labor costs that are spent in growing herbs
on the leased farmland, and indirect costs such as amortization of farmland development costs. Since April 2014, amortization of
farmland development costs has been expensed instead of allocated into inventory due to unpredictable future market value of planted
gingko trees. All related costs described in the above
are accumulated until the time of harvest and then allocated to harvested herbs when they are sold. |
| Property and equipment | Property and equipment Property and equipment are stated at cost,
net of accumulated depreciation or amortization. Depreciation is calculated on the straight-line method over the estimated useful
lives of the assets, taking into consideration the assets' estimated residual value. Leasehold improvements are amortized
over the shorter of lease term or remaining lease period of the underlying assets. Following are the estimated useful lives of
the Company's property and equipment:
Estimated Useful Life
Leasehold improvements 3-10 years
Motor vehicles 3-5 years
Office equipment & furniture 3-5 years
Buildings 35 years Maintenance, repairs and minor renewals
are charged to expenses as incurred. Major additions and betterment to property and equipment are capitalized. |
| Intangible assets | Intangible assets Intangible assets are acquired individually
or as part of a group of assets, and are initially recorded at their fair value. The cost of a group of assets acquired
in a transaction is allocated to the individual assets based on their relative fair values. The estimated useful lives of the Company's
intangible assets are as follows:
Estimated
Land use rights 50 years
Software 3 years The Company evaluates intangible assets
for impairment whenever events or changes in circumstances indicate that the assets might be impaired. |
| Impairment of long lived assets | Impairment of long lived assets The Company evaluates long lived tangible
and intangible assets for impairment, whenever events or changes in circumstances indicate that the carrying value may not be recoverable
from its estimated future cash flows. Recoverability is measured by comparing the assets' net book value to the related projected
undiscounted cash flows from these assets, considering a number of factors including past operating results, budgets, economic
projections, market trends and product development cycles. If the net book value of the asset exceeds the related undiscounted
cash flows, the asset is considered impaired, and a second test is performed to measure the amount of impairment loss. There was
$1,337,529 leasehold improvements impaired in the year ended March 31, 2019. There were $825,259 farmland assets and $1,196,197
prepayment of lease use rights, impaired in the year ended March 31, 2019(See Notes 9 and 11). |
| Notes payable | Notes payable During the normal course of business, the
Company regularly issues bank acceptance bills as a payment method to settle outstanding accounts payables with various material
suppliers. The Company records such bank acceptance bills as notes payable. Such notes payable are generally short term in nature
due to their short maturity period of six to nine months. |
| Income taxes | Income taxes The Company follows FASB ASC Topic 740,
“Income Taxes,” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences
of events that have been included in the financial statements or tax returns. Under this method, deferred income taxes are recognized
for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting
amounts at each period end based on enacted tax laws and statutory tax rates, applicable to the periods in which the differences
are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the
amount expected to be realized. The accounting standards clarify the accounting and disclosure requirements for uncertain tax positions
and prescribe a recognition threshold and measurement attribute for recognition and measurement of a tax position taken or expected
to be taken in a tax return. The accounting standards also provide guidance on de-recognition, classification, interest and penalties,
accounting in interim periods, disclosures, and transition. No significant penalties, uncertain tax provisions or interest
relating to income taxes were incurred during the periods ended March 31, 2019 and 2018. |
| Value added tax | Value added tax Sales revenue represents the invoiced value
of goods, net of VAT. All of the Company’s products are sold in the PRC and are subject to a VAT on the gross sales price.
The VAT rates range up to 17%, depending on the type of products sold. The VAT may be offset by VAT paid by the Company on
raw materials and other materials included in the cost of producing or acquiring its finished products. The Company recorded a
VAT payable net of payments in the accompanying financial statements. |
| Stock based compensation | Stock based compensation The Company follows the provisions of FASB
ASC 718, "Compensation — Stock Compensation," which establishes accounting standards for non-employee and employee
stock-based awards. Under the provisions of FASB ASC 718, the fair value of stock issued is used to measure the fair value of services
received as the Company believes such approach is a more reliable method of measuring the fair value of the services. For non-employee
stock-based awards, fair value is measured based on the value of the Company's common stock on the date that the commitment
for performance by the counterparty has been reached or the counterparty's performance is complete. The fair value of the
equity instrument is calculated and then recognized as compensation expense over the requisite performance period. For employee
stock-based awards, share-based compensation cost is measured at the grant date based on the fair value of the award and is recognized
as expense with graded vesting on a straight–line basis over the requisite service period for the entire award. |
| Advertising and promotion costs | Advertising and promotion costs Advertising and promotion costs are
expensed as incurred and amounted to $1,023,461 and $641,328 for the years ended March 31, 2019 and 2018, respectively. Such
costs consist primarily of print and promotional materials such as flyers to local communities. |
| Operating leases | Operating leases The Company leases premises for retail
drugstores, offices and wholesale warehouse under non-cancellable operating leases. Operating lease payments are expensed
over the term of lease. A majority of the Company's retail drugstore leases have a 3 to 10 year term with a renewal option
upon the expiration of the lease; the wholesale warehouse lease has a 10-year term with a renewal option upon the expiration of
the lease. The Company has historically been able to renew a majority of its drugstores leases. Under the terms of the lease agreements,
the Company has no legal or contractual asset retirement obligations at the end of the lease. In addition, land leased from
the government is amortized on a straight-line basis over a 30-year term. |
| Foreign currency translation | 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 the 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 income. The balance sheet amounts, with the exception
of equity, at March 31, 2019 and 2018 were translated at 1 RMB to 0.1490 USD and at 1 RMB to 0.1592 USD, respectively. The average
translation rates applied to income and cash flow statement amounts for years ended March 31, 2019 and 2018 were at 1 RMB to 0.1491
USD and at 1 RMB to 0.1510 USD, respectively. |
| Concentrations and credit risk | Concentrations and credit risk Certain financial instruments, which subject
the Company to concentration of credit risk, consist of cash and restricted cash. The Company has cash balances at financial institutions
located in Hong Kong and PRC. Balances at financial institutions in Hong Kong may, from time to time, exceed Hong Kong Deposit
Protection Board's insured limits. Since March 31, 2015, balances at financial institutions and state-owned banks within
the PRC are covered by insurance up to RMB 500,000 (USD 79,600) per bank. As of March 31, 2019 and March 31, 2018, the Company
had deposits totaling $24,730,736 and $31,433,969 that were covered by such limited insurance, respectively. Any balance over
RMB 500,000 (USD 79,600) per bank in PRC will not be covered. To date, the Company has not experienced any losses in such accounts. For the fiscal year ended March 31, 2019, two vendors collectively accounted for 40.3% of the Company's
total purchases and two suppliers accounted for more than 10% of total advances to suppliers. For the fiscal year ended March
31, 2018, one vendor accounted for 19% of the Company's total purchases and another vendor accounted for more than 10% of
total advances to suppliers. For the fiscal year ended March 31, 2019,
no customer accounted for more than 10% of the Company's total sales and more than 10% of total accounts receivable. For
the fiscal year ended March 31, 2018, no customer accounted for more than 10% of the Company's total sales or more than 10%
of total accounts receivable. |
| Recent Accounting Pronouncements | Recent Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02,
Leases (Topic 842). Lessees will be required to recognize a right-of-use asset and a lease liability for virtually all of their
leases (other than leases that meet the definition of a short-term lease). The liability will be equal to the present value of
future lease payments. The asset will be based on the liability, subject to adjustment, such as for initial direct costs. For income
statement purposes, a dual model was retained, requiring leases to be classified as either operating or finance leases. Operating
leases will result in straight-line expense (similar to current operating leases) while finance leases will result in a front-loaded
expense pattern (similar to current capital leases). Lessor accounting is similar to the current model, but updated to align with
certain changes to the lessee model (e.g., certain definitions, such as initial direct costs, have been updated) and the new revenue
recognition standard. The Company adopted this new accounting guidance on January 1, 2019 on a modified retrospective basis. The
adoption of this new guidance resulted in an increase in both assets and liabilities of approximately $15 million as of April 1,
2019. The adoption of this new guidance is not expected to have a material impact on the Company’s results of operations
or cash flows. In June 2016, the FASB issued ASU 2016-13,
“Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” providing
financial statement users with more decision-useful information about the expected credit losses on financial instruments and other
commitments to extend credit held by a reporting entity at each reporting date. For public business entities that are U.S. Securities
and Exchange Commission (SEC) filers, the amendments in this update are effective for fiscal years beginning after December 15,
2019, including interim periods within those fiscal years. All entities may adopt the amendments in this update earlier as of the
fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. We are currently evaluating
the impact of the adoption of ASU 2016-13 on our consolidated financial statements. In August 2016, the FASB issued ASU 2016-15,
“Statement of Cash Flows (Topic 230):Classification of Certain Cash Receipts and Cash Payments,” addressing eight specific
cash flow issues with the objective of reducing the existing diversity in practice. The amendments in this update are effective
for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years.
Early adoption is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period,
any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. An entity that elects
early adoption must adopt all of the amendments in the same period. The amendments in this update 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 impact of adoption on its
Condensed Consolidated Financial Statements for any period presented is not material. In July 2017, the FASB issued Accounting
Standards update (“ASU”) No. 2017-11, “Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity
(Topic 480), Derivatives and Hedging (Topic 815): I. Accounting for Certain Financial Instruments with Down Round Features; II.
Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain
Mandatorily Redeemable Noncontrolling Interests with a Scope Exception”. Part I of this update addresses the complexity of
accounting for certain financial instruments with down round features. Part II of this update addresses the difficulty of navigating
Topic 480, Distinguishing Liabilities from Equity, because of the existence of extensive pending content in the FASB Accounting
Standards Codification®. We are currently evaluating the impact of the adoption of ASU 2017-11 on our consolidated financial
statements. In January 2017, the FASB issued Accounting
Standards update (“ASU”) No. 2017-04, “Intangibles—Goodwill and Other (Topic 350): Simplifying the Test
for Goodwill Impairment” (“ASU 2017-04”), which removes Step 2 from the goodwill impairment test. An entity will
apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit’s carrying
amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The new guidance does not
amend the optional qualitative assessment of goodwill impairment. Public business entity that is a U.S. Securities and Exchange
Commission filer should adopt the amendments in this ASU for its annual or any interim goodwill impairment test in fiscal years
beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing
dates after January 1, 2017. ASU 2017-4 has no impact on our consolidated financial statements. |
| Adoption of New Revenue Recognition Standard | Adoption of New Revenue
Recognition Standard In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards
Update (“ASU”)2014-09, Revenue from Contracts with Customers (Topic 606). ASU 2014-09 outlines a single comprehensive
model for companies to use in accounting for revenue arising from contracts with customers and supersedes most current revenue
recognition guidance, including industry-specific guidance. In March 2016, the FASB issued ASU 2016-08,“Principal Versus
Agent Considerations (Reporting Revenue Gross Versus Net),” which amends the principal versus-agent implementation guidance
and in April 2016 the FASB issued ASU 2016-10, “Identifying Performance Obligations and Licensing,” which amends the
guidance in those areas in the new revenue recognition standard. On April 1, 2018, we adopted the guidance in ASC 606 and all the
related amendments and applied the new revenue standard to all contracts using the modified retrospective method. Based on the
new standard our revenue recognition policies related to membership rewards programs will change. But the impact of the new revenue
standard was not material and there was no adjustment required to the opening balance of retained earnings. We expect the impact
of the adoption of the new revenue standard to be immaterial to our net income on an ongoing basis. The following is a discussion of the Company’s
revenue recognition policies by segment under the new revenue recognition accounting standard: Pharmacy retail sales The physical pharmacies sell prescription
drugs, OTC drugs, traditional Chinese medicine, nutritional supplements, medical devices and sundry products. Revenue from sales
of prescription medicine at drugstores is recognized when the prescription is filled and the customer picks up and pays for the
prescription. Revenue from sales of other merchandise at drugstores is recognized at the point of sale, which is when a customer
pays for and receives the merchandise. Usually the majority of our merchandise, such as prescription and OTC drugs, are not allowed
to be returned after the customers leave the counter. Return of other products, such as sundry products, are minimal. Sales of
drugs reimbursed by the local government medical insurance agency and receivables from the agency are recognized when a customer
pays for the drugs at a store. Based on historical experience, a reserve for potential loss from denial of reimbursement on certain
unqualified drugs is made to the receivables from the government agency. Revenue from medical services is recognized after the
service has been rendered to a customer. As revenue from medical services are minimal compared to pharmacy retail sales, it is
included as part of the pharmacy retail sales. Online pharmacy sales The online pharmacy sells various
health products except for prescription drugs. Revenue from online pharmacy sales is recognized when merchandise is shipped
to customers. While most deliveries take one day, certain deliveries may take longer depending on a customer’s
location. Any loss caused in a shipment will be reimbursed by the Company’s courier company. Our sales policy allows
for the return of certain merchandises without reason within seven days after customer’s receipt of the applicable
merchandise. Historically, sales returns seven days after merchandise receipts have been minimal. Wholesale Jiuxin Medicine purchases medicine in quantity
and distributes products primarily to local pharmacies and medical products dealers. Revenue from sales of merchandise to non-retail
customers is recognized when the following conditions are met: (1) persuasive evidence of an arrangement exists (sales agreements
and customer purchase orders are used to determine the existence of an arrangement); (2) control of the merchandise
is transferred to customers The Company’s revenue is net of value
added tax (“VAT”) collected on behalf of PRC tax authorities in respect to the sales of merchandise. VAT collected
from customers, net of VAT paid for purchases, is recorded as a liability in the accompanying consolidated balance sheets until
it is paid to the relevant PRC tax authorities. Disaggregation of Revenue The following table disaggregates the Company’s
revenue by major source in each segment for the year ended March 31, 2019:
For the year ended March 31 2019 2018
Retail drugstores
Prescription drugs $ 23,516,046 $ 20,553,179
OTC drugs 31,401,328 28,368,059
Nutritional supplements 6,354,108 4,179,139
TCM 6,529,790 1,660,301
Sundry products 941,491 6,254,286
Medical devices 3,591,646 962,619
Total retail revenue $ 72,334,409 $ 61,977,583
Online pharmacy
Prescription drugs $ - $ -
OTC drugs 3,127,976 5,193,051
Nutritional supplements 737,315 29,717
TCM 74,262 3,932,607
Sundry products 2,736,070 1,880,707
Medical devices 2,108,836 1,096,849
Total online revenue $ 8,784,459 $ 12,132,931
Drug wholesale
Prescription drugs $ 16,745,862 $ 12,314,829
OTC drugs 8,964,587 9,381,932
Nutritional supplements 290,534 182,903
TCM 271,280 73,645
Sundry products 24,846 48,852
Medical devices 135,035 32
Total wholesale revenue $ 26,432,144 $ 22,002,193
Total revenue $ 107,551,012 $ 96,112,706 Contract Balances Contract liabilities primarily represent
the Company’s obligation to transfer additional goods or services to a customer for which the Company has received consideration,
for example membership points. The consideration received remains a contract liability until goods or services have been provided
to the retail customer. The following table provides information
about receivables and contract liabilities from contracts with customers:
March 31, March 31,
Trade receivable(included in accounts receivable, net) $ 8,692,514 $ 8,322,393
Contract liabilities (included in accrued expenses) 1,689,099 4,461,136 Impact of New Revenue Recognition Standard
on Financial Statement Line Items The Company adopted ASU 2014-09 using the
modified retrospective method. The cumulative effect of applying the new guidance to all contracts was recorded as an adjustment
to retained earnings as of the adoption date. As a result of applying the modified retrospective method to adopt the new revenue
guidance, the following adjustments were made to accounts on the condensed statement of operation for the year ended March 31,
2019:
Impact of Change in Accounting Policy
As Reported Balances
For the
The year Balance
Ended without
In thousands March 31, Adjustments Adoption of
Condensed Consolidated Statement of Operations:
Net revenues 107,551 (302 ) 107,249
Cost of revenues 82,443 - 82,443
Gross profit 25,108 (302 ) 24,806
SELLING EXPENSES 24,265 302 24,567
GENERAL AND ADMINISTRATIVE EXPENSES 1,719 - 1,719
Operating profit (876 ) - (1,480 )
Income (loss) before income tax provision (1,183 ) - (1,787 )
Income tax provision 135 - 135
Income (loss) from continuing operations (1,318 ) - (1,922 )
Net income (loss) (1,318 ) - (1,922 ) The adoption of ASU 2014-09 has no effect
on consolidated balance sheet and statement of cash flow. |
| Adoption of Statement of Cash Flows | The adoption of ASU 2014-09 has no effect
on consolidated balance sheet and statement of cash flow. Adoption of Statement of Cash Flows In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows, which amends Accounting Standard
Codification ("ASC") Topic 230. This ASU requires entities to show the changes in the total of cash, cash equivalents,
restricted cash and restricted cash equivalents in the statement of cash flows. When cash, cash equivalents, restricted cash and
restricted cash equivalents are presented in more than one line item on the balance sheet, the new guidance requires a reconciliation
of the totals in the statement of cash flows to the related captions in the balance sheet. Entities will also have to disclose
the nature of their restricted cash and restricted cash equivalent balances. The guidance is required to be applied retrospectively.
The Company adopted this new accounting guidance. The following represents a reconciliation of cash and cash equivalents in the
condensed consolidated balance sheet to total cash, cash equivalents and restricted cash in the condensed consolidated statement
of cash flows:
March 31, March 31,
2019 2018
Cash and cash equivalents 9,322,463 15,132,640
Restricted cash 15,422,739 16,319,551
Total cash, cash equivalents and restricted cash in the statement of cash flows 24,745,202 31,452,191 Restricted cash in the condensed consolidated
balance sheets primarily represents deposits required by a bank as security for its notes payable. The Company has notes payable
outstanding with the bank and is required to keep certain amounts on deposit that are subject to withdrawal restrictions. All restricted
cash is invested in time deposits and money markets, which are classified within Level 1 of the fair value hierarchy. Restricted cash activity was previously
reported in "Change in restricted cash" within financing activities cash flows on the Company's condensed consolidated
statement of cash flows. The following is a reconciliation of the effect on the relevant line items on the statement of cash flows
for the year ended March 31, 2018 as a result of adopting this new accounting guidance:
As
Previously As
Reported Adjustments Revised
Year Ended March 31, 2018
Change in restricted cash (5,664,224 ) 5,664,224 -
Net cash provided by financing activities (770,936 ) 5,664,224 4,893,288
Effects of exchange rate on cash 2,586,720 1,223,941 3,810,661
Net decrease in cash, cash equivalents and restricted cash (3,231,784 ) 6,888,165 3,656,381
Cash, cash equivalents, and restricted cash at the beginning of the period 18,364,424 9,431,386 27,795,810
Cash, cash equivalents, and restricted cash at the end of the period 15,132,640 16,319,551 31,452,191 |
